false00018188740.250.25P3YP1YP1Yhttp://fasb.org/us-gaap/2021-01-31#PropertyPlantAndEquipmentNethttp://fasb.org/us-gaap/2021-01-31#AccountsPayableAndAccruedLiabilitiesCurrentAndNoncurrent00018188742021-01-012021-03-31iso4217:USD00018188742021-03-3100018188742020-12-31xbrli:shares0001818874us-gaap:CommonClassAMember2021-03-310001818874us-gaap:CommonClassAMember2020-12-31iso4217:USDxbrli:shares0001818874us-gaap:CommonClassBMember2021-03-310001818874us-gaap:CommonClassBMember2020-12-310001818874us-gaap:CommonClassAMemberus-gaap:CommonStockMember2020-12-310001818874us-gaap:CommonStockMemberus-gaap:CommonClassBMember2020-12-310001818874us-gaap:AdditionalPaidInCapitalMember2020-12-310001818874us-gaap:RetainedEarningsMember2020-12-310001818874us-gaap:CommonClassAMemberus-gaap:CommonStockMember2021-01-012021-03-310001818874us-gaap:AdditionalPaidInCapitalMember2021-01-012021-03-310001818874us-gaap:RetainedEarningsMember2021-01-012021-03-310001818874us-gaap:CommonClassAMemberus-gaap:CommonStockMember2021-03-310001818874us-gaap:CommonStockMemberus-gaap:CommonClassBMember2021-03-310001818874us-gaap:AdditionalPaidInCapitalMember2021-03-310001818874us-gaap:RetainedEarningsMember2021-03-310001818874us-gaap:IPOMember2020-10-142020-10-140001818874us-gaap:OverAllotmentOptionMember2020-10-142020-10-1400018188742020-10-142020-10-1400018188742020-10-140001818874ipoe:SponsorMemberus-gaap:PrivatePlacementMember2020-10-140001818874ipoe:SponsorMemberus-gaap:PrivatePlacementMember2020-10-142020-10-14xbrli:pure0001818874ipoe:WarrantLiabilityMember2020-10-140001818874us-gaap:CommonClassAMember2021-01-012021-03-310001818874us-gaap:CreditConcentrationRiskMember2021-03-310001818874us-gaap:CommonClassAMemberus-gaap:IPOMember2020-10-140001818874ipoe:SponsorMember2020-10-140001818874ipoe:SponsorMember2020-10-142020-10-140001818874us-gaap:CommonClassAMemberus-gaap:PrivatePlacementMember2020-10-140001818874ipoe:SponsorMember2020-07-162020-07-160001818874ipoe:SponsorMember2020-07-160001818874ipoe:SponsorMember2020-09-172020-09-170001818874ipoe:SponsorMember2020-10-082020-10-080001818874us-gaap:CommonClassAMemberipoe:SponsorMember2020-07-160001818874srt:AffiliatedEntityMember2021-01-012021-03-310001818874srt:AffiliatedEntityMember2021-03-310001818874srt:AffiliatedEntityMemberus-gaap:AccruedLiabilitiesMember2021-03-310001818874srt:AffiliatedEntityMemberus-gaap:AccruedLiabilitiesMember2020-12-310001818874us-gaap:IPOMemberipoe:SponsorMember2021-01-012021-03-310001818874srt:AffiliatedEntityMemberipoe:IPOPromissoryNoteMemberus-gaap:NotesPayableOtherPayablesMember2020-07-160001818874srt:AffiliatedEntityMemberipoe:IPOPromissoryNoteMemberus-gaap:NotesPayableOtherPayablesMember2020-09-170001818874srt:AffiliatedEntityMemberipoe:IPOPromissoryNoteMemberus-gaap:NotesPayableOtherPayablesMember2020-10-140001818874srt:AffiliatedEntityMemberus-gaap:NotesPayableOtherPayablesMemberipoe:PromissoryNoteMember2021-01-110001818874srt:AffiliatedEntityMemberus-gaap:NotesPayableOtherPayablesMemberipoe:PromissoryNoteMember2021-03-310001818874ipoe:RelatedPartyLoansMembersrt:MaximumMember2021-01-012021-03-310001818874ipoe:RelatedPartyLoansMember2021-01-012021-03-310001818874us-gaap:RestrictedStockUnitsRSUMemberus-gaap:CommonClassAMember2020-11-130001818874ipoe:PlutusMergerSubIncMember2021-01-070001818874ipoe:PlutusMergerSubIncMember2021-01-072021-01-07ipoe:Vote0001818874us-gaap:CommonClassBMemberus-gaap:OverAllotmentOptionMember2021-03-310001818874us-gaap:CommonClassBMemberus-gaap:OverAllotmentOptionMember2020-12-310001818874us-gaap:CommonClassBMember2021-01-012021-03-310001818874ipoe:RedemptionOfWarrantPricePerShareEqualsOrExceeds18.00Member2021-03-310001818874ipoe:RedemptionOfWarrantPricePerShareEqualsOrExceeds18.00Member2021-01-012021-03-310001818874ipoe:RedemptionOfWarrantPricePerShareEqualsOrExceeds10.00Member2021-03-310001818874ipoe:RedemptionOfWarrantPricePerShareEqualsOrExceeds10.00Member2021-01-012021-03-3100018188742020-07-102020-12-310001818874us-gaap:FairValueInputsLevel1Memberus-gaap:FairValueMeasurementsRecurringMember2021-03-310001818874us-gaap:FairValueInputsLevel1Memberus-gaap:FairValueMeasurementsRecurringMember2020-12-310001818874us-gaap:FairValueInputsLevel2Memberus-gaap:FairValueMeasurementsRecurringMember2021-03-310001818874us-gaap:FairValueInputsLevel2Memberus-gaap:FairValueMeasurementsRecurringMember2020-12-310001818874us-gaap:CommonClassAMemberus-gaap:CommonStockMember2020-07-090001818874us-gaap:CommonStockMemberus-gaap:CommonClassBMember2020-07-090001818874us-gaap:AdditionalPaidInCapitalMember2020-07-090001818874us-gaap:RetainedEarningsMember2020-07-0900018188742020-07-090001818874us-gaap:CommonStockMemberus-gaap:CommonClassBMember2020-07-102020-12-310001818874us-gaap:AdditionalPaidInCapitalMemberus-gaap:CommonClassBMember2020-07-102020-12-310001818874us-gaap:CommonClassBMember2020-07-102020-12-310001818874us-gaap:CommonClassAMemberus-gaap:CommonStockMember2020-07-102020-12-310001818874us-gaap:AdditionalPaidInCapitalMemberus-gaap:CommonClassAMember2020-07-102020-12-310001818874us-gaap:CommonClassAMember2020-07-102020-12-310001818874us-gaap:AdditionalPaidInCapitalMember2020-07-102020-12-310001818874us-gaap:RetainedEarningsMember2020-07-102020-12-3100018188742020-01-012020-12-310001818874ipoe:SponsorMemberus-gaap:IPOMember2020-10-140001818874srt:ScenarioPreviouslyReportedMember2020-10-140001818874srt:RestatementAdjustmentMember2020-10-140001818874us-gaap:CommonClassAMembersrt:ScenarioPreviouslyReportedMember2020-10-140001818874srt:RestatementAdjustmentMemberus-gaap:CommonClassAMember2020-10-140001818874us-gaap:CommonClassAMember2020-10-140001818874srt:ScenarioPreviouslyReportedMember2020-12-310001818874srt:RestatementAdjustmentMember2020-12-310001818874us-gaap:CommonClassAMembersrt:ScenarioPreviouslyReportedMember2020-12-310001818874srt:RestatementAdjustmentMemberus-gaap:CommonClassAMember2020-12-310001818874srt:ScenarioPreviouslyReportedMember2020-07-102020-12-310001818874srt:RestatementAdjustmentMember2020-07-102020-12-310001818874us-gaap:CommonClassAMembersrt:ScenarioPreviouslyReportedMember2020-07-102020-12-310001818874srt:RestatementAdjustmentMemberus-gaap:CommonClassAMember2020-07-102020-12-310001818874ipoe:SponsorMember2020-07-102020-12-310001818874us-gaap:CreditConcentrationRiskMember2020-12-310001818874srt:AffiliatedEntityMember2020-07-102020-12-310001818874srt:AffiliatedEntityMember2020-12-310001818874us-gaap:IPOMemberipoe:SponsorMember2020-07-102020-12-310001818874ipoe:RelatedPartyLoansMembersrt:MaximumMember2020-07-102020-12-310001818874ipoe:RelatedPartyLoansMember2020-07-102020-12-310001818874us-gaap:CommonClassAMemberus-gaap:OverAllotmentOptionMember2020-12-310001818874ipoe:RedemptionOfWarrantPricePerShareEqualsOrExceeds18.00Member2020-12-310001818874ipoe:RedemptionOfWarrantPricePerShareEqualsOrExceeds18.00Member2020-07-102020-12-310001818874ipoe:RedemptionOfWarrantPricePerShareEqualsOrExceeds10.00Member2020-12-310001818874ipoe:RedemptionOfWarrantPricePerShareEqualsOrExceeds10.00Member2020-07-102020-12-310001818874us-gaap:MeasurementInputRiskFreeInterestRateMemberus-gaap:WarrantMember2020-10-140001818874us-gaap:WarrantMemberus-gaap:MeasurementInputExpectedTermMember2020-10-140001818874us-gaap:WarrantMemberus-gaap:MeasurementInputPriceVolatilityMember2020-10-140001818874us-gaap:WarrantMember2020-10-140001818874us-gaap:PrivatePlacementMember2020-10-140001818874us-gaap:IPOMember2020-10-140001818874us-gaap:PrivatePlacementMemberipoe:WarrantLiabilityMember2020-10-140001818874us-gaap:IPOMemberipoe:WarrantLiabilityMember2020-10-140001818874us-gaap:PrivatePlacementMemberipoe:WarrantLiabilityMember2020-12-310001818874us-gaap:IPOMemberipoe:WarrantLiabilityMember2020-12-310001818874ipoe:IPOEWSMember2020-12-310001818874us-gaap:PrivatePlacementMemberipoe:WarrantLiabilityMember2020-07-100001818874us-gaap:IPOMemberipoe:WarrantLiabilityMember2020-07-100001818874ipoe:WarrantLiabilityMember2020-07-100001818874us-gaap:PrivatePlacementMemberipoe:WarrantLiabilityMember2020-10-152020-12-310001818874us-gaap:IPOMemberipoe:WarrantLiabilityMember2020-10-152020-12-310001818874ipoe:WarrantLiabilityMember2020-10-152020-12-310001818874ipoe:WarrantLiabilityMember2020-12-310001818874ipoe:PlutusMergerSubIncMemberus-gaap:SubsequentEventMember2021-01-070001818874ipoe:PlutusMergerSubIncMemberus-gaap:SubsequentEventMember2021-01-072021-01-070001818874srt:AffiliatedEntityMemberipoe:IPOPromissoryNoteMemberus-gaap:NotesPayableOtherPayablesMemberus-gaap:SubsequentEventMember2021-01-110001818874ipoe:SocialFinanceIncMember2021-03-310001818874ipoe:SocialFinanceIncMember2020-12-310001818874ipoe:SocialFinanceIncMemberipoe:CreditCardLoanAndCommercialLoanPortfolioSegmentMember2021-03-310001818874ipoe:SocialFinanceIncMemberipoe:CreditCardLoanAndCommercialLoanPortfolioSegmentMember2020-12-310001818874ipoe:SocialFinanceIncMemberus-gaap:NonvotingCommonStockMember2020-12-310001818874ipoe:SocialFinanceIncMemberus-gaap:NonvotingCommonStockMember2021-03-310001818874ipoe:SocialFinanceIncMember2021-01-012021-03-310001818874ipoe:SocialFinanceIncMember2020-01-012020-03-310001818874ipoe:SocialFinanceIncMemberipoe:TechnologyPlatformFeesMember2021-01-012021-03-310001818874ipoe:SocialFinanceIncMemberipoe:TechnologyPlatformFeesMember2020-01-012020-03-310001818874ipoe:SocialFinanceIncMemberus-gaap:CommonStockMember2020-12-310001818874us-gaap:AdditionalPaidInCapitalMemberipoe:SocialFinanceIncMember2020-12-310001818874ipoe:SocialFinanceIncMemberus-gaap:AccumulatedOtherComprehensiveIncomeMember2020-12-310001818874ipoe:SocialFinanceIncMemberus-gaap:RetainedEarningsMember2020-12-310001818874us-gaap:AdditionalPaidInCapitalMemberipoe:SocialFinanceIncMember2021-01-012021-03-310001818874ipoe:SocialFinanceIncMemberus-gaap:CommonStockMember2021-01-012021-03-310001818874ipoe:SocialFinanceIncMemberus-gaap:AccumulatedOtherComprehensiveIncomeMember2021-01-012021-03-310001818874ipoe:SocialFinanceIncMemberus-gaap:RetainedEarningsMember2021-01-012021-03-310001818874ipoe:SocialFinanceIncMemberus-gaap:CommonStockMember2021-03-310001818874us-gaap:AdditionalPaidInCapitalMemberipoe:SocialFinanceIncMember2021-03-310001818874ipoe:SocialFinanceIncMemberus-gaap:AccumulatedOtherComprehensiveIncomeMember2021-03-310001818874ipoe:SocialFinanceIncMemberus-gaap:RetainedEarningsMember2021-03-310001818874ipoe:SocialFinanceIncMemberus-gaap:CommonStockMember2019-12-310001818874us-gaap:AdditionalPaidInCapitalMemberipoe:SocialFinanceIncMember2019-12-310001818874ipoe:SocialFinanceIncMemberus-gaap:AccumulatedOtherComprehensiveIncomeMember2019-12-310001818874ipoe:SocialFinanceIncMemberus-gaap:RetainedEarningsMember2019-12-310001818874ipoe:SocialFinanceIncMember2019-12-310001818874us-gaap:AdditionalPaidInCapitalMemberipoe:SocialFinanceIncMember2020-01-012020-03-310001818874ipoe:SocialFinanceIncMemberus-gaap:CommonStockMember2020-01-012020-03-310001818874ipoe:SocialFinanceIncMemberus-gaap:AccumulatedOtherComprehensiveIncomeMember2020-01-012020-03-310001818874ipoe:SocialFinanceIncMemberus-gaap:RetainedEarningsMember2020-01-012020-03-310001818874ipoe:SocialFinanceIncMemberus-gaap:CommonStockMember2020-03-310001818874us-gaap:AdditionalPaidInCapitalMemberipoe:SocialFinanceIncMember2020-03-310001818874ipoe:SocialFinanceIncMemberus-gaap:AccumulatedOtherComprehensiveIncomeMember2020-03-310001818874ipoe:SocialFinanceIncMemberus-gaap:RetainedEarningsMember2020-03-310001818874ipoe:SocialFinanceIncMember2020-03-31ipoe:entity0001818874ipoe:SocialFinanceIncMemberus-gaap:CommercialPortfolioSegmentMember2020-12-310001818874ipoe:SocialFinanceIncMemberipoe:CreditCardLoanPortfolioSegmentMemberus-gaap:CreditCardReceivablesMemberus-gaap:FinancialAssetNotPastDueMember2021-03-310001818874us-gaap:FinancingReceivables30To59DaysPastDueMemberipoe:SocialFinanceIncMemberipoe:CreditCardLoanPortfolioSegmentMemberus-gaap:CreditCardReceivablesMember2021-03-310001818874ipoe:SocialFinanceIncMemberipoe:CreditCardLoanPortfolioSegmentMemberus-gaap:FinancingReceivables60To89DaysPastDueMemberus-gaap:CreditCardReceivablesMember2021-03-310001818874ipoe:SocialFinanceIncMemberus-gaap:FinancingReceivablesEqualToGreaterThan90DaysPastDueMemberipoe:CreditCardLoanPortfolioSegmentMemberus-gaap:CreditCardReceivablesMember2021-03-310001818874ipoe:SocialFinanceIncMemberipoe:CreditCardLoanPortfolioSegmentMemberus-gaap:CreditCardReceivablesMemberus-gaap:FinancialAssetPastDueMember2021-03-310001818874us-gaap:EstimateOfFairValueFairValueDisclosureMemberipoe:SocialFinanceIncMemberipoe:CreditCardLoanPortfolioSegmentMemberus-gaap:CreditCardReceivablesMember2021-03-310001818874ipoe:SocialFinanceIncMemberipoe:CreditCardLoanPortfolioSegmentMemberus-gaap:CreditCardReceivablesMemberus-gaap:FinancialAssetNotPastDueMember2020-12-310001818874us-gaap:FinancingReceivables30To59DaysPastDueMemberipoe:SocialFinanceIncMemberipoe:CreditCardLoanPortfolioSegmentMemberus-gaap:CreditCardReceivablesMember2020-12-310001818874ipoe:SocialFinanceIncMemberipoe:CreditCardLoanPortfolioSegmentMemberus-gaap:FinancingReceivables60To89DaysPastDueMemberus-gaap:CreditCardReceivablesMember2020-12-310001818874ipoe:SocialFinanceIncMemberus-gaap:FinancingReceivablesEqualToGreaterThan90DaysPastDueMemberipoe:CreditCardLoanPortfolioSegmentMemberus-gaap:CreditCardReceivablesMember2020-12-310001818874ipoe:SocialFinanceIncMemberipoe:CreditCardLoanPortfolioSegmentMemberus-gaap:CreditCardReceivablesMemberus-gaap:FinancialAssetPastDueMember2020-12-310001818874us-gaap:EstimateOfFairValueFairValueDisclosureMemberipoe:SocialFinanceIncMemberipoe:CreditCardLoanPortfolioSegmentMemberus-gaap:CreditCardReceivablesMember2020-12-310001818874ipoe:SocialFinanceIncMemberipoe:CreditCardLoanPortfolioSegmentMemberus-gaap:CreditCardReceivablesMember2021-03-310001818874ipoe:SocialFinanceIncMemberipoe:CreditCardLoanPortfolioSegmentMemberus-gaap:CreditCardReceivablesMember2020-12-310001818874ipoe:SocialFinanceIncMemberipoe:MarginReceivableMember2021-03-310001818874ipoe:SocialFinanceIncMemberipoe:MarginReceivableMember2020-12-31ipoe:class0001818874ipoe:SocialFinanceIncMemberipoe:ApexClearingHoldingsLLCMember2018-12-310001818874ipoe:SocialFinanceIncMemberipoe:ApexClearingHoldingsLLCMember2018-12-012018-12-310001818874ipoe:SocialFinanceIncMemberipoe:ApexClearingHoldingsLLCMember2020-01-012020-03-310001818874ipoe:SocialFinanceIncMemberipoe:ApexClearingHoldingsLLCMember2021-01-012021-01-310001818874ipoe:SocialFinanceIncMemberipoe:ApexClearingHoldingsLLCMember2021-03-310001818874ipoe:SocialFinanceIncMemberipoe:ApexClearingHoldingsLLCMember2021-01-012021-03-310001818874ipoe:NoninterestIncomeLoanOriginationsAndSalesMemberipoe:NonSecuritizationInvestmentsMemberipoe:SocialFinanceIncMemberus-gaap:NondesignatedMember2021-01-012021-03-310001818874ipoe:NoninterestIncomeLoanOriginationsAndSalesMemberipoe:NonSecuritizationInvestmentsMemberipoe:SocialFinanceIncMemberus-gaap:NondesignatedMember2020-01-012020-03-310001818874ipoe:NoninterestIncomeLoanOriginationsAndSalesMemberus-gaap:CreditRiskContractMemberipoe:SocialFinanceIncMemberus-gaap:NondesignatedMember2020-01-012020-03-310001818874ipoe:NoninterestIncomeOtherOperatingIncomeMemberipoe:SocialFinanceIncMemberus-gaap:NondesignatedMember2020-01-012020-03-310001818874ipoe:NoninterestIncomeOtherOperatingIncomeMemberipoe:SocialFinanceIncMemberus-gaap:NondesignatedMember2021-01-012021-03-310001818874ipoe:SocialFinanceIncMemberipoe:RestrictedCashAndCashEquivalentsMember2021-03-310001818874ipoe:SocialFinanceIncMemberipoe:RestrictedCashAndCashEquivalentsMember2020-12-310001818874ipoe:LendingSegmentMemberipoe:SocialFinanceIncMember2020-01-012020-03-310001818874ipoe:LendingSegmentMemberipoe:SocialFinanceIncMember2021-01-012021-03-310001818874ipoe:SocialFinanceIncMemberipoe:FinancialServicesSegmentMemberipoe:ReferralsMember2021-01-012021-03-310001818874ipoe:SocialFinanceIncMemberipoe:FinancialServicesSegmentMemberipoe:ReferralsMember2020-01-012020-03-310001818874ipoe:BrokerageMemberipoe:SocialFinanceIncMemberipoe:FinancialServicesSegmentMember2021-01-012021-03-310001818874ipoe:BrokerageMemberipoe:SocialFinanceIncMemberipoe:FinancialServicesSegmentMember2020-01-012020-03-310001818874ipoe:SocialFinanceIncMemberipoe:FinancialServicesSegmentMemberipoe:PaymentNetworkFeesMember2021-01-012021-03-310001818874ipoe:SocialFinanceIncMemberipoe:FinancialServicesSegmentMemberipoe:PaymentNetworkFeesMember2020-01-012020-03-310001818874ipoe:EnterpriseServicesMemberipoe:SocialFinanceIncMemberipoe:FinancialServicesSegmentMember2021-01-012021-03-310001818874ipoe:EnterpriseServicesMemberipoe:SocialFinanceIncMemberipoe:FinancialServicesSegmentMember2020-01-012020-03-310001818874ipoe:SocialFinanceIncMemberipoe:FinancialServicesSegmentMember2021-01-012021-03-310001818874ipoe:SocialFinanceIncMemberipoe:FinancialServicesSegmentMember2020-01-012020-03-310001818874ipoe:SocialFinanceIncMemberipoe:TechnologyPlatformFeesMemberipoe:TechnologyPlatformSegmentMember2021-01-012021-03-310001818874ipoe:SocialFinanceIncMemberipoe:TechnologyPlatformFeesMemberipoe:TechnologyPlatformSegmentMember2020-01-012020-03-310001818874ipoe:SocialFinanceIncMemberipoe:PaymentNetworkFeesMemberipoe:TechnologyPlatformSegmentMember2021-01-012021-03-310001818874ipoe:SocialFinanceIncMemberipoe:PaymentNetworkFeesMemberipoe:TechnologyPlatformSegmentMember2020-01-012020-03-310001818874ipoe:SocialFinanceIncMemberipoe:TechnologyPlatformSegmentMember2021-01-012021-03-310001818874ipoe:SocialFinanceIncMemberipoe:TechnologyPlatformSegmentMember2020-01-012020-03-310001818874ipoe:SocialFinanceIncMemberipoe:ReferralsMember2021-01-012021-03-310001818874ipoe:SocialFinanceIncMemberipoe:ReferralsMember2020-01-012020-03-310001818874ipoe:SocialFinanceIncMemberipoe:PaymentNetworkFeesMember2021-01-012021-03-310001818874ipoe:SocialFinanceIncMemberipoe:PaymentNetworkFeesMember2020-01-012020-03-310001818874ipoe:BrokerageMemberipoe:SocialFinanceIncMember2021-01-012021-03-310001818874ipoe:BrokerageMemberipoe:SocialFinanceIncMember2020-01-012020-03-310001818874ipoe:EnterpriseServicesMemberipoe:SocialFinanceIncMember2021-01-012021-03-310001818874ipoe:EnterpriseServicesMemberipoe:SocialFinanceIncMember2020-01-012020-03-310001818874ipoe:SocialFinanceIncMemberus-gaap:SubsequentEventMember2021-05-282021-05-280001818874ipoe:SocialFinanceIncMember2020-01-012020-12-310001818874ipoe:SocialFinanceIncMemberus-gaap:SubsequentEventMember2021-05-280001818874ipoe:SocialFinanceIncMemberipoe:GoldenPacificBancorpIncMember2021-03-012021-03-310001818874ipoe:SocialFinanceIncMemberipoe:GoldenPacificBancorpIncMember2021-03-310001818874ipoe:SocialFinanceIncMemberipoe:GalileoFinancialTechnologiesIncMember2020-05-140001818874ipoe:SocialFinanceIncMemberipoe:GalileoFinancialTechnologiesIncMember2020-05-142020-05-140001818874ipoe:SocialFinanceIncMemberipoe:GalileoFinancialTechnologiesIncMember2020-05-152020-12-310001818874ipoe:SocialFinanceIncMemberus-gaap:SeriesHPreferredStockMemberipoe:GalileoFinancialTechnologiesIncMember2020-05-152020-12-310001818874us-gaap:DevelopedTechnologyRightsMemberipoe:SocialFinanceIncMemberipoe:GalileoFinancialTechnologiesIncMember2020-05-140001818874us-gaap:DevelopedTechnologyRightsMemberipoe:SocialFinanceIncMemberipoe:GalileoFinancialTechnologiesIncMember2020-05-142020-05-140001818874ipoe:SocialFinanceIncMemberus-gaap:CustomerRelatedIntangibleAssetsMemberipoe:GalileoFinancialTechnologiesIncMember2020-05-140001818874ipoe:SocialFinanceIncMemberus-gaap:CustomerRelatedIntangibleAssetsMemberipoe:GalileoFinancialTechnologiesIncMember2020-05-142020-05-140001818874ipoe:SocialFinanceIncMemberus-gaap:TrademarksAndTradeNamesMemberipoe:GalileoFinancialTechnologiesIncMember2020-05-140001818874ipoe:SocialFinanceIncMemberus-gaap:TrademarksAndTradeNamesMemberipoe:GalileoFinancialTechnologiesIncMember2020-05-142020-05-140001818874ipoe:SocialFinanceIncMemberipoe:GalileoFinancialTechnologiesIncMember2020-01-012020-03-310001818874ipoe:SocialFinanceIncMemberipoe:GalileoFinancialTechnologiesIncMember2020-03-310001818874ipoe:SocialFinanceIncMemberipoe:A8LimitedMember2020-04-280001818874ipoe:SocialFinanceIncMemberipoe:A8LimitedMember2020-04-282020-04-280001818874ipoe:SocialFinanceIncMemberus-gaap:CommonStockMemberipoe:A8LimitedMember2020-04-282020-04-280001818874srt:MinimumMemberipoe:SocialFinanceIncMemberipoe:A8LimitedMember2020-04-282020-04-280001818874ipoe:SocialFinanceIncMemberipoe:A8LimitedMembersrt:MaximumMember2020-04-282020-04-280001818874ipoe:SocialFinanceIncMemberipoe:StudentLoanPortfolioSegmentMemberipoe:SecuritizedStudentLoansMember2021-03-310001818874ipoe:SocialFinanceIncMemberipoe:StudentLoanPortfolioSegmentMemberipoe:SecuritizedStudentLoansMember2020-12-310001818874ipoe:SocialFinanceIncMemberipoe:SecuritizedPersonalLoanMemberipoe:PersonalLoanPortfolioSegmentMember2021-03-310001818874ipoe:SocialFinanceIncMemberipoe:SecuritizedPersonalLoanMemberipoe:PersonalLoanPortfolioSegmentMember2020-12-310001818874ipoe:SocialFinanceIncMemberus-gaap:StudentLoanMemberipoe:StudentLoanPortfolioSegmentMember2021-03-310001818874ipoe:SocialFinanceIncMemberus-gaap:StudentLoanMemberipoe:StudentLoanPortfolioSegmentMember2020-12-310001818874ipoe:HomeLoanPortfolioSegmentMemberipoe:SocialFinanceIncMemberus-gaap:HomeEquityLoanMember2021-03-310001818874ipoe:HomeLoanPortfolioSegmentMemberipoe:SocialFinanceIncMemberus-gaap:HomeEquityLoanMember2020-12-310001818874ipoe:SocialFinanceIncMemberus-gaap:ConsumerLoanMemberipoe:PersonalLoanPortfolioSegmentMember2021-03-310001818874ipoe:SocialFinanceIncMemberus-gaap:ConsumerLoanMemberipoe:PersonalLoanPortfolioSegmentMember2020-12-310001818874ipoe:SocialFinanceIncMemberus-gaap:CommercialPortfolioSegmentMemberus-gaap:CommercialLoanMember2021-03-310001818874ipoe:SocialFinanceIncMemberus-gaap:CommercialPortfolioSegmentMemberus-gaap:CommercialLoanMember2020-12-310001818874ipoe:SocialFinanceIncMemberipoe:CreditCardLoanPortfolioSegmentMemberus-gaap:CreditCardReceivablesMember2021-01-012021-03-310001818874us-gaap:EstimateOfFairValueFairValueDisclosureMemberus-gaap:StudentLoanMemberipoe:SocialFinanceIncMemberipoe:StudentLoanPortfolioSegmentMemberus-gaap:FairValueMeasurementsRecurringMember2021-03-310001818874ipoe:HomeLoanPortfolioSegmentMemberus-gaap:EstimateOfFairValueFairValueDisclosureMemberipoe:SocialFinanceIncMemberus-gaap:HomeEquityLoanMemberus-gaap:FairValueMeasurementsRecurringMember2021-03-310001818874us-gaap:EstimateOfFairValueFairValueDisclosureMemberipoe:SocialFinanceIncMemberus-gaap:ConsumerLoanMemberipoe:PersonalLoanPortfolioSegmentMemberus-gaap:FairValueMeasurementsRecurringMember2021-03-310001818874us-gaap:EstimateOfFairValueFairValueDisclosureMemberipoe:SocialFinanceIncMemberus-gaap:FairValueMeasurementsRecurringMember2021-03-310001818874us-gaap:EstimateOfFairValueFairValueDisclosureMemberus-gaap:StudentLoanMemberipoe:SocialFinanceIncMemberipoe:StudentLoanPortfolioSegmentMemberus-gaap:FairValueMeasurementsRecurringMember2020-12-310001818874ipoe:HomeLoanPortfolioSegmentMemberus-gaap:EstimateOfFairValueFairValueDisclosureMemberipoe:SocialFinanceIncMemberus-gaap:HomeEquityLoanMemberus-gaap:FairValueMeasurementsRecurringMember2020-12-310001818874us-gaap:EstimateOfFairValueFairValueDisclosureMemberipoe:SocialFinanceIncMemberus-gaap:ConsumerLoanMemberipoe:PersonalLoanPortfolioSegmentMemberus-gaap:FairValueMeasurementsRecurringMember2020-12-310001818874us-gaap:EstimateOfFairValueFairValueDisclosureMemberipoe:SocialFinanceIncMemberus-gaap:FairValueMeasurementsRecurringMember2020-12-310001818874us-gaap:EstimateOfFairValueFairValueDisclosureMemberus-gaap:StudentLoanMemberipoe:SocialFinanceIncMemberus-gaap:FinancingReceivablesEqualToGreaterThan90DaysPastDueMemberipoe:StudentLoanPortfolioSegmentMemberus-gaap:FairValueMeasurementsRecurringMember2021-03-310001818874ipoe:HomeLoanPortfolioSegmentMemberus-gaap:EstimateOfFairValueFairValueDisclosureMemberipoe:SocialFinanceIncMemberus-gaap:FinancingReceivablesEqualToGreaterThan90DaysPastDueMemberus-gaap:HomeEquityLoanMemberus-gaap:FairValueMeasurementsRecurringMember2021-03-310001818874us-gaap:EstimateOfFairValueFairValueDisclosureMemberipoe:SocialFinanceIncMemberus-gaap:ConsumerLoanMemberus-gaap:FinancingReceivablesEqualToGreaterThan90DaysPastDueMemberipoe:PersonalLoanPortfolioSegmentMemberus-gaap:FairValueMeasurementsRecurringMember2021-03-310001818874us-gaap:EstimateOfFairValueFairValueDisclosureMemberipoe:SocialFinanceIncMemberus-gaap:FinancingReceivablesEqualToGreaterThan90DaysPastDueMemberus-gaap:FairValueMeasurementsRecurringMember2021-03-310001818874us-gaap:EstimateOfFairValueFairValueDisclosureMemberus-gaap:StudentLoanMemberipoe:SocialFinanceIncMemberus-gaap:FinancingReceivablesEqualToGreaterThan90DaysPastDueMemberipoe:StudentLoanPortfolioSegmentMemberus-gaap:FairValueMeasurementsRecurringMember2020-12-310001818874ipoe:HomeLoanPortfolioSegmentMemberus-gaap:EstimateOfFairValueFairValueDisclosureMemberipoe:SocialFinanceIncMemberus-gaap:FinancingReceivablesEqualToGreaterThan90DaysPastDueMemberus-gaap:HomeEquityLoanMemberus-gaap:FairValueMeasurementsRecurringMember2020-12-310001818874us-gaap:EstimateOfFairValueFairValueDisclosureMemberipoe:SocialFinanceIncMemberus-gaap:ConsumerLoanMemberus-gaap:FinancingReceivablesEqualToGreaterThan90DaysPastDueMemberipoe:PersonalLoanPortfolioSegmentMemberus-gaap:FairValueMeasurementsRecurringMember2020-12-310001818874us-gaap:EstimateOfFairValueFairValueDisclosureMemberipoe:SocialFinanceIncMemberus-gaap:FinancingReceivablesEqualToGreaterThan90DaysPastDueMemberus-gaap:FairValueMeasurementsRecurringMember2020-12-310001818874ipoe:SocialFinanceIncMemberus-gaap:StudentLoanMemberipoe:StudentLoanPortfolioSegmentMemberus-gaap:FairValueMeasurementsRecurringMember2020-12-310001818874ipoe:HomeLoanPortfolioSegmentMemberipoe:SocialFinanceIncMemberus-gaap:HomeEquityLoanMemberus-gaap:FairValueMeasurementsRecurringMember2020-12-310001818874ipoe:SocialFinanceIncMemberus-gaap:ConsumerLoanMemberipoe:PersonalLoanPortfolioSegmentMemberus-gaap:FairValueMeasurementsRecurringMember2020-12-310001818874ipoe:SocialFinanceIncMemberus-gaap:FairValueMeasurementsRecurringMember2020-12-310001818874ipoe:SocialFinanceIncMemberus-gaap:StudentLoanMemberipoe:StudentLoanPortfolioSegmentMemberus-gaap:FairValueMeasurementsRecurringMember2021-01-012021-03-310001818874ipoe:HomeLoanPortfolioSegmentMemberipoe:SocialFinanceIncMemberus-gaap:HomeEquityLoanMemberus-gaap:FairValueMeasurementsRecurringMember2021-01-012021-03-310001818874ipoe:SocialFinanceIncMemberus-gaap:ConsumerLoanMemberipoe:PersonalLoanPortfolioSegmentMemberus-gaap:FairValueMeasurementsRecurringMember2021-01-012021-03-310001818874ipoe:SocialFinanceIncMemberus-gaap:FairValueMeasurementsRecurringMember2021-01-012021-03-310001818874ipoe:SocialFinanceIncMemberus-gaap:StudentLoanMemberipoe:StudentLoanPortfolioSegmentMemberus-gaap:FairValueMeasurementsRecurringMember2021-03-310001818874ipoe:HomeLoanPortfolioSegmentMemberipoe:SocialFinanceIncMemberus-gaap:HomeEquityLoanMemberus-gaap:FairValueMeasurementsRecurringMember2021-03-310001818874ipoe:SocialFinanceIncMemberus-gaap:ConsumerLoanMemberipoe:PersonalLoanPortfolioSegmentMemberus-gaap:FairValueMeasurementsRecurringMember2021-03-310001818874ipoe:SocialFinanceIncMemberus-gaap:FairValueMeasurementsRecurringMember2021-03-310001818874ipoe:SocialFinanceIncMemberus-gaap:StudentLoanMemberipoe:StudentLoanPortfolioSegmentMemberus-gaap:FairValueMeasurementsRecurringMember2019-12-310001818874ipoe:HomeLoanPortfolioSegmentMemberipoe:SocialFinanceIncMemberus-gaap:HomeEquityLoanMemberus-gaap:FairValueMeasurementsRecurringMember2019-12-310001818874ipoe:SocialFinanceIncMemberus-gaap:ConsumerLoanMemberipoe:PersonalLoanPortfolioSegmentMemberus-gaap:FairValueMeasurementsRecurringMember2019-12-310001818874ipoe:SocialFinanceIncMemberus-gaap:FairValueMeasurementsRecurringMember2019-12-310001818874ipoe:SocialFinanceIncMemberus-gaap:StudentLoanMemberipoe:StudentLoanPortfolioSegmentMemberus-gaap:FairValueMeasurementsRecurringMember2020-01-012020-03-310001818874ipoe:HomeLoanPortfolioSegmentMemberipoe:SocialFinanceIncMemberus-gaap:HomeEquityLoanMemberus-gaap:FairValueMeasurementsRecurringMember2020-01-012020-03-310001818874ipoe:SocialFinanceIncMemberus-gaap:ConsumerLoanMemberipoe:PersonalLoanPortfolioSegmentMemberus-gaap:FairValueMeasurementsRecurringMember2020-01-012020-03-310001818874ipoe:SocialFinanceIncMemberus-gaap:FairValueMeasurementsRecurringMember2020-01-012020-03-310001818874ipoe:SocialFinanceIncMemberus-gaap:StudentLoanMemberipoe:StudentLoanPortfolioSegmentMemberus-gaap:FairValueMeasurementsRecurringMember2020-03-310001818874ipoe:HomeLoanPortfolioSegmentMemberipoe:SocialFinanceIncMemberus-gaap:HomeEquityLoanMemberus-gaap:FairValueMeasurementsRecurringMember2020-03-310001818874ipoe:SocialFinanceIncMemberus-gaap:ConsumerLoanMemberipoe:PersonalLoanPortfolioSegmentMemberus-gaap:FairValueMeasurementsRecurringMember2020-03-310001818874ipoe:SocialFinanceIncMemberus-gaap:FairValueMeasurementsRecurringMember2020-03-310001818874ipoe:SocialFinanceIncMemberus-gaap:VariableInterestEntityPrimaryBeneficiaryMember2021-03-310001818874ipoe:SocialFinanceIncMemberus-gaap:VariableInterestEntityPrimaryBeneficiaryMember2020-12-31ipoe:loanTrust0001818874ipoe:SocialFinanceIncMemberipoe:PersonalLoanPortfolioSegmentMemberus-gaap:VariableInterestEntityNotPrimaryBeneficiaryMember2021-01-012021-03-310001818874ipoe:SocialFinanceIncMemberipoe:PersonalLoanPortfolioSegmentMemberus-gaap:VariableInterestEntityNotPrimaryBeneficiaryMember2020-01-012020-03-31ipoe:investment0001818874ipoe:SocialFinanceIncMemberipoe:PersonalLoanPortfolioSegmentMemberus-gaap:VariableInterestEntityNotPrimaryBeneficiaryMember2021-03-310001818874ipoe:SocialFinanceIncMemberipoe:PersonalLoanPortfolioSegmentMemberus-gaap:VariableInterestEntityNotPrimaryBeneficiaryMember2020-12-310001818874ipoe:SocialFinanceIncMemberipoe:StudentLoanPortfolioSegmentMemberus-gaap:VariableInterestEntityNotPrimaryBeneficiaryMember2020-01-012020-03-310001818874ipoe:SocialFinanceIncMemberipoe:StudentLoanPortfolioSegmentMemberus-gaap:VariableInterestEntityNotPrimaryBeneficiaryMember2021-01-012021-03-310001818874ipoe:SocialFinanceIncMemberipoe:StudentLoanPortfolioSegmentMemberus-gaap:VariableInterestEntityNotPrimaryBeneficiaryMember2021-03-310001818874ipoe:SocialFinanceIncMemberipoe:StudentLoanPortfolioSegmentMemberus-gaap:VariableInterestEntityNotPrimaryBeneficiaryMember2020-12-310001818874ipoe:SocialFinanceIncMemberus-gaap:VariableInterestEntityPrimaryBeneficiaryMemberipoe:StudentLoanPortfolioSegmentMember2021-01-012021-03-310001818874ipoe:SocialFinanceIncMemberus-gaap:VariableInterestEntityPrimaryBeneficiaryMemberipoe:StudentLoanPortfolioSegmentMember2020-01-012020-03-310001818874ipoe:SocialFinanceIncMemberus-gaap:VariableInterestEntityNotPrimaryBeneficiaryMember2021-03-310001818874ipoe:SocialFinanceIncMemberus-gaap:VariableInterestEntityNotPrimaryBeneficiaryMember2020-12-310001818874ipoe:SocialFinanceIncMemberipoe:StudentLoanPortfolioSegmentMemberus-gaap:AssetBackedSecuritiesSecuritizedLoansAndReceivablesMember2021-03-310001818874ipoe:SocialFinanceIncMemberipoe:StudentLoanPortfolioSegmentMemberus-gaap:AssetBackedSecuritiesSecuritizedLoansAndReceivablesMember2020-03-310001818874ipoe:SocialFinanceIncMemberipoe:StudentLoanPortfolioSegmentMemberus-gaap:AssetBackedSecuritiesSecuritizedLoansAndReceivablesMember2021-01-012021-03-310001818874ipoe:SocialFinanceIncMemberipoe:StudentLoanPortfolioSegmentMemberus-gaap:AssetBackedSecuritiesSecuritizedLoansAndReceivablesMember2020-01-012020-03-310001818874ipoe:SocialFinanceIncMemberus-gaap:AssetBackedSecuritiesSecuritizedLoansAndReceivablesMemberipoe:PersonalLoanPortfolioSegmentMember2021-03-310001818874ipoe:SocialFinanceIncMemberus-gaap:AssetBackedSecuritiesSecuritizedLoansAndReceivablesMemberipoe:PersonalLoanPortfolioSegmentMember2020-03-310001818874ipoe:SocialFinanceIncMemberus-gaap:AssetBackedSecuritiesSecuritizedLoansAndReceivablesMemberipoe:PersonalLoanPortfolioSegmentMember2021-01-012021-03-310001818874ipoe:SocialFinanceIncMemberus-gaap:AssetBackedSecuritiesSecuritizedLoansAndReceivablesMemberipoe:PersonalLoanPortfolioSegmentMember2020-01-012020-03-310001818874ipoe:SocialFinanceIncMemberipoe:WholeLoansMemberipoe:StudentLoanPortfolioSegmentMember2021-03-310001818874ipoe:SocialFinanceIncMemberipoe:WholeLoansMemberipoe:StudentLoanPortfolioSegmentMember2020-03-310001818874ipoe:SocialFinanceIncMemberipoe:WholeLoansMemberipoe:StudentLoanPortfolioSegmentMember2021-01-012021-03-310001818874ipoe:SocialFinanceIncMemberipoe:WholeLoansMemberipoe:StudentLoanPortfolioSegmentMember2020-01-012020-03-310001818874ipoe:HomeLoanPortfolioSegmentMemberipoe:SocialFinanceIncMemberipoe:WholeLoansMember2021-03-310001818874ipoe:HomeLoanPortfolioSegmentMemberipoe:SocialFinanceIncMemberipoe:WholeLoansMember2020-03-310001818874ipoe:HomeLoanPortfolioSegmentMemberipoe:SocialFinanceIncMemberipoe:WholeLoansMember2021-01-012021-03-310001818874ipoe:HomeLoanPortfolioSegmentMemberipoe:SocialFinanceIncMemberipoe:WholeLoansMember2020-01-012020-03-310001818874ipoe:SocialFinanceIncMemberipoe:WholeLoansMemberipoe:PersonalLoanPortfolioSegmentMember2021-03-310001818874ipoe:SocialFinanceIncMemberipoe:WholeLoansMemberipoe:PersonalLoanPortfolioSegmentMember2020-03-310001818874ipoe:SocialFinanceIncMemberipoe:WholeLoansMemberipoe:PersonalLoanPortfolioSegmentMember2021-01-012021-03-310001818874ipoe:SocialFinanceIncMemberipoe:WholeLoansMemberipoe:PersonalLoanPortfolioSegmentMember2020-01-012020-03-310001818874ipoe:LoansInRepaymentMemberipoe:SocialFinanceIncMemberus-gaap:VariableInterestEntityNotPrimaryBeneficiaryMemberipoe:StudentLoanPortfolioSegmentMember2021-03-310001818874ipoe:HomeLoanPortfolioSegmentMemberipoe:LoansInRepaymentMemberipoe:SocialFinanceIncMemberus-gaap:VariableInterestEntityNotPrimaryBeneficiaryMember2021-03-310001818874ipoe:LoansInRepaymentMemberipoe:SocialFinanceIncMemberus-gaap:VariableInterestEntityNotPrimaryBeneficiaryMemberipoe:PersonalLoanPortfolioSegmentMember2021-03-310001818874ipoe:LoansInRepaymentMemberipoe:SocialFinanceIncMemberus-gaap:VariableInterestEntityNotPrimaryBeneficiaryMember2021-03-310001818874ipoe:LoansInSchoolGracePeriodOrDefermentMemberipoe:SocialFinanceIncMemberus-gaap:VariableInterestEntityNotPrimaryBeneficiaryMemberipoe:StudentLoanPortfolioSegmentMember2021-03-310001818874ipoe:HomeLoanPortfolioSegmentMemberipoe:LoansInSchoolGracePeriodOrDefermentMemberipoe:SocialFinanceIncMemberus-gaap:VariableInterestEntityNotPrimaryBeneficiaryMember2021-03-310001818874ipoe:LoansInSchoolGracePeriodOrDefermentMemberipoe:SocialFinanceIncMemberus-gaap:VariableInterestEntityNotPrimaryBeneficiaryMemberipoe:PersonalLoanPortfolioSegmentMember2021-03-310001818874ipoe:LoansInSchoolGracePeriodOrDefermentMemberipoe:SocialFinanceIncMemberus-gaap:VariableInterestEntityNotPrimaryBeneficiaryMember2021-03-310001818874ipoe:SocialFinanceIncMemberus-gaap:VariableInterestEntityNotPrimaryBeneficiaryMemberipoe:StudentLoanPortfolioSegmentMemberipoe:LoansInForbearanceMember2021-03-310001818874ipoe:HomeLoanPortfolioSegmentMemberipoe:SocialFinanceIncMemberus-gaap:VariableInterestEntityNotPrimaryBeneficiaryMemberipoe:LoansInForbearanceMember2021-03-310001818874ipoe:SocialFinanceIncMemberus-gaap:VariableInterestEntityNotPrimaryBeneficiaryMemberipoe:LoansInForbearanceMemberipoe:PersonalLoanPortfolioSegmentMember2021-03-310001818874ipoe:SocialFinanceIncMemberus-gaap:VariableInterestEntityNotPrimaryBeneficiaryMemberipoe:LoansInForbearanceMember2021-03-310001818874ipoe:SocialFinanceIncMemberus-gaap:VariableInterestEntityNotPrimaryBeneficiaryMemberipoe:StudentLoanPortfolioSegmentMemberipoe:LoansInDelinquencyMember2021-03-310001818874ipoe:HomeLoanPortfolioSegmentMemberipoe:SocialFinanceIncMemberus-gaap:VariableInterestEntityNotPrimaryBeneficiaryMemberipoe:LoansInDelinquencyMember2021-03-310001818874ipoe:SocialFinanceIncMemberus-gaap:VariableInterestEntityNotPrimaryBeneficiaryMemberipoe:LoansInDelinquencyMemberipoe:PersonalLoanPortfolioSegmentMember2021-03-310001818874ipoe:SocialFinanceIncMemberus-gaap:VariableInterestEntityNotPrimaryBeneficiaryMemberipoe:LoansInDelinquencyMember2021-03-310001818874ipoe:SocialFinanceIncMemberus-gaap:VariableInterestEntityNotPrimaryBeneficiaryMemberipoe:StudentLoanPortfolioSegmentMember2021-03-310001818874ipoe:HomeLoanPortfolioSegmentMemberipoe:SocialFinanceIncMemberus-gaap:VariableInterestEntityNotPrimaryBeneficiaryMember2021-03-310001818874ipoe:SocialFinanceIncMemberus-gaap:VariableInterestEntityNotPrimaryBeneficiaryMemberipoe:PersonalLoanPortfolioSegmentMember2021-03-310001818874ipoe:SocialFinanceIncMemberus-gaap:VariableInterestEntityNotPrimaryBeneficiaryMember2021-03-310001818874ipoe:SocialFinanceIncMemberus-gaap:VariableInterestEntityNotPrimaryBeneficiaryMemberipoe:StudentLoanPortfolioSegmentMember2021-01-012021-03-310001818874ipoe:HomeLoanPortfolioSegmentMemberipoe:SocialFinanceIncMemberus-gaap:VariableInterestEntityNotPrimaryBeneficiaryMember2021-01-012021-03-310001818874ipoe:SocialFinanceIncMemberus-gaap:VariableInterestEntityNotPrimaryBeneficiaryMemberipoe:PersonalLoanPortfolioSegmentMember2021-01-012021-03-310001818874ipoe:SocialFinanceIncMemberus-gaap:VariableInterestEntityNotPrimaryBeneficiaryMember2021-01-012021-03-310001818874ipoe:LoansInRepaymentMemberipoe:SocialFinanceIncMemberus-gaap:VariableInterestEntityNotPrimaryBeneficiaryMemberipoe:StudentLoanPortfolioSegmentMember2020-12-310001818874ipoe:HomeLoanPortfolioSegmentMemberipoe:LoansInRepaymentMemberipoe:SocialFinanceIncMemberus-gaap:VariableInterestEntityNotPrimaryBeneficiaryMember2020-12-310001818874ipoe:LoansInRepaymentMemberipoe:SocialFinanceIncMemberus-gaap:VariableInterestEntityNotPrimaryBeneficiaryMemberipoe:PersonalLoanPortfolioSegmentMember2020-12-310001818874ipoe:LoansInRepaymentMemberipoe:SocialFinanceIncMemberus-gaap:VariableInterestEntityNotPrimaryBeneficiaryMember2020-12-310001818874ipoe:LoansInSchoolGracePeriodOrDefermentMemberipoe:SocialFinanceIncMemberus-gaap:VariableInterestEntityNotPrimaryBeneficiaryMemberipoe:StudentLoanPortfolioSegmentMember2020-12-310001818874ipoe:HomeLoanPortfolioSegmentMemberipoe:LoansInSchoolGracePeriodOrDefermentMemberipoe:SocialFinanceIncMemberus-gaap:VariableInterestEntityNotPrimaryBeneficiaryMember2020-12-310001818874ipoe:LoansInSchoolGracePeriodOrDefermentMemberipoe:SocialFinanceIncMemberus-gaap:VariableInterestEntityNotPrimaryBeneficiaryMemberipoe:PersonalLoanPortfolioSegmentMember2020-12-310001818874ipoe:LoansInSchoolGracePeriodOrDefermentMemberipoe:SocialFinanceIncMemberus-gaap:VariableInterestEntityNotPrimaryBeneficiaryMember2020-12-310001818874ipoe:SocialFinanceIncMemberus-gaap:VariableInterestEntityNotPrimaryBeneficiaryMemberipoe:StudentLoanPortfolioSegmentMemberipoe:LoansInForbearanceMember2020-12-310001818874ipoe:HomeLoanPortfolioSegmentMemberipoe:SocialFinanceIncMemberus-gaap:VariableInterestEntityNotPrimaryBeneficiaryMemberipoe:LoansInForbearanceMember2020-12-310001818874ipoe:SocialFinanceIncMemberus-gaap:VariableInterestEntityNotPrimaryBeneficiaryMemberipoe:LoansInForbearanceMemberipoe:PersonalLoanPortfolioSegmentMember2020-12-310001818874ipoe:SocialFinanceIncMemberus-gaap:VariableInterestEntityNotPrimaryBeneficiaryMemberipoe:LoansInForbearanceMember2020-12-310001818874ipoe:SocialFinanceIncMemberus-gaap:VariableInterestEntityNotPrimaryBeneficiaryMemberipoe:StudentLoanPortfolioSegmentMemberipoe:LoansInDelinquencyMember2020-12-310001818874ipoe:HomeLoanPortfolioSegmentMemberipoe:SocialFinanceIncMemberus-gaap:VariableInterestEntityNotPrimaryBeneficiaryMemberipoe:LoansInDelinquencyMember2020-12-310001818874ipoe:SocialFinanceIncMemberus-gaap:VariableInterestEntityNotPrimaryBeneficiaryMemberipoe:LoansInDelinquencyMemberipoe:PersonalLoanPortfolioSegmentMember2020-12-310001818874ipoe:SocialFinanceIncMemberus-gaap:VariableInterestEntityNotPrimaryBeneficiaryMemberipoe:LoansInDelinquencyMember2020-12-310001818874ipoe:SocialFinanceIncMemberus-gaap:VariableInterestEntityNotPrimaryBeneficiaryMemberipoe:StudentLoanPortfolioSegmentMember2020-12-310001818874ipoe:HomeLoanPortfolioSegmentMemberipoe:SocialFinanceIncMemberus-gaap:VariableInterestEntityNotPrimaryBeneficiaryMember2020-12-310001818874ipoe:SocialFinanceIncMemberus-gaap:VariableInterestEntityNotPrimaryBeneficiaryMemberipoe:PersonalLoanPortfolioSegmentMember2020-12-310001818874ipoe:SocialFinanceIncMemberus-gaap:VariableInterestEntityNotPrimaryBeneficiaryMember2020-12-310001818874ipoe:SocialFinanceIncMemberus-gaap:VariableInterestEntityNotPrimaryBeneficiaryMemberipoe:StudentLoanPortfolioSegmentMember2020-01-012020-12-310001818874ipoe:HomeLoanPortfolioSegmentMemberipoe:SocialFinanceIncMemberus-gaap:VariableInterestEntityNotPrimaryBeneficiaryMember2020-01-012020-12-310001818874ipoe:SocialFinanceIncMemberus-gaap:VariableInterestEntityNotPrimaryBeneficiaryMemberipoe:PersonalLoanPortfolioSegmentMember2020-01-012020-12-310001818874ipoe:SocialFinanceIncMemberus-gaap:VariableInterestEntityNotPrimaryBeneficiaryMember2020-01-012020-12-310001818874ipoe:SocialFinanceIncMemberus-gaap:CarryingReportedAmountFairValueDisclosureMemberus-gaap:FairValueInputsLevel1Member2021-03-310001818874us-gaap:EstimateOfFairValueFairValueDisclosureMemberipoe:SocialFinanceIncMemberus-gaap:FairValueInputsLevel1Member2021-03-310001818874ipoe:SocialFinanceIncMemberus-gaap:CarryingReportedAmountFairValueDisclosureMemberus-gaap:FairValueInputsLevel1Member2020-12-310001818874us-gaap:EstimateOfFairValueFairValueDisclosureMemberipoe:SocialFinanceIncMemberus-gaap:FairValueInputsLevel1Member2020-12-310001818874us-gaap:CarryingReportedAmountFairValueDisclosureMemberipoe:SocialFinanceIncMemberus-gaap:FairValueInputsLevel3Memberus-gaap:StudentLoanMemberus-gaap:FairValueMeasurementsRecurringMember2021-03-310001818874us-gaap:EstimateOfFairValueFairValueDisclosureMemberipoe:SocialFinanceIncMemberus-gaap:FairValueInputsLevel3Memberus-gaap:StudentLoanMemberus-gaap:FairValueMeasurementsRecurringMember2021-03-310001818874us-gaap:CarryingReportedAmountFairValueDisclosureMemberipoe:SocialFinanceIncMemberus-gaap:FairValueInputsLevel3Memberus-gaap:StudentLoanMemberus-gaap:FairValueMeasurementsRecurringMember2020-12-310001818874us-gaap:EstimateOfFairValueFairValueDisclosureMemberipoe:SocialFinanceIncMemberus-gaap:FairValueInputsLevel3Memberus-gaap:StudentLoanMemberus-gaap:FairValueMeasurementsRecurringMember2020-12-310001818874us-gaap:CarryingReportedAmountFairValueDisclosureMemberipoe:SocialFinanceIncMemberus-gaap:FairValueInputsLevel3Memberus-gaap:HomeEquityLoanMemberus-gaap:FairValueMeasurementsRecurringMember2021-03-310001818874us-gaap:EstimateOfFairValueFairValueDisclosureMemberipoe:SocialFinanceIncMemberus-gaap:FairValueInputsLevel3Memberus-gaap:HomeEquityLoanMemberus-gaap:FairValueMeasurementsRecurringMember2021-03-310001818874us-gaap:CarryingReportedAmountFairValueDisclosureMemberipoe:SocialFinanceIncMemberus-gaap:FairValueInputsLevel3Memberus-gaap:HomeEquityLoanMemberus-gaap:FairValueMeasurementsRecurringMember2020-12-310001818874us-gaap:EstimateOfFairValueFairValueDisclosureMemberipoe:SocialFinanceIncMemberus-gaap:FairValueInputsLevel3Memberus-gaap:HomeEquityLoanMemberus-gaap:FairValueMeasurementsRecurringMember2020-12-310001818874us-gaap:CarryingReportedAmountFairValueDisclosureMemberipoe:SocialFinanceIncMemberus-gaap:FairValueInputsLevel3Memberus-gaap:ConsumerLoanMemberus-gaap:FairValueMeasurementsRecurringMember2021-03-310001818874us-gaap:EstimateOfFairValueFairValueDisclosureMemberipoe:SocialFinanceIncMemberus-gaap:FairValueInputsLevel3Memberus-gaap:ConsumerLoanMemberus-gaap:FairValueMeasurementsRecurringMember2021-03-310001818874us-gaap:CarryingReportedAmountFairValueDisclosureMemberipoe:SocialFinanceIncMemberus-gaap:FairValueInputsLevel3Memberus-gaap:ConsumerLoanMemberus-gaap:FairValueMeasurementsRecurringMember2020-12-310001818874us-gaap:EstimateOfFairValueFairValueDisclosureMemberipoe:SocialFinanceIncMemberus-gaap:FairValueInputsLevel3Memberus-gaap:ConsumerLoanMemberus-gaap:FairValueMeasurementsRecurringMember2020-12-310001818874us-gaap:CarryingReportedAmountFairValueDisclosureMemberipoe:SocialFinanceIncMemberus-gaap:FairValueInputsLevel3Memberus-gaap:CreditCardReceivablesMemberus-gaap:FairValueMeasurementsRecurringMember2021-03-310001818874us-gaap:EstimateOfFairValueFairValueDisclosureMemberipoe:SocialFinanceIncMemberus-gaap:FairValueInputsLevel3Memberus-gaap:CreditCardReceivablesMemberus-gaap:FairValueMeasurementsRecurringMember2021-03-310001818874us-gaap:CarryingReportedAmountFairValueDisclosureMemberipoe:SocialFinanceIncMemberus-gaap:FairValueInputsLevel3Memberus-gaap:CreditCardReceivablesMemberus-gaap:FairValueMeasurementsRecurringMember2020-12-310001818874us-gaap:EstimateOfFairValueFairValueDisclosureMemberipoe:SocialFinanceIncMemberus-gaap:FairValueInputsLevel3Memberus-gaap:CreditCardReceivablesMemberus-gaap:FairValueMeasurementsRecurringMember2020-12-310001818874us-gaap:CarryingReportedAmountFairValueDisclosureMemberipoe:SocialFinanceIncMemberus-gaap:CommercialLoanMemberus-gaap:FairValueInputsLevel3Memberus-gaap:FairValueMeasurementsRecurringMember2021-03-310001818874us-gaap:EstimateOfFairValueFairValueDisclosureMemberipoe:SocialFinanceIncMemberus-gaap:CommercialLoanMemberus-gaap:FairValueInputsLevel3Memberus-gaap:FairValueMeasurementsRecurringMember2021-03-310001818874us-gaap:CarryingReportedAmountFairValueDisclosureMemberipoe:SocialFinanceIncMemberus-gaap:CommercialLoanMemberus-gaap:FairValueInputsLevel3Memberus-gaap:FairValueMeasurementsRecurringMember2020-12-310001818874us-gaap:EstimateOfFairValueFairValueDisclosureMemberipoe:SocialFinanceIncMemberus-gaap:CommercialLoanMemberus-gaap:FairValueInputsLevel3Memberus-gaap:FairValueMeasurementsRecurringMember2020-12-310001818874ipoe:SocialFinanceIncMemberus-gaap:CarryingReportedAmountFairValueDisclosureMemberus-gaap:FairValueInputsLevel3Memberus-gaap:FairValueMeasurementsRecurringMember2021-03-310001818874us-gaap:EstimateOfFairValueFairValueDisclosureMemberipoe:SocialFinanceIncMemberus-gaap:FairValueInputsLevel3Memberus-gaap:FairValueMeasurementsRecurringMember2021-03-310001818874ipoe:SocialFinanceIncMemberus-gaap:CarryingReportedAmountFairValueDisclosureMemberus-gaap:FairValueInputsLevel3Memberus-gaap:FairValueMeasurementsRecurringMember2020-12-310001818874us-gaap:EstimateOfFairValueFairValueDisclosureMemberipoe:SocialFinanceIncMemberus-gaap:FairValueInputsLevel3Memberus-gaap:FairValueMeasurementsRecurringMember2020-12-310001818874us-gaap:CarryingReportedAmountFairValueDisclosureMemberus-gaap:AssetBackedSecuritiesMemberipoe:SocialFinanceIncMemberus-gaap:FairValueInputsLevel2Memberus-gaap:FairValueMeasurementsRecurringMember2021-03-310001818874us-gaap:EstimateOfFairValueFairValueDisclosureMemberus-gaap:AssetBackedSecuritiesMemberipoe:SocialFinanceIncMemberus-gaap:FairValueInputsLevel2Memberus-gaap:FairValueMeasurementsRecurringMember2021-03-310001818874us-gaap:CarryingReportedAmountFairValueDisclosureMemberus-gaap:AssetBackedSecuritiesMemberipoe:SocialFinanceIncMemberus-gaap:FairValueInputsLevel2Memberus-gaap:FairValueMeasurementsRecurringMember2020-12-310001818874us-gaap:EstimateOfFairValueFairValueDisclosureMemberus-gaap:AssetBackedSecuritiesMemberipoe:SocialFinanceIncMemberus-gaap:FairValueInputsLevel2Memberus-gaap:FairValueMeasurementsRecurringMember2020-12-310001818874ipoe:ResidualInvestmentsMemberus-gaap:CarryingReportedAmountFairValueDisclosureMemberipoe:SocialFinanceIncMemberus-gaap:FairValueInputsLevel3Memberus-gaap:FairValueMeasurementsRecurringMember2021-03-310001818874us-gaap:EstimateOfFairValueFairValueDisclosureMemberipoe:ResidualInvestmentsMemberipoe:SocialFinanceIncMemberus-gaap:FairValueInputsLevel3Memberus-gaap:FairValueMeasurementsRecurringMember2021-03-310001818874ipoe:ResidualInvestmentsMemberus-gaap:CarryingReportedAmountFairValueDisclosureMemberipoe:SocialFinanceIncMemberus-gaap:FairValueInputsLevel3Memberus-gaap:FairValueMeasurementsRecurringMember2020-12-310001818874us-gaap:EstimateOfFairValueFairValueDisclosureMemberipoe:ResidualInvestmentsMemberipoe:SocialFinanceIncMemberus-gaap:FairValueInputsLevel3Memberus-gaap:FairValueMeasurementsRecurringMember2020-12-310001818874us-gaap:ExchangeTradedFundsMemberus-gaap:CarryingReportedAmountFairValueDisclosureMemberipoe:SocialFinanceIncMemberus-gaap:FairValueInputsLevel1Memberus-gaap:FairValueMeasurementsRecurringMember2021-03-310001818874us-gaap:EstimateOfFairValueFairValueDisclosureMemberus-gaap:ExchangeTradedFundsMemberipoe:SocialFinanceIncMemberus-gaap:FairValueInputsLevel1Memberus-gaap:FairValueMeasurementsRecurringMember2021-03-310001818874us-gaap:ExchangeTradedFundsMemberus-gaap:CarryingReportedAmountFairValueDisclosureMemberipoe:SocialFinanceIncMemberus-gaap:FairValueInputsLevel1Memberus-gaap:FairValueMeasurementsRecurringMember2020-12-310001818874us-gaap:EstimateOfFairValueFairValueDisclosureMemberus-gaap:ExchangeTradedFundsMemberipoe:SocialFinanceIncMemberus-gaap:FairValueInputsLevel1Memberus-gaap:FairValueMeasurementsRecurringMember2020-12-310001818874us-gaap:CarryingReportedAmountFairValueDisclosureMemberipoe:SocialFinanceIncMemberus-gaap:FairValueInputsLevel3Memberus-gaap:FairValueMeasurementsNonrecurringMemberus-gaap:OtherAggregatedInvestmentsMember2021-03-310001818874us-gaap:EstimateOfFairValueFairValueDisclosureMemberipoe:SocialFinanceIncMemberus-gaap:FairValueInputsLevel3Memberus-gaap:FairValueMeasurementsNonrecurringMemberus-gaap:OtherAggregatedInvestmentsMember2021-03-310001818874us-gaap:CarryingReportedAmountFairValueDisclosureMemberipoe:SocialFinanceIncMemberus-gaap:FairValueInputsLevel3Memberus-gaap:FairValueMeasurementsNonrecurringMemberus-gaap:OtherAggregatedInvestmentsMember2020-12-310001818874us-gaap:EstimateOfFairValueFairValueDisclosureMemberipoe:SocialFinanceIncMemberus-gaap:FairValueInputsLevel3Memberus-gaap:FairValueMeasurementsNonrecurringMemberus-gaap:OtherAggregatedInvestmentsMember2020-12-310001818874ipoe:SocialFinanceIncMemberus-gaap:CarryingReportedAmountFairValueDisclosureMemberus-gaap:FairValueInputsLevel1Memberus-gaap:FairValueMeasurementsRecurringMember2021-03-310001818874us-gaap:EstimateOfFairValueFairValueDisclosureMemberipoe:SocialFinanceIncMemberus-gaap:FairValueInputsLevel1Memberus-gaap:FairValueMeasurementsRecurringMember2021-03-310001818874ipoe:SocialFinanceIncMemberus-gaap:CarryingReportedAmountFairValueDisclosureMemberus-gaap:FairValueInputsLevel1Memberus-gaap:FairValueMeasurementsRecurringMember2020-12-310001818874us-gaap:EstimateOfFairValueFairValueDisclosureMemberipoe:SocialFinanceIncMemberus-gaap:FairValueInputsLevel1Memberus-gaap:FairValueMeasurementsRecurringMember2020-12-310001818874us-gaap:InterestRateSwapMemberus-gaap:CarryingReportedAmountFairValueDisclosureMemberipoe:SocialFinanceIncMemberus-gaap:FairValueInputsLevel2Memberus-gaap:FairValueMeasurementsRecurringMember2021-03-310001818874us-gaap:EstimateOfFairValueFairValueDisclosureMemberus-gaap:InterestRateSwapMemberipoe:SocialFinanceIncMemberus-gaap:FairValueInputsLevel2Memberus-gaap:FairValueMeasurementsRecurringMember2021-03-310001818874us-gaap:InterestRateSwapMemberus-gaap:CarryingReportedAmountFairValueDisclosureMemberipoe:SocialFinanceIncMemberus-gaap:FairValueInputsLevel2Memberus-gaap:FairValueMeasurementsRecurringMember2020-12-310001818874us-gaap:EstimateOfFairValueFairValueDisclosureMemberus-gaap:InterestRateSwapMemberipoe:SocialFinanceIncMemberus-gaap:FairValueInputsLevel2Memberus-gaap:FairValueMeasurementsRecurringMember2020-12-310001818874ipoe:SocialFinanceIncMemberus-gaap:CarryingReportedAmountFairValueDisclosureMember2021-03-310001818874us-gaap:EstimateOfFairValueFairValueDisclosureMemberipoe:SocialFinanceIncMember2021-03-310001818874ipoe:SocialFinanceIncMemberus-gaap:CarryingReportedAmountFairValueDisclosureMember2020-12-310001818874us-gaap:EstimateOfFairValueFairValueDisclosureMemberipoe:SocialFinanceIncMember2020-12-310001818874ipoe:SocialFinanceIncMemberus-gaap:CarryingReportedAmountFairValueDisclosureMemberus-gaap:FairValueInputsLevel2Member2021-03-310001818874us-gaap:EstimateOfFairValueFairValueDisclosureMemberipoe:SocialFinanceIncMemberus-gaap:FairValueInputsLevel2Member2021-03-310001818874ipoe:SocialFinanceIncMemberus-gaap:CarryingReportedAmountFairValueDisclosureMemberus-gaap:FairValueInputsLevel2Member2020-12-310001818874us-gaap:EstimateOfFairValueFairValueDisclosureMemberipoe:SocialFinanceIncMemberus-gaap:FairValueInputsLevel2Member2020-12-310001818874ipoe:ResidualInterestsClassifiedAsDebtMemberus-gaap:CarryingReportedAmountFairValueDisclosureMemberipoe:SocialFinanceIncMemberus-gaap:FairValueInputsLevel3Memberus-gaap:FairValueMeasurementsRecurringMember2021-03-310001818874us-gaap:EstimateOfFairValueFairValueDisclosureMemberipoe:ResidualInterestsClassifiedAsDebtMemberipoe:SocialFinanceIncMemberus-gaap:FairValueInputsLevel3Memberus-gaap:FairValueMeasurementsRecurringMember2021-03-310001818874ipoe:ResidualInterestsClassifiedAsDebtMemberus-gaap:CarryingReportedAmountFairValueDisclosureMemberipoe:SocialFinanceIncMemberus-gaap:FairValueInputsLevel3Memberus-gaap:FairValueMeasurementsRecurringMember2020-12-310001818874us-gaap:EstimateOfFairValueFairValueDisclosureMemberipoe:ResidualInterestsClassifiedAsDebtMemberipoe:SocialFinanceIncMemberus-gaap:FairValueInputsLevel3Memberus-gaap:FairValueMeasurementsRecurringMember2020-12-310001818874srt:MinimumMemberipoe:SocialFinanceIncMemberus-gaap:MeasurementInputPrepaymentRateMemberipoe:StudentLoanPortfolioSegmentMember2021-03-310001818874ipoe:SocialFinanceIncMemberus-gaap:MeasurementInputPrepaymentRateMemberipoe:StudentLoanPortfolioSegmentMembersrt:MaximumMember2021-03-310001818874srt:WeightedAverageMemberipoe:SocialFinanceIncMemberus-gaap:MeasurementInputPrepaymentRateMemberipoe:StudentLoanPortfolioSegmentMember2021-03-310001818874srt:MinimumMemberipoe:SocialFinanceIncMemberus-gaap:MeasurementInputPrepaymentRateMemberipoe:StudentLoanPortfolioSegmentMember2020-12-310001818874ipoe:SocialFinanceIncMemberus-gaap:MeasurementInputPrepaymentRateMemberipoe:StudentLoanPortfolioSegmentMembersrt:MaximumMember2020-12-310001818874srt:WeightedAverageMemberipoe:SocialFinanceIncMemberus-gaap:MeasurementInputPrepaymentRateMemberipoe:StudentLoanPortfolioSegmentMember2020-12-310001818874srt:MinimumMemberipoe:SocialFinanceIncMemberipoe:StudentLoanPortfolioSegmentMemberus-gaap:MeasurementInputDefaultRateMember2021-03-310001818874ipoe:SocialFinanceIncMemberipoe:StudentLoanPortfolioSegmentMemberus-gaap:MeasurementInputDefaultRateMembersrt:MaximumMember2021-03-310001818874srt:WeightedAverageMemberipoe:SocialFinanceIncMemberipoe:StudentLoanPortfolioSegmentMemberus-gaap:MeasurementInputDefaultRateMember2021-03-310001818874srt:MinimumMemberipoe:SocialFinanceIncMemberipoe:StudentLoanPortfolioSegmentMemberus-gaap:MeasurementInputDefaultRateMember2020-12-310001818874ipoe:SocialFinanceIncMemberipoe:StudentLoanPortfolioSegmentMemberus-gaap:MeasurementInputDefaultRateMembersrt:MaximumMember2020-12-310001818874srt:WeightedAverageMemberipoe:SocialFinanceIncMemberipoe:StudentLoanPortfolioSegmentMemberus-gaap:MeasurementInputDefaultRateMember2020-12-310001818874srt:MinimumMemberipoe:SocialFinanceIncMemberus-gaap:MeasurementInputDiscountRateMemberipoe:StudentLoanPortfolioSegmentMember2021-03-310001818874ipoe:SocialFinanceIncMemberus-gaap:MeasurementInputDiscountRateMemberipoe:StudentLoanPortfolioSegmentMembersrt:MaximumMember2021-03-310001818874srt:WeightedAverageMemberipoe:SocialFinanceIncMemberus-gaap:MeasurementInputDiscountRateMemberipoe:StudentLoanPortfolioSegmentMember2021-03-310001818874srt:MinimumMemberipoe:SocialFinanceIncMemberus-gaap:MeasurementInputDiscountRateMemberipoe:StudentLoanPortfolioSegmentMember2020-12-310001818874ipoe:SocialFinanceIncMemberus-gaap:MeasurementInputDiscountRateMemberipoe:StudentLoanPortfolioSegmentMembersrt:MaximumMember2020-12-310001818874srt:WeightedAverageMemberipoe:SocialFinanceIncMemberus-gaap:MeasurementInputDiscountRateMemberipoe:StudentLoanPortfolioSegmentMember2020-12-310001818874ipoe:HomeLoanPortfolioSegmentMembersrt:MinimumMemberipoe:SocialFinanceIncMemberus-gaap:MeasurementInputPrepaymentRateMember2021-03-310001818874ipoe:HomeLoanPortfolioSegmentMemberipoe:SocialFinanceIncMemberus-gaap:MeasurementInputPrepaymentRateMembersrt:MaximumMember2021-03-310001818874srt:WeightedAverageMemberipoe:HomeLoanPortfolioSegmentMemberipoe:SocialFinanceIncMemberus-gaap:MeasurementInputPrepaymentRateMember2021-03-310001818874ipoe:HomeLoanPortfolioSegmentMembersrt:MinimumMemberipoe:SocialFinanceIncMemberus-gaap:MeasurementInputPrepaymentRateMember2020-12-310001818874ipoe:HomeLoanPortfolioSegmentMemberipoe:SocialFinanceIncMemberus-gaap:MeasurementInputPrepaymentRateMembersrt:MaximumMember2020-12-310001818874srt:WeightedAverageMemberipoe:HomeLoanPortfolioSegmentMemberipoe:SocialFinanceIncMemberus-gaap:MeasurementInputPrepaymentRateMember2020-12-310001818874ipoe:HomeLoanPortfolioSegmentMembersrt:MinimumMemberipoe:SocialFinanceIncMemberus-gaap:MeasurementInputDefaultRateMember2021-03-310001818874ipoe:HomeLoanPortfolioSegmentMemberipoe:SocialFinanceIncMemberus-gaap:MeasurementInputDefaultRateMembersrt:MaximumMember2021-03-310001818874srt:WeightedAverageMemberipoe:HomeLoanPortfolioSegmentMemberipoe:SocialFinanceIncMemberus-gaap:MeasurementInputDefaultRateMember2021-03-310001818874ipoe:HomeLoanPortfolioSegmentMembersrt:MinimumMemberipoe:SocialFinanceIncMemberus-gaap:MeasurementInputDefaultRateMember2020-12-310001818874ipoe:HomeLoanPortfolioSegmentMemberipoe:SocialFinanceIncMemberus-gaap:MeasurementInputDefaultRateMembersrt:MaximumMember2020-12-310001818874srt:WeightedAverageMemberipoe:HomeLoanPortfolioSegmentMemberipoe:SocialFinanceIncMemberus-gaap:MeasurementInputDefaultRateMember2020-12-310001818874ipoe:HomeLoanPortfolioSegmentMembersrt:MinimumMemberipoe:SocialFinanceIncMemberus-gaap:MeasurementInputDiscountRateMember2021-03-310001818874ipoe:HomeLoanPortfolioSegmentMemberipoe:SocialFinanceIncMemberus-gaap:MeasurementInputDiscountRateMembersrt:MaximumMember2021-03-310001818874srt:WeightedAverageMemberipoe:HomeLoanPortfolioSegmentMemberipoe:SocialFinanceIncMemberus-gaap:MeasurementInputDiscountRateMember2021-03-310001818874ipoe:HomeLoanPortfolioSegmentMembersrt:MinimumMemberipoe:SocialFinanceIncMemberus-gaap:MeasurementInputDiscountRateMember2020-12-310001818874ipoe:HomeLoanPortfolioSegmentMemberipoe:SocialFinanceIncMemberus-gaap:MeasurementInputDiscountRateMembersrt:MaximumMember2020-12-310001818874srt:WeightedAverageMemberipoe:HomeLoanPortfolioSegmentMemberipoe:SocialFinanceIncMemberus-gaap:MeasurementInputDiscountRateMember2020-12-310001818874srt:MinimumMemberipoe:SocialFinanceIncMemberus-gaap:MeasurementInputPrepaymentRateMemberipoe:PersonalLoanPortfolioSegmentMember2021-03-310001818874ipoe:SocialFinanceIncMemberus-gaap:MeasurementInputPrepaymentRateMemberipoe:PersonalLoanPortfolioSegmentMembersrt:MaximumMember2021-03-310001818874srt:WeightedAverageMemberipoe:SocialFinanceIncMemberus-gaap:MeasurementInputPrepaymentRateMemberipoe:PersonalLoanPortfolioSegmentMember2021-03-310001818874srt:MinimumMemberipoe:SocialFinanceIncMemberus-gaap:MeasurementInputPrepaymentRateMemberipoe:PersonalLoanPortfolioSegmentMember2020-12-310001818874ipoe:SocialFinanceIncMemberus-gaap:MeasurementInputPrepaymentRateMemberipoe:PersonalLoanPortfolioSegmentMembersrt:MaximumMember2020-12-310001818874srt:WeightedAverageMemberipoe:SocialFinanceIncMemberus-gaap:MeasurementInputPrepaymentRateMemberipoe:PersonalLoanPortfolioSegmentMember2020-12-310001818874srt:MinimumMemberipoe:SocialFinanceIncMemberus-gaap:MeasurementInputDefaultRateMemberipoe:PersonalLoanPortfolioSegmentMember2021-03-310001818874ipoe:SocialFinanceIncMemberus-gaap:MeasurementInputDefaultRateMemberipoe:PersonalLoanPortfolioSegmentMembersrt:MaximumMember2021-03-310001818874srt:WeightedAverageMemberipoe:SocialFinanceIncMemberus-gaap:MeasurementInputDefaultRateMemberipoe:PersonalLoanPortfolioSegmentMember2021-03-310001818874srt:MinimumMemberipoe:SocialFinanceIncMemberus-gaap:MeasurementInputDefaultRateMemberipoe:PersonalLoanPortfolioSegmentMember2020-12-310001818874ipoe:SocialFinanceIncMemberus-gaap:MeasurementInputDefaultRateMemberipoe:PersonalLoanPortfolioSegmentMembersrt:MaximumMember2020-12-310001818874srt:WeightedAverageMemberipoe:SocialFinanceIncMemberus-gaap:MeasurementInputDefaultRateMemberipoe:PersonalLoanPortfolioSegmentMember2020-12-310001818874srt:MinimumMemberipoe:SocialFinanceIncMemberus-gaap:MeasurementInputDiscountRateMemberipoe:PersonalLoanPortfolioSegmentMember2021-03-310001818874ipoe:SocialFinanceIncMemberus-gaap:MeasurementInputDiscountRateMemberipoe:PersonalLoanPortfolioSegmentMembersrt:MaximumMember2021-03-310001818874srt:WeightedAverageMemberipoe:SocialFinanceIncMemberus-gaap:MeasurementInputDiscountRateMemberipoe:PersonalLoanPortfolioSegmentMember2021-03-310001818874srt:MinimumMemberipoe:SocialFinanceIncMemberus-gaap:MeasurementInputDiscountRateMemberipoe:PersonalLoanPortfolioSegmentMember2020-12-310001818874ipoe:SocialFinanceIncMemberus-gaap:MeasurementInputDiscountRateMemberipoe:PersonalLoanPortfolioSegmentMembersrt:MaximumMember2020-12-310001818874srt:WeightedAverageMemberipoe:SocialFinanceIncMemberus-gaap:MeasurementInputDiscountRateMemberipoe:PersonalLoanPortfolioSegmentMember2020-12-310001818874srt:MinimumMemberipoe:SocialFinanceIncMemberipoe:StudentLoanPortfolioSegmentMemberus-gaap:MeasurementInputCostToSellMember2021-03-310001818874ipoe:SocialFinanceIncMemberipoe:StudentLoanPortfolioSegmentMemberus-gaap:MeasurementInputCostToSellMembersrt:MaximumMember2021-03-310001818874srt:WeightedAverageMemberipoe:SocialFinanceIncMemberipoe:StudentLoanPortfolioSegmentMemberus-gaap:MeasurementInputCostToSellMember2021-03-310001818874srt:MinimumMemberipoe:SocialFinanceIncMemberipoe:StudentLoanPortfolioSegmentMemberus-gaap:MeasurementInputCostToSellMember2020-12-310001818874ipoe:SocialFinanceIncMemberipoe:StudentLoanPortfolioSegmentMemberus-gaap:MeasurementInputCostToSellMembersrt:MaximumMember2020-12-310001818874srt:WeightedAverageMemberipoe:SocialFinanceIncMemberipoe:StudentLoanPortfolioSegmentMemberus-gaap:MeasurementInputCostToSellMember2020-12-310001818874ipoe:HomeLoanPortfolioSegmentMembersrt:MinimumMemberipoe:SocialFinanceIncMemberus-gaap:MeasurementInputCostToSellMember2021-03-310001818874ipoe:HomeLoanPortfolioSegmentMemberipoe:SocialFinanceIncMemberus-gaap:MeasurementInputCostToSellMembersrt:MaximumMember2021-03-310001818874srt:WeightedAverageMemberipoe:HomeLoanPortfolioSegmentMemberipoe:SocialFinanceIncMemberus-gaap:MeasurementInputCostToSellMember2021-03-310001818874ipoe:HomeLoanPortfolioSegmentMembersrt:MinimumMemberipoe:SocialFinanceIncMemberus-gaap:MeasurementInputCostToSellMember2020-12-310001818874ipoe:HomeLoanPortfolioSegmentMemberipoe:SocialFinanceIncMemberus-gaap:MeasurementInputCostToSellMembersrt:MaximumMember2020-12-310001818874srt:WeightedAverageMemberipoe:HomeLoanPortfolioSegmentMemberipoe:SocialFinanceIncMemberus-gaap:MeasurementInputCostToSellMember2020-12-310001818874srt:MinimumMemberipoe:SocialFinanceIncMemberus-gaap:MeasurementInputCostToSellMemberipoe:PersonalLoanPortfolioSegmentMember2021-03-310001818874ipoe:SocialFinanceIncMemberus-gaap:MeasurementInputCostToSellMemberipoe:PersonalLoanPortfolioSegmentMembersrt:MaximumMember2021-03-310001818874srt:WeightedAverageMemberipoe:SocialFinanceIncMemberus-gaap:MeasurementInputCostToSellMemberipoe:PersonalLoanPortfolioSegmentMember2021-03-310001818874srt:MinimumMemberipoe:SocialFinanceIncMemberus-gaap:MeasurementInputCostToSellMemberipoe:PersonalLoanPortfolioSegmentMember2020-12-310001818874ipoe:SocialFinanceIncMemberus-gaap:MeasurementInputCostToSellMemberipoe:PersonalLoanPortfolioSegmentMembersrt:MaximumMember2020-12-310001818874srt:WeightedAverageMemberipoe:SocialFinanceIncMemberus-gaap:MeasurementInputCostToSellMemberipoe:PersonalLoanPortfolioSegmentMember2020-12-310001818874ipoe:SocialFinanceIncMemberipoe:StudentLoanPortfolioSegmentMember2020-12-310001818874ipoe:HomeLoanPortfolioSegmentMemberipoe:SocialFinanceIncMember2020-12-310001818874ipoe:SocialFinanceIncMemberipoe:PersonalLoanPortfolioSegmentMember2020-12-310001818874ipoe:SocialFinanceIncMemberipoe:StudentLoanPortfolioSegmentMember2021-01-012021-03-310001818874ipoe:HomeLoanPortfolioSegmentMemberipoe:SocialFinanceIncMember2021-01-012021-03-310001818874ipoe:SocialFinanceIncMemberipoe:PersonalLoanPortfolioSegmentMember2021-01-012021-03-310001818874ipoe:SocialFinanceIncMemberipoe:StudentLoanPortfolioSegmentMember2021-03-310001818874ipoe:HomeLoanPortfolioSegmentMemberipoe:SocialFinanceIncMember2021-03-310001818874ipoe:SocialFinanceIncMemberipoe:PersonalLoanPortfolioSegmentMember2021-03-310001818874ipoe:SocialFinanceIncMemberipoe:StudentLoanPortfolioSegmentMember2019-12-310001818874ipoe:HomeLoanPortfolioSegmentMemberipoe:SocialFinanceIncMember2019-12-310001818874ipoe:SocialFinanceIncMemberipoe:PersonalLoanPortfolioSegmentMember2019-12-310001818874ipoe:SocialFinanceIncMemberipoe:StudentLoanPortfolioSegmentMember2020-01-012020-03-310001818874ipoe:HomeLoanPortfolioSegmentMemberipoe:SocialFinanceIncMember2020-01-012020-03-310001818874ipoe:SocialFinanceIncMemberipoe:PersonalLoanPortfolioSegmentMember2020-01-012020-03-310001818874ipoe:SocialFinanceIncMemberipoe:StudentLoanPortfolioSegmentMember2020-03-310001818874ipoe:HomeLoanPortfolioSegmentMemberipoe:SocialFinanceIncMember2020-03-310001818874ipoe:SocialFinanceIncMemberipoe:PersonalLoanPortfolioSegmentMember2020-03-310001818874srt:MinimumMemberipoe:SocialFinanceIncMemberus-gaap:MeasurementInputDiscountRateMember2021-03-310001818874ipoe:SocialFinanceIncMemberus-gaap:MeasurementInputDiscountRateMembersrt:MaximumMember2021-03-310001818874srt:MinimumMemberipoe:SocialFinanceIncMemberus-gaap:MeasurementInputDiscountRateMember2020-12-310001818874ipoe:SocialFinanceIncMemberus-gaap:MeasurementInputDiscountRateMembersrt:MaximumMember2020-12-310001818874srt:MinimumMemberipoe:SocialFinanceIncMemberus-gaap:MeasurementInputPrepaymentRateMember2021-03-310001818874ipoe:SocialFinanceIncMemberus-gaap:MeasurementInputPrepaymentRateMembersrt:MaximumMember2021-03-310001818874srt:MinimumMemberipoe:SocialFinanceIncMemberus-gaap:MeasurementInputPrepaymentRateMember2020-12-310001818874ipoe:SocialFinanceIncMemberus-gaap:MeasurementInputPrepaymentRateMembersrt:MaximumMember2020-12-310001818874srt:WeightedAverageMemberipoe:SocialFinanceIncMemberus-gaap:MeasurementInputPrepaymentRateMember2021-03-310001818874srt:WeightedAverageMemberipoe:SocialFinanceIncMemberus-gaap:MeasurementInputPrepaymentRateMember2020-12-310001818874srt:MinimumMemberipoe:SocialFinanceIncMemberus-gaap:MeasurementInputDefaultRateMember2021-03-310001818874ipoe:SocialFinanceIncMemberus-gaap:MeasurementInputDefaultRateMembersrt:MaximumMember2021-03-310001818874srt:WeightedAverageMemberipoe:SocialFinanceIncMemberus-gaap:MeasurementInputDefaultRateMember2021-03-310001818874srt:MinimumMemberipoe:SocialFinanceIncMemberus-gaap:MeasurementInputDefaultRateMember2020-12-310001818874ipoe:SocialFinanceIncMemberus-gaap:MeasurementInputDefaultRateMembersrt:MaximumMember2020-12-310001818874srt:WeightedAverageMemberipoe:SocialFinanceIncMemberus-gaap:MeasurementInputDefaultRateMember2020-12-310001818874srt:WeightedAverageMemberipoe:SocialFinanceIncMemberus-gaap:MeasurementInputDiscountRateMember2021-03-310001818874srt:WeightedAverageMemberipoe:SocialFinanceIncMemberus-gaap:MeasurementInputDiscountRateMember2020-12-310001818874ipoe:ResidualInvestmentsMemberipoe:SocialFinanceIncMemberus-gaap:FairValueMeasurementsRecurringMember2020-12-310001818874ipoe:ResidualInterestsClassifiedAsDebtMemberipoe:SocialFinanceIncMemberus-gaap:FairValueMeasurementsRecurringMember2020-12-310001818874ipoe:ResidualInvestmentsMemberipoe:SocialFinanceIncMemberus-gaap:FairValueMeasurementsRecurringMember2021-01-012021-03-310001818874ipoe:ResidualInterestsClassifiedAsDebtMemberipoe:SocialFinanceIncMemberus-gaap:FairValueMeasurementsRecurringMember2021-01-012021-03-310001818874ipoe:ResidualInvestmentsMemberipoe:SocialFinanceIncMemberus-gaap:FairValueMeasurementsRecurringMember2021-03-310001818874ipoe:ResidualInterestsClassifiedAsDebtMemberipoe:SocialFinanceIncMemberus-gaap:FairValueMeasurementsRecurringMember2021-03-310001818874ipoe:ResidualInvestmentsMemberipoe:SocialFinanceIncMemberus-gaap:FairValueMeasurementsRecurringMember2019-12-310001818874ipoe:ResidualInterestsClassifiedAsDebtMemberipoe:SocialFinanceIncMemberus-gaap:FairValueMeasurementsRecurringMember2019-12-310001818874ipoe:ResidualInvestmentsMemberipoe:SocialFinanceIncMemberus-gaap:FairValueMeasurementsRecurringMember2020-01-012020-03-310001818874ipoe:ResidualInterestsClassifiedAsDebtMemberipoe:SocialFinanceIncMemberus-gaap:FairValueMeasurementsRecurringMember2020-01-012020-03-310001818874ipoe:ResidualInvestmentsMemberipoe:SocialFinanceIncMemberus-gaap:FairValueMeasurementsRecurringMember2020-03-310001818874ipoe:ResidualInterestsClassifiedAsDebtMemberipoe:SocialFinanceIncMemberus-gaap:FairValueMeasurementsRecurringMember2020-03-310001818874us-gaap:LoansMemberipoe:SocialFinanceIncMember2021-01-012021-03-310001818874us-gaap:LoansMemberipoe:SocialFinanceIncMember2020-01-012020-03-310001818874ipoe:ResidualInvestmentsMemberipoe:SocialFinanceIncMember2021-01-012021-03-310001818874ipoe:ResidualInvestmentsMemberipoe:SocialFinanceIncMember2020-01-012020-03-310001818874ipoe:MeasurementInputLoanFundingProbabilityMembersrt:MinimumMemberipoe:SocialFinanceIncMember2021-03-310001818874ipoe:MeasurementInputLoanFundingProbabilityMemberipoe:SocialFinanceIncMembersrt:MaximumMember2021-03-310001818874srt:WeightedAverageMemberipoe:MeasurementInputLoanFundingProbabilityMemberipoe:SocialFinanceIncMember2021-03-310001818874ipoe:MeasurementInputLoanFundingProbabilityMembersrt:MinimumMemberipoe:SocialFinanceIncMember2020-12-310001818874ipoe:MeasurementInputLoanFundingProbabilityMemberipoe:SocialFinanceIncMembersrt:MaximumMember2020-12-310001818874srt:WeightedAverageMemberipoe:MeasurementInputLoanFundingProbabilityMemberipoe:SocialFinanceIncMember2020-12-310001818874us-gaap:InterestRateLockCommitmentsMemberipoe:SocialFinanceIncMemberus-gaap:FairValueMeasurementsRecurringMember2020-12-310001818874us-gaap:InterestRateLockCommitmentsMemberipoe:SocialFinanceIncMemberus-gaap:FairValueMeasurementsRecurringMember2021-01-012021-03-310001818874us-gaap:InterestRateLockCommitmentsMemberipoe:SocialFinanceIncMemberus-gaap:FairValueMeasurementsRecurringMember2021-03-310001818874us-gaap:InterestRateLockCommitmentsMemberipoe:SocialFinanceIncMemberus-gaap:FairValueMeasurementsRecurringMember2019-12-310001818874us-gaap:InterestRateLockCommitmentsMemberipoe:SocialFinanceIncMemberus-gaap:FairValueMeasurementsRecurringMember2020-01-012020-03-310001818874us-gaap:InterestRateLockCommitmentsMemberipoe:SocialFinanceIncMemberus-gaap:FairValueMeasurementsRecurringMember2020-03-310001818874ipoe:SocialFinanceIncMember2020-04-012020-06-300001818874ipoe:StudentLoanWarehouseFacilitiesMemberipoe:SoFiFundingIMemberipoe:SocialFinanceIncMemberus-gaap:LineOfCreditMember2021-03-310001818874ipoe:StudentLoanWarehouseFacilitiesMemberipoe:SoFiFundingIMemberus-gaap:LondonInterbankOfferedRateLIBORMemberipoe:SocialFinanceIncMemberus-gaap:LineOfCreditMember2021-01-012021-03-310001818874ipoe:StudentLoanWarehouseFacilitiesMemberipoe:SoFiFundingIMemberipoe:SocialFinanceIncMemberus-gaap:LineOfCreditMember2020-12-310001818874ipoe:StudentLoanWarehouseFacilitiesMemberipoe:SocialFinanceIncMemberipoe:SoFiFundingIIIMemberus-gaap:LineOfCreditMember2021-03-310001818874ipoe:StudentLoanWarehouseFacilitiesMemberipoe:SocialFinanceIncMemberus-gaap:PrimeRateMemberipoe:SoFiFundingIIIMemberus-gaap:LineOfCreditMember2021-01-012021-03-310001818874ipoe:StudentLoanWarehouseFacilitiesMemberipoe:SocialFinanceIncMemberipoe:SoFiFundingIIIMemberus-gaap:LineOfCreditMember2020-12-310001818874ipoe:StudentLoanWarehouseFacilitiesMemberipoe:SoFiFundingVMemberipoe:SocialFinanceIncMemberus-gaap:LineOfCreditMember2021-03-310001818874ipoe:StudentLoanWarehouseFacilitiesMemberipoe:SoFiFundingVMemberus-gaap:LondonInterbankOfferedRateLIBORMemberipoe:SocialFinanceIncMemberus-gaap:LineOfCreditMember2021-01-012021-03-310001818874ipoe:StudentLoanWarehouseFacilitiesMemberipoe:SoFiFundingVMemberipoe:SocialFinanceIncMemberus-gaap:LineOfCreditMember2020-12-310001818874ipoe:StudentLoanWarehouseFacilitiesMemberipoe:SocialFinanceIncMemberipoe:SoFiFundingVIMemberus-gaap:LineOfCreditMember2021-03-310001818874ipoe:StudentLoanWarehouseFacilitiesMemberus-gaap:LondonInterbankOfferedRateLIBORMemberipoe:SocialFinanceIncMemberipoe:SoFiFundingVIMemberus-gaap:LineOfCreditMember2021-01-012021-03-310001818874ipoe:StudentLoanWarehouseFacilitiesMemberipoe:SocialFinanceIncMemberipoe:SoFiFundingVIMemberus-gaap:LineOfCreditMember2020-12-310001818874ipoe:StudentLoanWarehouseFacilitiesMemberipoe:SocialFinanceIncMemberipoe:SoFiFundingVIIMemberus-gaap:LineOfCreditMember2021-03-310001818874ipoe:StudentLoanWarehouseFacilitiesMemberus-gaap:LondonInterbankOfferedRateLIBORMemberipoe:SocialFinanceIncMemberipoe:SoFiFundingVIIMemberus-gaap:LineOfCreditMember2021-01-012021-03-310001818874ipoe:StudentLoanWarehouseFacilitiesMemberipoe:SocialFinanceIncMemberipoe:SoFiFundingVIIMemberus-gaap:LineOfCreditMember2020-12-310001818874ipoe:StudentLoanWarehouseFacilitiesMemberipoe:SoFiFundingVIIIMemberipoe:SocialFinanceIncMemberus-gaap:LineOfCreditMember2021-03-310001818874ipoe:StudentLoanWarehouseFacilitiesMemberipoe:SoFiFundingVIIIMemberus-gaap:LondonInterbankOfferedRateLIBORMemberipoe:SocialFinanceIncMemberus-gaap:LineOfCreditMember2021-01-012021-03-310001818874ipoe:StudentLoanWarehouseFacilitiesMemberipoe:SoFiFundingVIIIMemberipoe:SocialFinanceIncMemberus-gaap:LineOfCreditMember2020-12-310001818874ipoe:StudentLoanWarehouseFacilitiesMemberipoe:SocialFinanceIncMemberipoe:SoFiFundingIXMemberus-gaap:LineOfCreditMember2021-03-310001818874ipoe:StudentLoanWarehouseFacilitiesMemberus-gaap:LondonInterbankOfferedRateLIBORMemberipoe:SocialFinanceIncMemberipoe:SoFiFundingIXMemberus-gaap:LineOfCreditMember2021-01-012021-03-310001818874ipoe:StudentLoanWarehouseFacilitiesMemberipoe:CommercialPaperRateMemberipoe:SocialFinanceIncMemberipoe:SoFiFundingIXMemberus-gaap:LineOfCreditMember2021-01-012021-03-310001818874ipoe:StudentLoanWarehouseFacilitiesMemberipoe:SocialFinanceIncMemberipoe:SoFiFundingIXMemberus-gaap:LineOfCreditMember2020-12-310001818874ipoe:StudentLoanWarehouseFacilitiesMemberipoe:SocialFinanceIncMemberipoe:SoFiFundingXMemberus-gaap:LineOfCreditMember2021-03-310001818874ipoe:StudentLoanWarehouseFacilitiesMemberipoe:CommercialPaperRateMemberipoe:SocialFinanceIncMemberipoe:SoFiFundingXMemberus-gaap:LineOfCreditMember2021-01-012021-03-310001818874ipoe:StudentLoanWarehouseFacilitiesMemberipoe:SocialFinanceIncMemberipoe:SoFiFundingXMemberus-gaap:LineOfCreditMember2020-12-310001818874ipoe:StudentLoanWarehouseFacilitiesMemberipoe:SocialFinanceIncMemberipoe:SoFiFundingXIMemberus-gaap:LineOfCreditMember2021-03-310001818874ipoe:StudentLoanWarehouseFacilitiesMemberipoe:CommercialPaperRateMemberipoe:SocialFinanceIncMemberipoe:SoFiFundingXIMemberus-gaap:LineOfCreditMember2021-01-012021-03-310001818874ipoe:StudentLoanWarehouseFacilitiesMemberipoe:SocialFinanceIncMemberipoe:SoFiFundingXIMemberus-gaap:LineOfCreditMember2020-12-310001818874ipoe:StudentLoanWarehouseFacilitiesMemberipoe:SocialFinanceIncMemberus-gaap:LineOfCreditMember2021-03-310001818874ipoe:StudentLoanWarehouseFacilitiesMemberipoe:SocialFinanceIncMemberus-gaap:LineOfCreditMember2020-12-310001818874ipoe:SocialFinanceIncMemberipoe:SoFiFundingPLIMemberipoe:PersonalLoanWarehouseFacilitiesMemberus-gaap:LineOfCreditMember2021-03-310001818874us-gaap:LondonInterbankOfferedRateLIBORMemberipoe:SocialFinanceIncMemberipoe:SoFiFundingPLIMemberipoe:PersonalLoanWarehouseFacilitiesMemberus-gaap:LineOfCreditMember2021-01-012021-03-310001818874ipoe:SocialFinanceIncMemberipoe:SoFiFundingPLIMemberipoe:PersonalLoanWarehouseFacilitiesMemberus-gaap:LineOfCreditMember2020-12-310001818874ipoe:SocialFinanceIncMemberipoe:SoFiFundingPLIIMemberipoe:PersonalLoanWarehouseFacilitiesMemberus-gaap:LineOfCreditMember2021-03-310001818874us-gaap:LondonInterbankOfferedRateLIBORMemberipoe:SocialFinanceIncMemberipoe:SoFiFundingPLIIMemberipoe:PersonalLoanWarehouseFacilitiesMemberus-gaap:LineOfCreditMember2021-01-012021-03-310001818874ipoe:SocialFinanceIncMemberipoe:SoFiFundingPLIIMemberipoe:PersonalLoanWarehouseFacilitiesMemberus-gaap:LineOfCreditMember2020-12-310001818874ipoe:SocialFinanceIncMemberipoe:SoFiFundingPLIIIMemberipoe:PersonalLoanWarehouseFacilitiesMemberus-gaap:LineOfCreditMember2021-03-310001818874us-gaap:LondonInterbankOfferedRateLIBORMemberipoe:SocialFinanceIncMemberipoe:SoFiFundingPLIIIMemberipoe:PersonalLoanWarehouseFacilitiesMemberus-gaap:LineOfCreditMember2021-01-012021-03-310001818874ipoe:SocialFinanceIncMemberipoe:SoFiFundingPLIIIMemberipoe:PersonalLoanWarehouseFacilitiesMemberus-gaap:LineOfCreditMember2020-12-310001818874ipoe:SocialFinanceIncMemberipoe:SoFiFundingPLIVMemberipoe:PersonalLoanWarehouseFacilitiesMemberus-gaap:LineOfCreditMember2021-03-310001818874ipoe:CommercialPaperRateMemberipoe:SocialFinanceIncMemberipoe:SoFiFundingPLIVMemberipoe:PersonalLoanWarehouseFacilitiesMemberus-gaap:LineOfCreditMember2021-01-012021-03-310001818874ipoe:SocialFinanceIncMemberipoe:SoFiFundingPLIVMemberipoe:PersonalLoanWarehouseFacilitiesMemberus-gaap:LineOfCreditMember2020-12-310001818874ipoe:SocialFinanceIncMemberipoe:SoFiFundingPLVIMemberipoe:PersonalLoanWarehouseFacilitiesMemberus-gaap:LineOfCreditMember2021-03-310001818874us-gaap:LondonInterbankOfferedRateLIBORMemberipoe:SocialFinanceIncMemberipoe:SoFiFundingPLVIMemberipoe:PersonalLoanWarehouseFacilitiesMemberus-gaap:LineOfCreditMember2021-01-012021-03-310001818874ipoe:SocialFinanceIncMemberipoe:SoFiFundingPLVIMemberipoe:PersonalLoanWarehouseFacilitiesMemberus-gaap:LineOfCreditMember2020-12-310001818874ipoe:SoFiFundingPLVIIMemberipoe:SocialFinanceIncMemberipoe:PersonalLoanWarehouseFacilitiesMemberus-gaap:LineOfCreditMember2021-03-310001818874ipoe:SoFiFundingPLVIIMemberus-gaap:LondonInterbankOfferedRateLIBORMemberipoe:SocialFinanceIncMemberipoe:PersonalLoanWarehouseFacilitiesMemberus-gaap:LineOfCreditMember2021-01-012021-03-310001818874ipoe:SoFiFundingPLVIIMemberipoe:SocialFinanceIncMemberipoe:PersonalLoanWarehouseFacilitiesMemberus-gaap:LineOfCreditMember2020-12-310001818874ipoe:SocialFinanceIncMemberipoe:SoFiFundingPLXMemberipoe:PersonalLoanWarehouseFacilitiesMemberus-gaap:LineOfCreditMember2021-03-310001818874us-gaap:LondonInterbankOfferedRateLIBORMemberipoe:SocialFinanceIncMemberipoe:SoFiFundingPLXMemberipoe:PersonalLoanWarehouseFacilitiesMemberus-gaap:LineOfCreditMember2021-01-012021-03-310001818874ipoe:SocialFinanceIncMemberipoe:SoFiFundingPLXMemberipoe:PersonalLoanWarehouseFacilitiesMemberus-gaap:LineOfCreditMember2020-12-310001818874ipoe:SoFiFundingPLXIMemberipoe:SocialFinanceIncMemberipoe:PersonalLoanWarehouseFacilitiesMemberus-gaap:LineOfCreditMember2021-03-310001818874ipoe:SoFiFundingPLXIMemberus-gaap:LondonInterbankOfferedRateLIBORMemberipoe:SocialFinanceIncMemberipoe:PersonalLoanWarehouseFacilitiesMemberus-gaap:LineOfCreditMember2021-01-012021-03-310001818874ipoe:SoFiFundingPLXIMemberipoe:SocialFinanceIncMemberipoe:PersonalLoanWarehouseFacilitiesMemberus-gaap:LineOfCreditMember2020-12-310001818874ipoe:SocialFinanceIncMemberipoe:SoFiFundingPLXIIMemberipoe:PersonalLoanWarehouseFacilitiesMemberus-gaap:LineOfCreditMember2021-03-310001818874srt:MinimumMemberus-gaap:LondonInterbankOfferedRateLIBORMemberipoe:SocialFinanceIncMemberipoe:SoFiFundingPLXIIMemberipoe:PersonalLoanWarehouseFacilitiesMemberus-gaap:LineOfCreditMember2021-01-012021-03-310001818874us-gaap:LondonInterbankOfferedRateLIBORMemberipoe:SocialFinanceIncMemberipoe:SoFiFundingPLXIIMemberipoe:PersonalLoanWarehouseFacilitiesMemberus-gaap:LineOfCreditMembersrt:MaximumMember2021-01-012021-03-310001818874ipoe:SocialFinanceIncMemberipoe:SoFiFundingPLXIIMemberipoe:PersonalLoanWarehouseFacilitiesMemberus-gaap:LineOfCreditMember2020-12-310001818874ipoe:SocialFinanceIncMemberipoe:SoFiFundingPLXIIIMemberipoe:PersonalLoanWarehouseFacilitiesMemberus-gaap:LineOfCreditMember2021-03-310001818874us-gaap:LondonInterbankOfferedRateLIBORMemberipoe:SocialFinanceIncMemberipoe:SoFiFundingPLXIIIMemberipoe:PersonalLoanWarehouseFacilitiesMemberus-gaap:LineOfCreditMember2021-01-012021-03-310001818874ipoe:SocialFinanceIncMemberipoe:SoFiFundingPLXIIIMemberipoe:PersonalLoanWarehouseFacilitiesMemberus-gaap:LineOfCreditMember2020-12-310001818874ipoe:SocialFinanceIncMemberipoe:PersonalLoanWarehouseFacilitiesMemberus-gaap:LineOfCreditMember2021-03-310001818874ipoe:SocialFinanceIncMemberipoe:PersonalLoanWarehouseFacilitiesMemberus-gaap:LineOfCreditMember2020-12-310001818874ipoe:SocialFinanceIncMemberipoe:HomeLoanWarehouseFacilitiesMemberipoe:MortgageWarehouseVMemberus-gaap:LineOfCreditMember2021-03-310001818874us-gaap:LondonInterbankOfferedRateLIBORMemberipoe:SocialFinanceIncMemberipoe:HomeLoanWarehouseFacilitiesMemberipoe:MortgageWarehouseVMemberus-gaap:LineOfCreditMember2021-01-012021-03-310001818874ipoe:SocialFinanceIncMemberipoe:HomeLoanWarehouseFacilitiesMemberipoe:MortgageWarehouseVMemberus-gaap:LineOfCreditMember2020-12-310001818874ipoe:SocialFinanceIncMemberipoe:HomeLoanWarehouseFacilitiesMemberus-gaap:LineOfCreditMember2021-03-310001818874ipoe:SocialFinanceIncMemberipoe:HomeLoanWarehouseFacilitiesMemberus-gaap:LineOfCreditMember2020-12-310001818874ipoe:SocialFinanceIncMemberipoe:RiskRetentionWarehouseFacilitiesMemberipoe:SoFiRRFundingIMemberus-gaap:LineOfCreditMember2021-03-310001818874us-gaap:LondonInterbankOfferedRateLIBORMemberipoe:SocialFinanceIncMemberipoe:RiskRetentionWarehouseFacilitiesMemberipoe:SoFiRRFundingIMemberus-gaap:LineOfCreditMember2021-01-012021-03-310001818874ipoe:SocialFinanceIncMemberipoe:RiskRetentionWarehouseFacilitiesMemberipoe:SoFiRRFundingIMemberus-gaap:LineOfCreditMember2020-12-310001818874ipoe:SocialFinanceIncMemberipoe:SoFiRRRepoMemberipoe:RiskRetentionWarehouseFacilitiesMemberus-gaap:LineOfCreditMember2021-03-310001818874us-gaap:LondonInterbankOfferedRateLIBORMemberipoe:SocialFinanceIncMemberipoe:SoFiRRRepoMemberipoe:RiskRetentionWarehouseFacilitiesMemberus-gaap:LineOfCreditMember2021-01-012021-03-310001818874ipoe:SocialFinanceIncMemberipoe:SoFiRRRepoMemberipoe:RiskRetentionWarehouseFacilitiesMemberus-gaap:LineOfCreditMember2020-12-310001818874ipoe:SoFiEURRRepoMemberipoe:SocialFinanceIncMemberipoe:RiskRetentionWarehouseFacilitiesMemberus-gaap:LineOfCreditMember2021-03-310001818874ipoe:SoFiEURRRepoMemberus-gaap:LondonInterbankOfferedRateLIBORMemberipoe:SocialFinanceIncMemberipoe:RiskRetentionWarehouseFacilitiesMemberus-gaap:LineOfCreditMember2021-01-012021-03-310001818874ipoe:SoFiEURRRepoMemberipoe:SocialFinanceIncMemberipoe:RiskRetentionWarehouseFacilitiesMemberus-gaap:LineOfCreditMember2020-12-310001818874ipoe:SocialFinanceIncMemberipoe:SoFiCRRRepoMemberipoe:RiskRetentionWarehouseFacilitiesMemberus-gaap:LineOfCreditMember2021-03-310001818874srt:MinimumMemberus-gaap:LondonInterbankOfferedRateLIBORMemberipoe:SocialFinanceIncMemberipoe:SoFiCRRRepoMemberipoe:RiskRetentionWarehouseFacilitiesMemberus-gaap:LineOfCreditMember2021-01-012021-03-310001818874us-gaap:LondonInterbankOfferedRateLIBORMemberipoe:SocialFinanceIncMemberipoe:SoFiCRRRepoMemberipoe:RiskRetentionWarehouseFacilitiesMemberus-gaap:LineOfCreditMembersrt:MaximumMember2021-01-012021-03-310001818874ipoe:SocialFinanceIncMemberipoe:SoFiCRRRepoMemberipoe:RiskRetentionWarehouseFacilitiesMemberus-gaap:LineOfCreditMember2020-12-310001818874ipoe:SoFiRRFundingIIMemberipoe:SocialFinanceIncMemberipoe:RiskRetentionWarehouseFacilitiesMemberus-gaap:LineOfCreditMember2021-03-310001818874ipoe:SoFiRRFundingIIMemberus-gaap:LondonInterbankOfferedRateLIBORMemberipoe:SocialFinanceIncMemberipoe:RiskRetentionWarehouseFacilitiesMemberus-gaap:LineOfCreditMember2021-01-012021-03-310001818874ipoe:SoFiRRFundingIIMemberipoe:SocialFinanceIncMemberipoe:RiskRetentionWarehouseFacilitiesMemberus-gaap:LineOfCreditMember2020-12-310001818874ipoe:SoFiRRFundingIIIMemberipoe:SocialFinanceIncMemberipoe:RiskRetentionWarehouseFacilitiesMemberus-gaap:LineOfCreditMember2021-03-310001818874ipoe:SoFiRRFundingIIIMemberus-gaap:LondonInterbankOfferedRateLIBORMemberipoe:SocialFinanceIncMemberipoe:RiskRetentionWarehouseFacilitiesMemberus-gaap:LineOfCreditMember2021-01-012021-03-310001818874ipoe:SoFiRRFundingIIIMemberipoe:SocialFinanceIncMemberipoe:RiskRetentionWarehouseFacilitiesMemberus-gaap:LineOfCreditMember2020-12-310001818874ipoe:SocialFinanceIncMemberipoe:RiskRetentionWarehouseFacilitiesMemberipoe:SoFiRRFundingIVMemberus-gaap:LineOfCreditMember2021-03-310001818874us-gaap:LondonInterbankOfferedRateLIBORMemberipoe:SocialFinanceIncMemberipoe:RiskRetentionWarehouseFacilitiesMemberipoe:SoFiRRFundingIVMemberus-gaap:LineOfCreditMember2021-01-012021-03-310001818874ipoe:SocialFinanceIncMemberipoe:RiskRetentionWarehouseFacilitiesMemberipoe:SoFiRRFundingIVMemberus-gaap:LineOfCreditMember2020-12-310001818874ipoe:SoFiRRFundingVMemberipoe:SocialFinanceIncMemberipoe:RiskRetentionWarehouseFacilitiesMemberus-gaap:LineOfCreditMember2021-03-310001818874ipoe:SoFiRRFundingVMemberipoe:SocialFinanceIncMemberipoe:RiskRetentionWarehouseFacilitiesMemberus-gaap:LineOfCreditMember2020-12-310001818874ipoe:SocialFinanceIncMemberipoe:RiskRetentionWarehouseFacilitiesMemberus-gaap:LineOfCreditMember2021-03-310001818874ipoe:SocialFinanceIncMemberipoe:RiskRetentionWarehouseFacilitiesMemberus-gaap:LineOfCreditMember2020-12-310001818874us-gaap:RevolvingCreditFacilityMemberus-gaap:LondonInterbankOfferedRateLIBORMemberipoe:SocialFinanceIncMemberus-gaap:RevolvingCreditFacilityMemberipoe:SoFiCorporateRevolverMember2021-01-012021-03-310001818874us-gaap:RevolvingCreditFacilityMemberipoe:SocialFinanceIncMemberus-gaap:RevolvingCreditFacilityMemberipoe:SoFiCorporateRevolverMember2021-03-310001818874us-gaap:RevolvingCreditFacilityMemberipoe:SocialFinanceIncMemberus-gaap:RevolvingCreditFacilityMemberipoe:SoFiCorporateRevolverMember2020-12-310001818874ipoe:SocialFinanceIncMemberus-gaap:LondonInterbankOfferedRateLIBORMemberipoe:SellerNoteMemberus-gaap:NotesPayableOtherPayablesMember2021-03-310001818874ipoe:SocialFinanceIncMemberipoe:SellerNoteMemberus-gaap:NotesPayableOtherPayablesMember2021-03-310001818874ipoe:SocialFinanceIncMemberipoe:SellerNoteMemberus-gaap:NotesPayableOtherPayablesMember2020-12-310001818874srt:MinimumMemberus-gaap:LondonInterbankOfferedRateLIBORMemberipoe:SocialFinanceIncMemberipoe:OtherFinancingNotesMemberus-gaap:NotesPayableOtherPayablesMember2021-03-310001818874us-gaap:LondonInterbankOfferedRateLIBORMemberipoe:SocialFinanceIncMemberipoe:OtherFinancingNotesMemberus-gaap:NotesPayableOtherPayablesMembersrt:MaximumMember2021-03-310001818874ipoe:SocialFinanceIncMemberipoe:OtherFinancingNotesMemberus-gaap:NotesPayableOtherPayablesMember2021-03-310001818874ipoe:SocialFinanceIncMemberipoe:OtherFinancingNotesMemberus-gaap:NotesPayableOtherPayablesMember2020-12-310001818874ipoe:LoanSecuritizationsMemberipoe:SocialFinanceIncMemberipoe:SoFiPLP2016BLLCMember2021-03-310001818874srt:MinimumMemberipoe:LoanSecuritizationsMemberus-gaap:LondonInterbankOfferedRateLIBORMemberipoe:SocialFinanceIncMemberipoe:SoFiPLP2016BLLCMember2021-01-012021-03-310001818874ipoe:LoanSecuritizationsMemberus-gaap:LondonInterbankOfferedRateLIBORMemberipoe:SocialFinanceIncMemberipoe:SoFiPLP2016BLLCMembersrt:MaximumMember2021-01-012021-03-310001818874ipoe:LoanSecuritizationsMemberipoe:SocialFinanceIncMemberipoe:SoFiPLP2016BLLCMember2020-12-310001818874ipoe:LoanSecuritizationsMemberipoe:SocialFinanceIncMemberipoe:SoFiPLP2016CLLCMember2021-03-310001818874srt:MinimumMemberipoe:LoanSecuritizationsMemberus-gaap:LondonInterbankOfferedRateLIBORMemberipoe:SocialFinanceIncMemberipoe:SoFiPLP2016CLLCMember2021-01-012021-03-310001818874ipoe:LoanSecuritizationsMemberus-gaap:LondonInterbankOfferedRateLIBORMemberipoe:SocialFinanceIncMemberipoe:SoFiPLP2016CLLCMembersrt:MaximumMember2021-01-012021-03-310001818874ipoe:LoanSecuritizationsMemberipoe:SocialFinanceIncMemberipoe:SoFiPLP2016CLLCMember2020-12-310001818874ipoe:LoanSecuritizationsMemberipoe:SocialFinanceIncMemberipoe:SoFiPLP2016DLLCMember2021-03-310001818874srt:MinimumMemberipoe:LoanSecuritizationsMemberus-gaap:LondonInterbankOfferedRateLIBORMemberipoe:SocialFinanceIncMemberipoe:SoFiPLP2016DLLCMember2021-01-012021-03-310001818874ipoe:LoanSecuritizationsMemberus-gaap:LondonInterbankOfferedRateLIBORMemberipoe:SocialFinanceIncMemberipoe:SoFiPLP2016DLLCMembersrt:MaximumMember2021-01-012021-03-310001818874ipoe:LoanSecuritizationsMemberipoe:SocialFinanceIncMemberipoe:SoFiPLP2016DLLCMember2020-12-310001818874ipoe:LoanSecuritizationsMemberipoe:SocialFinanceIncMemberipoe:SoFiPLP2016ELLCMember2021-03-310001818874srt:MinimumMemberipoe:LoanSecuritizationsMemberus-gaap:LondonInterbankOfferedRateLIBORMemberipoe:SocialFinanceIncMemberipoe:SoFiPLP2016ELLCMember2021-01-012021-03-310001818874ipoe:LoanSecuritizationsMemberus-gaap:LondonInterbankOfferedRateLIBORMemberipoe:SocialFinanceIncMemberipoe:SoFiPLP2016ELLCMembersrt:MaximumMember2021-01-012021-03-310001818874ipoe:LoanSecuritizationsMemberipoe:SocialFinanceIncMemberipoe:SoFiPLP2016ELLCMember2020-12-310001818874ipoe:LoanSecuritizationsMemberipoe:SocialFinanceIncMemberipoe:SoFiPLP2017ALLCMember2021-03-310001818874srt:MinimumMemberipoe:LoanSecuritizationsMemberus-gaap:LondonInterbankOfferedRateLIBORMemberipoe:SocialFinanceIncMemberipoe:SoFiPLP2017ALLCMember2021-01-012021-03-310001818874ipoe:LoanSecuritizationsMemberus-gaap:LondonInterbankOfferedRateLIBORMemberipoe:SocialFinanceIncMemberipoe:SoFiPLP2017ALLCMembersrt:MaximumMember2021-01-012021-03-310001818874ipoe:LoanSecuritizationsMemberipoe:SocialFinanceIncMemberipoe:SoFiPLP2017ALLCMember2020-12-310001818874ipoe:LoanSecuritizationsMemberipoe:SocialFinanceIncMemberipoe:SoFiPLP2017BLLCMember2021-03-310001818874srt:MinimumMemberipoe:LoanSecuritizationsMemberipoe:SocialFinanceIncMemberipoe:SoFiPLP2017BLLCMember2021-03-310001818874ipoe:LoanSecuritizationsMemberipoe:SocialFinanceIncMemberipoe:SoFiPLP2017BLLCMembersrt:MaximumMember2021-03-310001818874ipoe:LoanSecuritizationsMemberipoe:SocialFinanceIncMemberipoe:SoFiPLP2017BLLCMember2020-12-310001818874ipoe:LoanSecuritizationsMemberipoe:SocialFinanceIncMemberipoe:SoFiPLP2017CLLCMember2021-03-310001818874srt:MinimumMemberipoe:LoanSecuritizationsMemberus-gaap:LondonInterbankOfferedRateLIBORMemberipoe:SocialFinanceIncMemberipoe:SoFiPLP2017CLLCMember2021-01-012021-03-310001818874ipoe:LoanSecuritizationsMemberus-gaap:LondonInterbankOfferedRateLIBORMemberipoe:SocialFinanceIncMemberipoe:SoFiPLP2017CLLCMembersrt:MaximumMember2021-01-012021-03-310001818874ipoe:LoanSecuritizationsMemberipoe:SocialFinanceIncMemberipoe:SoFiPLP2017CLLCMember2020-12-310001818874ipoe:LoanSecuritizationsMemberipoe:SocialFinanceIncMember2021-03-310001818874ipoe:LoanSecuritizationsMemberipoe:SocialFinanceIncMember2020-12-310001818874ipoe:SoFiCLP20161LLCMemberipoe:SocialFinanceIncMemberipoe:PersonalLoanSecuritizationsMember2021-03-310001818874ipoe:SoFiCLP20161LLCMemberipoe:SocialFinanceIncMemberipoe:PersonalLoanSecuritizationsMember2020-12-310001818874ipoe:SocialFinanceIncMemberipoe:SoFiCLP20162LLCMemberipoe:PersonalLoanSecuritizationsMember2021-03-310001818874srt:MinimumMemberipoe:SocialFinanceIncMemberipoe:SoFiCLP20162LLCMemberipoe:PersonalLoanSecuritizationsMember2021-03-310001818874ipoe:SocialFinanceIncMemberipoe:SoFiCLP20162LLCMemberipoe:PersonalLoanSecuritizationsMembersrt:MaximumMember2021-03-310001818874ipoe:SocialFinanceIncMemberipoe:SoFiCLP20162LLCMemberipoe:PersonalLoanSecuritizationsMember2020-12-310001818874ipoe:SocialFinanceIncMemberipoe:SoFiCLP20163LLCMemberipoe:PersonalLoanSecuritizationsMember2021-03-310001818874srt:MinimumMemberipoe:SocialFinanceIncMemberipoe:SoFiCLP20163LLCMemberipoe:PersonalLoanSecuritizationsMember2021-03-310001818874ipoe:SocialFinanceIncMemberipoe:SoFiCLP20163LLCMemberipoe:PersonalLoanSecuritizationsMembersrt:MaximumMember2021-03-310001818874ipoe:SocialFinanceIncMemberipoe:SoFiCLP20163LLCMemberipoe:PersonalLoanSecuritizationsMember2020-12-310001818874ipoe:SocialFinanceIncMemberipoe:SoFiCLP20183LLCMemberipoe:PersonalLoanSecuritizationsMember2021-03-310001818874srt:MinimumMemberipoe:SocialFinanceIncMemberipoe:SoFiCLP20183LLCMemberipoe:PersonalLoanSecuritizationsMember2021-03-310001818874ipoe:SocialFinanceIncMemberipoe:SoFiCLP20183LLCMemberipoe:PersonalLoanSecuritizationsMembersrt:MaximumMember2021-03-310001818874ipoe:SocialFinanceIncMemberipoe:SoFiCLP20183LLCMemberipoe:PersonalLoanSecuritizationsMember2020-12-310001818874ipoe:SocialFinanceIncMemberipoe:SoFiCLP20184LLCMemberipoe:PersonalLoanSecuritizationsMember2021-03-310001818874srt:MinimumMemberipoe:SocialFinanceIncMemberipoe:SoFiCLP20184LLCMemberipoe:PersonalLoanSecuritizationsMember2021-03-310001818874ipoe:SocialFinanceIncMemberipoe:SoFiCLP20184LLCMemberipoe:PersonalLoanSecuritizationsMembersrt:MaximumMember2021-03-310001818874ipoe:SocialFinanceIncMemberipoe:SoFiCLP20184LLCMemberipoe:PersonalLoanSecuritizationsMember2020-12-310001818874ipoe:SocialFinanceIncMemberipoe:SoFiCLP20183RepackLLCMemberipoe:PersonalLoanSecuritizationsMember2021-03-310001818874ipoe:SocialFinanceIncMemberipoe:SoFiCLP20183RepackLLCMemberipoe:PersonalLoanSecuritizationsMember2020-12-310001818874ipoe:SocialFinanceIncMemberipoe:SoFiCLP20184RepackLLCMemberipoe:PersonalLoanSecuritizationsMember2021-03-310001818874ipoe:SocialFinanceIncMemberipoe:SoFiCLP20184RepackLLCMemberipoe:PersonalLoanSecuritizationsMember2020-12-310001818874ipoe:SocialFinanceIncMemberipoe:PersonalLoanSecuritizationsMember2021-03-310001818874ipoe:SocialFinanceIncMemberipoe:PersonalLoanSecuritizationsMember2020-12-310001818874ipoe:SocialFinanceIncMemberus-gaap:RevolvingCreditFacilityMemberipoe:SoFiCorporateRevolverMember2020-12-310001818874srt:MinimumMemberipoe:SocialFinanceIncMember2021-01-012021-03-310001818874ipoe:SocialFinanceIncMembersrt:MaximumMember2021-01-012021-03-310001818874srt:MinimumMemberipoe:SocialFinanceIncMemberus-gaap:PrimeRateMemberipoe:SoFiFundingIIIMember2021-01-012021-03-310001818874ipoe:CommercialPaperRateMemberipoe:SocialFinanceIncMemberipoe:SoFiFundingIXMember2021-01-012021-03-310001818874ipoe:CommercialPaperRateMemberipoe:SocialFinanceIncMemberipoe:SoFiFundingIXMember2020-01-012020-12-310001818874ipoe:CommercialPaperRateMemberipoe:SocialFinanceIncMemberipoe:SoFiFundingXMember2021-01-012021-03-310001818874ipoe:CommercialPaperRateMemberipoe:SocialFinanceIncMemberipoe:SoFiFundingXMember2020-01-012020-12-310001818874ipoe:CommercialPaperRateMemberipoe:SocialFinanceIncMemberipoe:SoFiFundingXIMember2021-01-012021-03-310001818874ipoe:CommercialPaperRateMemberipoe:SocialFinanceIncMemberipoe:SoFiFundingXIMember2020-01-012020-12-310001818874ipoe:CommercialPaperRateMemberipoe:SocialFinanceIncMemberipoe:SoFiFundingPLIMember2021-01-012021-03-310001818874ipoe:CommercialPaperRateMemberipoe:SocialFinanceIncMemberipoe:SoFiFundingPLIVMember2021-01-012021-03-310001818874ipoe:CommercialPaperRateMemberipoe:SocialFinanceIncMemberipoe:SoFiFundingPLIVMember2020-01-012020-12-310001818874ipoe:CommercialPaperRateMemberipoe:SocialFinanceIncMemberipoe:SoFiFundingPLVIMember2021-01-012021-03-310001818874us-gaap:RevolvingCreditFacilityMemberipoe:SocialFinanceIncMemberipoe:SellerNoteMember2021-01-012021-03-31ipoe:loan0001818874ipoe:SocialFinanceIncMemberipoe:RiskRetentionWarehouseFacilitiesMember2021-01-012021-03-310001818874ipoe:SocialFinanceIncMemberipoe:Series1RedeemablePreferredStockMember2021-03-310001818874ipoe:SocialFinanceIncMemberipoe:Series1RedeemablePreferredStockMember2020-12-310001818874ipoe:SocialFinanceIncMemberipoe:SeriesARedeemablePreferredStockMember2021-03-310001818874ipoe:SocialFinanceIncMemberipoe:SeriesARedeemablePreferredStockMember2020-12-310001818874ipoe:SocialFinanceIncMemberipoe:SeriesBRedeemablePreferredStockMember2021-03-310001818874ipoe:SocialFinanceIncMemberipoe:SeriesBRedeemablePreferredStockMember2020-12-310001818874srt:MinimumMemberipoe:SocialFinanceIncMemberipoe:SeriesCRedeemablePreferredStockMember2021-03-310001818874ipoe:SocialFinanceIncMemberipoe:SeriesCRedeemablePreferredStockMembersrt:MaximumMember2021-03-310001818874ipoe:SocialFinanceIncMemberipoe:SeriesCRedeemablePreferredStockMember2021-03-310001818874ipoe:SocialFinanceIncMemberipoe:SeriesCRedeemablePreferredStockMember2020-12-310001818874ipoe:SeriesDRedeemablePreferredStockMemberipoe:SocialFinanceIncMember2021-03-310001818874ipoe:SeriesDRedeemablePreferredStockMemberipoe:SocialFinanceIncMember2020-12-310001818874ipoe:SocialFinanceIncMemberipoe:SeriesERedeemablePreferredStockMember2021-03-310001818874ipoe:SocialFinanceIncMemberipoe:SeriesERedeemablePreferredStockMember2020-12-310001818874ipoe:SocialFinanceIncMemberipoe:SeriesFRedeemablePreferredStockMember2021-03-310001818874ipoe:SocialFinanceIncMemberipoe:SeriesFRedeemablePreferredStockMember2020-12-310001818874ipoe:SocialFinanceIncMemberipoe:SeriesGRedeemablePreferredStockMember2021-03-310001818874ipoe:SocialFinanceIncMemberipoe:SeriesGRedeemablePreferredStockMember2020-12-310001818874ipoe:SocialFinanceIncMemberipoe:SeriesHRedeemablePreferredStockMember2021-03-310001818874ipoe:SocialFinanceIncMemberipoe:SeriesHRedeemablePreferredStockMember2020-12-310001818874ipoe:SocialFinanceIncMemberipoe:SeriesH1RedeemablePreferredStockMember2021-03-310001818874ipoe:SocialFinanceIncMemberipoe:SeriesH1RedeemablePreferredStockMember2020-12-310001818874ipoe:SocialFinanceIncMemberus-gaap:RedeemablePreferredStockMember2020-12-012020-12-310001818874ipoe:SocialFinanceIncMemberipoe:SeriesBRedeemablePreferredStockMember2020-12-012020-12-310001818874ipoe:SeriesDRedeemablePreferredStockMemberipoe:SocialFinanceIncMember2020-12-012020-12-310001818874ipoe:SocialFinanceIncMemberipoe:SeriesERedeemablePreferredStockMember2020-12-012020-12-310001818874ipoe:SocialFinanceIncMemberipoe:SeriesFRedeemablePreferredStockMember2020-12-012020-12-310001818874ipoe:SocialFinanceIncMemberus-gaap:RedeemablePreferredStockMember2020-01-012020-12-310001818874ipoe:SocialFinanceIncMemberipoe:SeriesH1RedeemablePreferredStockMemberipoe:GalileoFinancialTechnologiesIncMember2020-05-012020-05-310001818874ipoe:SocialFinanceIncMemberipoe:InitialPublicOfferingMember2020-05-290001818874ipoe:SpecialPaymentOfferingMemberipoe:SocialFinanceIncMember2020-05-290001818874ipoe:SocialFinanceIncMemberipoe:Series1RedeemablePreferredStockMember2021-01-012021-03-310001818874ipoe:SocialFinanceIncMemberipoe:SeriesARedeemablePreferredStockMember2021-01-012021-03-310001818874ipoe:SocialFinanceIncMemberipoe:SeriesARedeemablePreferredStockMember2020-01-012020-12-310001818874ipoe:SocialFinanceIncMemberipoe:SeriesBRedeemablePreferredStockMember2021-01-012021-03-310001818874ipoe:SocialFinanceIncMemberipoe:SeriesBRedeemablePreferredStockMember2020-01-012020-12-310001818874ipoe:SeriesDRedeemablePreferredStockMemberipoe:SocialFinanceIncMember2021-01-012021-03-310001818874ipoe:SeriesDRedeemablePreferredStockMemberipoe:SocialFinanceIncMember2020-01-012020-12-310001818874ipoe:SocialFinanceIncMemberipoe:SeriesERedeemablePreferredStockMember2021-01-012021-03-310001818874ipoe:SocialFinanceIncMemberipoe:SeriesERedeemablePreferredStockMember2020-01-012020-12-310001818874ipoe:SocialFinanceIncMemberipoe:SeriesFRedeemablePreferredStockMember2021-01-012021-03-310001818874ipoe:SocialFinanceIncMemberipoe:SeriesFRedeemablePreferredStockMember2020-01-012020-12-310001818874ipoe:SocialFinanceIncMemberipoe:SeriesGRedeemablePreferredStockMember2021-01-012021-03-310001818874ipoe:SocialFinanceIncMemberipoe:SeriesGRedeemablePreferredStockMember2020-01-012020-12-310001818874ipoe:SocialFinanceIncMemberipoe:SeriesHRedeemablePreferredStockMember2021-01-012021-03-310001818874ipoe:SocialFinanceIncMemberipoe:SeriesHRedeemablePreferredStockMember2020-01-012020-12-310001818874ipoe:SocialFinanceIncMemberipoe:SeriesH1RedeemablePreferredStockMember2021-01-012021-03-310001818874ipoe:SocialFinanceIncMemberipoe:SeriesH1RedeemablePreferredStockMember2020-01-012020-12-310001818874ipoe:SocialFinanceIncMemberipoe:Series1RedeemablePreferredStockMember2019-05-292019-05-290001818874ipoe:SocialFinanceIncMemberipoe:Series1RedeemablePreferredStockMember2020-03-310001818874srt:MinimumMemberipoe:SocialFinanceIncMemberipoe:Series1RedeemablePreferredStockMemberipoe:InitialPublicOfferingMember2021-03-310001818874srt:MinimumMemberipoe:SocialFinanceIncMemberipoe:Series1RedeemablePreferredStockMemberipoe:InitialPublicOfferingMember2021-01-012021-03-310001818874ipoe:SocialFinanceIncMemberipoe:SeriesCRedeemablePreferredStockMember2021-01-012021-03-310001818874ipoe:SeriesAAndBRedeemablePreferredStockMemberipoe:SocialFinanceIncMember2021-03-310001818874ipoe:SocialFinanceIncMemberipoe:SeriesDAndERedeemablePreferredStockMember2021-03-310001818874ipoe:SocialFinanceIncMemberipoe:WarrantToPurchaseSeriesHRedeemablePreferredStockMember2019-12-310001818874ipoe:SocialFinanceIncMemberipoe:Series1AndSeriesHRedeemablePreferredStockMember2019-05-292019-05-290001818874us-gaap:MeasurementInputRiskFreeInterestRateMemberipoe:SocialFinanceIncMember2021-03-310001818874us-gaap:MeasurementInputRiskFreeInterestRateMemberipoe:SocialFinanceIncMember2020-12-310001818874us-gaap:MeasurementInputRiskFreeInterestRateMemberipoe:SocialFinanceIncMember2019-05-290001818874ipoe:SocialFinanceIncMemberus-gaap:MeasurementInputExpectedTermMember2021-03-310001818874ipoe:SocialFinanceIncMemberus-gaap:MeasurementInputExpectedTermMember2020-12-310001818874ipoe:SocialFinanceIncMemberus-gaap:MeasurementInputExpectedTermMember2019-05-290001818874ipoe:SocialFinanceIncMemberus-gaap:MeasurementInputPriceVolatilityMember2021-03-310001818874ipoe:SocialFinanceIncMemberus-gaap:MeasurementInputPriceVolatilityMember2020-12-310001818874ipoe:SocialFinanceIncMemberus-gaap:MeasurementInputPriceVolatilityMember2019-05-290001818874ipoe:SocialFinanceIncMemberus-gaap:MeasurementInputExpectedDividendRateMember2021-03-310001818874ipoe:SocialFinanceIncMemberus-gaap:MeasurementInputExpectedDividendRateMember2020-12-310001818874ipoe:SocialFinanceIncMemberus-gaap:MeasurementInputExpectedDividendRateMember2019-05-290001818874ipoe:SocialFinanceIncMember2019-05-290001818874ipoe:SocialFinanceIncMemberipoe:SeriesHRedeemablePreferredStockMember2019-05-290001818874ipoe:SocialFinanceIncMemberipoe:CommonStockTransactionMemberus-gaap:CommonStockMember2020-12-310001818874ipoe:SocialFinanceIncMemberipoe:SeriesHRedeemablePreferredStockMember2019-05-292019-05-290001818874ipoe:SocialFinanceIncMemberipoe:WarrantLiabilityMember2020-12-310001818874ipoe:SocialFinanceIncMemberipoe:WarrantLiabilityMember2021-01-012021-03-310001818874ipoe:SocialFinanceIncMemberipoe:WarrantLiabilityMember2021-03-310001818874ipoe:SocialFinanceIncMemberipoe:WarrantLiabilityMember2019-12-310001818874ipoe:SocialFinanceIncMemberipoe:WarrantLiabilityMember2020-01-012020-03-310001818874ipoe:SocialFinanceIncMemberipoe:WarrantLiabilityMember2020-03-310001818874ipoe:SocialFinanceIncMemberus-gaap:CommonStockMember2021-03-310001818874ipoe:SocialFinanceIncMemberus-gaap:CommonStockMember2020-12-310001818874ipoe:CommonStockIssuanceMemberipoe:SocialFinanceIncMemberus-gaap:CommonStockMember2020-12-012020-12-310001818874ipoe:CommonStockIssuanceMemberipoe:SocialFinanceIncMember2020-12-012020-12-310001818874ipoe:CommonStockIssuanceMemberipoe:SocialFinanceIncMember2020-01-012020-12-310001818874ipoe:SocialFinanceIncMemberus-gaap:RedeemablePreferredStockMember2021-03-310001818874ipoe:SocialFinanceIncMemberus-gaap:RedeemablePreferredStockMember2020-12-310001818874ipoe:SocialFinanceIncMemberipoe:UnissuedRedeemablePreferredStockReservedForIssuedWarrantsMember2021-03-310001818874ipoe:SocialFinanceIncMemberipoe:UnissuedRedeemablePreferredStockReservedForIssuedWarrantsMember2020-12-310001818874ipoe:SocialFinanceIncMemberipoe:UnissuedRedeemablePreferredStockMember2021-03-310001818874ipoe:SocialFinanceIncMemberipoe:UnissuedRedeemablePreferredStockMember2020-12-310001818874ipoe:SocialFinanceIncMemberipoe:EmployeeStockOptionAndRestrictedStockUnitsMember2021-03-310001818874ipoe:SocialFinanceIncMemberipoe:EmployeeStockOptionAndRestrictedStockUnitsMember2020-12-310001818874ipoe:SocialFinanceIncMemberipoe:AmendedAndRestated2011StockOptionPlanMember2021-03-310001818874ipoe:SocialFinanceIncMemberipoe:AmendedAndRestated2011StockOptionPlanMember2020-12-310001818874ipoe:SocialFinanceIncMemberipoe:ContingentCommonStockAcquisitionsMember2021-03-310001818874ipoe:SocialFinanceIncMemberipoe:ContingentCommonStockAcquisitionsMember2020-12-310001818874ipoe:SocialFinanceIncMemberipoe:ContingentCommonStockAcquisitionsMemberipoe:A8LimitedMember2020-12-310001818874ipoe:SocialFinanceIncMemberipoe:ContingentCommonStockAcquisitionsMemberipoe:A8LimitedMember2021-03-310001818874ipoe:SocialFinanceIncMemberipoe:ContingentCommonStockAdjustmentToStockIssuanceMemberipoe:A8LimitedMember2021-03-310001818874ipoe:StockPlanAssumedInBusinessCombinationMemberipoe:SocialFinanceIncMember2021-03-310001818874ipoe:SocialFinanceIncMemberus-gaap:RestrictedStockUnitsRSUMember2021-01-012021-03-310001818874ipoe:SocialFinanceIncMemberus-gaap:RestrictedStockUnitsRSUMember2020-01-012020-03-310001818874ipoe:SocialFinanceIncMemberus-gaap:ResearchAndDevelopmentExpenseMember2021-01-012021-03-310001818874ipoe:SocialFinanceIncMemberus-gaap:ResearchAndDevelopmentExpenseMember2020-01-012020-03-310001818874ipoe:SocialFinanceIncMemberus-gaap:SellingAndMarketingExpenseMember2021-01-012021-03-310001818874ipoe:SocialFinanceIncMemberus-gaap:SellingAndMarketingExpenseMember2020-01-012020-03-310001818874us-gaap:CostOfSalesMemberipoe:SocialFinanceIncMember2021-01-012021-03-310001818874us-gaap:CostOfSalesMemberipoe:SocialFinanceIncMember2020-01-012020-03-310001818874ipoe:SocialFinanceIncMemberus-gaap:GeneralAndAdministrativeExpenseMember2021-01-012021-03-310001818874ipoe:SocialFinanceIncMemberus-gaap:GeneralAndAdministrativeExpenseMember2020-01-012020-03-310001818874us-gaap:EmployeeStockOptionMemberipoe:SocialFinanceIncMember2021-01-012021-03-310001818874ipoe:SocialFinanceIncMemberus-gaap:RestrictedStockUnitsRSUMember2020-12-310001818874ipoe:SocialFinanceIncMemberus-gaap:RestrictedStockUnitsRSUMember2021-03-310001818874us-gaap:InvestorMemberipoe:SocialFinanceIncMemberipoe:StockholderNoteReceivableMember2019-03-310001818874us-gaap:InvestorMemberipoe:SocialFinanceIncMemberipoe:StockholderNoteReceivableMember2019-12-310001818874us-gaap:InvestorMemberipoe:SocialFinanceIncMemberipoe:StockholderNoteReceivableMember2020-12-310001818874us-gaap:InvestorMemberipoe:SocialFinanceIncMemberipoe:StockholderNoteReceivableMember2020-01-012020-03-310001818874ipoe:SocialFinanceIncMemberus-gaap:CommonStockMember2020-01-012020-12-310001818874ipoe:SocialFinanceIncMemberus-gaap:EquityMethodInvesteeMemberipoe:APEXLoanMember2019-11-300001818874ipoe:SocialFinanceIncMemberus-gaap:EquityMethodInvesteeMemberipoe:APEXLoanMember2020-08-310001818874ipoe:SocialFinanceIncMemberus-gaap:EquityMethodInvesteeMemberipoe:APEXLoanMember2020-12-310001818874ipoe:SocialFinanceIncMemberipoe:APEXLoanInterestIncomeReceivableMemberus-gaap:EquityMethodInvesteeMember2020-12-310001818874ipoe:SocialFinanceIncMemberus-gaap:EquityMethodInvesteeMemberipoe:APEXLoanMember2021-02-012021-02-280001818874ipoe:SocialFinanceIncMemberipoe:APEXLoanPrincipalBalancesMemberus-gaap:EquityMethodInvesteeMember2021-02-012021-02-280001818874ipoe:SocialFinanceIncMemberus-gaap:EquityMethodInvesteeMemberipoe:APEXLoanDiscountAccretionMember2021-02-012021-02-280001818874ipoe:SocialFinanceIncMemberus-gaap:EquityMethodInvesteeMemberipoe:APEXLoanMember2021-01-012021-03-310001818874ipoe:SocialFinanceIncMemberus-gaap:EquityMethodInvesteeMemberipoe:APEXLoanDiscountAccretionMember2021-01-012021-03-310001818874ipoe:SocialFinanceIncMemberus-gaap:EquityMethodInvesteeMemberipoe:APEXLoanMember2020-01-012020-03-310001818874ipoe:NamingAndSponsorshipAgreementMemberipoe:SocialFinanceIncMember2019-09-012019-09-300001818874ipoe:NamingAndSponsorshipAgreementMemberipoe:SocialFinanceIncMember2021-01-012021-03-310001818874ipoe:LoanSalesVolumeBenchmarkMemberus-gaap:CustomerConcentrationRiskMemberipoe:SocialFinanceIncMemberipoe:TwoLargestThirdPartyBuyersMember2021-01-012021-03-310001818874ipoe:SocialFinanceIncMemberipoe:GalileoFinancialTechnologiesIncMember2020-11-300001818874ipoe:NamingAndSponsorshipAgreementMemberipoe:SocialFinanceIncMember2020-09-300001818874ipoe:NamingAndSponsorshipAgreementMemberipoe:SocialFinanceIncMember2020-01-012020-12-310001818874ipoe:NamingAndSponsorshipAgreementMemberipoe:SocialFinanceIncMember2021-01-012021-01-310001818874ipoe:SocialFinanceIncMemberipoe:FNMALetterOfCreditMemberus-gaap:LetterOfCreditMember2021-03-310001818874ipoe:SocialFinanceIncMemberipoe:FNMALetterOfCreditMemberus-gaap:LetterOfCreditMember2020-12-310001818874ipoe:RedeemablePreferredStockExchangeableForCommonStockMemberipoe:SocialFinanceIncMember2021-01-012021-03-310001818874ipoe:RedeemablePreferredStockExchangeableForCommonStockMemberipoe:SocialFinanceIncMember2020-01-012020-03-310001818874ipoe:SocialFinanceIncMemberipoe:RedeemablePreferredStockWarrantsExchangeableForCommonStockMember2021-01-012021-03-310001818874ipoe:SocialFinanceIncMemberipoe:RedeemablePreferredStockWarrantsExchangeableForCommonStockMember2020-01-012020-03-310001818874ipoe:SocialFinanceIncMemberipoe:ContingentCommonStockAcquisitionsMember2021-01-012021-03-310001818874ipoe:SocialFinanceIncMemberipoe:ContingentCommonStockAcquisitionsMember2020-01-012020-03-310001818874us-gaap:EmployeeStockOptionMemberipoe:SocialFinanceIncMember2021-01-012021-03-310001818874us-gaap:EmployeeStockOptionMemberipoe:SocialFinanceIncMember2020-01-012020-03-310001818874ipoe:SocialFinanceIncMemberus-gaap:RestrictedStockUnitsRSUMember2021-01-012021-03-310001818874ipoe:SocialFinanceIncMemberus-gaap:RestrictedStockUnitsRSUMember2020-01-012020-03-310001818874ipoe:SocialFinanceIncMemberipoe:A8LimitedMemberipoe:ContingentCommonStockAcquisitionsMember2021-01-012021-03-310001818874ipoe:SocialFinanceIncMemberipoe:ContingentCommonStockAcquisitionsMember2020-12-012020-12-31ipoe:segment0001818874ipoe:SocialFinanceIncMemberus-gaap:CorporateNonSegmentMemberipoe:SellerNoteMember2021-01-012021-03-310001818874ipoe:SocialFinanceIncMemberus-gaap:CorporateNonSegmentMemberipoe:SellerNoteMember2020-01-012020-03-310001818874us-gaap:OperatingSegmentsMemberipoe:LendingSegmentMemberipoe:SocialFinanceIncMember2021-01-012021-03-310001818874us-gaap:OperatingSegmentsMemberipoe:SocialFinanceIncMemberipoe:FinancialServicesSegmentMember2021-01-012021-03-310001818874us-gaap:OperatingSegmentsMemberipoe:SocialFinanceIncMemberipoe:TechnologyPlatformSegmentMember2021-01-012021-03-310001818874us-gaap:OperatingSegmentsMemberipoe:SocialFinanceIncMember2021-01-012021-03-310001818874ipoe:SocialFinanceIncMemberus-gaap:CorporateNonSegmentMember2021-01-012021-03-310001818874us-gaap:OperatingSegmentsMemberipoe:LendingSegmentMemberipoe:SocialFinanceIncMember2020-01-012020-03-310001818874us-gaap:OperatingSegmentsMemberipoe:SocialFinanceIncMemberipoe:FinancialServicesSegmentMember2020-01-012020-03-310001818874us-gaap:OperatingSegmentsMemberipoe:SocialFinanceIncMemberipoe:TechnologyPlatformSegmentMember2020-01-012020-03-310001818874us-gaap:OperatingSegmentsMemberipoe:SocialFinanceIncMember2020-01-012020-03-310001818874ipoe:SocialFinanceIncMemberus-gaap:CorporateNonSegmentMember2020-01-012020-03-310001818874us-gaap:OperatingSegmentsMemberipoe:NoninterestIncomeMemberipoe:SocialFinanceIncMemberipoe:TechnologyPlatformSegmentMember2021-01-012021-03-310001818874us-gaap:OperatingSegmentsMemberipoe:NoninterestIncomeMemberipoe:SocialFinanceIncMemberipoe:TechnologyPlatformSegmentMember2020-01-012020-03-310001818874us-gaap:CustomerConcentrationRiskMemberipoe:SocialFinanceIncMemberipoe:FiveLargestCustomersMemberus-gaap:SalesRevenueSegmentMemberipoe:TechnologyPlatformSegmentMember2021-01-012021-03-310001818874us-gaap:CustomerConcentrationRiskMemberipoe:SocialFinanceIncMemberipoe:FiveLargestCustomersMemberus-gaap:SalesRevenueNetMemberipoe:TechnologyPlatformSegmentMember2021-01-012021-03-310001818874ipoe:SocialFinanceIncMemberus-gaap:MaterialReconcilingItemsMember2021-01-012021-03-310001818874ipoe:SocialFinanceIncMemberus-gaap:MaterialReconcilingItemsMember2020-01-012020-03-310001818874ipoe:SocialFinanceIncMemberipoe:CorporateAndReconcilingItemsMember2021-01-012021-03-310001818874ipoe:SocialFinanceIncMemberipoe:CorporateAndReconcilingItemsMember2020-01-012020-03-310001818874ipoe:SocialFinanceIncMemberus-gaap:NonvotingCommonStockMember2019-12-310001818874ipoe:SocialFinanceIncMember2019-01-012019-12-310001818874ipoe:SocialFinanceIncMember2018-01-012018-12-310001818874ipoe:SocialFinanceIncMemberipoe:TechnologyPlatformFeesMember2020-01-012020-12-310001818874ipoe:SocialFinanceIncMemberipoe:TechnologyPlatformFeesMember2019-01-012019-12-310001818874ipoe:SocialFinanceIncMemberipoe:TechnologyPlatformFeesMember2018-01-012018-12-310001818874ipoe:SocialFinanceIncMemberus-gaap:CommonStockMember2017-12-310001818874us-gaap:AdditionalPaidInCapitalMemberipoe:SocialFinanceIncMember2017-12-310001818874ipoe:SocialFinanceIncMemberus-gaap:TreasuryStockMember2017-12-310001818874ipoe:SocialFinanceIncMemberus-gaap:AccumulatedOtherComprehensiveIncomeMember2017-12-310001818874ipoe:SocialFinanceIncMemberus-gaap:RetainedEarningsMember2017-12-310001818874ipoe:SocialFinanceIncMember2017-12-310001818874us-gaap:AdditionalPaidInCapitalMemberipoe:SocialFinanceIncMember2018-01-012018-12-310001818874ipoe:SocialFinanceIncMemberus-gaap:CommonStockMember2018-01-012018-12-310001818874ipoe:SocialFinanceIncMemberus-gaap:AccumulatedOtherComprehensiveIncomeMember2018-01-012018-12-310001818874ipoe:SocialFinanceIncMemberus-gaap:RetainedEarningsMember2018-01-012018-12-310001818874ipoe:SocialFinanceIncMemberus-gaap:CommonStockMember2018-12-310001818874us-gaap:AdditionalPaidInCapitalMemberipoe:SocialFinanceIncMember2018-12-310001818874ipoe:SocialFinanceIncMemberus-gaap:TreasuryStockMember2018-12-310001818874ipoe:SocialFinanceIncMemberus-gaap:AccumulatedOtherComprehensiveIncomeMember2018-12-310001818874ipoe:SocialFinanceIncMemberus-gaap:RetainedEarningsMember2018-12-310001818874ipoe:SocialFinanceIncMember2018-12-310001818874us-gaap:AdditionalPaidInCapitalMemberipoe:SocialFinanceIncMember2019-01-012019-12-310001818874ipoe:SocialFinanceIncMemberus-gaap:CommonStockMember2019-01-012019-12-310001818874ipoe:SocialFinanceIncMemberus-gaap:RetainedEarningsMember2019-01-012019-12-310001818874ipoe:SocialFinanceIncMemberus-gaap:TreasuryStockMember2019-01-012019-12-310001818874ipoe:SocialFinanceIncMemberus-gaap:AccumulatedOtherComprehensiveIncomeMember2019-01-012019-12-310001818874ipoe:SocialFinanceIncMemberus-gaap:TreasuryStockMember2019-12-310001818874us-gaap:AdditionalPaidInCapitalMemberipoe:SocialFinanceIncMember2020-01-012020-12-310001818874ipoe:SocialFinanceIncMemberus-gaap:CommonStockMember2020-01-012020-12-310001818874ipoe:SocialFinanceIncMemberus-gaap:RetainedEarningsMember2020-01-012020-12-310001818874ipoe:SocialFinanceIncMemberus-gaap:AccumulatedOtherComprehensiveIncomeMember2020-01-012020-12-31ipoe:riskCategory0001818874ipoe:SocialFinanceIncMemberipoe:ApexClearingHoldingsLLCMember2020-01-012020-12-310001818874ipoe:SocialFinanceIncMemberipoe:ApexClearingHoldingsLLCMember2019-01-012019-12-310001818874ipoe:SocialFinanceIncMemberipoe:ApexClearingHoldingsLLCMember2018-01-012018-12-310001818874srt:MinimumMemberipoe:SocialFinanceIncMemberipoe:ApexClearingHoldingsLLCMember2020-01-012020-12-310001818874ipoe:SocialFinanceIncMemberipoe:ApexClearingHoldingsLLCMembersrt:MaximumMember2020-01-012020-12-310001818874ipoe:SocialFinanceIncMemberipoe:ApexClearingHoldingsLLCMemberus-gaap:SubsequentEventMember2021-01-012021-01-310001818874ipoe:SocialFinanceIncMemberipoe:ApexClearingHoldingsLLCMember2020-10-012020-12-310001818874ipoe:SocialFinanceIncMemberipoe:ApexClearingHoldingsLLCMember2019-12-310001818874ipoe:SocialFinanceIncMemberipoe:ResidentialMortgageOriginationMember2019-12-310001818874ipoe:SocialFinanceIncMemberipoe:ResidentialMortgageOriginationMember2020-01-012020-12-310001818874srt:MinimumMemberipoe:SocialFinanceIncMember2020-01-012020-12-310001818874ipoe:SocialFinanceIncMembersrt:MaximumMember2020-01-012020-12-310001818874ipoe:SocialFinanceIncMemberus-gaap:ComputerEquipmentMember2020-12-310001818874ipoe:SocialFinanceIncMemberus-gaap:LeaseholdImprovementsMember2020-12-310001818874ipoe:SocialFinanceIncMemberus-gaap:FurnitureAndFixturesMember2020-12-310001818874ipoe:SocialFinanceIncMemberus-gaap:SoftwareAndSoftwareDevelopmentCostsMember2020-12-310001818874ipoe:SocialFinanceIncMemberus-gaap:ComputerEquipmentMember2019-12-310001818874ipoe:SocialFinanceIncMemberus-gaap:LeaseholdImprovementsMember2019-12-310001818874ipoe:SocialFinanceIncMemberus-gaap:FurnitureAndFixturesMember2019-12-310001818874ipoe:SocialFinanceIncMemberus-gaap:SoftwareAndSoftwareDevelopmentCostsMember2019-12-310001818874ipoe:SocialFinanceIncMemberipoe:PropertyPlantAndEquipmentAndFinanceLeaseRightOfUseAssetsMember2020-01-012020-12-310001818874ipoe:SocialFinanceIncMemberipoe:PropertyPlantAndEquipmentAndFinanceLeaseRightOfUseAssetsMember2019-01-012019-12-310001818874ipoe:SocialFinanceIncMemberipoe:PropertyPlantAndEquipmentAndFinanceLeaseRightOfUseAssetsMember2018-01-012018-12-310001818874ipoe:SocialFinanceIncMemberus-gaap:SoftwareAndSoftwareDevelopmentCostsMember2019-01-012019-12-310001818874ipoe:SocialFinanceIncMemberus-gaap:SoftwareAndSoftwareDevelopmentCostsMember2020-01-012020-12-310001818874ipoe:SocialFinanceIncMemberus-gaap:SoftwareAndSoftwareDevelopmentCostsMember2018-01-012018-12-3100018188742019-01-012019-12-3100018188742018-01-012018-12-310001818874ipoe:SocialFinanceIncMemberipoe:RightOfUseAssetsMember2020-12-310001818874ipoe:NoninterestIncomeLoanOriginationsAndSalesMemberipoe:SocialFinanceIncMemberus-gaap:NondesignatedMember2020-01-012020-12-310001818874ipoe:NoninterestIncomeLoanOriginationsAndSalesMemberipoe:SocialFinanceIncMemberus-gaap:NondesignatedMember2019-01-012019-12-310001818874ipoe:NoninterestIncomeLoanOriginationsAndSalesMemberipoe:SocialFinanceIncMemberus-gaap:NondesignatedMember2018-01-012018-12-310001818874ipoe:NoninterestIncomeLoanOriginationsAndSalesMemberus-gaap:CreditRiskContractMemberipoe:SocialFinanceIncMemberus-gaap:NondesignatedMember2020-01-012020-12-310001818874ipoe:NoninterestIncomeOtherOperatingIncomeMemberipoe:NonSecuritizationInvestmentsMemberipoe:SocialFinanceIncMemberus-gaap:NondesignatedMember2020-01-012020-12-310001818874ipoe:NoninterestIncomeOtherOperatingIncomeMemberipoe:NonSecuritizationInvestmentsMemberipoe:SocialFinanceIncMemberus-gaap:NondesignatedMember2019-01-012019-12-310001818874ipoe:NoninterestIncomeOtherOperatingIncomeMemberipoe:NonSecuritizationInvestmentsMemberipoe:SocialFinanceIncMemberus-gaap:NondesignatedMember2018-01-012018-12-310001818874ipoe:SocialFinanceIncMemberipoe:RestrictedCashAndCashEquivalentsMember2019-12-310001818874ipoe:SocialFinanceIncMemberipoe:PaymentNetworkFeesMember2020-01-012020-12-31ipoe:performanceObligation0001818874ipoe:SocialFinanceIncMemberipoe:ReferralsMember2020-01-012020-12-310001818874ipoe:BrokerageMemberipoe:SocialFinanceIncMember2020-01-012020-12-310001818874ipoe:LendingSegmentMemberipoe:SocialFinanceIncMember2020-01-012020-12-310001818874ipoe:LendingSegmentMemberipoe:SocialFinanceIncMember2019-01-012019-12-310001818874ipoe:LendingSegmentMemberipoe:SocialFinanceIncMember2018-01-012018-12-310001818874ipoe:SocialFinanceIncMemberipoe:FinancialServicesSegmentMemberipoe:ReferralsMember2020-01-012020-12-310001818874ipoe:SocialFinanceIncMemberipoe:FinancialServicesSegmentMemberipoe:ReferralsMember2019-01-012019-12-310001818874ipoe:SocialFinanceIncMemberipoe:FinancialServicesSegmentMemberipoe:ReferralsMember2018-01-012018-12-310001818874ipoe:BrokerageMemberipoe:SocialFinanceIncMemberipoe:FinancialServicesSegmentMember2020-01-012020-12-310001818874ipoe:BrokerageMemberipoe:SocialFinanceIncMemberipoe:FinancialServicesSegmentMember2019-01-012019-12-310001818874ipoe:BrokerageMemberipoe:SocialFinanceIncMemberipoe:FinancialServicesSegmentMember2018-01-012018-12-310001818874ipoe:SocialFinanceIncMemberipoe:FinancialServicesSegmentMemberipoe:PaymentNetworkFeesMember2020-01-012020-12-310001818874ipoe:SocialFinanceIncMemberipoe:FinancialServicesSegmentMemberipoe:PaymentNetworkFeesMember2019-01-012019-12-310001818874ipoe:SocialFinanceIncMemberipoe:FinancialServicesSegmentMemberipoe:PaymentNetworkFeesMember2018-01-012018-12-310001818874ipoe:EnterpriseServicesMemberipoe:SocialFinanceIncMemberipoe:FinancialServicesSegmentMember2020-01-012020-12-310001818874ipoe:EnterpriseServicesMemberipoe:SocialFinanceIncMemberipoe:FinancialServicesSegmentMember2019-01-012019-12-310001818874ipoe:EnterpriseServicesMemberipoe:SocialFinanceIncMemberipoe:FinancialServicesSegmentMember2018-01-012018-12-310001818874ipoe:SocialFinanceIncMemberipoe:FinancialServicesSegmentMember2020-01-012020-12-310001818874ipoe:SocialFinanceIncMemberipoe:FinancialServicesSegmentMember2019-01-012019-12-310001818874ipoe:SocialFinanceIncMemberipoe:FinancialServicesSegmentMember2018-01-012018-12-310001818874ipoe:SocialFinanceIncMemberipoe:TechnologyPlatformFeesMemberipoe:TechnologyPlatformSegmentMember2020-01-012020-12-310001818874ipoe:SocialFinanceIncMemberipoe:TechnologyPlatformFeesMemberipoe:TechnologyPlatformSegmentMember2019-01-012019-12-310001818874ipoe:SocialFinanceIncMemberipoe:TechnologyPlatformFeesMemberipoe:TechnologyPlatformSegmentMember2018-01-012018-12-310001818874ipoe:SocialFinanceIncMemberipoe:PaymentNetworkFeesMemberipoe:TechnologyPlatformSegmentMember2020-01-012020-12-310001818874ipoe:SocialFinanceIncMemberipoe:PaymentNetworkFeesMemberipoe:TechnologyPlatformSegmentMember2019-01-012019-12-310001818874ipoe:SocialFinanceIncMemberipoe:PaymentNetworkFeesMemberipoe:TechnologyPlatformSegmentMember2018-01-012018-12-310001818874ipoe:SocialFinanceIncMemberipoe:TechnologyPlatformSegmentMember2020-01-012020-12-310001818874ipoe:SocialFinanceIncMemberipoe:TechnologyPlatformSegmentMember2019-01-012019-12-310001818874ipoe:SocialFinanceIncMemberipoe:TechnologyPlatformSegmentMember2018-01-012018-12-310001818874ipoe:SocialFinanceIncMemberipoe:ReferralsMember2019-01-012019-12-310001818874ipoe:SocialFinanceIncMemberipoe:ReferralsMember2018-01-012018-12-310001818874ipoe:SocialFinanceIncMemberipoe:PaymentNetworkFeesMember2019-01-012019-12-310001818874ipoe:SocialFinanceIncMemberipoe:PaymentNetworkFeesMember2018-01-012018-12-310001818874ipoe:BrokerageMemberipoe:SocialFinanceIncMember2019-01-012019-12-310001818874ipoe:BrokerageMemberipoe:SocialFinanceIncMember2018-01-012018-12-310001818874ipoe:EnterpriseServicesMemberipoe:SocialFinanceIncMember2020-01-012020-12-310001818874ipoe:EnterpriseServicesMemberipoe:SocialFinanceIncMember2019-01-012019-12-310001818874ipoe:EnterpriseServicesMemberipoe:SocialFinanceIncMember2018-01-012018-12-310001818874ipoe:ReplacementOptionsMemberipoe:SocialFinanceIncMemberipoe:GalileoFinancialTechnologiesIncMember2020-05-142020-05-140001818874ipoe:SocialFinanceIncMemberipoe:SellerNoteMemberipoe:GalileoFinancialTechnologiesIncMember2020-05-140001818874ipoe:SocialFinanceIncMemberipoe:SellerNoteMemberipoe:GalileoFinancialTechnologiesIncMember2020-05-142020-05-140001818874ipoe:SocialFinanceIncMemberipoe:SellerNoteMemberipoe:GalileoFinancialTechnologiesIncMember2020-11-140001818874ipoe:SocialFinanceIncMemberipoe:SellerNoteMemberipoe:GalileoFinancialTechnologiesIncMember2020-05-142020-11-140001818874ipoe:SocialFinanceIncMemberipoe:SellerNoteMemberipoe:GalileoFinancialTechnologiesIncMember2020-01-012020-12-310001818874ipoe:SocialFinanceIncMemberus-gaap:SeriesHPreferredStockMemberipoe:GalileoFinancialTechnologiesIncMember2020-05-142020-05-140001818874ipoe:SocialFinanceIncMemberus-gaap:SeriesHPreferredStockMemberipoe:ValuationTechniqueBacksolveMethodMemberipoe:GalileoFinancialTechnologiesIncMember2020-05-140001818874us-gaap:EmployeeStockOptionMemberipoe:SocialFinanceIncMemberipoe:GalileoFinancialTechnologiesIncMember2020-05-140001818874us-gaap:EmployeeStockOptionMembersrt:MinimumMemberipoe:SocialFinanceIncMemberipoe:GalileoFinancialTechnologiesIncMember2020-05-142020-05-140001818874us-gaap:EmployeeStockOptionMemberipoe:SocialFinanceIncMemberipoe:GalileoFinancialTechnologiesIncMembersrt:MaximumMember2020-05-142020-05-140001818874us-gaap:EmployeeStockOptionMemberipoe:SocialFinanceIncMemberipoe:GalileoFinancialTechnologiesIncMember2020-05-142020-05-140001818874ipoe:SocialFinanceIncMemberus-gaap:SeriesHPreferredStockMemberipoe:GalileoFinancialTechnologiesIncMember2020-05-140001818874ipoe:SocialFinanceIncMemberipoe:GalileoFinancialTechnologiesIncMember2020-01-012020-12-310001818874ipoe:SocialFinanceIncMemberipoe:GalileoFinancialTechnologiesIncMember2020-05-142020-12-310001818874ipoe:SocialFinanceIncMemberipoe:GalileoFinancialTechnologiesIncMember2019-01-012019-12-310001818874ipoe:SocialFinanceIncMemberipoe:GalileoFinancialTechnologiesIncMember2020-12-310001818874ipoe:SocialFinanceIncMemberipoe:ValuationTechniqueBacksolveMethodMemberus-gaap:CommonStockMemberipoe:A8LimitedMember2020-04-280001818874ipoe:SocialFinanceIncMemberipoe:A8LimitedMember2020-01-012020-12-310001818874ipoe:SocialFinanceIncMemberipoe:FinancialServicesSegmentMember2020-12-310001818874ipoe:SocialFinanceIncMemberipoe:TechnologyPlatformSegmentMember2020-12-310001818874us-gaap:DevelopedTechnologyRightsMemberipoe:SocialFinanceIncMember2020-01-012020-12-310001818874us-gaap:DevelopedTechnologyRightsMemberipoe:SocialFinanceIncMember2020-12-310001818874ipoe:SocialFinanceIncMemberus-gaap:CustomerRelatedIntangibleAssetsMember2020-01-012020-12-310001818874ipoe:SocialFinanceIncMemberus-gaap:CustomerRelatedIntangibleAssetsMember2020-12-310001818874ipoe:SocialFinanceIncMemberus-gaap:TrademarksAndTradeNamesMember2020-01-012020-12-310001818874ipoe:SocialFinanceIncMemberus-gaap:TrademarksAndTradeNamesMember2020-12-310001818874ipoe:CoreBankingInfrastructureRelatedIntangibleAssetsMemberipoe:SocialFinanceIncMember2020-01-012020-12-310001818874ipoe:CoreBankingInfrastructureRelatedIntangibleAssetsMemberipoe:SocialFinanceIncMember2020-12-310001818874ipoe:SocialFinanceIncMemberus-gaap:LicensingAgreementsMember2020-01-012020-12-310001818874ipoe:SocialFinanceIncMemberus-gaap:LicensingAgreementsMember2020-12-310001818874ipoe:CoreBankingInfrastructureRelatedIntangibleAssetsMemberipoe:SocialFinanceIncMember2019-01-012019-12-310001818874ipoe:CoreBankingInfrastructureRelatedIntangibleAssetsMemberipoe:SocialFinanceIncMember2019-12-310001818874ipoe:SocialFinanceIncMemberipoe:PartnershipRelatedIntangibleAssetsMember2019-01-012019-12-310001818874ipoe:SocialFinanceIncMemberipoe:PartnershipRelatedIntangibleAssetsMember2019-12-310001818874us-gaap:DevelopedTechnologyRightsMemberipoe:SocialFinanceIncMemberipoe:GalileoFinancialTechnologiesIncMember2020-01-012020-12-310001818874ipoe:SocialFinanceIncMemberus-gaap:CustomerRelatedIntangibleAssetsMemberipoe:GalileoFinancialTechnologiesIncMember2020-01-012020-12-310001818874ipoe:SocialFinanceIncMemberus-gaap:TrademarksAndTradeNamesMemberipoe:GalileoFinancialTechnologiesIncMember2020-01-012020-12-310001818874us-gaap:DevelopedTechnologyRightsMemberipoe:SocialFinanceIncMember2019-01-012019-12-310001818874us-gaap:IntangibleAssetsAmortizationPeriodMemberipoe:SocialFinanceIncMembersrt:CumulativeEffectPeriodOfAdoptionAdjustmentMember2020-01-012020-12-310001818874ipoe:SocialFinanceIncMemberipoe:StudentLoanPortfolioSegmentMemberipoe:SecuritizedStudentLoansMember2019-12-310001818874ipoe:SocialFinanceIncMemberipoe:SecuritizedPersonalLoanMemberipoe:PersonalLoanPortfolioSegmentMember2019-12-310001818874ipoe:SocialFinanceIncMemberus-gaap:StudentLoanMemberipoe:StudentLoanPortfolioSegmentMember2019-12-310001818874ipoe:HomeLoanPortfolioSegmentMemberipoe:SocialFinanceIncMemberus-gaap:HomeEquityLoanMember2019-12-310001818874ipoe:SocialFinanceIncMemberus-gaap:ConsumerLoanMemberipoe:PersonalLoanPortfolioSegmentMember2019-12-310001818874ipoe:SocialFinanceIncMemberipoe:CreditCardLoanPortfolioSegmentMemberus-gaap:CreditCardReceivablesMember2019-12-310001818874ipoe:SocialFinanceIncMemberus-gaap:CommercialPortfolioSegmentMemberus-gaap:CommercialLoanMember2019-12-310001818874ipoe:SocialFinanceIncMemberipoe:CreditCardLoanAndCommercialLoanPortfolioSegmentMember2019-12-310001818874ipoe:SocialFinanceIncMemberipoe:CreditCardLoanPortfolioSegmentMemberus-gaap:CreditCardReceivablesMember2020-01-012020-12-310001818874us-gaap:EstimateOfFairValueFairValueDisclosureMemberus-gaap:StudentLoanMemberipoe:SocialFinanceIncMemberipoe:StudentLoanPortfolioSegmentMemberus-gaap:FairValueMeasurementsRecurringMember2019-12-310001818874ipoe:HomeLoanPortfolioSegmentMemberus-gaap:EstimateOfFairValueFairValueDisclosureMemberipoe:SocialFinanceIncMemberus-gaap:HomeEquityLoanMemberus-gaap:FairValueMeasurementsRecurringMember2019-12-310001818874us-gaap:EstimateOfFairValueFairValueDisclosureMemberipoe:SocialFinanceIncMemberus-gaap:ConsumerLoanMemberipoe:PersonalLoanPortfolioSegmentMemberus-gaap:FairValueMeasurementsRecurringMember2019-12-310001818874us-gaap:EstimateOfFairValueFairValueDisclosureMemberipoe:SocialFinanceIncMemberus-gaap:FairValueMeasurementsRecurringMember2019-12-310001818874us-gaap:EstimateOfFairValueFairValueDisclosureMemberus-gaap:StudentLoanMemberipoe:SocialFinanceIncMemberus-gaap:FinancingReceivablesEqualToGreaterThan90DaysPastDueMemberipoe:StudentLoanPortfolioSegmentMemberus-gaap:FairValueMeasurementsRecurringMember2019-12-310001818874ipoe:HomeLoanPortfolioSegmentMemberus-gaap:EstimateOfFairValueFairValueDisclosureMemberipoe:SocialFinanceIncMemberus-gaap:FinancingReceivablesEqualToGreaterThan90DaysPastDueMemberus-gaap:HomeEquityLoanMemberus-gaap:FairValueMeasurementsRecurringMember2019-12-310001818874us-gaap:EstimateOfFairValueFairValueDisclosureMemberipoe:SocialFinanceIncMemberus-gaap:ConsumerLoanMemberus-gaap:FinancingReceivablesEqualToGreaterThan90DaysPastDueMemberipoe:PersonalLoanPortfolioSegmentMemberus-gaap:FairValueMeasurementsRecurringMember2019-12-310001818874us-gaap:EstimateOfFairValueFairValueDisclosureMemberipoe:SocialFinanceIncMemberus-gaap:FinancingReceivablesEqualToGreaterThan90DaysPastDueMemberus-gaap:FairValueMeasurementsRecurringMember2019-12-310001818874ipoe:SocialFinanceIncMemberus-gaap:StudentLoanMemberipoe:StudentLoanPortfolioSegmentMemberus-gaap:FairValueMeasurementsRecurringMember2018-12-310001818874ipoe:HomeLoanPortfolioSegmentMemberipoe:SocialFinanceIncMemberus-gaap:HomeEquityLoanMemberus-gaap:FairValueMeasurementsRecurringMember2018-12-310001818874ipoe:SocialFinanceIncMemberus-gaap:ConsumerLoanMemberipoe:PersonalLoanPortfolioSegmentMemberus-gaap:FairValueMeasurementsRecurringMember2018-12-310001818874ipoe:SocialFinanceIncMemberus-gaap:FairValueMeasurementsRecurringMember2018-12-310001818874ipoe:SocialFinanceIncMemberus-gaap:StudentLoanMemberipoe:StudentLoanPortfolioSegmentMemberus-gaap:FairValueMeasurementsRecurringMember2019-01-012019-12-310001818874ipoe:HomeLoanPortfolioSegmentMemberipoe:SocialFinanceIncMemberus-gaap:HomeEquityLoanMemberus-gaap:FairValueMeasurementsRecurringMember2019-01-012019-12-310001818874ipoe:SocialFinanceIncMemberus-gaap:ConsumerLoanMemberipoe:PersonalLoanPortfolioSegmentMemberus-gaap:FairValueMeasurementsRecurringMember2019-01-012019-12-310001818874ipoe:SocialFinanceIncMemberus-gaap:FairValueMeasurementsRecurringMember2019-01-012019-12-310001818874ipoe:SocialFinanceIncMemberus-gaap:StudentLoanMemberipoe:StudentLoanPortfolioSegmentMemberus-gaap:FairValueMeasurementsRecurringMember2020-01-012020-12-310001818874ipoe:HomeLoanPortfolioSegmentMemberipoe:SocialFinanceIncMemberus-gaap:HomeEquityLoanMemberus-gaap:FairValueMeasurementsRecurringMember2020-01-012020-12-310001818874ipoe:SocialFinanceIncMemberus-gaap:ConsumerLoanMemberipoe:PersonalLoanPortfolioSegmentMemberus-gaap:FairValueMeasurementsRecurringMember2020-01-012020-12-310001818874ipoe:SocialFinanceIncMemberus-gaap:FairValueMeasurementsRecurringMember2020-01-012020-12-310001818874ipoe:SocialFinanceIncMemberus-gaap:VariableInterestEntityPrimaryBeneficiaryMember2019-12-310001818874ipoe:SocialFinanceIncMemberipoe:PersonalLoanPortfolioSegmentMemberus-gaap:VariableInterestEntityNotPrimaryBeneficiaryMember2020-01-012020-12-310001818874ipoe:SocialFinanceIncMemberipoe:PersonalLoanPortfolioSegmentMemberus-gaap:VariableInterestEntityNotPrimaryBeneficiaryMember2019-01-012019-12-310001818874ipoe:SocialFinanceIncMemberipoe:PersonalLoanPortfolioSegmentMemberus-gaap:VariableInterestEntityNotPrimaryBeneficiaryMember2019-12-310001818874ipoe:SocialFinanceIncMemberipoe:StudentLoanPortfolioSegmentMemberus-gaap:VariableInterestEntityNotPrimaryBeneficiaryMember2020-01-012020-12-310001818874ipoe:SocialFinanceIncMemberipoe:StudentLoanPortfolioSegmentMemberus-gaap:VariableInterestEntityNotPrimaryBeneficiaryMember2019-01-012019-12-310001818874ipoe:SocialFinanceIncMemberipoe:StudentLoanPortfolioSegmentMemberus-gaap:VariableInterestEntityNotPrimaryBeneficiaryMember2019-12-310001818874ipoe:SocialFinanceIncMemberus-gaap:VariableInterestEntityPrimaryBeneficiaryMemberipoe:StudentLoanPortfolioSegmentMember2020-01-012020-12-310001818874ipoe:SocialFinanceIncMemberus-gaap:VariableInterestEntityPrimaryBeneficiaryMemberipoe:StudentLoanPortfolioSegmentMember2018-01-012018-12-310001818874ipoe:SocialFinanceIncMemberus-gaap:VariableInterestEntityPrimaryBeneficiaryMemberipoe:StudentLoanPortfolioSegmentMember2019-01-012019-12-310001818874ipoe:SocialFinanceIncMemberus-gaap:VariableInterestEntityNotPrimaryBeneficiaryMember2019-12-310001818874ipoe:SocialFinanceIncMemberipoe:StudentLoanPortfolioSegmentMemberus-gaap:AssetBackedSecuritiesSecuritizedLoansAndReceivablesMember2020-12-310001818874ipoe:SocialFinanceIncMemberipoe:StudentLoanPortfolioSegmentMemberus-gaap:AssetBackedSecuritiesSecuritizedLoansAndReceivablesMember2019-12-310001818874ipoe:SocialFinanceIncMemberipoe:StudentLoanPortfolioSegmentMemberus-gaap:AssetBackedSecuritiesSecuritizedLoansAndReceivablesMember2018-12-310001818874ipoe:SocialFinanceIncMemberipoe:StudentLoanPortfolioSegmentMemberus-gaap:AssetBackedSecuritiesSecuritizedLoansAndReceivablesMember2020-01-012020-12-310001818874ipoe:SocialFinanceIncMemberipoe:StudentLoanPortfolioSegmentMemberus-gaap:AssetBackedSecuritiesSecuritizedLoansAndReceivablesMember2019-01-012019-12-310001818874ipoe:SocialFinanceIncMemberipoe:StudentLoanPortfolioSegmentMemberus-gaap:AssetBackedSecuritiesSecuritizedLoansAndReceivablesMember2018-01-012018-12-310001818874ipoe:SocialFinanceIncMemberus-gaap:AssetBackedSecuritiesSecuritizedLoansAndReceivablesMemberipoe:PersonalLoanPortfolioSegmentMember2020-12-310001818874ipoe:SocialFinanceIncMemberus-gaap:AssetBackedSecuritiesSecuritizedLoansAndReceivablesMemberipoe:PersonalLoanPortfolioSegmentMember2019-12-310001818874ipoe:SocialFinanceIncMemberus-gaap:AssetBackedSecuritiesSecuritizedLoansAndReceivablesMemberipoe:PersonalLoanPortfolioSegmentMember2018-12-310001818874ipoe:SocialFinanceIncMemberus-gaap:AssetBackedSecuritiesSecuritizedLoansAndReceivablesMemberipoe:PersonalLoanPortfolioSegmentMember2020-01-012020-12-310001818874ipoe:SocialFinanceIncMemberus-gaap:AssetBackedSecuritiesSecuritizedLoansAndReceivablesMemberipoe:PersonalLoanPortfolioSegmentMember2019-01-012019-12-310001818874ipoe:SocialFinanceIncMemberus-gaap:AssetBackedSecuritiesSecuritizedLoansAndReceivablesMemberipoe:PersonalLoanPortfolioSegmentMember2018-01-012018-12-310001818874ipoe:SocialFinanceIncMemberipoe:WholeLoansMemberipoe:StudentLoanPortfolioSegmentMember2020-12-310001818874ipoe:SocialFinanceIncMemberipoe:WholeLoansMemberipoe:StudentLoanPortfolioSegmentMember2019-12-310001818874ipoe:SocialFinanceIncMemberipoe:WholeLoansMemberipoe:StudentLoanPortfolioSegmentMember2018-12-310001818874ipoe:SocialFinanceIncMemberipoe:WholeLoansMemberipoe:StudentLoanPortfolioSegmentMember2020-01-012020-12-310001818874ipoe:SocialFinanceIncMemberipoe:WholeLoansMemberipoe:StudentLoanPortfolioSegmentMember2019-01-012019-12-310001818874ipoe:SocialFinanceIncMemberipoe:WholeLoansMemberipoe:StudentLoanPortfolioSegmentMember2018-01-012018-12-310001818874ipoe:HomeLoanPortfolioSegmentMemberipoe:SocialFinanceIncMemberipoe:WholeLoansMember2020-12-310001818874ipoe:HomeLoanPortfolioSegmentMemberipoe:SocialFinanceIncMemberipoe:WholeLoansMember2019-12-310001818874ipoe:HomeLoanPortfolioSegmentMemberipoe:SocialFinanceIncMemberipoe:WholeLoansMember2018-12-310001818874ipoe:HomeLoanPortfolioSegmentMemberipoe:SocialFinanceIncMemberipoe:WholeLoansMember2020-01-012020-12-310001818874ipoe:HomeLoanPortfolioSegmentMemberipoe:SocialFinanceIncMemberipoe:WholeLoansMember2019-01-012019-12-310001818874ipoe:HomeLoanPortfolioSegmentMemberipoe:SocialFinanceIncMemberipoe:WholeLoansMember2018-01-012018-12-310001818874ipoe:SocialFinanceIncMemberipoe:WholeLoansMemberipoe:PersonalLoanPortfolioSegmentMember2020-12-310001818874ipoe:SocialFinanceIncMemberipoe:WholeLoansMemberipoe:PersonalLoanPortfolioSegmentMember2019-12-310001818874ipoe:SocialFinanceIncMemberipoe:WholeLoansMemberipoe:PersonalLoanPortfolioSegmentMember2018-12-310001818874ipoe:SocialFinanceIncMemberipoe:WholeLoansMemberipoe:PersonalLoanPortfolioSegmentMember2020-01-012020-12-310001818874ipoe:SocialFinanceIncMemberipoe:WholeLoansMemberipoe:PersonalLoanPortfolioSegmentMember2019-01-012019-12-310001818874ipoe:SocialFinanceIncMemberipoe:WholeLoansMemberipoe:PersonalLoanPortfolioSegmentMember2018-01-012018-12-310001818874ipoe:SocialFinanceIncMemberipoe:StudentLoanPortfolioSegmentMemberipoe:ParticipatingInterestsMember2018-12-310001818874ipoe:SocialFinanceIncMemberipoe:StudentLoanPortfolioSegmentMemberipoe:ParticipatingInterestsMember2018-01-012018-12-310001818874ipoe:LoansInRepaymentMemberipoe:SocialFinanceIncMemberus-gaap:VariableInterestEntityNotPrimaryBeneficiaryMemberipoe:StudentLoanPortfolioSegmentMember2019-12-310001818874ipoe:HomeLoanPortfolioSegmentMemberipoe:LoansInRepaymentMemberipoe:SocialFinanceIncMemberus-gaap:VariableInterestEntityNotPrimaryBeneficiaryMember2019-12-310001818874ipoe:LoansInRepaymentMemberipoe:SocialFinanceIncMemberus-gaap:VariableInterestEntityNotPrimaryBeneficiaryMemberipoe:PersonalLoanPortfolioSegmentMember2019-12-310001818874ipoe:LoansInRepaymentMemberipoe:SocialFinanceIncMemberus-gaap:VariableInterestEntityNotPrimaryBeneficiaryMember2019-12-310001818874ipoe:LoansInSchoolGracePeriodOrDefermentMemberipoe:SocialFinanceIncMemberus-gaap:VariableInterestEntityNotPrimaryBeneficiaryMemberipoe:StudentLoanPortfolioSegmentMember2019-12-310001818874ipoe:HomeLoanPortfolioSegmentMemberipoe:LoansInSchoolGracePeriodOrDefermentMemberipoe:SocialFinanceIncMemberus-gaap:VariableInterestEntityNotPrimaryBeneficiaryMember2019-12-310001818874ipoe:LoansInSchoolGracePeriodOrDefermentMemberipoe:SocialFinanceIncMemberus-gaap:VariableInterestEntityNotPrimaryBeneficiaryMemberipoe:PersonalLoanPortfolioSegmentMember2019-12-310001818874ipoe:LoansInSchoolGracePeriodOrDefermentMemberipoe:SocialFinanceIncMemberus-gaap:VariableInterestEntityNotPrimaryBeneficiaryMember2019-12-310001818874ipoe:SocialFinanceIncMemberus-gaap:VariableInterestEntityNotPrimaryBeneficiaryMemberipoe:StudentLoanPortfolioSegmentMemberipoe:LoansInForbearanceMember2019-12-310001818874ipoe:HomeLoanPortfolioSegmentMemberipoe:SocialFinanceIncMemberus-gaap:VariableInterestEntityNotPrimaryBeneficiaryMemberipoe:LoansInForbearanceMember2019-12-310001818874ipoe:SocialFinanceIncMemberus-gaap:VariableInterestEntityNotPrimaryBeneficiaryMemberipoe:LoansInForbearanceMemberipoe:PersonalLoanPortfolioSegmentMember2019-12-310001818874ipoe:SocialFinanceIncMemberus-gaap:VariableInterestEntityNotPrimaryBeneficiaryMemberipoe:LoansInForbearanceMember2019-12-310001818874ipoe:SocialFinanceIncMemberus-gaap:VariableInterestEntityNotPrimaryBeneficiaryMemberipoe:StudentLoanPortfolioSegmentMemberipoe:LoansInDelinquencyMember2019-12-310001818874ipoe:HomeLoanPortfolioSegmentMemberipoe:SocialFinanceIncMemberus-gaap:VariableInterestEntityNotPrimaryBeneficiaryMemberipoe:LoansInDelinquencyMember2019-12-310001818874ipoe:SocialFinanceIncMemberus-gaap:VariableInterestEntityNotPrimaryBeneficiaryMemberipoe:LoansInDelinquencyMemberipoe:PersonalLoanPortfolioSegmentMember2019-12-310001818874ipoe:SocialFinanceIncMemberus-gaap:VariableInterestEntityNotPrimaryBeneficiaryMemberipoe:LoansInDelinquencyMember2019-12-310001818874ipoe:SocialFinanceIncMemberus-gaap:VariableInterestEntityNotPrimaryBeneficiaryMemberipoe:StudentLoanPortfolioSegmentMember2019-12-310001818874ipoe:HomeLoanPortfolioSegmentMemberipoe:SocialFinanceIncMemberus-gaap:VariableInterestEntityNotPrimaryBeneficiaryMember2019-12-310001818874ipoe:SocialFinanceIncMemberus-gaap:VariableInterestEntityNotPrimaryBeneficiaryMemberipoe:PersonalLoanPortfolioSegmentMember2019-12-310001818874ipoe:SocialFinanceIncMemberus-gaap:VariableInterestEntityNotPrimaryBeneficiaryMember2019-12-310001818874ipoe:SocialFinanceIncMemberus-gaap:VariableInterestEntityNotPrimaryBeneficiaryMemberipoe:StudentLoanPortfolioSegmentMember2019-01-012019-12-310001818874ipoe:HomeLoanPortfolioSegmentMemberipoe:SocialFinanceIncMemberus-gaap:VariableInterestEntityNotPrimaryBeneficiaryMember2019-01-012019-12-310001818874ipoe:SocialFinanceIncMemberus-gaap:VariableInterestEntityNotPrimaryBeneficiaryMemberipoe:PersonalLoanPortfolioSegmentMember2019-01-012019-12-310001818874ipoe:SocialFinanceIncMemberus-gaap:VariableInterestEntityNotPrimaryBeneficiaryMember2019-01-012019-12-3100018188742019-12-310001818874ipoe:SocialFinanceIncMemberus-gaap:CarryingReportedAmountFairValueDisclosureMemberus-gaap:FairValueInputsLevel1Member2019-12-310001818874us-gaap:EstimateOfFairValueFairValueDisclosureMemberipoe:SocialFinanceIncMemberus-gaap:FairValueInputsLevel1Member2019-12-310001818874us-gaap:CarryingReportedAmountFairValueDisclosureMemberipoe:SocialFinanceIncMemberus-gaap:FairValueInputsLevel3Memberus-gaap:StudentLoanMemberus-gaap:FairValueMeasurementsRecurringMember2019-12-310001818874us-gaap:EstimateOfFairValueFairValueDisclosureMemberipoe:SocialFinanceIncMemberus-gaap:FairValueInputsLevel3Memberus-gaap:StudentLoanMemberus-gaap:FairValueMeasurementsRecurringMember2019-12-310001818874us-gaap:CarryingReportedAmountFairValueDisclosureMemberipoe:SocialFinanceIncMemberus-gaap:FairValueInputsLevel3Memberus-gaap:HomeEquityLoanMemberus-gaap:FairValueMeasurementsRecurringMember2019-12-310001818874us-gaap:EstimateOfFairValueFairValueDisclosureMemberipoe:SocialFinanceIncMemberus-gaap:FairValueInputsLevel3Memberus-gaap:HomeEquityLoanMemberus-gaap:FairValueMeasurementsRecurringMember2019-12-310001818874us-gaap:CarryingReportedAmountFairValueDisclosureMemberipoe:SocialFinanceIncMemberus-gaap:FairValueInputsLevel3Memberus-gaap:ConsumerLoanMemberus-gaap:FairValueMeasurementsRecurringMember2019-12-310001818874us-gaap:EstimateOfFairValueFairValueDisclosureMemberipoe:SocialFinanceIncMemberus-gaap:FairValueInputsLevel3Memberus-gaap:ConsumerLoanMemberus-gaap:FairValueMeasurementsRecurringMember2019-12-310001818874us-gaap:CarryingReportedAmountFairValueDisclosureMemberipoe:SocialFinanceIncMemberus-gaap:FairValueInputsLevel3Memberus-gaap:CreditCardReceivablesMemberus-gaap:FairValueMeasurementsRecurringMember2019-12-310001818874us-gaap:EstimateOfFairValueFairValueDisclosureMemberipoe:SocialFinanceIncMemberus-gaap:FairValueInputsLevel3Memberus-gaap:CreditCardReceivablesMemberus-gaap:FairValueMeasurementsRecurringMember2019-12-310001818874us-gaap:CarryingReportedAmountFairValueDisclosureMemberipoe:SocialFinanceIncMemberus-gaap:CommercialLoanMemberus-gaap:FairValueInputsLevel3Memberus-gaap:FairValueMeasurementsRecurringMember2019-12-310001818874us-gaap:EstimateOfFairValueFairValueDisclosureMemberipoe:SocialFinanceIncMemberus-gaap:CommercialLoanMemberus-gaap:FairValueInputsLevel3Memberus-gaap:FairValueMeasurementsRecurringMember2019-12-310001818874ipoe:SocialFinanceIncMemberus-gaap:CarryingReportedAmountFairValueDisclosureMemberus-gaap:FairValueInputsLevel3Memberus-gaap:FairValueMeasurementsRecurringMember2019-12-310001818874us-gaap:EstimateOfFairValueFairValueDisclosureMemberipoe:SocialFinanceIncMemberus-gaap:FairValueInputsLevel3Memberus-gaap:FairValueMeasurementsRecurringMember2019-12-310001818874us-gaap:CarryingReportedAmountFairValueDisclosureMemberus-gaap:AssetBackedSecuritiesMemberipoe:SocialFinanceIncMemberus-gaap:FairValueInputsLevel2Memberus-gaap:FairValueMeasurementsRecurringMember2019-12-310001818874us-gaap:EstimateOfFairValueFairValueDisclosureMemberus-gaap:AssetBackedSecuritiesMemberipoe:SocialFinanceIncMemberus-gaap:FairValueInputsLevel2Memberus-gaap:FairValueMeasurementsRecurringMember2019-12-310001818874ipoe:ResidualInvestmentsMemberus-gaap:CarryingReportedAmountFairValueDisclosureMemberipoe:SocialFinanceIncMemberus-gaap:FairValueInputsLevel3Memberus-gaap:FairValueMeasurementsRecurringMember2019-12-310001818874us-gaap:EstimateOfFairValueFairValueDisclosureMemberipoe:ResidualInvestmentsMemberipoe:SocialFinanceIncMemberus-gaap:FairValueInputsLevel3Memberus-gaap:FairValueMeasurementsRecurringMember2019-12-310001818874us-gaap:ExchangeTradedFundsMemberus-gaap:CarryingReportedAmountFairValueDisclosureMemberipoe:SocialFinanceIncMemberus-gaap:FairValueInputsLevel1Memberus-gaap:FairValueMeasurementsRecurringMember2019-12-310001818874us-gaap:EstimateOfFairValueFairValueDisclosureMemberus-gaap:ExchangeTradedFundsMemberipoe:SocialFinanceIncMemberus-gaap:FairValueInputsLevel1Memberus-gaap:FairValueMeasurementsRecurringMember2019-12-310001818874us-gaap:CarryingReportedAmountFairValueDisclosureMemberipoe:SocialFinanceIncMemberus-gaap:FairValueInputsLevel3Memberus-gaap:FairValueMeasurementsNonrecurringMemberus-gaap:OtherAggregatedInvestmentsMember2019-12-310001818874us-gaap:EstimateOfFairValueFairValueDisclosureMemberipoe:SocialFinanceIncMemberus-gaap:FairValueInputsLevel3Memberus-gaap:FairValueMeasurementsNonrecurringMemberus-gaap:OtherAggregatedInvestmentsMember2019-12-310001818874ipoe:SocialFinanceIncMemberus-gaap:CarryingReportedAmountFairValueDisclosureMemberus-gaap:FairValueInputsLevel1Memberus-gaap:FairValueMeasurementsRecurringMember2019-12-310001818874us-gaap:EstimateOfFairValueFairValueDisclosureMemberipoe:SocialFinanceIncMemberus-gaap:FairValueInputsLevel1Memberus-gaap:FairValueMeasurementsRecurringMember2019-12-310001818874ipoe:SocialFinanceIncMemberus-gaap:CarryingReportedAmountFairValueDisclosureMember2019-12-310001818874us-gaap:EstimateOfFairValueFairValueDisclosureMemberipoe:SocialFinanceIncMember2019-12-310001818874ipoe:SocialFinanceIncMemberus-gaap:CarryingReportedAmountFairValueDisclosureMemberus-gaap:FairValueInputsLevel2Member2019-12-310001818874us-gaap:EstimateOfFairValueFairValueDisclosureMemberipoe:SocialFinanceIncMemberus-gaap:FairValueInputsLevel2Member2019-12-310001818874ipoe:ResidualInterestsClassifiedAsDebtMemberus-gaap:CarryingReportedAmountFairValueDisclosureMemberipoe:SocialFinanceIncMemberus-gaap:FairValueInputsLevel3Memberus-gaap:FairValueMeasurementsRecurringMember2019-12-310001818874us-gaap:EstimateOfFairValueFairValueDisclosureMemberipoe:ResidualInterestsClassifiedAsDebtMemberipoe:SocialFinanceIncMemberus-gaap:FairValueInputsLevel3Memberus-gaap:FairValueMeasurementsRecurringMember2019-12-310001818874us-gaap:InterestRateSwapMemberus-gaap:CarryingReportedAmountFairValueDisclosureMemberipoe:SocialFinanceIncMemberus-gaap:FairValueInputsLevel2Memberus-gaap:FairValueMeasurementsRecurringMember2019-12-310001818874us-gaap:EstimateOfFairValueFairValueDisclosureMemberus-gaap:InterestRateSwapMemberipoe:SocialFinanceIncMemberus-gaap:FairValueInputsLevel2Memberus-gaap:FairValueMeasurementsRecurringMember2019-12-310001818874srt:MinimumMemberipoe:SocialFinanceIncMemberus-gaap:MeasurementInputPrepaymentRateMemberipoe:StudentLoanPortfolioSegmentMember2019-12-310001818874ipoe:SocialFinanceIncMemberus-gaap:MeasurementInputPrepaymentRateMemberipoe:StudentLoanPortfolioSegmentMembersrt:MaximumMember2019-12-310001818874srt:WeightedAverageMemberipoe:SocialFinanceIncMemberus-gaap:MeasurementInputPrepaymentRateMemberipoe:StudentLoanPortfolioSegmentMember2019-12-310001818874srt:MinimumMemberipoe:SocialFinanceIncMemberipoe:StudentLoanPortfolioSegmentMemberus-gaap:MeasurementInputDefaultRateMember2019-12-310001818874ipoe:SocialFinanceIncMemberipoe:StudentLoanPortfolioSegmentMemberus-gaap:MeasurementInputDefaultRateMembersrt:MaximumMember2019-12-310001818874srt:WeightedAverageMemberipoe:SocialFinanceIncMemberipoe:StudentLoanPortfolioSegmentMemberus-gaap:MeasurementInputDefaultRateMember2019-12-310001818874srt:MinimumMemberipoe:SocialFinanceIncMemberus-gaap:MeasurementInputDiscountRateMemberipoe:StudentLoanPortfolioSegmentMember2019-12-310001818874ipoe:SocialFinanceIncMemberus-gaap:MeasurementInputDiscountRateMemberipoe:StudentLoanPortfolioSegmentMembersrt:MaximumMember2019-12-310001818874srt:WeightedAverageMemberipoe:SocialFinanceIncMemberus-gaap:MeasurementInputDiscountRateMemberipoe:StudentLoanPortfolioSegmentMember2019-12-310001818874ipoe:HomeLoanPortfolioSegmentMembersrt:MinimumMemberipoe:SocialFinanceIncMemberus-gaap:MeasurementInputPrepaymentRateMember2019-12-310001818874ipoe:HomeLoanPortfolioSegmentMemberipoe:SocialFinanceIncMemberus-gaap:MeasurementInputPrepaymentRateMembersrt:MaximumMember2019-12-310001818874srt:WeightedAverageMemberipoe:HomeLoanPortfolioSegmentMemberipoe:SocialFinanceIncMemberus-gaap:MeasurementInputPrepaymentRateMember2019-12-310001818874ipoe:HomeLoanPortfolioSegmentMembersrt:MinimumMemberipoe:SocialFinanceIncMemberus-gaap:MeasurementInputDefaultRateMember2019-12-310001818874ipoe:HomeLoanPortfolioSegmentMemberipoe:SocialFinanceIncMemberus-gaap:MeasurementInputDefaultRateMembersrt:MaximumMember2019-12-310001818874srt:WeightedAverageMemberipoe:HomeLoanPortfolioSegmentMemberipoe:SocialFinanceIncMemberus-gaap:MeasurementInputDefaultRateMember2019-12-310001818874ipoe:HomeLoanPortfolioSegmentMembersrt:MinimumMemberipoe:SocialFinanceIncMemberus-gaap:MeasurementInputDiscountRateMember2019-12-310001818874ipoe:HomeLoanPortfolioSegmentMemberipoe:SocialFinanceIncMemberus-gaap:MeasurementInputDiscountRateMembersrt:MaximumMember2019-12-310001818874srt:WeightedAverageMemberipoe:HomeLoanPortfolioSegmentMemberipoe:SocialFinanceIncMemberus-gaap:MeasurementInputDiscountRateMember2019-12-310001818874srt:MinimumMemberipoe:SocialFinanceIncMemberus-gaap:MeasurementInputPrepaymentRateMemberipoe:PersonalLoanPortfolioSegmentMember2019-12-310001818874ipoe:SocialFinanceIncMemberus-gaap:MeasurementInputPrepaymentRateMemberipoe:PersonalLoanPortfolioSegmentMembersrt:MaximumMember2019-12-310001818874srt:WeightedAverageMemberipoe:SocialFinanceIncMemberus-gaap:MeasurementInputPrepaymentRateMemberipoe:PersonalLoanPortfolioSegmentMember2019-12-310001818874srt:MinimumMemberipoe:SocialFinanceIncMemberus-gaap:MeasurementInputDefaultRateMemberipoe:PersonalLoanPortfolioSegmentMember2019-12-310001818874ipoe:SocialFinanceIncMemberus-gaap:MeasurementInputDefaultRateMemberipoe:PersonalLoanPortfolioSegmentMembersrt:MaximumMember2019-12-310001818874srt:WeightedAverageMemberipoe:SocialFinanceIncMemberus-gaap:MeasurementInputDefaultRateMemberipoe:PersonalLoanPortfolioSegmentMember2019-12-310001818874srt:MinimumMemberipoe:SocialFinanceIncMemberus-gaap:MeasurementInputDiscountRateMemberipoe:PersonalLoanPortfolioSegmentMember2019-12-310001818874ipoe:SocialFinanceIncMemberus-gaap:MeasurementInputDiscountRateMemberipoe:PersonalLoanPortfolioSegmentMembersrt:MaximumMember2019-12-310001818874srt:WeightedAverageMemberipoe:SocialFinanceIncMemberus-gaap:MeasurementInputDiscountRateMemberipoe:PersonalLoanPortfolioSegmentMember2019-12-310001818874srt:MinimumMemberipoe:SocialFinanceIncMemberipoe:StudentLoanPortfolioSegmentMemberus-gaap:MeasurementInputCostToSellMember2019-12-310001818874ipoe:SocialFinanceIncMemberipoe:StudentLoanPortfolioSegmentMemberus-gaap:MeasurementInputCostToSellMembersrt:MaximumMember2019-12-310001818874srt:WeightedAverageMemberipoe:SocialFinanceIncMemberipoe:StudentLoanPortfolioSegmentMemberus-gaap:MeasurementInputCostToSellMember2019-12-310001818874ipoe:HomeLoanPortfolioSegmentMembersrt:MinimumMemberipoe:SocialFinanceIncMemberus-gaap:MeasurementInputCostToSellMember2019-12-310001818874ipoe:HomeLoanPortfolioSegmentMemberipoe:SocialFinanceIncMemberus-gaap:MeasurementInputCostToSellMembersrt:MaximumMember2019-12-310001818874srt:WeightedAverageMemberipoe:HomeLoanPortfolioSegmentMemberipoe:SocialFinanceIncMemberus-gaap:MeasurementInputCostToSellMember2019-12-310001818874srt:MinimumMemberipoe:SocialFinanceIncMemberus-gaap:MeasurementInputCostToSellMemberipoe:PersonalLoanPortfolioSegmentMember2019-12-310001818874ipoe:SocialFinanceIncMemberus-gaap:MeasurementInputCostToSellMemberipoe:PersonalLoanPortfolioSegmentMembersrt:MaximumMember2019-12-310001818874srt:WeightedAverageMemberipoe:SocialFinanceIncMemberus-gaap:MeasurementInputCostToSellMemberipoe:PersonalLoanPortfolioSegmentMember2019-12-310001818874ipoe:SocialFinanceIncMemberipoe:StudentLoanPortfolioSegmentMember2018-12-310001818874ipoe:HomeLoanPortfolioSegmentMemberipoe:SocialFinanceIncMember2018-12-310001818874ipoe:SocialFinanceIncMemberipoe:PersonalLoanPortfolioSegmentMember2018-12-310001818874ipoe:SocialFinanceIncMemberipoe:StudentLoanPortfolioSegmentMember2019-01-012019-12-310001818874ipoe:HomeLoanPortfolioSegmentMemberipoe:SocialFinanceIncMember2019-01-012019-12-310001818874ipoe:SocialFinanceIncMemberipoe:PersonalLoanPortfolioSegmentMember2019-01-012019-12-310001818874ipoe:SocialFinanceIncMemberipoe:StudentLoanPortfolioSegmentMember2020-01-012020-12-310001818874ipoe:HomeLoanPortfolioSegmentMemberipoe:SocialFinanceIncMember2020-01-012020-12-310001818874ipoe:SocialFinanceIncMemberipoe:PersonalLoanPortfolioSegmentMember2020-01-012020-12-310001818874srt:MinimumMemberipoe:SocialFinanceIncMemberus-gaap:MeasurementInputDiscountRateMember2019-12-310001818874ipoe:SocialFinanceIncMemberus-gaap:MeasurementInputDiscountRateMembersrt:MaximumMember2019-12-310001818874srt:MinimumMemberipoe:SocialFinanceIncMemberus-gaap:MeasurementInputPrepaymentRateMember2019-12-310001818874ipoe:SocialFinanceIncMemberus-gaap:MeasurementInputPrepaymentRateMembersrt:MaximumMember2019-12-310001818874srt:WeightedAverageMemberipoe:SocialFinanceIncMemberus-gaap:MeasurementInputPrepaymentRateMember2019-12-310001818874srt:MinimumMemberipoe:SocialFinanceIncMemberus-gaap:MeasurementInputDefaultRateMember2019-12-310001818874ipoe:SocialFinanceIncMemberus-gaap:MeasurementInputDefaultRateMembersrt:MaximumMember2019-12-310001818874srt:WeightedAverageMemberipoe:SocialFinanceIncMemberus-gaap:MeasurementInputDefaultRateMember2019-12-310001818874srt:WeightedAverageMemberipoe:SocialFinanceIncMemberus-gaap:MeasurementInputDiscountRateMember2019-12-310001818874ipoe:ResidualInvestmentsMemberipoe:SocialFinanceIncMemberus-gaap:FairValueMeasurementsRecurringMember2018-12-310001818874ipoe:ResidualInterestsClassifiedAsDebtMemberipoe:SocialFinanceIncMemberus-gaap:FairValueMeasurementsRecurringMember2018-12-310001818874ipoe:ResidualInvestmentsMemberipoe:SocialFinanceIncMemberus-gaap:FairValueMeasurementsRecurringMember2019-01-012019-12-310001818874ipoe:ResidualInterestsClassifiedAsDebtMemberipoe:SocialFinanceIncMemberus-gaap:FairValueMeasurementsRecurringMember2019-01-012019-12-310001818874ipoe:ResidualInvestmentsMemberipoe:SocialFinanceIncMemberus-gaap:FairValueMeasurementsRecurringMember2020-01-012020-12-310001818874ipoe:ResidualInterestsClassifiedAsDebtMemberipoe:SocialFinanceIncMemberus-gaap:FairValueMeasurementsRecurringMember2020-01-012020-12-310001818874us-gaap:LoansMemberipoe:SocialFinanceIncMember2020-01-012020-12-310001818874us-gaap:LoansMemberipoe:SocialFinanceIncMember2019-01-012019-12-310001818874us-gaap:LoansMemberipoe:SocialFinanceIncMember2018-01-012018-12-310001818874ipoe:ResidualInvestmentsMemberipoe:SocialFinanceIncMember2020-01-012020-12-310001818874ipoe:ResidualInvestmentsMemberipoe:SocialFinanceIncMember2019-01-012019-12-310001818874ipoe:ResidualInvestmentsMemberipoe:SocialFinanceIncMember2018-01-012018-12-310001818874ipoe:MeasurementInputLoanFundingProbabilityMembersrt:MinimumMemberipoe:SocialFinanceIncMember2019-12-310001818874ipoe:MeasurementInputLoanFundingProbabilityMemberipoe:SocialFinanceIncMembersrt:MaximumMember2019-12-310001818874srt:WeightedAverageMemberipoe:MeasurementInputLoanFundingProbabilityMemberipoe:SocialFinanceIncMember2019-12-310001818874us-gaap:InterestRateLockCommitmentsMemberipoe:SocialFinanceIncMemberus-gaap:FairValueMeasurementsRecurringMember2018-12-310001818874us-gaap:InterestRateLockCommitmentsMemberipoe:SocialFinanceIncMemberus-gaap:FairValueMeasurementsRecurringMember2019-01-012019-12-310001818874us-gaap:InterestRateLockCommitmentsMemberipoe:SocialFinanceIncMemberus-gaap:FairValueMeasurementsRecurringMember2020-01-012020-12-310001818874ipoe:StudentLoanWarehouseFacilitiesMemberipoe:SoFiFundingIMemberus-gaap:LondonInterbankOfferedRateLIBORMemberipoe:SocialFinanceIncMemberus-gaap:LineOfCreditMember2020-01-012020-12-310001818874ipoe:StudentLoanWarehouseFacilitiesMemberipoe:SoFiFundingIMemberipoe:SocialFinanceIncMemberus-gaap:LineOfCreditMember2019-12-310001818874ipoe:StudentLoanWarehouseFacilitiesMemberipoe:SocialFinanceIncMemberus-gaap:PrimeRateMemberipoe:SoFiFundingIIIMemberus-gaap:LineOfCreditMember2020-01-012020-12-310001818874ipoe:StudentLoanWarehouseFacilitiesMemberipoe:SocialFinanceIncMemberipoe:SoFiFundingIIIMemberus-gaap:LineOfCreditMember2019-12-310001818874ipoe:StudentLoanWarehouseFacilitiesMemberipoe:SoFiFundingVMemberus-gaap:LondonInterbankOfferedRateLIBORMemberipoe:SocialFinanceIncMemberus-gaap:LineOfCreditMember2020-01-012020-12-310001818874ipoe:StudentLoanWarehouseFacilitiesMemberipoe:SoFiFundingVMemberipoe:SocialFinanceIncMemberus-gaap:LineOfCreditMember2019-12-310001818874ipoe:StudentLoanWarehouseFacilitiesMemberus-gaap:LondonInterbankOfferedRateLIBORMemberipoe:SocialFinanceIncMemberipoe:SoFiFundingVIMemberus-gaap:LineOfCreditMember2020-01-012020-12-310001818874ipoe:StudentLoanWarehouseFacilitiesMemberipoe:SocialFinanceIncMemberipoe:SoFiFundingVIMemberus-gaap:LineOfCreditMember2019-12-310001818874ipoe:StudentLoanWarehouseFacilitiesMemberus-gaap:LondonInterbankOfferedRateLIBORMemberipoe:SocialFinanceIncMemberipoe:SoFiFundingVIIMemberus-gaap:LineOfCreditMember2020-01-012020-12-310001818874ipoe:StudentLoanWarehouseFacilitiesMemberipoe:SocialFinanceIncMemberipoe:SoFiFundingVIIMemberus-gaap:LineOfCreditMember2019-12-310001818874ipoe:StudentLoanWarehouseFacilitiesMemberipoe:SoFiFundingVIIIMemberus-gaap:LondonInterbankOfferedRateLIBORMemberipoe:SocialFinanceIncMemberus-gaap:LineOfCreditMember2020-01-012020-12-310001818874ipoe:StudentLoanWarehouseFacilitiesMemberipoe:SoFiFundingVIIIMemberipoe:SocialFinanceIncMemberus-gaap:LineOfCreditMember2019-12-310001818874ipoe:StudentLoanWarehouseFacilitiesMemberus-gaap:LondonInterbankOfferedRateLIBORMemberipoe:SocialFinanceIncMemberipoe:SoFiFundingIXMemberus-gaap:LineOfCreditMember2020-01-012020-12-310001818874ipoe:StudentLoanWarehouseFacilitiesMemberipoe:CommercialPaperRateMemberipoe:SocialFinanceIncMemberipoe:SoFiFundingIXMemberus-gaap:LineOfCreditMember2020-01-012020-12-310001818874ipoe:StudentLoanWarehouseFacilitiesMemberipoe:SocialFinanceIncMemberipoe:SoFiFundingIXMemberus-gaap:LineOfCreditMember2019-12-310001818874ipoe:StudentLoanWarehouseFacilitiesMemberipoe:CommercialPaperRateMemberipoe:SocialFinanceIncMemberipoe:SoFiFundingXMemberus-gaap:LineOfCreditMember2020-01-012020-12-310001818874ipoe:StudentLoanWarehouseFacilitiesMemberipoe:SocialFinanceIncMemberipoe:SoFiFundingXMemberus-gaap:LineOfCreditMember2019-12-310001818874ipoe:StudentLoanWarehouseFacilitiesMemberipoe:CommercialPaperRateMemberipoe:SocialFinanceIncMemberipoe:SoFiFundingXIMemberus-gaap:LineOfCreditMember2020-01-012020-12-310001818874ipoe:StudentLoanWarehouseFacilitiesMemberipoe:SocialFinanceIncMemberipoe:SoFiFundingXIMemberus-gaap:LineOfCreditMember2019-12-310001818874ipoe:StudentLoanWarehouseFacilitiesMemberipoe:SocialFinanceIncMemberus-gaap:LineOfCreditMember2019-12-310001818874us-gaap:LondonInterbankOfferedRateLIBORMemberipoe:SocialFinanceIncMemberipoe:SoFiFundingPLIMemberipoe:PersonalLoanWarehouseFacilitiesMemberus-gaap:LineOfCreditMember2020-01-012020-12-310001818874ipoe:SocialFinanceIncMemberipoe:SoFiFundingPLIMemberipoe:PersonalLoanWarehouseFacilitiesMemberus-gaap:LineOfCreditMember2019-12-310001818874us-gaap:LondonInterbankOfferedRateLIBORMemberipoe:SocialFinanceIncMemberipoe:SoFiFundingPLIIMemberipoe:PersonalLoanWarehouseFacilitiesMemberus-gaap:LineOfCreditMember2020-01-012020-12-310001818874ipoe:SocialFinanceIncMemberipoe:SoFiFundingPLIIMemberipoe:PersonalLoanWarehouseFacilitiesMemberus-gaap:LineOfCreditMember2019-12-310001818874us-gaap:LondonInterbankOfferedRateLIBORMemberipoe:SocialFinanceIncMemberipoe:SoFiFundingPLIIIMemberipoe:PersonalLoanWarehouseFacilitiesMemberus-gaap:LineOfCreditMember2020-01-012020-12-310001818874ipoe:SocialFinanceIncMemberipoe:SoFiFundingPLIIIMemberipoe:PersonalLoanWarehouseFacilitiesMemberus-gaap:LineOfCreditMember2019-12-310001818874ipoe:CommercialPaperRateMemberipoe:SocialFinanceIncMemberipoe:SoFiFundingPLIVMemberipoe:PersonalLoanWarehouseFacilitiesMemberus-gaap:LineOfCreditMember2020-01-012020-12-310001818874ipoe:SocialFinanceIncMemberipoe:SoFiFundingPLIVMemberipoe:PersonalLoanWarehouseFacilitiesMemberus-gaap:LineOfCreditMember2019-12-310001818874us-gaap:LondonInterbankOfferedRateLIBORMemberipoe:SocialFinanceIncMemberipoe:SoFiFundingPLVIMemberipoe:PersonalLoanWarehouseFacilitiesMemberus-gaap:LineOfCreditMember2020-01-012020-12-310001818874ipoe:SocialFinanceIncMemberipoe:SoFiFundingPLVIMemberipoe:PersonalLoanWarehouseFacilitiesMemberus-gaap:LineOfCreditMember2019-12-310001818874ipoe:SoFiFundingPLVIIMemberus-gaap:LondonInterbankOfferedRateLIBORMemberipoe:SocialFinanceIncMemberipoe:PersonalLoanWarehouseFacilitiesMemberus-gaap:LineOfCreditMember2020-01-012020-12-310001818874ipoe:SoFiFundingPLVIIMemberipoe:SocialFinanceIncMemberipoe:PersonalLoanWarehouseFacilitiesMemberus-gaap:LineOfCreditMember2019-12-310001818874ipoe:SocialFinanceIncMemberipoe:SoFiFundingPLIXMemberipoe:PersonalLoanWarehouseFacilitiesMemberus-gaap:LineOfCreditMember2020-12-310001818874us-gaap:LondonInterbankOfferedRateLIBORMemberipoe:SocialFinanceIncMemberipoe:SoFiFundingPLIXMemberipoe:PersonalLoanWarehouseFacilitiesMemberus-gaap:LineOfCreditMember2020-01-012020-12-310001818874ipoe:SocialFinanceIncMemberipoe:SoFiFundingPLIXMemberipoe:PersonalLoanWarehouseFacilitiesMemberus-gaap:LineOfCreditMember2019-12-310001818874us-gaap:LondonInterbankOfferedRateLIBORMemberipoe:SocialFinanceIncMemberipoe:SoFiFundingPLXMemberipoe:PersonalLoanWarehouseFacilitiesMemberus-gaap:LineOfCreditMember2020-01-012020-12-310001818874ipoe:SocialFinanceIncMemberipoe:SoFiFundingPLXMemberipoe:PersonalLoanWarehouseFacilitiesMemberus-gaap:LineOfCreditMember2019-12-310001818874ipoe:SoFiFundingPLXIMemberus-gaap:LondonInterbankOfferedRateLIBORMemberipoe:SocialFinanceIncMemberipoe:PersonalLoanWarehouseFacilitiesMemberus-gaap:LineOfCreditMember2020-01-012020-12-310001818874ipoe:SoFiFundingPLXIMemberipoe:SocialFinanceIncMemberipoe:PersonalLoanWarehouseFacilitiesMemberus-gaap:LineOfCreditMember2019-12-310001818874srt:MinimumMemberus-gaap:LondonInterbankOfferedRateLIBORMemberipoe:SocialFinanceIncMemberipoe:SoFiFundingPLXIIMemberipoe:PersonalLoanWarehouseFacilitiesMemberus-gaap:LineOfCreditMember2020-01-012020-12-310001818874us-gaap:LondonInterbankOfferedRateLIBORMemberipoe:SocialFinanceIncMemberipoe:SoFiFundingPLXIIMemberipoe:PersonalLoanWarehouseFacilitiesMemberus-gaap:LineOfCreditMembersrt:MaximumMember2020-01-012020-12-310001818874ipoe:SocialFinanceIncMemberipoe:SoFiFundingPLXIIMemberipoe:PersonalLoanWarehouseFacilitiesMemberus-gaap:LineOfCreditMember2019-12-310001818874us-gaap:LondonInterbankOfferedRateLIBORMemberipoe:SocialFinanceIncMemberipoe:SoFiFundingPLXIIIMemberipoe:PersonalLoanWarehouseFacilitiesMemberus-gaap:LineOfCreditMember2020-01-012020-12-310001818874ipoe:SocialFinanceIncMemberipoe:SoFiFundingPLXIIIMemberipoe:PersonalLoanWarehouseFacilitiesMemberus-gaap:LineOfCreditMember2019-12-310001818874ipoe:SocialFinanceIncMemberipoe:PersonalLoanWarehouseFacilitiesMemberus-gaap:LineOfCreditMember2019-12-310001818874us-gaap:LondonInterbankOfferedRateLIBORMemberipoe:SocialFinanceIncMemberipoe:HomeLoanWarehouseFacilitiesMemberipoe:MortgageWarehouseVMemberus-gaap:LineOfCreditMember2020-01-012020-12-310001818874ipoe:SocialFinanceIncMemberipoe:HomeLoanWarehouseFacilitiesMemberipoe:MortgageWarehouseVMemberus-gaap:LineOfCreditMember2019-12-310001818874ipoe:SocialFinanceIncMemberipoe:HomeLoanWarehouseFacilitiesMemberus-gaap:LineOfCreditMember2019-12-310001818874us-gaap:LondonInterbankOfferedRateLIBORMemberipoe:SocialFinanceIncMemberipoe:RiskRetentionWarehouseFacilitiesMemberipoe:SoFiRRFundingIMemberus-gaap:LineOfCreditMember2020-01-012020-12-310001818874ipoe:SocialFinanceIncMemberipoe:RiskRetentionWarehouseFacilitiesMemberipoe:SoFiRRFundingIMemberus-gaap:LineOfCreditMember2019-12-310001818874us-gaap:LondonInterbankOfferedRateLIBORMemberipoe:SocialFinanceIncMemberipoe:SoFiRRRepoMemberipoe:RiskRetentionWarehouseFacilitiesMemberus-gaap:LineOfCreditMember2020-01-012020-12-310001818874ipoe:SocialFinanceIncMemberipoe:SoFiRRRepoMemberipoe:RiskRetentionWarehouseFacilitiesMemberus-gaap:LineOfCreditMember2019-12-310001818874ipoe:SoFiEURRRepoMemberus-gaap:LondonInterbankOfferedRateLIBORMemberipoe:SocialFinanceIncMemberipoe:RiskRetentionWarehouseFacilitiesMemberus-gaap:LineOfCreditMember2020-01-012020-12-310001818874ipoe:SoFiEURRRepoMemberipoe:SocialFinanceIncMemberipoe:RiskRetentionWarehouseFacilitiesMemberus-gaap:LineOfCreditMember2019-12-310001818874srt:MinimumMemberus-gaap:LondonInterbankOfferedRateLIBORMemberipoe:SocialFinanceIncMemberipoe:SoFiCRRRepoMemberipoe:RiskRetentionWarehouseFacilitiesMemberus-gaap:LineOfCreditMember2020-01-012020-12-310001818874us-gaap:LondonInterbankOfferedRateLIBORMemberipoe:SocialFinanceIncMemberipoe:SoFiCRRRepoMemberipoe:RiskRetentionWarehouseFacilitiesMemberus-gaap:LineOfCreditMembersrt:MaximumMember2020-01-012020-12-310001818874ipoe:SocialFinanceIncMemberipoe:SoFiCRRRepoMemberipoe:RiskRetentionWarehouseFacilitiesMemberus-gaap:LineOfCreditMember2019-12-310001818874ipoe:SoFiRRFundingIIMemberus-gaap:LondonInterbankOfferedRateLIBORMemberipoe:SocialFinanceIncMemberipoe:RiskRetentionWarehouseFacilitiesMemberus-gaap:LineOfCreditMember2020-01-012020-12-310001818874ipoe:SoFiRRFundingIIMemberipoe:SocialFinanceIncMemberipoe:RiskRetentionWarehouseFacilitiesMemberus-gaap:LineOfCreditMember2019-12-310001818874ipoe:SoFiRRFundingIIIMemberus-gaap:LondonInterbankOfferedRateLIBORMemberipoe:SocialFinanceIncMemberipoe:RiskRetentionWarehouseFacilitiesMemberus-gaap:LineOfCreditMember2020-01-012020-12-310001818874ipoe:SoFiRRFundingIIIMemberipoe:SocialFinanceIncMemberipoe:RiskRetentionWarehouseFacilitiesMemberus-gaap:LineOfCreditMember2019-12-310001818874us-gaap:LondonInterbankOfferedRateLIBORMemberipoe:SocialFinanceIncMemberipoe:RiskRetentionWarehouseFacilitiesMemberipoe:SoFiRRFundingIVMemberus-gaap:LineOfCreditMember2020-01-012020-12-310001818874ipoe:SocialFinanceIncMemberipoe:RiskRetentionWarehouseFacilitiesMemberipoe:SoFiRRFundingIVMemberus-gaap:LineOfCreditMember2019-12-310001818874ipoe:SocialFinanceIncMemberipoe:RiskRetentionWarehouseFacilitiesMemberus-gaap:LineOfCreditMember2019-12-310001818874us-gaap:RevolvingCreditFacilityMemberus-gaap:LondonInterbankOfferedRateLIBORMemberipoe:SocialFinanceIncMemberus-gaap:RevolvingCreditFacilityMemberipoe:SoFiCorporateRevolverMember2020-01-012020-12-310001818874us-gaap:RevolvingCreditFacilityMemberipoe:SocialFinanceIncMemberus-gaap:RevolvingCreditFacilityMemberipoe:SoFiCorporateRevolverMember2019-12-310001818874ipoe:SocialFinanceIncMemberus-gaap:LondonInterbankOfferedRateLIBORMemberipoe:SellerNoteMemberus-gaap:NotesPayableOtherPayablesMember2020-12-310001818874ipoe:SocialFinanceIncMemberipoe:SellerNoteMemberus-gaap:NotesPayableOtherPayablesMember2019-12-310001818874srt:MinimumMemberus-gaap:LondonInterbankOfferedRateLIBORMemberipoe:SocialFinanceIncMemberipoe:OtherFinancingNotesMemberus-gaap:NotesPayableOtherPayablesMember2020-12-310001818874us-gaap:LondonInterbankOfferedRateLIBORMemberipoe:SocialFinanceIncMemberipoe:OtherFinancingNotesMemberus-gaap:NotesPayableOtherPayablesMembersrt:MaximumMember2020-12-310001818874ipoe:SocialFinanceIncMemberipoe:OtherFinancingNotesMemberus-gaap:NotesPayableOtherPayablesMember2019-12-310001818874srt:MinimumMemberipoe:LoanSecuritizationsMemberus-gaap:LondonInterbankOfferedRateLIBORMemberipoe:SocialFinanceIncMemberipoe:SoFiPLP2016BLLCMember2020-01-012020-12-310001818874ipoe:LoanSecuritizationsMemberus-gaap:LondonInterbankOfferedRateLIBORMemberipoe:SocialFinanceIncMemberipoe:SoFiPLP2016BLLCMembersrt:MaximumMember2020-01-012020-12-310001818874ipoe:LoanSecuritizationsMemberipoe:SocialFinanceIncMemberipoe:SoFiPLP2016BLLCMember2019-12-310001818874srt:MinimumMemberipoe:LoanSecuritizationsMemberus-gaap:LondonInterbankOfferedRateLIBORMemberipoe:SocialFinanceIncMemberipoe:SoFiPLP2016CLLCMember2020-01-012020-12-310001818874ipoe:LoanSecuritizationsMemberus-gaap:LondonInterbankOfferedRateLIBORMemberipoe:SocialFinanceIncMemberipoe:SoFiPLP2016CLLCMembersrt:MaximumMember2020-01-012020-12-310001818874ipoe:LoanSecuritizationsMemberipoe:SocialFinanceIncMemberipoe:SoFiPLP2016CLLCMember2019-12-310001818874srt:MinimumMemberipoe:LoanSecuritizationsMemberus-gaap:LondonInterbankOfferedRateLIBORMemberipoe:SocialFinanceIncMemberipoe:SoFiPLP2016DLLCMember2020-01-012020-12-310001818874ipoe:LoanSecuritizationsMemberus-gaap:LondonInterbankOfferedRateLIBORMemberipoe:SocialFinanceIncMemberipoe:SoFiPLP2016DLLCMembersrt:MaximumMember2020-01-012020-12-310001818874ipoe:LoanSecuritizationsMemberipoe:SocialFinanceIncMemberipoe:SoFiPLP2016DLLCMember2019-12-310001818874srt:MinimumMemberipoe:LoanSecuritizationsMemberus-gaap:LondonInterbankOfferedRateLIBORMemberipoe:SocialFinanceIncMemberipoe:SoFiPLP2016ELLCMember2020-01-012020-12-310001818874ipoe:LoanSecuritizationsMemberus-gaap:LondonInterbankOfferedRateLIBORMemberipoe:SocialFinanceIncMemberipoe:SoFiPLP2016ELLCMembersrt:MaximumMember2020-01-012020-12-310001818874ipoe:LoanSecuritizationsMemberipoe:SocialFinanceIncMemberipoe:SoFiPLP2016ELLCMember2019-12-310001818874srt:MinimumMemberipoe:LoanSecuritizationsMemberus-gaap:LondonInterbankOfferedRateLIBORMemberipoe:SocialFinanceIncMemberipoe:SoFiPLP2017ALLCMember2020-01-012020-12-310001818874ipoe:LoanSecuritizationsMemberus-gaap:LondonInterbankOfferedRateLIBORMemberipoe:SocialFinanceIncMemberipoe:SoFiPLP2017ALLCMembersrt:MaximumMember2020-01-012020-12-310001818874ipoe:LoanSecuritizationsMemberipoe:SocialFinanceIncMemberipoe:SoFiPLP2017ALLCMember2019-12-310001818874srt:MinimumMemberipoe:LoanSecuritizationsMemberipoe:SocialFinanceIncMemberipoe:SoFiPLP2017BLLCMember2020-12-310001818874ipoe:LoanSecuritizationsMemberipoe:SocialFinanceIncMemberipoe:SoFiPLP2017BLLCMembersrt:MaximumMember2020-12-310001818874ipoe:LoanSecuritizationsMemberipoe:SocialFinanceIncMemberipoe:SoFiPLP2017BLLCMember2019-12-310001818874srt:MinimumMemberipoe:LoanSecuritizationsMemberus-gaap:LondonInterbankOfferedRateLIBORMemberipoe:SocialFinanceIncMemberipoe:SoFiPLP2017CLLCMember2020-01-012020-12-310001818874ipoe:LoanSecuritizationsMemberus-gaap:LondonInterbankOfferedRateLIBORMemberipoe:SocialFinanceIncMemberipoe:SoFiPLP2017CLLCMembersrt:MaximumMember2020-01-012020-12-310001818874ipoe:LoanSecuritizationsMemberipoe:SocialFinanceIncMemberipoe:SoFiPLP2017CLLCMember2019-12-310001818874ipoe:LoanSecuritizationsMemberipoe:SocialFinanceIncMember2019-12-310001818874ipoe:SoFiCLP20161LLCMemberipoe:SocialFinanceIncMemberipoe:PersonalLoanSecuritizationsMember2019-12-310001818874srt:MinimumMemberipoe:SocialFinanceIncMemberipoe:SoFiCLP20162LLCMemberipoe:PersonalLoanSecuritizationsMember2020-12-310001818874ipoe:SocialFinanceIncMemberipoe:SoFiCLP20162LLCMemberipoe:PersonalLoanSecuritizationsMembersrt:MaximumMember2020-12-310001818874ipoe:SocialFinanceIncMemberipoe:SoFiCLP20162LLCMemberipoe:PersonalLoanSecuritizationsMember2019-12-310001818874srt:MinimumMemberipoe:SocialFinanceIncMemberipoe:SoFiCLP20163LLCMemberipoe:PersonalLoanSecuritizationsMember2020-12-310001818874ipoe:SocialFinanceIncMemberipoe:SoFiCLP20163LLCMemberipoe:PersonalLoanSecuritizationsMembersrt:MaximumMember2020-12-310001818874ipoe:SocialFinanceIncMemberipoe:SoFiCLP20163LLCMemberipoe:PersonalLoanSecuritizationsMember2019-12-310001818874ipoe:SocialFinanceIncMemberipoe:SoFiCLP20171LLCMemberipoe:PersonalLoanSecuritizationsMember2020-12-310001818874srt:MinimumMemberipoe:SocialFinanceIncMemberipoe:SoFiCLP20171LLCMemberipoe:PersonalLoanSecuritizationsMember2020-12-310001818874ipoe:SocialFinanceIncMemberipoe:SoFiCLP20171LLCMemberipoe:PersonalLoanSecuritizationsMembersrt:MaximumMember2020-12-310001818874ipoe:SocialFinanceIncMemberipoe:SoFiCLP20171LLCMemberipoe:PersonalLoanSecuritizationsMember2019-12-310001818874ipoe:SoFiCLP20172LLCMemberipoe:SocialFinanceIncMemberipoe:PersonalLoanSecuritizationsMember2020-12-310001818874srt:MinimumMemberipoe:SoFiCLP20172LLCMemberipoe:SocialFinanceIncMemberipoe:PersonalLoanSecuritizationsMember2020-12-310001818874ipoe:SoFiCLP20172LLCMemberipoe:SocialFinanceIncMemberipoe:PersonalLoanSecuritizationsMembersrt:MaximumMember2020-12-310001818874ipoe:SoFiCLP20172LLCMemberipoe:SocialFinanceIncMemberipoe:PersonalLoanSecuritizationsMember2019-12-310001818874ipoe:SocialFinanceIncMemberipoe:SoFiCLP20173LLCMemberipoe:PersonalLoanSecuritizationsMember2020-12-310001818874srt:MinimumMemberipoe:SocialFinanceIncMemberipoe:SoFiCLP20173LLCMemberipoe:PersonalLoanSecuritizationsMember2020-12-310001818874ipoe:SocialFinanceIncMemberipoe:SoFiCLP20173LLCMemberipoe:PersonalLoanSecuritizationsMembersrt:MaximumMember2020-12-310001818874ipoe:SocialFinanceIncMemberipoe:SoFiCLP20173LLCMemberipoe:PersonalLoanSecuritizationsMember2019-12-310001818874srt:MinimumMemberipoe:SocialFinanceIncMemberipoe:SoFiCLP20183LLCMemberipoe:PersonalLoanSecuritizationsMember2020-12-310001818874ipoe:SocialFinanceIncMemberipoe:SoFiCLP20183LLCMemberipoe:PersonalLoanSecuritizationsMembersrt:MaximumMember2020-12-310001818874ipoe:SocialFinanceIncMemberipoe:SoFiCLP20183LLCMemberipoe:PersonalLoanSecuritizationsMember2019-12-310001818874srt:MinimumMemberipoe:SocialFinanceIncMemberipoe:SoFiCLP20184LLCMemberipoe:PersonalLoanSecuritizationsMember2020-12-310001818874ipoe:SocialFinanceIncMemberipoe:SoFiCLP20184LLCMemberipoe:PersonalLoanSecuritizationsMembersrt:MaximumMember2020-12-310001818874ipoe:SocialFinanceIncMemberipoe:SoFiCLP20184LLCMemberipoe:PersonalLoanSecuritizationsMember2019-12-310001818874ipoe:SocialFinanceIncMemberipoe:SoFiCLP20183RepackLLCMemberipoe:PersonalLoanSecuritizationsMember2019-12-310001818874ipoe:SocialFinanceIncMemberipoe:SoFiCLP20184RepackLLCMemberipoe:PersonalLoanSecuritizationsMember2019-12-310001818874ipoe:SocialFinanceIncMemberipoe:PersonalLoanSecuritizationsMember2019-12-310001818874srt:MinimumMemberipoe:SocialFinanceIncMemberus-gaap:PrimeRateMemberipoe:SoFiFundingIIIMember2020-01-012020-12-310001818874ipoe:SocialFinanceIncMemberipoe:LoanWarehouseFacilitiesMember2020-01-012020-12-310001818874ipoe:SocialFinanceIncMemberipoe:LoanWarehouseFacilitiesMember2020-12-310001818874ipoe:SocialFinanceIncMemberipoe:RiskRetentionWarehouseFacilitiesMember2020-01-012020-12-310001818874ipoe:SocialFinanceIncMemberipoe:LoanSecuritizationsMember2020-01-012020-12-310001818874ipoe:SocialFinanceIncMemberipoe:LoanSecuritizationsMember2020-12-310001818874ipoe:SocialFinanceIncMemberipoe:PersonalLoanSecuritizationsMember2020-01-012020-12-310001818874ipoe:SocialFinanceIncMemberipoe:PersonalLoanSecuritizationsMember2020-12-310001818874ipoe:SocialFinanceIncMemberipoe:SellerNoteMemberipoe:GalileoFinancialTechnologiesIncMember2020-12-310001818874ipoe:SocialFinanceIncMemberipoe:LoanWarehouseFacilitiesMember2019-01-012019-12-310001818874ipoe:SocialFinanceIncMemberipoe:LoanWarehouseFacilitiesMember2019-12-310001818874ipoe:SocialFinanceIncMemberipoe:PersonalLoanSecuritizationsMember2019-01-012019-12-310001818874ipoe:SocialFinanceIncMemberipoe:PersonalLoanSecuritizationsMember2019-12-310001818874ipoe:SocialFinanceIncMemberipoe:PersonalLoanSecuritizationsMember2019-05-012019-05-310001818874ipoe:SocialFinanceIncMemberipoe:RevolvingCreditFacilitySellerNoteAndOtherFinancingNotesMember2020-12-310001818874ipoe:SocialFinanceIncMemberipoe:Series1RedeemablePreferredStockMember2019-12-310001818874ipoe:SocialFinanceIncMemberipoe:SeriesARedeemablePreferredStockMember2019-12-310001818874ipoe:SocialFinanceIncMemberipoe:SeriesBRedeemablePreferredStockMember2019-12-310001818874srt:MinimumMemberipoe:SocialFinanceIncMemberipoe:SeriesCRedeemablePreferredStockMember2020-12-310001818874ipoe:SocialFinanceIncMemberipoe:SeriesCRedeemablePreferredStockMembersrt:MaximumMember2020-12-310001818874ipoe:SocialFinanceIncMemberipoe:SeriesCRedeemablePreferredStockMember2019-12-310001818874ipoe:SeriesDRedeemablePreferredStockMemberipoe:SocialFinanceIncMember2019-12-310001818874ipoe:SocialFinanceIncMemberipoe:SeriesERedeemablePreferredStockMember2019-12-310001818874ipoe:SocialFinanceIncMemberipoe:SeriesFRedeemablePreferredStockMember2019-12-310001818874ipoe:SocialFinanceIncMemberipoe:SeriesGRedeemablePreferredStockMember2019-12-310001818874ipoe:SocialFinanceIncMemberipoe:SeriesHRedeemablePreferredStockMember2019-12-310001818874ipoe:SocialFinanceIncMemberipoe:SeriesH1RedeemablePreferredStockMember2019-12-310001818874ipoe:SocialFinanceIncMemberipoe:SeriesHRedeemablePreferredStockMember2019-05-012019-05-310001818874ipoe:SocialFinanceIncMemberipoe:Series1RedeemablePreferredStockMember2019-05-012019-05-310001818874ipoe:SocialFinanceIncMemberus-gaap:RedeemablePreferredStockMember2019-05-012019-05-310001818874ipoe:SocialFinanceIncMemberipoe:SeriesHRedeemablePreferredStockMember2019-10-012019-10-310001818874ipoe:SocialFinanceIncMemberipoe:SeriesARedeemablePreferredStockMember2019-01-012019-12-310001818874ipoe:SocialFinanceIncMemberipoe:SeriesBRedeemablePreferredStockMember2019-01-012019-12-310001818874ipoe:SeriesDRedeemablePreferredStockMemberipoe:SocialFinanceIncMember2019-01-012019-12-310001818874ipoe:SocialFinanceIncMemberipoe:SeriesERedeemablePreferredStockMember2019-01-012019-12-310001818874ipoe:SocialFinanceIncMemberipoe:SeriesFRedeemablePreferredStockMember2019-01-012019-12-310001818874ipoe:SocialFinanceIncMemberipoe:SeriesGRedeemablePreferredStockMember2019-01-012019-12-310001818874ipoe:SocialFinanceIncMemberipoe:SeriesHRedeemablePreferredStockMember2019-01-012019-12-310001818874ipoe:SocialFinanceIncMemberipoe:SeriesH1RedeemablePreferredStockMember2019-01-012019-12-310001818874us-gaap:DividendPaidMemberipoe:SocialFinanceIncMemberipoe:Series1RedeemablePreferredStockMember2020-01-012020-12-310001818874us-gaap:DividendPaidMemberipoe:SocialFinanceIncMemberipoe:Series1RedeemablePreferredStockMember2019-01-012019-12-310001818874ipoe:SocialFinanceIncMemberipoe:Series1RedeemablePreferredStockMember2020-01-012020-12-310001818874ipoe:SocialFinanceIncMemberipoe:Series1RedeemablePreferredStockMember2019-01-012019-12-310001818874srt:MinimumMemberipoe:SocialFinanceIncMemberipoe:Series1RedeemablePreferredStockMemberipoe:InitialPublicOfferingMember2020-12-310001818874srt:MinimumMemberipoe:SocialFinanceIncMemberipoe:Series1RedeemablePreferredStockMemberipoe:InitialPublicOfferingMember2020-01-012020-12-310001818874ipoe:SocialFinanceIncMemberipoe:SeriesCRedeemablePreferredStockMember2020-01-012020-12-310001818874ipoe:SeriesAAndBRedeemablePreferredStockMemberipoe:SocialFinanceIncMember2020-12-310001818874ipoe:SocialFinanceIncMemberipoe:SeriesDAndERedeemablePreferredStockMember2020-12-310001818874us-gaap:MeasurementInputRiskFreeInterestRateMemberipoe:SocialFinanceIncMember2019-12-310001818874ipoe:SocialFinanceIncMemberus-gaap:MeasurementInputExpectedTermMember2019-12-310001818874ipoe:SocialFinanceIncMemberus-gaap:MeasurementInputPriceVolatilityMember2019-12-310001818874ipoe:SocialFinanceIncMemberus-gaap:MeasurementInputExpectedDividendRateMember2019-12-310001818874ipoe:SocialFinanceIncMemberipoe:WarrantLiabilityMember2019-05-290001818874ipoe:SocialFinanceIncMemberipoe:WarrantLiabilityMember2019-05-302019-12-310001818874ipoe:SocialFinanceIncMemberipoe:WarrantLiabilityMember2020-01-012020-12-310001818874ipoe:SocialFinanceIncMemberus-gaap:CommonStockMember2019-12-310001818874ipoe:SocialFinanceIncMemberus-gaap:RedeemablePreferredStockMember2019-12-310001818874ipoe:SocialFinanceIncMemberipoe:UnissuedRedeemablePreferredStockReservedForIssuedWarrantsMember2019-12-310001818874ipoe:SocialFinanceIncMemberipoe:UnissuedRedeemablePreferredStockMember2019-12-310001818874ipoe:SocialFinanceIncMemberipoe:EmployeeStockOptionAndRestrictedStockUnitsMember2019-12-310001818874ipoe:SocialFinanceIncMemberipoe:AmendedAndRestated2011StockOptionPlanMember2019-12-310001818874ipoe:SocialFinanceIncMemberipoe:ContingentCommonStockAcquisitionsMember2019-12-310001818874ipoe:StockPlanAssumedInBusinessCombinationMemberipoe:SocialFinanceIncMember2020-12-310001818874ipoe:SocialFinanceIncMemberus-gaap:RestrictedStockUnitsRSUMember2020-01-012020-12-310001818874ipoe:SocialFinanceIncMemberus-gaap:RestrictedStockUnitsRSUMember2019-01-012019-12-310001818874ipoe:SocialFinanceIncMemberus-gaap:RestrictedStockUnitsRSUMember2018-01-012018-12-310001818874ipoe:SocialFinanceIncMemberus-gaap:ResearchAndDevelopmentExpenseMember2020-01-012020-12-310001818874ipoe:SocialFinanceIncMemberus-gaap:ResearchAndDevelopmentExpenseMember2019-01-012019-12-310001818874ipoe:SocialFinanceIncMemberus-gaap:ResearchAndDevelopmentExpenseMember2018-01-012018-12-310001818874ipoe:SocialFinanceIncMemberus-gaap:SellingAndMarketingExpenseMember2020-01-012020-12-310001818874ipoe:SocialFinanceIncMemberus-gaap:SellingAndMarketingExpenseMember2019-01-012019-12-310001818874ipoe:SocialFinanceIncMemberus-gaap:SellingAndMarketingExpenseMember2018-01-012018-12-310001818874us-gaap:CostOfSalesMemberipoe:SocialFinanceIncMember2020-01-012020-12-310001818874us-gaap:CostOfSalesMemberipoe:SocialFinanceIncMember2019-01-012019-12-310001818874us-gaap:CostOfSalesMemberipoe:SocialFinanceIncMember2018-01-012018-12-310001818874ipoe:SocialFinanceIncMemberus-gaap:GeneralAndAdministrativeExpenseMember2020-01-012020-12-310001818874ipoe:SocialFinanceIncMemberus-gaap:GeneralAndAdministrativeExpenseMember2019-01-012019-12-310001818874ipoe:SocialFinanceIncMemberus-gaap:GeneralAndAdministrativeExpenseMember2018-01-012018-12-310001818874us-gaap:EmployeeStockOptionMemberipoe:SocialFinanceIncMemberus-gaap:ShareBasedCompensationAwardTrancheOneMember2020-01-012020-12-310001818874us-gaap:EmployeeStockOptionMemberipoe:SocialFinanceIncMemberus-gaap:ShareBasedCompensationAwardTrancheTwoMember2020-01-012020-12-310001818874us-gaap:EmployeeStockOptionMemberipoe:ShareBasedPaymentArrangementAlternativeVestingScheduleOneTrancheOneMemberipoe:SocialFinanceIncMember2020-01-012020-12-310001818874us-gaap:EmployeeStockOptionMemberipoe:SocialFinanceIncMemberipoe:ShareBasedPaymentArrangementAlternativeTrancheTwoMember2020-01-012020-12-310001818874us-gaap:EmployeeStockOptionMemberipoe:SocialFinanceIncMemberipoe:ShareBasedPaymentArrangementAlternativeVestingScheduleTwoTrancheTwoMember2020-01-012020-12-310001818874us-gaap:EmployeeStockOptionMemberipoe:SocialFinanceIncMemberipoe:ShareBasedPaymentArrangementAlternativeTrancheThreeMember2020-01-012020-12-310001818874us-gaap:EmployeeStockOptionMemberipoe:SocialFinanceIncMember2020-01-012020-12-310001818874ipoe:SocialFinanceIncMemberus-gaap:RestrictedStockUnitsRSUMember2020-05-142020-05-140001818874us-gaap:EmployeeStockOptionMemberipoe:SocialFinanceIncMember2020-05-142020-05-14ipoe:employee0001818874ipoe:SocialFinanceIncMemberus-gaap:CommonStockMember2020-05-140001818874us-gaap:EmployeeStockOptionMembersrt:MinimumMemberipoe:SocialFinanceIncMember2020-01-012020-12-310001818874us-gaap:EmployeeStockOptionMemberipoe:SocialFinanceIncMembersrt:MaximumMember2020-01-012020-12-310001818874us-gaap:EmployeeStockOptionMembersrt:MinimumMemberipoe:SocialFinanceIncMember2018-01-012018-12-310001818874us-gaap:EmployeeStockOptionMemberipoe:SocialFinanceIncMembersrt:MaximumMember2018-01-012018-12-310001818874us-gaap:EmployeeStockOptionMemberipoe:SocialFinanceIncMember2018-01-012018-12-310001818874us-gaap:EmployeeStockOptionMembersrt:MinimumMemberipoe:SocialFinanceIncMember2020-12-310001818874us-gaap:EmployeeStockOptionMemberipoe:SocialFinanceIncMembersrt:MaximumMember2020-12-310001818874us-gaap:EmployeeStockOptionMembersrt:MinimumMemberipoe:SocialFinanceIncMember2018-12-310001818874us-gaap:EmployeeStockOptionMemberipoe:SocialFinanceIncMembersrt:MaximumMember2018-12-310001818874us-gaap:EmployeeStockOptionMemberipoe:SocialFinanceIncMember2019-01-012019-12-310001818874us-gaap:EmployeeStockOptionMemberipoe:SocialFinanceIncMember2020-12-310001818874ipoe:SocialFinanceIncMemberus-gaap:RestrictedStockUnitsRSUMemberus-gaap:ShareBasedCompensationAwardTrancheOneMember2020-01-012020-12-310001818874ipoe:ShareBasedPaymentArrangementAlternativeVestingScheduleOneTrancheOneMemberipoe:SocialFinanceIncMemberus-gaap:RestrictedStockUnitsRSUMember2020-01-012020-12-310001818874ipoe:SocialFinanceIncMemberus-gaap:RestrictedStockUnitsRSUMemberipoe:ShareBasedPaymentArrangementAlternativeTrancheTwoMember2020-01-012020-12-310001818874ipoe:SocialFinanceIncMemberus-gaap:RestrictedStockUnitsRSUMemberipoe:ShareBasedPaymentArrangementAlternativeVestingScheduleTwoTrancheTwoMember2020-01-012020-12-310001818874ipoe:SocialFinanceIncMemberus-gaap:RestrictedStockUnitsRSUMemberipoe:ShareBasedPaymentArrangementAlternativeTrancheThreeMember2020-01-012020-12-310001818874srt:MinimumMemberipoe:SocialFinanceIncMemberus-gaap:RestrictedStockUnitsRSUMemberipoe:ShareBasedPaymentArrangementAlternativeVestingScheduleFourMember2020-01-012020-12-310001818874ipoe:SocialFinanceIncMemberus-gaap:RestrictedStockUnitsRSUMemberipoe:ShareBasedPaymentArrangementAlternativeVestingScheduleFourMembersrt:MaximumMember2020-01-012020-12-310001818874ipoe:SocialFinanceIncMemberus-gaap:RestrictedStockUnitsRSUMemberipoe:SecondAnniversaryOfCommencementDateMembersrt:ExecutiveOfficerMember2020-01-012020-12-310001818874ipoe:SocialFinanceIncMemberus-gaap:RestrictedStockUnitsRSUMembersrt:ExecutiveOfficerMember2020-01-012020-12-310001818874ipoe:SocialFinanceIncMemberus-gaap:RestrictedStockUnitsRSUMember2019-12-310001818874ipoe:AdditionsChargedToCostsAndExpensesMemberipoe:SocialFinanceIncMember2018-01-012018-12-310001818874ipoe:SocialFinanceIncMemberipoe:AdditionsChargedToOtherAccountsMember2018-01-012018-12-310001818874ipoe:SocialFinanceIncMemberipoe:DeductionsMember2018-01-012018-12-310001818874ipoe:AdditionsChargedToCostsAndExpensesMemberipoe:SocialFinanceIncMember2019-01-012019-12-310001818874ipoe:SocialFinanceIncMemberipoe:AdditionsChargedToOtherAccountsMember2019-01-012019-12-310001818874ipoe:SocialFinanceIncMemberipoe:DeductionsMember2019-01-012019-12-310001818874ipoe:AdditionsChargedToCostsAndExpensesMemberipoe:SocialFinanceIncMember2020-01-012020-12-310001818874ipoe:SocialFinanceIncMemberipoe:AdditionsChargedToOtherAccountsMember2020-01-012020-12-310001818874ipoe:SocialFinanceIncMemberipoe:DeductionsMember2020-01-012020-12-310001818874ipoe:SocialFinanceIncMemberipoe:USFederalMember2020-12-310001818874ipoe:SocialFinanceIncMemberipoe:USFederalMember2019-12-310001818874ipoe:SocialFinanceIncMemberus-gaap:StateAndLocalJurisdictionMember2020-12-310001818874ipoe:SocialFinanceIncMemberus-gaap:StateAndLocalJurisdictionMember2019-12-310001818874ipoe:SocialFinanceIncMemberus-gaap:ForeignCountryMember2020-12-310001818874ipoe:SocialFinanceIncMemberus-gaap:ForeignCountryMember2019-12-310001818874ipoe:USFederalAndStateMemberipoe:SocialFinanceIncMemberus-gaap:ResearchMember2020-12-310001818874ipoe:USFederalAndStateMemberipoe:SocialFinanceIncMemberus-gaap:ResearchMember2019-12-310001818874us-gaap:InvestorMemberipoe:SocialFinanceIncMemberipoe:StockholderNoteReceivableMember2019-03-012019-03-310001818874us-gaap:InvestorMemberipoe:SocialFinanceIncMemberipoe:StockholderNoteReceivableProceedsMember2019-10-012019-10-310001818874us-gaap:InvestorMemberipoe:SocialFinanceIncMemberipoe:StockholderNoteReceivableCommonStockAndRedeemablePreferredStockMember2019-10-012019-10-310001818874us-gaap:InvestorMemberipoe:SocialFinanceIncMemberipoe:StockholderNoteReceivableMember2019-01-012019-12-310001818874us-gaap:InvestorMemberipoe:SocialFinanceIncMemberipoe:StockholderNoteReceivableInterestReceivableMember2019-12-310001818874us-gaap:InvestorMemberipoe:SocialFinanceIncMemberipoe:StockholderNoteReceivableMember2020-01-012020-12-310001818874us-gaap:AdditionalPaidInCapitalMemberus-gaap:InvestorMemberipoe:SocialFinanceIncMemberipoe:StockholderNoteReceivableMember2020-12-310001818874ipoe:SocialFinanceIncMemberus-gaap:RetainedEarningsMemberus-gaap:CommonStockMember2020-01-012020-12-310001818874ipoe:SocialFinanceIncMemberus-gaap:EquityMethodInvesteeMemberipoe:APEXLoanMember2019-01-012019-12-310001818874ipoe:SocialFinanceIncMemberipoe:ApexLoanNoninterestIncomeLossMemberus-gaap:EquityMethodInvesteeMember2020-01-012020-12-310001818874ipoe:SocialFinanceIncMemberus-gaap:EquityMethodInvesteeMemberipoe:APEXLoanMember2020-01-012020-12-310001818874ipoe:SocialFinanceIncMemberipoe:APEXLoanPrincipalBalancesMemberus-gaap:EquityMethodInvesteeMember2020-01-012020-12-310001818874ipoe:SocialFinanceIncMemberus-gaap:EquityMethodInvesteeMemberipoe:APEXLoanDiscountAccretionMember2020-01-012020-12-310001818874us-gaap:EquityMethodInvestmentNonconsolidatedInvesteeOrGroupOfInvesteesMember2020-12-310001818874us-gaap:EquityMethodInvestmentNonconsolidatedInvesteeOrGroupOfInvesteesMember2019-12-310001818874us-gaap:EquityMethodInvestmentNonconsolidatedInvesteeOrGroupOfInvesteesMember2020-01-012020-12-310001818874us-gaap:EquityMethodInvestmentNonconsolidatedInvesteeOrGroupOfInvesteesMember2019-01-012019-12-310001818874us-gaap:EquityMethodInvestmentNonconsolidatedInvesteeOrGroupOfInvesteesMember2018-01-012018-12-310001818874srt:MinimumMemberipoe:SocialFinanceIncMember2020-12-310001818874ipoe:SocialFinanceIncMembersrt:MaximumMember2020-12-310001818874ipoe:NamingAndSponsorshipAgreementMemberipoe:SocialFinanceIncMember2019-09-300001818874ipoe:NamingAndSponsorshipAgreementMemberipoe:SocialFinanceIncMember2020-12-310001818874ipoe:LoanSalesVolumeBenchmarkMemberus-gaap:CustomerConcentrationRiskMemberipoe:SocialFinanceIncMemberipoe:TwoLargestThirdPartyBuyersMember2020-01-012020-12-310001818874ipoe:LoanSalesVolumeBenchmarkMemberus-gaap:CustomerConcentrationRiskMemberipoe:LargestThirdPartyBuyerMember2019-01-012019-12-310001818874ipoe:GalileoFinancialTechnologiesIncMember2020-05-310001818874ipoe:GalileoFinancialTechnologiesIncMember2020-05-140001818874ipoe:GalileoFinancialTechnologiesIncMember2020-12-310001818874ipoe:SocialFinanceIncMemberipoe:FNMALetterOfCreditMemberus-gaap:LetterOfCreditMember2019-12-310001818874ipoe:RedeemablePreferredStockExchangeableForCommonStockMemberipoe:SocialFinanceIncMember2020-01-012020-12-310001818874ipoe:RedeemablePreferredStockExchangeableForCommonStockMemberipoe:SocialFinanceIncMember2019-01-012019-12-310001818874ipoe:RedeemablePreferredStockExchangeableForCommonStockMemberipoe:SocialFinanceIncMember2018-01-012018-12-310001818874ipoe:SocialFinanceIncMemberipoe:RedeemablePreferredStockWarrantsExchangeableForCommonStockMember2020-01-012020-12-310001818874ipoe:SocialFinanceIncMemberipoe:RedeemablePreferredStockWarrantsExchangeableForCommonStockMember2019-01-012019-12-310001818874ipoe:SocialFinanceIncMemberipoe:RedeemablePreferredStockWarrantsExchangeableForCommonStockMember2018-01-012018-12-310001818874ipoe:SocialFinanceIncMemberipoe:ContingentCommonStockAcquisitionsMember2020-01-012020-12-310001818874ipoe:SocialFinanceIncMemberipoe:ContingentCommonStockAcquisitionsMember2019-01-012019-12-310001818874ipoe:SocialFinanceIncMemberipoe:ContingentCommonStockAcquisitionsMember2018-01-012018-12-310001818874us-gaap:EmployeeStockOptionMemberipoe:SocialFinanceIncMember2020-01-012020-12-310001818874us-gaap:EmployeeStockOptionMemberipoe:SocialFinanceIncMember2019-01-012019-12-310001818874us-gaap:EmployeeStockOptionMemberipoe:SocialFinanceIncMember2018-01-012018-12-310001818874ipoe:SocialFinanceIncMemberus-gaap:RestrictedStockUnitsRSUMember2020-01-012020-12-310001818874ipoe:SocialFinanceIncMemberus-gaap:RestrictedStockUnitsRSUMember2019-01-012019-12-310001818874ipoe:SocialFinanceIncMemberus-gaap:RestrictedStockUnitsRSUMember2018-01-012018-12-310001818874ipoe:SocialFinanceIncMemberus-gaap:CorporateNonSegmentMemberipoe:SellerNoteMember2020-01-012020-12-310001818874ipoe:SocialFinanceIncMemberus-gaap:CorporateNonSegmentMemberipoe:SellerNoteMember2019-01-012019-12-310001818874us-gaap:OperatingSegmentsMemberipoe:LendingSegmentMemberipoe:SocialFinanceIncMember2020-01-012020-12-310001818874us-gaap:OperatingSegmentsMemberipoe:SocialFinanceIncMemberipoe:FinancialServicesSegmentMember2020-01-012020-12-310001818874us-gaap:OperatingSegmentsMemberipoe:SocialFinanceIncMemberipoe:TechnologyPlatformSegmentMember2020-01-012020-12-310001818874us-gaap:OperatingSegmentsMemberipoe:SocialFinanceIncMember2020-01-012020-12-310001818874ipoe:SocialFinanceIncMemberus-gaap:CorporateNonSegmentMember2020-01-012020-12-310001818874us-gaap:OperatingSegmentsMemberipoe:NoninterestIncomeMemberipoe:SocialFinanceIncMemberipoe:TechnologyPlatformSegmentMember2020-01-012020-12-310001818874us-gaap:CustomerConcentrationRiskMemberipoe:SocialFinanceIncMemberipoe:FiveLargestCustomersMemberus-gaap:SalesRevenueSegmentMemberipoe:TechnologyPlatformSegmentMember2020-01-012020-12-310001818874us-gaap:CustomerConcentrationRiskMemberipoe:SocialFinanceIncMemberipoe:FiveLargestCustomersMemberus-gaap:SalesRevenueNetMemberipoe:TechnologyPlatformSegmentMember2020-01-012020-12-310001818874us-gaap:OperatingSegmentsMemberipoe:LendingSegmentMemberipoe:SocialFinanceIncMember2019-01-012019-12-310001818874us-gaap:OperatingSegmentsMemberipoe:SocialFinanceIncMemberipoe:FinancialServicesSegmentMember2019-01-012019-12-310001818874us-gaap:OperatingSegmentsMemberipoe:SocialFinanceIncMemberipoe:TechnologyPlatformSegmentMember2019-01-012019-12-310001818874us-gaap:OperatingSegmentsMemberipoe:SocialFinanceIncMember2019-01-012019-12-310001818874ipoe:SocialFinanceIncMemberus-gaap:CorporateNonSegmentMember2019-01-012019-12-310001818874us-gaap:OperatingSegmentsMemberipoe:LendingSegmentMemberipoe:SocialFinanceIncMember2018-01-012018-12-310001818874us-gaap:OperatingSegmentsMemberipoe:SocialFinanceIncMemberipoe:FinancialServicesSegmentMember2018-01-012018-12-310001818874us-gaap:OperatingSegmentsMemberipoe:SocialFinanceIncMemberipoe:TechnologyPlatformSegmentMember2018-01-012018-12-310001818874us-gaap:OperatingSegmentsMemberipoe:SocialFinanceIncMember2018-01-012018-12-310001818874ipoe:SocialFinanceIncMemberus-gaap:CorporateNonSegmentMember2018-01-012018-12-310001818874ipoe:SocialFinanceIncMemberus-gaap:MaterialReconcilingItemsMember2020-01-012020-12-310001818874ipoe:SocialFinanceIncMemberus-gaap:MaterialReconcilingItemsMember2019-01-012019-12-310001818874ipoe:SocialFinanceIncMemberus-gaap:MaterialReconcilingItemsMember2018-01-012018-12-310001818874ipoe:SocialFinanceIncMemberipoe:CorporateAndReconcilingItemsMember2020-01-012020-12-310001818874ipoe:SocialFinanceIncMemberipoe:CorporateAndReconcilingItemsMember2019-01-012019-12-310001818874ipoe:SocialFinanceIncMemberipoe:CorporateAndReconcilingItemsMember2018-01-012018-12-310001818874ipoe:SocialFinanceIncMemberipoe:Series1RedeemablePreferredStockMemberus-gaap:SubsequentEventMember2021-01-310001818874ipoe:SocialFinanceIncMemberipoe:Series1RedeemablePreferredStockMemberus-gaap:SubsequentEventMember2021-01-012021-01-310001818874ipoe:SocialFinanceIncMemberus-gaap:SubsequentEventMember2021-01-012021-01-310001818874ipoe:SocialFinanceIncMemberus-gaap:CommonStockMemberus-gaap:SubsequentEventMember2021-01-012021-01-310001818874ipoe:SocialFinanceIncMemberipoe:SellerNoteMemberus-gaap:SubsequentEventMember2021-02-012021-02-280001818874ipoe:SocialFinanceIncMemberipoe:SellerNoteMemberus-gaap:SubsequentEventMember2021-02-280001818874ipoe:SocialFinanceIncMemberus-gaap:EquityMethodInvesteeMemberipoe:APEXLoanMember2021-02-280001818874ipoe:SocialFinanceIncMemberipoe:GoldenPacificBancorpIncMemberus-gaap:SubsequentEventMember2021-03-012021-03-310001818874ipoe:SocialFinanceIncMemberipoe:GoldenPacificBancorpIncMemberus-gaap:SubsequentEventMember2021-03-310001818874ipoe:SocialFinanceIncMembersrt:ParentCompanyMember2020-12-310001818874ipoe:SocialFinanceIncMembersrt:ParentCompanyMember2019-12-310001818874ipoe:SocialFinanceIncMembersrt:ParentCompanyMemberus-gaap:NonvotingCommonStockMember2020-12-310001818874ipoe:SocialFinanceIncMembersrt:ParentCompanyMemberus-gaap:NonvotingCommonStockMember2019-12-310001818874ipoe:SocialFinanceIncMembersrt:ParentCompanyMember2020-01-012020-12-310001818874ipoe:SocialFinanceIncMembersrt:ParentCompanyMember2019-01-012019-12-310001818874ipoe:SocialFinanceIncMembersrt:ParentCompanyMember2018-01-012018-12-310001818874ipoe:SocialFinanceIncMembersrt:ParentCompanyMember2018-12-310001818874ipoe:SocialFinanceIncMembersrt:ParentCompanyMember2017-12-310001818874srt:AffiliatedEntityMemberipoe:SocialFinanceIncMembersrt:ParentCompanyMemberipoe:ManagementServicesAgreementMember2020-12-310001818874srt:AffiliatedEntityMemberipoe:SocialFinanceIncMembersrt:ParentCompanyMemberipoe:ManagementServicesAgreementMember2019-12-310001818874srt:AffiliatedEntityMemberus-gaap:LondonInterbankOfferedRateLIBORMemberipoe:SocialFinanceIncMemberipoe:PromissoryNoteAgreementMembersrt:ParentCompanyMember2020-01-012020-12-310001818874srt:AffiliatedEntityMemberipoe:SocialFinanceIncMemberipoe:PromissoryNoteAgreementMembersrt:ParentCompanyMember2020-12-310001818874srt:AffiliatedEntityMemberipoe:SocialFinanceIncMemberipoe:PromissoryNoteAgreementMembersrt:ParentCompanyMember2019-12-31

As filed with the Securities and Exchange Commission on June 14, 2021
Registration No. 333-                     
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM S-1
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
SoFi Technologies, Inc.
(Exact Name of Registrant as Specified in Its Charter)
Delaware
6199
98-1547291
(State or other jurisdiction of
incorporation or organization)
(Primary Standard Industrial
Classification Code Number)
(I.R.S. Employer
Identification Number)
234 1st Street
San Francisco, California 94105
(855) 456-7634
(Address, including zip code, and telephone number, including area code, of Registrant’s principal executive offices)
Christopher Lapointe
Chief Financial Officer
SoFi Technologies, Inc.
234 1st Street
San Francisco, California 94105
(855) 456-7634
(Name, address, including zip code, and telephone number, including area code, of agent for service)
Copies to:
Jocelyn M. Arel, Esq.
Benjamin K. Marsh, Esq.
Goodwin Procter LLP
The New York Times Building
620 Eighth Avenue
New York, New York 10018
(212) 813-8800
Robert Lavet
General Counsel and Secretary
SoFi Technologies, Inc.
234 1st Street
San Francisco, California 94105
(855) 456-7634
Approximate date of commencement of proposed sale of the securities to the public: From time to time after this Registration Statement becomes effective.
If any of the securities being registered on this Form are to be offered on a delayed or continuous basis pursuant to Rule 415 under the Securities Act of 1933 (the “Securities Act”) check the following box: ☒
If this Form is filed to register additional securities for an offering pursuant to Rule 462(b) under the Securities Act, please check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. ☐
If this Form is a post-effective amendment filed pursuant to Rule 462(c) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. ☐
If this Form is a post-effective amendment filed pursuant to Rule 462(d) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering.
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.
Large accelerated filer
Accelerated filer
Non-accelerated filer
Smaller reporting company
Emerging growth company
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 7(a)(2)(B) of the Securities Act. ☐



CALCULATION OF REGISTRATION FEE
Title of each class of securities to be registered
Amount to be registered(1)
Proposed maximum offering price per security Proposed maximum aggregate offering price Amount of registration fee
Common stock(2)(3)
470,681,133  $ 20.89 
(4)
$ 9,832,528,868  $ 1,072,728.90 
Warrants(2)(5)
20,170,990  $ 7.85 
(6)
$ 158,342,272  $ 17,275.14 
Common stock(2)(7)
28,125,000  $ 11.50 
(8)
$ 323,437,500  $ 35,287.03 
Common stock(2)(9)
12,170,990  $ 8.86 
(8)
$ 107,834,971  $ 11,764.80 
Series 1 Fixed-to-Floating Rate Cumulative Redeemable Preferred Stock(2)(10)
3,234,000  $ 100.00 
(11)
$ 323,400,000  $ 35,282.94 
Total $ 10,745,543,611  $ 1,172,338.81 
(1)Immediately prior to the consummation of the merger (the “Merger”) described in the prospectus forming part of this registration statement (the “prospectus”), Social Capital Hedosophia Holdings Corp. V, a Cayman Islands exempted company (“SCH”), effected a deregistration under the Cayman Islands Companies Law (2020 Revision) and a domestication under Section 388 of the Delaware General Corporation Law, pursuant to which SCH’s jurisdiction of incorporation was changed from the Cayman Islands to the State of Delaware (the “Domestication”), and was renamed “SoFi Technologies, Inc.” (“SoFi Technologies”), as further described in the prospectus. All securities being registered were or will be issued by SoFi Technologies.
(2)Pursuant to Rule 416(a) of the Securities Act of 1933, as amended (the “Securities Act”), an indeterminable number of additional securities that may be issued to prevent dilution resulting from stock splits, stock dividends or similar transactions are also being registered.
(3)The number of shares of common stock being registered represents the sum of (a) 263,378,239 shares of common stock issued to certain shareholders in connection with the Merger, (b) 122,500,000 shares of common stock issued to certain qualified institutional buyers and accredited investors in private placements consummated in connection with the PIPE Investment (as defined herein), (c) 27,089,789 shares of common stock reserved for issuance upon the exercise of options to purchase common stock, and (d) 57,713,105 shares of common stock reserved for issuance upon the settlement of restricted stock units.
(4)Estimated solely for the purpose of calculating the registration fee, based on the average of the high and low prices of the shares of common stock of SoFi Technologies on The Nasdaq Global Select Market (“Nasdaq”) on June 7, 2021 (such date being within five business days of the date that this registration statement was first filed with the SEC) in accordance with Rule 457(c) of the Securities Act.
(5)The number of warrants being registered represents the sum of (a) 8,000,000 warrants to purchase shares of common stock issued to a shareholder of SCH (the “SCH warrants”), and (b) 12,170,990 warrants to purchase shares of common stock issued in exchange for warrants of Social Finance, Inc. (“SoFi”) to purchase Series H preferred stock of SoFi in connection with the Merger (the “SoFi warrants”).
(6)Estimated solely for the purpose of calculating the registration fee, based on the average of the high and low prices of the warrants of SoFi Technologies on Nasdaq on June 7, 2021 (such date being within five business days of the date that this registration statement was first filed with the SEC) in accordance with Rule 457(c) of the Securities Act.
(7)Reflects the shares of common stock that may be issued to certain shareholders upon the exercise of outstanding SCH warrants and public warrants (as defined herein), with each warrant exercisable for one share of common stock, subject to adjustment, for an exercise price of $11.50 per share.
(8)Calculated pursuant to Rule 457(g) under the Securities Act, based on the exercise price of the warrants.
(9)Reflects the shares of common stock that may be issued to certain shareholders upon the exercise of outstanding SoFi warrants, with each warrant exercisable for one share of common stock, subject to adjustment, for an exercise price of $8.86 per share.
(10)The number of shares of Series 1 preferred stock being registered represents 3,234,000 shares of Series 1 preferred stock issued in exchange for an equivalent number of shares of Series 1 fixed-to-floating rate cumulative redeemable preferred stock of SoFi (the “SoFi series 1 preferred”) in connection with the Merger. The shares of SoFi series 1 preferred were originally issued in a private placement transaction at a purchase price of $100 per share.
(11)Calculated pursuant to Rule 457(o) under the Securities Act, based on the maximum offering price.
The registrant hereby amends this registration statement on such date or dates as may be necessary to delay its effective date until the registrant shall file a further amendment which specifically states that this registration statement shall thereafter become effective in accordance with Section 8(a) of the Securities Act or until this registration statement shall become effective on such date as the SEC, acting pursuant to said Section 8(a), may determine.



The information in this preliminary prospectus is not complete and may be changed. We may not sell these securities until the registration statement filed with the Securities and Exchange Commission is effective. This preliminary prospectus is not an offer to sell these securities and it is not soliciting an offer to buy these securities in any jurisdiction where the offer or sale is not permitted.

SUBJECT TO COMPLETION, DATED JUNE 14, 2021

PROSPECTUS FOR
470,681,133 SHARES OF COMMON STOCK
3,234,000 SHARES OF SERIES 1 PREFERRED STOCK
20,170,990 WARRANTS TO PURCHASE SHARES OF COMMON STOCK
AND
40,295,990 SHARES OF COMMON STOCK UNDERLYING WARRANTS
OF
SOFI TECHNOLOGIES, INC.
This prospectus relates to (i) the resale of 263,378,239 shares of common stock, par value $0.0001 per share (the “common stock”) issued in connection with the Merger (as defined below) by certain of the selling securityholders named in this prospectus, (ii) the resale of 122,500,000 shares of common stock issued in the PIPE Investment (as defined below) by certain of the selling securityholders, (iii) the resale of 3,234,000 shares of Series 1 preferred stock (the “Series 1 preferred stock”) issued in connection with the Merger by certain of the selling securityholders named in this prospectus, (iv) the issuance by us and resale of 27,089,789 shares of common stock reserved for issuance upon the exercise of options to purchase common stock, and (v) the issuance by us and resale of 57,713,105 shares of common stock reserved for issuance upon the settlement of restricted stock units. This prospectus also relates to (a) the resale of 8,000,000 warrants (the “SCH warrants”) to purchase shares of common stock issued to a shareholder of SCH (as defined below), (b) the resale of 12,170,990 warrants (the “SoFi warrants”) to purchase shares of common stock issued in exchange for warrants of SoFi (as defined below) to purchase Series H preferred stock of SoFi in connection with the Merger, and (c) the issuance by us of up to 40,295,990 shares of common stock upon the exercise of outstanding warrants, which warrants include the SCH warrants, the SoFi warrants and 20,125,000 warrants previously registered in connection with the Merger (the “public warrants” and, together with the SCH warrants and the SoFi warrants, the “warrants”). We collectively refer to the selling securityholders covered by this prospectus as the “Selling Securityholders”.
On May 28, 2021, we consummated the transactions contemplated by that certain Agreement and Plan of Merger, dated as of January 7, 2021, as amended on March 16, 2021 (the “Merger Agreement”), by and among Social Capital Hedosophia Holdings Corp. V, a Cayman Islands exempted company (“SCH”), Plutus Merger Sub Inc., a Delaware corporation and a direct wholly owned subsidiary of SCH (“Merger Sub”), and Social Finance, Inc., a Delaware corporation (“SoFi”). As contemplated by the Merger Agreement, SCH was domesticated as a Delaware corporation and changed its name to “SoFi Technologies, Inc.” (the “Domestication”). Following the Domestication, Merger Sub merged with and into SoFi, the separate corporate existence of Merger Sub ceased and SoFi survived as a wholly owned subsidiary of SoFi Technologies, Inc. (“SoFi Technologies”) (the “Merger” and, together with the Domestication, the “Business Combination”).
We are registering the resale of shares of common stock and warrants as required by (i) the amended and restated registration rights agreement, dated as of May 28, 2021 (the “Registration Rights Agreement”), entered into by and among SoFi Technologies, SCH Sponsor V LLC, certain former stockholders of SoFi, Jay Parikh, Jennifer Dulski and certain additional parties, (ii) the registration rights agreement, dated as of May 28, 2021 (the “Series 1 Registration Rights Agreement”), entered into by and among SoFi Technologies and certain former shareholders of SoFi, and (iii) the subscription agreements, entered into by and among SCH and certain qualified institutional buyers and accredited investors relating to the purchase of shares of common stock in private placements consummated in connection with the Business Combination.
i


We are also registering (i) the resale of other shares of common stock held by certain of our shareholders, and (ii) the issuance and resale of shares of common stock reserved for issuance upon the exercise of options to purchase shares of common stock and the settlement of restricted stock units, in each case, held by certain of our current and former employees.
We will receive the proceeds from any exercise of the warrants for cash and outstanding stock options, but not from the resale of any of the securities registered hereby by the Selling Securityholders.
We will bear all costs, expenses and fees in connection with the registration of the securities. The Selling Securityholders will bear all commissions and discounts, if any, attributable to their respective sales of the securities.
Trading of our common stock and warrants began on The Nasdaq Global Select Market (“Nasdaq”) on June 1, 2021, under the ticker symbols “SOFI” and “SOFIW”, respectively. Prior to the Domestication and transfer to Nasdaq, SCH’s Class A ordinary shares, par value $0.0001 per share (the “SCH Class A ordinary shares”), and SCH warrants to purchase SCH Class A ordinary shares traded on the New York Stock Exchange (“NYSE”) under the ticker symbols “IPOE” and “IPOE.WS”, respectively. On June 11, 2021, the closing sale prices of our common stock and warrants as reported by Nasdaq were $22.40 and $8.84, respectively.
Investing in our securities involves risks that are described in the “Risk Factors” section beginning on page 22 of this prospectus.
Neither the Securities and Exchange Commission (the “SEC”) nor any state securities commission has approved or disapproved of the securities to be issued under this prospectus or determined if this prospectus is truthful or complete. Any representation to the contrary is a criminal offense.
The date of this prospectus is                                      , 2021.
ii


TABLE OF CONTENTS
Page
2
3
4
9
11
20
22
71
72
73
77
84
112
114
200
210
217
234
237
245
254
266
268
272
272
272
F-1
You should rely only on the information contained in this prospectus. No one has been authorized to provide you with information that is different from that contained in this prospectus. This prospectus is dated as of the date set forth on the cover hereof. You should not assume that the information contained in this prospectus is accurate as of any date other than that date.
1

TABLE OF CONTENTS
ABOUT THIS PROSPECTUS
This prospectus is part of a registration statement on Form S-1 that we filed with the SEC using the “shelf” registration process. Under the shelf registration process, the Selling Securityholders may, from time to time, sell the securities offered by them described in this prospectus. We will not receive any proceeds from the sale by such Selling Securityholders of the securities offered by them described in this prospectus. This prospectus also relates to the issuance by us of shares of common stock issuable upon the exercise of stock options and warrants, and the settlement of restricted stock units. We will receive proceeds from any exercise of the warrants and stock options for cash.
Neither we nor the Selling Securityholders have authorized anyone to provide you with any information or to make any representations other than those contained in this prospectus or any applicable prospectus supplement or any free writing prospectuses prepared by or on behalf of us or to which we have referred you. Neither we nor the Selling Securityholders take responsibility for, and can provide no assurance as to the reliability of, any other information that others may give you. Neither we nor the Selling Securityholders will make an offer to sell these securities in any jurisdiction where such offer or sale are not permitted. No dealer, salesperson or other person is authorized to give any information or to represent anything not contained in this prospectus, any applicable prospectus supplement or any related free writing prospectus. You should assume that the information appearing in this prospectus or any prospectus supplement is accurate as of the date on the front of those documents only, regardless of the time of delivery of this prospectus or any applicable prospectus supplement, or any sale of a security. Our business, financial condition, results of operations and prospects may have changed since those dates.
The Selling Securityholders and their permitted transferees may use this shelf registration statement to sell securities from time to time through any means described in the section titled “Plan of Distribution”. More specific terms of any securities that the Selling Securityholders and their permitted transferees offer and sell may be provided in a prospectus supplement that describes, among other things, the specific amounts and prices of the securities being offered and the terms of the offering.
We may also provide a prospectus supplement or post-effective amendment to the registration statement to add information to, or update or change information contained in, this prospectus. Any statement contained in this prospectus will be deemed to be modified or superseded for purposes of this prospectus to the extent that a statement contained in such prospectus supplement or post-effective amendment modifies or supersedes such statement. Any statement so modified will be deemed to constitute a part of this prospectus only as so modified, and any statement so superseded will be deemed not to constitute a part of this prospectus. You should read both this prospectus and any applicable prospectus supplement or post-effective amendment to the registration statement together with the additional information to which we refer you in the sections of this prospectus titled “Where You Can Find More Information”.
Unless the context indicates otherwise, references in this prospectus to the “company”, “SoFi Technologies”, “we”, “us”, “our” and similar terms refer to SoFi Technologies, Inc. (f/k/a Social Capital Hedosophia Holdings Corp. V) and its consolidated subsidiaries. References to “SCH” refer to our predecessor company prior to the consummation of the Business Combination (the “Closing”, and the date of the consummation of the Business Combination, the “Closing Date”). References to “SoFi” refer to Social Finance, Inc. prior to the Closing.
This prospectus contains summaries of certain provisions contained in some of the documents described herein, but reference is made to the actual documents for complete information. All of the summaries are qualified in their entirety by the actual documents. Copies of some of the documents referred to herein have been filed, will be filed or will be incorporated by reference as exhibits to the registration statement of which this prospectus is a part, and you may obtain copies of those documents as described below under “Where You Can Find More Information”.
2

TABLE OF CONTENTS
TRADEMARKS
This document contains references to trademarks and service marks belonging to other entities. Solely for convenience, trademarks and trade names referred to in this prospectus may appear without the ® or ™ symbols, but such references are not intended to indicate, in any way, that the applicable licensor will not assert, to the fullest extent under applicable law, its rights to these trademarks and trade names. SoFi Technologies does not intend its use or display of other companies’ trade names, trademarks or service marks to imply a relationship with, or endorsement or sponsorship of it by, any other companies.
3

TABLE OF CONTENTS
SELECTED DEFINITIONS
Unless otherwise stated in this prospectus or the context otherwise requires, references to:
“2011 Plan” are to Social Finance, Inc. 2011 Stock Plan;
“2021 Incentive Plan” or “2021 Plan” are to the 2021 Stock Option and Incentive Plan for SoFi Technologies, Inc.;
“Apex” are to Apex Clearing Holdings, LLC, a provider of investment custody and clearing services in which we held a minority stake;
“Amended and Restated Series H Preferred Stock Warrant Agreement” are to the Amended and Restated Series H Preferred Stock Warrant Agreements, entered into at Closing between SoFi Technologies and each holder of SoFi Series H warrants;
“ASC” are to Accounting Standards Codification;
“Base Exchange Ratio” are to the quotient obtained by dividing (i) the Aggregate Common Share Consideration (as defined in the Merger Agreement) by (ii) the aggregate fully diluted number of shares of SoFi common stock issued and outstanding immediately prior to the Merger as calculated pursuant to the Merger Agreement;
“Black-Scholes Model” are to the Black-Scholes Option Pricing Model;
“Business Combination” are to the Domestication together with the Merger;
“Bylaws” are to the bylaws of SoFi Technologies;
“CARES Act” are to the Coronavirus Aid, Relief and Economic Security Act;
“Cayman Constitutional Documents” are to SCH’s Amended and Restated Memorandum and Articles of Association;
“CFPs” are to our free Certified Financial Planners;
“Certificate of Incorporation” are to the certificate of incorporation of SoFi Technologies;
“Closing” are to the closing of the Business Combination;
“company”, “we”, “us” and “our” are to SoFi Technologies;
“common stock” are to shares of SoFi Technologies common stock, par value $0.0001 per share;
“Continental” are to Continental Stock Transfer & Trust Company;
“COVID-19” are to the novel coronavirus pandemic;
“DGCL” are to the General Corporation Law of the State of Delaware, as amended;
“Domestication” are to the domestication of SCH as a corporation incorporated in the State of Delaware;
“Exchange Act” are to the Securities Exchange Act of 1934, as amended;
“Federal Reserve” are to the Board of Governors of the Federal Reserve System;
“Financial Services Productivity Loop” are to a virtuous cycle generated by our integrated financial services platform whereby positive member experiences with our products can lead to members using more of our products, resulting in higher revenue per member without incurring additional member acquisition costs;
4

TABLE OF CONTENTS
“FINRA” are to the Financial Industry Regulatory Authority, Inc.;
“FNMA” are to the Federal National Mortgage Association;
“founder shares” are to the SCH Class B ordinary shares purchased by the Sponsor in a private placement prior to the SCH initial public offering;
“GAAP” are to accounting principles generally accepted in the United States of America;
“Galileo” are to Galileo Financial Technologies, Inc., a provider of technology platform services to financial and non-financial institutions and a wholly-owned subsidiary of SoFi Technologies;
“IPO registration statement” are to the Registration Statements on Form S-1 (333-248915 and 333-249396) filed by SCH in connection with the SCH initial public offering, which became effective on October 8, 2020;
“IRS” are to the U.S. Internal Revenue Service;
“JOBS Act” are to the Jumpstart Our Business Startups Act of 2012;
“LIBOR” are to the London Inter-Bank Offered Rate;
“Member” is defined as someone who has a lending relationship with us via origination or servicing, opened a financial services account, linked an external account to our platform, or signed up for our credit score monitoring service;
“Member Bank” are to SoFi’s member bank holding companies;
“Merger” are to the merger of Merger Sub with and into SoFi, with SoFi surviving the merger as a wholly-owned subsidiary of SoFi Technologies;
“Merger Agreement” are to Agreement and Plan of Merger, dated as of January 7, 2021, as amended on March 16, 2021, by and among SCH, Merger Sub and SoFi;
“Merger Sub” are to Plutus Merger Sub Inc., a Delaware corporation and former subsidiary of SCH;
“Nasdaq” are to the Nasdaq Global Select Market;
“NYSE” are to the New York Stock Exchange;
“OCC” are to the U.S. Office of the Comptroller of the Currency;
“ordinary shares” are to the SCH Class A ordinary shares and the SCH Class B ordinary shares, collectively;
“Person” are to any individual, firm, corporation, partnership, limited liability company, incorporated or unincorporated association, joint venture, joint stock company, governmental authority or instrumentality or other entity of any kind;
“PIPE Investment” are to the purchase of shares of SoFi Technologies common stock pursuant to the Subscription Agreements;
“PIPE Investment Amount” are to the aggregate gross purchase price received by SCH prior to or substantially concurrently with Closing for the shares in the PIPE Investment;
“PIPE Investors” are to those certain investors participating in the PIPE Investment pursuant to the Subscription Agreements;
5

TABLE OF CONTENTS
“private placement warrants” are to the SCH private placement warrants and the warrants of SoFi Technologies issued as a matter of law upon the conversion thereof at the time of the Domestication;
“pro forma” are to giving pro forma effect to the Business Combination;
“public shareholders” are to holders of public shares, whether acquired in the SCH initial public offering or acquired in the secondary market;
“public shares” are to the SCH Class A ordinary shares (including those that underlie the units) that were offered and sold by SCH in the SCH initial public offering and registered pursuant to the IPO registration statement or the shares of SoFi Technologies common stock issued as a matter of law upon the conversion thereof at the time of the Domestication, unless the context otherwise requires;
“public warrants” are to the redeemable warrants (including those that underlie the units) that were offered and sold by SCH in the SCH initial public offering and registered pursuant to the IPO registration statement or the redeemable warrants of SoFi Technologies issued as a matter of law upon the conversion thereof at the time of the Domestication, as context requires;
“redemption” are to each redemption of public shares for cash pursuant to the Cayman Constitutional Documents and the organizational documents of SoFi Technologies;
“Registration Rights Agreement” are to the Amended and Restated Registration Rights Agreement, dated as of May 28, 2021, by and among SoFi Technologies, Sponsor, certain former stockholders of SoFi, as set forth on Schedule 1 thereto, Jay Parikh, Jennifer Dulski and the parties set forth on Schedule 2 thereto;
“RSU” are to restricted stock units;
“Sarbanes Oxley Act” are to the Sarbanes-Oxley Act of 2002;
“SCH” are to Social Capital Hedosophia Holdings Corp. V, prior to the Domestication;
“SCH Class A ordinary shares” are to SCH’s Class A ordinary shares, par value $0.0001 per share;
“SCH Class B ordinary shares” are to SCH’s Class B ordinary shares, par value $0.0001 per share;
“SCH initial public offering” are to SCH’s initial public offering that was consummated on October 14, 2020;
“SCH units” and “units” are to the units of SCH, each unit representing one SCH Class A ordinary share and one-fourth of one redeemable warrant to acquire one SCH Class A ordinary share, that were offered and sold by SCH in the SCH initial public offering and registered pursuant to the IPO registration statement (less the number of units that have been separated into the underlying public shares and underlying warrants upon the request of the holder thereof);
“SCH warrants” are to the warrants to purchase shares of common stock issued to a shareholder of SCH;
“SEC” are to the United States Securities and Exchange Commission;
“Securities Act” are to the Securities Act of 1933, as amended;
“Selling Securityholders” are to to the selling securityholders covered by this prospectus;
“Series 1 Agreement” are to the Amended and Restated Series 1 Preferred Stock Investors’ Agreement, dated as of January 7, 2021, with the Series 1 Holders and SCH;
“Series 1 preferred stock” are to the shares of SoFi Technologies’ Series 1 Fixed-to-Floating Rate Cumulative Redeemable Preferred Stock, par value $0.0000025 per share;
6

TABLE OF CONTENTS
“Series 1 Registration Rights Agreement” are to the Registration Rights Agreement, dated as of May 28, 2021, by and among SoFi Technologies and certain former stockholders of SoFi, as set forth on Schedule 1 thereto;
“Series 1 Holders” are to holders of the SoFi Technologies Series 1 Preferred Stock;
“Shareholders’ Agreement” are to that certain Shareholders’ Agreement, dated as of May 28, 2021, by and among SoFi Technologies, Sponsor and the parties identified on the signature pages thereto;
“SoFi” refers to Social Finance, Inc., a Delaware corporation;
“SoFi awards” are to SoFi Options and SoFi RSUs;
“SoFi common stock” are to shares of SoFi voting common stock, par value $0.0000025 per share;
“SoFi Options” are to options to purchase shares of SoFi common stock;
“SoFi Series 1 preferred stock” are to shares of SoFi Series 1 Fixed-to-Floating Rate Cumulative Redeemable Preferred Stock;
“SoFi Series H Preferred Stock” are to shares of SoFi Series H Preferred Stock;
“SoFi Stadium” are to the LA Stadium and Entertainment District at Hollywood Park in Inglewood, California;
“SoFi Stockholders” are to the Sponsor, Jay Parikh, stockholders of SoFi and holders of SoFi awards prior to the Business Combination;
“SoFi Technologies” are to SCH after the Domestication and its name change from Social Capital Hedosophia Corp. V;
“SoFi Technologies common stock” are to shares of SoFi Technologies voting common stock, par value $0.0001 per share;
“SoFi Technologies Options” are to options to purchase shares of SoFi Technologies common stock;
“SoFi Technologies Restricted Stock” are to restricted shares of SoFi Technologies common stock;
“SoFi Technologies RSUs” are to restricted stock units based on shares of SoFi Technologies common stock;
“SoFi RSUs” are to restricted stock units based on shares of SoFi common stock;
“SoFi warrants” are to the warrants to purchase shares of SoFi Technologies common stock issued in exchange for warrants of SoFi to purchase SoFi Series H Preferred Stock in connection with the Merger;
“SPE” are to special-purpose entity;
“Sponsor” are to SCH Sponsor V LLC, a Cayman Islands limited liability company;
“Sponsor Related PIPE Investors” are to a PIPE Investor that are existing directors, officers or equity holders of the Sponsor and its affiliates (together with their permitted transferees);
“Sponsor Support Agreement” are to that certain Support Agreement, dated January 7, 2021, by and among the Sponsor, SCH, each director of SCH and SoFi, as amended and modified from time to time;
“Subscription Agreements” are to the subscription agreements pursuant to which the PIPE Investment was consummated;
7

TABLE OF CONTENTS
“trust account” are to the trust account established at the consummation of the SCH initial public offering at JP Morgan Chase Bank, N.A. and maintained by Continental, as trustee;
“VIEs” are to variable interest entities;
“warrants” are to the public warrants, the SCH warrants and the SoFi warrants, unless the context otherwise requires; and
“Warrant Agreement” are to the agreement dated as of October 8, 2020, between SCH and Continental.
Unless otherwise stated in this prospectus or the context otherwise requires, all references in this prospectus to shares of our common stock or warrants include such securities underlying the units.
8

TABLE OF CONTENTS
CAUTIONARY STATEMENT REGARDING FORWARD-LOOKING STATEMENTS
This prospectus contains statements that are forward-looking and as such are not historical facts. This includes, without limitation, statements regarding the financial position, business strategy and the plans and objectives of management for our future operations. These statements constitute projections, forecasts and forward-looking statements, and are not guarantees of performance. Such statements can be identified by the fact that they do not relate strictly to historical or current facts. When used in this prospectus, words such as “anticipate,” “believe,” “continue,” “could,” “estimate,” “expect,” “intend,” “may,” “might,” “plan,” “possible,” “potential,” “predict,” “project,” “should,” “strive,” “would” and similar expressions may identify forward-looking statements, but the absence of these words does not mean that a statement is not forward-looking.
Forward-looking statements in this prospectus and in any document incorporated by reference in this prospectus may include, for example, statements about:
the effect of uncertainties related to the COVID-19 pandemic;
our ability to achieve and maintain profitability in the future;
the impact on our business of the regulatory environment and complexities with compliance related to such environment;
our ability to become a bank holding company and acquire a national bank charter;
our ability to respond to general economic conditions;
our ability to manage our growth effectively and our expectations regarding the development and expansion of our business;
our ability to access sources of capital, including debt financing and other sources of capital to finance operations and growth;
the success of our marketing efforts and our ability to expand our member base;
our ability to grow market share in existing markets or any new markets we may enter;
our ability to develop new products, features and functionality that are competitive and meet market needs;
our ability to realize the benefits of our strategy, including our financial services productivity loop;
our ability to make accurate credit and pricing decisions or effectively forecast our loss rates
our ability to establish and maintain an effective system of internal controls over financial reporting;
our ability to maintain the listing of our securities on Nasdaq;
the risk that the Business Combination disrupts our plans and operations;
our inability to realize the anticipated benefits of the Business Combination;
the outcome of any legal or governmental proceedings that may be instituted against us; and
other factors detailed under the section titled “Risk Factors”.
These forward-looking statements are based on information available as of the date of this prospectus and current expectations, forecasts and assumptions, and involve a number of judgments, risks and uncertainties. Accordingly, forward-looking statements should not be relied upon as representing our views as of any subsequent date, and we do not undertake any obligation to update forward-looking statements to reflect events or circumstances after the date they were made, whether as a result of new information, future events or otherwise, except as may be required under applicable securities laws.
9

TABLE OF CONTENTS
As a result of a number of known and unknown risks and uncertainties, our actual results or performance may be materially different from those expressed or implied by these forward-looking statements. You should not place undue reliance on these forward-looking statements.
10

TABLE OF CONTENTS
PROSPECTUS SUMMARY
This summary highlights selected information from this prospectus and may not contain all of the information that is important to you in making an investment decision. Before investing in our securities, you should carefully read this entire prospectus, including our financial statements and the related notes included in this prospectus and the information set forth under the headings “Risk Factors” and “Management’s Discussion and Analysis of Financial Condition and Results of Operations.” See also the section titled “Where You Can Find Additional Information”.
Unless context otherwise requires, references in this prospectus to the “company”, “we”, “us” or “our” refer to the business of SoFi, which became the business of SoFi Technologies following the Closing.
Company Overview
We are a member-centric, one-stop shop for financial services that allows members to borrow, save, spend, invest and protect their money. Our mission is to help our members achieve financial independence in order to realize their ambitions. To us, financial independence does not mean being wealthy, but rather represents the ability of our members to have the financial means to achieve their personal objectives at each stage of life, such as owning a home, having a family, or having a career of their choice — more simply stated, to have enough money to do what they want. We were founded in 2011 and have developed a comprehensive suite of financial products that offers the speed, selection, content and convenience that only an integrated digital platform can provide.
In order for us to achieve our mission, we have to help people “get their money right”, which means providing them with the ability to borrow better, save better, spend better, invest better and protect better. Everything we do today is geared toward helping our members “Get Your Money Right” and we strive to innovate and build ways for our members to achieve this goal.
We believe that consumers with high earnings and very good credit are underserved by the disparate financial services offerings available in today’s market. There are approximately 500 million U.S. accounts in Federal Deposit Insurance Company (“FDIC”) insured banks and approximately 50% of those accounts are with the largest 15 U.S. banks. In addition, more than 50% of Americans use more than one bank for their financial services, and a majority of these people cite the lack of a single platform capable of providing the services and solutions they need as the reason. Based on the market capitalization of leading U.S. financial institutions, we estimate the market for financial services to be approximately $2.0 trillion, representing a substantial and compelling opportunity for us to attract members to our digital native, technology-driven platform with products and services to satisfy the needs of members at every important financial decision in their lives.
We have created an innovative financial services platform designed to offer best-in-class products to meet the broad objectives of our members and the lifecycle of their financial needs. Since our inception through March 31, 2021, we have served approximately 2.3 million members who have used approximately 3.2 million products on our platform. We define a member as someone who has a lending relationship with us through origination or servicing, has opened a financial services account, has linked an external account to our platform, or has signed up for our credit score monitoring service. Once someone becomes a member, they are always considered a member unless they violate our terms of service. This means that our members have continuous access to our free Certified Financial Planners (“CFPs”), our career advice services, our member events, all of our content, educational material, news, tools and calculators at no cost to the member. Additionally, our mobile app and website have been designed with a member home feed that is personalized and delivers content to a member about what they must do that day in their financial life, what they should consider doing that day in their financial life, and what they can do that day in their financial life. We have experienced accelerating year-over-year member growth for the past seven consecutive quarters. We believe we have just scratched the surface, and that we are in the early stages of the digital transformation of financial services. As a result, we have a substantial opportunity to continue to grow our member base and increase the number of products members use on our platform.
11

TABLE OF CONTENTS
Our Differentiation
In order to build best-in-class offerings, we focus on four differentiators: fast, selection, content and convenience.
(1)Fast — We aspire to be the fastest place for our members to responsibly do anything, whether it’s applying for a loan, getting a funded loan, opening an account, buying or selling a stock, uploading a mobile check, getting access to money, paying a friend, or accessing relevant financial content. Our products are all digital and we have a culture of iteration to help drive faster and faster services.
(2)Selection — Given the digital nature of our products, the permutations of features and services that can be made available to our members across their needs to borrow, save, spend, invest and protect are significant. We will continue to iterate, learn and innovate to broaden our selection in the same way we did by providing our members with the ability to buy single stocks without commissions, purchase fractional shares, invest in SoFi proprietary robo-advisory portfolios, and invest in SoFi-branded Exchange-Traded Funds.
(3)Content — Our financial education, insights, research content, actionable tools and advice are designed to provide meaningful value for our members. Our carefully-crafted and personalized content is offered through our member home feed and is designed to help our members get their money right. We strive to provide digestible financial education, meaningful answers, salient information, advice, credit scores, financial calculators, investment research and financial news that enhance member loyalty and increase the likelihood that members will use additional SoFi products in the future.
(4)Convenience — We hold ourselves accountable to providing the most convenient member experience possible in terms of ease of use, ubiquity, functionality, simplicity and responsive customer service. Our long-term goal is to provide the most convenient 24x7 service and dispel the historical construct of financial service availability based on a 9-5 Monday through Friday work day.
Each product we offer is delivered in a member-centric way and is built and enhanced with these differentiators in mind.
We offer our members a full suite of financial products and services all in one common mobile platform. To complement these products and services, we believe in building vertically-integrated technology platforms designed to manage and deliver our suite of solutions to our members in a low-cost and differentiated manner.
Lending Solutions:   We offer multiple loan products, such as student loans, personal loans and home loans, designed to serve the lifecycle needs of our members. We believe our proprietary underwriting models predicated on data and scale help us better understand and manage risk and help us achieve a potential gain on sale through our whole loan or securitizations channels.
Financial Services Solutions:   We offer a suite of financial services solutions, including cash management and investment services across our SoFi Money, SoFi Invest, SoFi Credit Card and SoFi Relay products. SoFi Money is a digitally-native, mobile cash management experience for our members. SoFi Invest is a mobile-first investment platform offering members access to trading and advisory solutions, such as active investing, robo-advisory and cryptocurrency accounts. SoFi Credit Card offers a rewards program that provides double the rewards when the cardholder redeems them into SoFi Money, SoFi Invest or SoFi personal or student loans. To complement these products, we offer financial tracking through SoFi Relay, and partner with other enterprises through loan referrals and our SoFi At Work service. We have also developed a financial services marketplace platform branded Lantern Credit to help applicants that do not qualify for SoFi products with alternative products, as well as providing a product comparison experience.
Our Strategy — The Financial Services Productivity Loop
We believe that gaining our members’ trust and developing a relationship with our members is central to our success as a financial services platform. Moreover, we believe that some of the current frictions faced by other
12

TABLE OF CONTENTS
financial institutions are caused by a disjointed and non-seamless product experience, and an inability to offer a comprehensive, integrated suite of products in one digital native experience to meet a customer’s holistic financial needs. Through our mobile technology and continuous effort to improve each of our financial services offerings, we believe we are building a digital mobile native financial services platform that members can access for all of their financial services needs.
Our strategy, what we refer to as the “Financial Services Productivity Loop”, is centered around building trust and a lifetime relationship with our members, which we believe will help build a sustainable competitive advantage. In order to deliver on our strategy, we must develop best in class unit economics and best in class products that build trust and reliability between our members and our platform. When we do this on a member’s first product, and they later consider using a second product, we believe they are more likely to start with our platform and that we have a higher chance that they will select one of our products to meet their other financial needs. This would result in delivering more revenue per member without incurring additional member acquisition costs, resulting in higher lifetime value per member. This also reinforces the benefits of our platform, which simplifies the entire financial ecosystem for our members, helping them get their money right. We are able to use the increased profits to further improve member benefits and product experience.
We believe we are in the early stages of realizing the benefits of the Financial Services Productivity Loop, as increasing numbers of our members are using multiple products on our platform. From the first quarter of 2020 to the first quarter of 2021, the number of our members who have used more than one of our product offerings grew 171% from approximately 216,000 to approximately 585,000.
In addition to realizing the benefits of more of our members adopting multiple SoFi products, both in terms of additional revenue and lower member acquisition costs per product, the Financial Services Productivity Loop strategy delivers operating and technology efficiencies to deliver better unit economics on a per product basis. One of the success factors of our lending business is that it is vertically integrated across our technology stack, risk protocols and operations processes. This vertical integration has led to strong lending unit economics and first quarter 2021 contribution profit margin of 59%, which is defined as contribution profit divided by total net revenue for the Lending segment.
IPOE-20210614_G1.JPG
We believe that by participating in the entire technology ecosystem powering digital financial services, we not only reduce costs to operate our member-centric business, but also deliver increasing value to our enterprise customers. To that end, in May 2020, we acquired Galileo Financial Technologies, LLC (“Galileo”), which has allowed us to vertically integrate across more of our financial services, which we believe will help us achieve better unit economics.
13

TABLE OF CONTENTS
A key element of our long-term strategy is to secure a national bank charter, which we believe would enhance the profitability of our lending capabilities and improve the value proposition of our SoFi Money product. While we currently rely on third-party bank holding companies to provide cash management services to our members, we believe that securing a national bank charter would, among other things, allow us to provide members and prospective members broader and more competitive options across their financial services needs, including deposit accounts, and lower our cost to fund loans (by utilizing our SoFi Money members’ deposits to fund our loans), which would enable us to offer lower interest rates on loans to members as well as offer higher interest rates on SoFi Money accounts, all while continuing not to charge non-interest based fees.
In October 2020, we received preliminary, conditional approval from the OCC for our application for a national bank charter. Final OCC approval is subject to a number of preopening requirements. In March 2021, we entered into an agreement to acquire Golden Pacific Bancorp, Inc., a bank holding company, and its wholly-owned subsidiary, Golden Pacific Bank, National Association, a national bank, for a total cash purchase price of $22.3 million. The acquisition is subject to regulatory approval, including approval from the OCC of a revised business plan for the acquiree national bank, and approval from the Federal Reserve to become a bank holding company and for a change of control, and other customary closing conditions. In March 2021, we submitted an application to the Federal Reserve to become a bank holding company. The application review process is ongoing.
Our Products
We offer a suite of financial products all in one digital native application to help members get their money right. In 2011, we started our company with an innovative approach to the private student loan market and later expanded our lending product offerings to include personal loans and home loans. Over the last two years, we have expanded our overall strategy to not only include products that enable our members to borrow better, but also to save better, spend better, invest better and protect better. In the first quarter of 2019, we launched SoFi Money, SoFi Invest and SoFi Relay. In that same quarter, we also redesigned our end-to-end approach to mortgage lending and relaunched home loans. In the third quarter of 2019, we introduced in-school loans and in the third quarter of 2020, we launched SoFi Credit Card, which was expanded to a broader market in the fourth quarter of 2020.
In addition, we built a social area within our mobile application, which we refer to as the member home feed. In the member home feed, we show our members what is happening in their financial lives through personalized cards with relevant content, news and tools. Our goal is for these cards to help our members answer three questions every day: (i) what must you do in your financial life; (ii) what should you consider doing in your financial life; and (iii) what can you do in your financial life. Through the member home feed, there are significant opportunities to build frequent engagement and, to date, the member home feed has been an important and additional driver of new
14

TABLE OF CONTENTS
product adoption. The member home feed is an important part of our strategy and our ability to use data as a competitive advantage.
IPOE-20210614_G2.JPG
Our Segments
We conduct our business through three reportable segments: Lending, Financial Services and Technology Platform. Our three reportable segments and their respective products are as follows:
Lending Financial Services Technology Platform
Student Loans (in school and student loan refinancing)
SoFi Money
Technology Platform Services (Galileo)
Personal Loans
SoFi Invest
Clearing Brokerage Services (Apex)
Home Loans
SoFi Relay
SoFi Credit Card
SoFi At Work
SoFi Protect
Lantern Credit
Lending Segment
Through our Lending segment, we offer student loans, personal loans, home loans and related services.
Student Loans.   We primarily operate in the student loan refinance space, with a focus on super-prime graduate school loans. Subsequently, we expanded into “in-school” lending, which allows members to borrow funds while they attend school. We offer flexible loan sizes and repayment options, as well as competitive rates, on our student loan refinancing and in-school loan products.
Personal Loans.   We primarily originate personal loans for debt consolidation purposes and home improvement projects. We offer fixed and variable rate loans with no origination fees and flexible repayment terms, such as unemployment protection. We believe there are opportunities for us to pursue additional personal loan channels.
Home Loans.   We have historically offered agency and non-agency loans for members purchasing a home or refinancing an existing mortgage. On our home loan products, we offer competitive rates, flexible down-payment options for as little as 5% and educational tools and calculators.
15

TABLE OF CONTENTS
We retain servicing rights to our originated loans (other than home loans), and believe our servicing function is an important asset because of the connection to the member it affords us throughout the life of the loan. We believe this ongoing relationship with our members enhances the effectiveness of our Financial Services Productivity Loop by increasing member touchpoints and driving the number of products per member.
Our platform supports the full transaction lifecycle, including credit application, underwriting, approval, funding and servicing. Through data derived at loan origination and throughout the servicing process, SoFi has life of loan performance data on each loan in its ecosystem, which provides a meaningful data asset.
Financial Services Segment
Our Financial Services segment consists of cash management. investment and other related services.
SoFi Money.   Through SoFi Money, a digital, mobile cash management experience for our members, we invest in member acquisition and marketing activities to attract new members, including by offering rewards to incentivize prospective members to house their cash management activities on the SoFi platform.
SoFi Invest.   We also provide introductory brokerage services to our members, and have invested significantly in creating SoFi Invest, a streamlined mobile investing experience through which we offer multiple ways to invest and give members access to active investing, robo-advisory and cryptocurrency services. While we do not charge trading fees, other than for cryptocurrency trading, our platform benefits from increasing assets under management as we generate interest income on cash balances that we hold, and we also earn brokerage revenue through share lending and pay for order flow arrangements. We also believe there are opportunities to generate incremental future revenue through margin lending and options. Through our acquisition of 8 Limited in 2020, we expanded SoFi Invest into the Hong Kong market. Furthermore, our innovative “stock bits” feature allows members to purchase fractional shares in various companies.
Other.   In August 2020, we began offering the SoFi Credit Card, which we expanded to a broader market in the fourth quarter of 2020. Additionally, we developed SoFi Relay within the SoFi mobile application, a personal finance management product which allows members to track all of their financial accounts in one place and utilize credit score monitoring services. Further, we leverage our technology and information infrastructure to offer services to other enterprises, such as loan referrals and SoFi At Work, which is a platform we offer to enterprises that are looking for a seamless way to provide financial benefits to their employees, such as student loan payments made on their employees’ behalf, for which we earn a fee. We have also developed a financial services marketplace platform branded Lantern Credit to help applicants that do not qualify for SoFi products with alternative products, as well as providing a product comparison experience. Finally, through SoFi Protect, we offer third-party insurance products through partnerships.
Technology Platform Segment
Our Technology Platform segment consists of Galileo, which we acquired in May 2020. Galileo is a provider of technology platform services to financial and non-financial institutions. Through Galileo, we provide services through a suite of program, event and authorization application programming interfaces for financial and non-financial institutions. Galileo provides us with recurring revenues through multi-year agreements with its customers, consisting primarily of platform-as-a-service access for various financial and non-financial institutions, and transaction card program management services. Additionally, Galileo provides vertical integration benefits with SoFi Money. In addition to growth in its U.S. client base, Galileo is increasingly focused on international opportunities, including in Latin America and Asia.
Historically, our Technology Platform segment also included our minority ownership of Apex, a technology-enabled provider of investment custody and clearing brokerage services, in which we invested in December 2018 and exited in January 2021.
16

TABLE OF CONTENTS
Risk Factors
Our business is subject to numerous risks and uncertainties, including those highlighted in the section titled “Risk Factors” immediately following this prospectus summary, which illuminate challenges that we face in connection with the successful implementation of our strategy and the growth of our business. The following considerations, among others, may offset our competitive strengths or have a negative effect on our business strategy, which could cause a decline in the price of shares of our securities and result in a loss of all or a portion of your investment:
We have a history of losses and may not achieve profitability in the future.
We operate in a rapidly evolving industry, and have limited experience in our Financial Services and Technology Platform segments, which may make it difficult to evaluate our future prospects.
We have experienced rapid growth in recent years, including through the addition of new lines of business, which may place significant demands on our operational, administrative, compliance and financial resources.
There is no assurance that our revenue and business models will be successful.
We are acquiring a national bank, which is subject to regulatory approvals and other closing conditions, and, if consummated, the acquisition will subject us to significant additional regulation.
Legislative and regulatory policies and related actions in connection with student loans could have a material adverse effect on our student loan portfolios and future originations.
The new administration has proposed debt relief for existing federal student loan borrowers and there are proposals to make student loans fully dischargeable in bankruptcy.
Our results of operations and future prospects depend on our ability to retain existing, and attract new, members. We face intense and increasing competition and, if we do not compete effectively, our competitive positioning and our operating results would be harmed.
Negative publicity could result in a decline in our member growth and have a material adverse effect on our business, our brand and our results of operations.
We sell a significant percentage of our unsecured loans to a small number of whole loan purchasers and the loss of one or more significant purchasers could have a negative impact on our operating results.
Galileo depends on a small number of customers, the loss or disruptions in operations of any of which could have a material adverse effect on its business and financial results, and negatively impact our financial results and results of operations.
Changes in business, economic, or political conditions could impact our business, resulting in lower revenues and other adverse effects to our results of operations.
Legislative and regulatory responses to the COVID-19 pandemic and related economic uncertainty could have a material adverse effect on our loan portfolios. Further, certain loans may be subject to discharge in certain circumstances which, among other things, may impact the timing of payments and our ability to collect on those loans.
We operate in a cyclical industry. In an economic downturn, we may not be able to grow our lending business or maintain expected levels of liquidity, loss minimization and revenue growth.
If we do not make accurate credit and pricing decisions or effectively forecast our loss rates, our business and financial results will be harmed, and the harm could be material.
We offer personal loans which have a limited performance history and have not yet been tested in down-cycle economic conditions.
We service all of the personal loans that we originate and have limited loan servicing experience, and we rely on third parties to service the student loans and mortgage loans that we originate. A failure by us or these third parties to service loans properly could result in lost revenue and impact our liquidity.
17

TABLE OF CONTENTS
Fluctuations in interest rates could negatively affect our business.
If one or more of our warehouse facilities, on which we are highly dependent, is terminated, we may be unable to find replacement financing on favorable terms, or at all, which would have a material adverse effect on our business and financial condition.
Higher than expected payment speeds of loans could negatively impact our returns as the holder of the residual interests in securitization trusts holding student, personal and home loans. These factors could materially alter our net interest income or the value of our residual interest holdings.
Increases in member default rates on loans could make us and our loans less attractive to whole loan buyers, lenders under debt warehouse facilities and investors in securitizations which may adversely affect our access to financing and our business.
We require substantial capital and, in the future, may require additional capital to pursue our business objectives and achieve recurring profitability. If adequate capital is not available to us, including due to the cost and availability of funding in the capital markets, our business, operating results and financial condition may be harmed.
Our Lending segment is highly regulated, and if we fail to comply with federal and state consumer protection laws, rules, regulations and guidance, our business could be adversely affected.
Changes in consumer finance and other applicable laws and regulations, as well as changes in enforcement policies and priorities, may negatively impact the management of our business, results of operations, ability to offer certain products or the terms and conditions upon which they are offered, and ability to compete.
Our Financial Services segment is subject to the regulatory framework applicable to investment management and broker-dealers, including regulation by the SEC and FINRA.
The regulatory regime governing blockchain technologies and cryptocurrencies is uncertain, and new regulations or policies may alter our business practices with respect to cryptocurrency. There has recently been an increased regulatory and enforcement focus in this area.
Litigation, regulatory actions and compliance issues could subject us to significant fines, penalties, judgments, remediation costs, negative publicity, changes to our business model, and requirements resulting in increased expenses.
As a private company, we had not endeavored to establish and maintain public-company-quality internal control over financial reporting. If we fail to establish and maintain proper and effective internal control over financial reporting as a public company, our ability to produce accurate and timely financial statements could be impaired, investors may lose confidence in our financial reporting and the trading price of our common stock may decline.
Incorrect estimates or assumptions by management in connection with the preparation of our consolidated financial statements could adversely affect our reported assets, liabilities, income, revenue or expenses.
Cyber-attacks and other security breaches could have an adverse effect on our business, harm our reputation and expose us to liability.
Various disruptions or failures affecting our platform and/or systems or any third-party processor we utilize could result in slowdowns or wholesale failures to process and enable transactions on our platform, including collecting payments on loans and maintaining accurate accounts.
We are subject to complex and stringent data protection and privacy laws and regulations. Any significant or high profile data privacy breach or violation of data privacy laws could result in the loss of business and reputation, litigation against us, liquidated and other damages, and regulatory investigations and penalties that could adversely affect our reputation and operating results and financial condition.
18

TABLE OF CONTENTS
Accounting Treatment
The Business Combination was accounted for as a reverse recapitalization, in accordance with accounting principles generally accepted in the United States of America (“GAAP”). Under the guidance in ASC 805, SoFi Technologies was treated as the “acquired” company for financial reporting purposes. Accordingly, the Business Combination will be treated as the equivalent of SoFi issuing stock for the net assets of SoFi Technologies, accompanied by a recapitalization whereby no goodwill or other intangible assets are recorded. Operations prior to the Business Combination will be those of SoFi.
Corporate Information
We were incorporated under the name “Social Capital Hedosophia Holdings Corp. V” on July 10, 2020 as a Cayman Islands exempted company for purposes of effecting a merger, share exchange, asset acquisition, share purchase, reorganization or similar business combination with one or more businesses. On May 28, 2021, we domesticated into a Delaware corporation and changed our name to “SoFi Technologies, Inc.” in connection with the Domestication.
Our principal executive office is located at 234 1st Street, San Francisco, California 94105. Our telephone number is (855) 456-7634. Our website address is www.sofi.com. Information contained on, or otherwise accessible through, our website is not a part of this prospectus.
19

TABLE OF CONTENTS
The Offering
Issuer
SoFi Technologies, Inc.
Issuance of common stock
Shares of common stock to be issued by us
Up to 125,098,884 shares consisting of:
27,089,789 shares of common stock reserved for issuance upon the exercise of options to purchase common stock;
57,713,105 shares of common stock reserved for issuance upon the settlement of restricted stock units; and
40,295,990 shares of common stock issuable upon the exercise of outstanding warrants, consisting of (i) 8,000,000 shares of common stock issuable upon the exercise of the SCH warrants, (ii) 12,170,990 shares of common stock issuable upon the exercise of the SoFi warrants, and (iii) 20,125,000 shares of common stock issuable upon the exercise of the public warrants.
Shares of common stock outstanding prior to the exercise of stock options and warrants, and the settlement of restricted stock units
795,224,257 shares
Exercise price of warrants
$11.50 per share, subject to adjustments as described herein, for the SCH warrants and the public warrants, and $8.86 per share, subject to adjustments as described herein, for the SoFi warrants
Use of proceeds
We will receive up to an aggregate of approximately $431 million from the exercise of the warrants (assuming the exercise in full of all of the warrants for cash) and $166 million from the exercise of stock options (assuming the exercise in full of all of the outstanding stock options for cash). We expect to use the net proceeds from the exercise of the warrants and stock options for general corporate purposes. See “Use of Proceeds”.
20

TABLE OF CONTENTS
Resale of common stock, Series 1 preferred stock and warrants
Shares of common stock offered by the Selling Securityholders
490,852,123 shares consisting of:
263,378,239 shares of common stock issued in connection with the Merger to certain of the Selling Securityholders;
122,500,000 shares of common stock issued in the PIPE Investment;
27,089,789 shares of common stock reserved for issuance by us upon the exercise of options to purchase common stock;
57,713,105 shares of common stock reserved for issuance by us upon the settlement of restricted stock units; and
20,170,990 shares of common stock consisting of (i) 8,000,000 shares of common stock issuable upon the exercise of the SCH warrants, and (ii) 12,170,990 shares of common stock issuable upon the exercise of the SoFi warrants.
Shares of Series 1 preferred stock offered by the Selling Securityholders
3,234,000 shares of Series 1 preferred stock
Warrants offered by the Selling Securityholders
20,170,990 warrants consisting of:
8,000,000 SCH warrants; and
12,170,990 SoFi warrants
Terms of the offering
The Selling Securityholders will determine when and how they will dispose of the securities registered under this prospectus for resale. See “Plan of Distribution”.
Use of proceeds
We will not receive any proceeds from the sale of the securities registered under this prospectus by the Selling Securityholders.
Lock-up restrictions
Certain of our stockholders are subject to certain restrictions on transfer until the termination of applicable lock-up periods. See “Securities Act Restrictions on Resale of Our Securities—Lock-Up Restrictions”.
Risk factors
See “Risk Factors” and the other information included in this prospectus for a discussion of factors you should consider before investing in our securities.
Nasdaq symbols
Our common stock and warrants are listed on Nasdaq under the symbols “SOFI” and “SOFIW”, respectively.
21

TABLE OF CONTENTS
RISK FACTORS
An investment in our securities involves a high degree of risk. You should carefully consider the risks described below before making an investment decision. Our business, prospects, financial condition or operating results could be harmed by any of these risks, as well as other risks not currently known to us or that we currently consider immaterial. The trading price of our securities could decline due to any of these risks, and, as a result, you may lose all or part of your investment. Certain statements in “Risk Factors” are forward-looking statements. See “Cautionary Note Regarding Forward-Looking Statements”.
Business, Financial and Operational Risks
We operate in a rapidly evolving industry, and have limited experience in our Financial Services and Technology Platform segments, which may make it difficult for us to successfully identify and address the risks and uncertainties we face.
We operate in a rapidly evolving industry, and have limited experience in our Financial Services and Technology Platform segments, which may make it difficult to evaluate our business and future prospects. In particular, we have limited experience offering cash management and investment services and technology solutions. We face numerous challenges to our success, including our ability to:
increase or maintain the number, volume and types of, and add new features to, the loans we extend to our members as the market for loans evolves and as we face new and increasing competitive threats;
increase the number of members utilizing non-lending products, and maintain and build on the loyalty of existing members by increasing their use of new or additional products;
successfully maintain and enhance our diversified funding strategy, including through securitization financing from consolidated and nonconsolidated variable interest entities (“VIEs”), whole loan sales and debt warehouse facilities;
further establish, diversify and refine our cash management, investment and brokerage offerings to meet evolving consumer needs and preferences;
diversify our sources of revenue;
favorably compete with other companies, including traditional and alternative technology-enabled lenders and broker dealers;
introduce new products or other offerings to meet the needs of our existing and prospective members or to keep pace with competitive lending, cash management, investment and other developments;
maintain or increase the effectiveness of our direct marketing, and other sales and marketing efforts;
successfully navigate economic conditions and fluctuations in the credit markets;
establish fraud prevention strategies that proactively identify threat vectors and mitigate losses;
defend our platform from information security vulnerabilities, cyberattacks or malicious attacks;
effectively manage the growth of our business;
effectively manage our expenses;
obtain debt or equity capital on attractive terms or at all;
successfully continue to expand internationally;
adequately respond to macroeconomic and other exogenous challenges, including the ongoing COVID-19 pandemic; and
22

TABLE OF CONTENTS
anticipate and react to changes in an evolving regulatory and political environment.
We may not be able to successfully address the risks and uncertainties we face, which could negatively impact our business, financial condition, results of operations, cash flows and future prospects.
We have a history of losses and may not achieve profitability in the future.
Our net losses were $177.6 million and $106.4 million for the three months ended March 31, 2021 and 2020, respectively, and $224.1 million, $239.7 million and $252.4 million for the years ended December 31, 2020, 2019 and 2018, respectively. As of March 31, 2021 and December 31, 2020, we had a total permanent deficit of $293.6 million and $120.1 million, respectively. We may continue to incur net losses in the future, and such losses may fluctuate significantly from quarter to quarter. We will need to generate and sustain significant revenues for our business generally, and achieve greater scale and generate greater operating cash flows from our Financial Services segment, in particular, in future periods in order to achieve, maintain or increase our level of profitability. We intend to continue to invest in sales and marketing, technology and new products and services in order to enhance our brand recognition and our value proposition to our members, and these additional costs will create further challenges to generating near term profitability. General and administrative expenses have increased, and we expect they may continue to increase, to meet the increased compliance and other requirements associated with operating as a public company and evolving regulatory requirements. In addition, we are acquiring a national bank charter, and operating a bank may significantly increase our compliance costs. See “—We are acquiring a national bank, which is subject to regulatory approvals and other closing conditions, and, if consummated, the acquisition will subject us to significant additional regulation”.
Our efforts to grow our business may be more costly than we expect, and we may not be able to increase our revenue sufficiently to offset our higher operating expenses. We may continue to incur losses and not achieve future profitability or, if achieved, be unable to maintain such profitability, due to a number of reasons, including the risks described in this prospectus, unforeseen expenses, difficulties, complications and delays, and other unknown events.
We have experienced rapid growth in recent years, including through the addition of new lines of business, which may place significant demands on our operational, risk management, sales and marketing, technology, compliance, and finance and accounting resources.
Our rapid growth in certain areas of our business in recent years, primarily within our Financial Services and Technology segments, has placed significant demands on our operational, risk management, sales and marketing, technology, compliance, and finance and accounting infrastructure, and has resulted in increased expenses, a trend that we expect to continue as our business is growing. In addition, we are required to continuously develop and adapt our systems and infrastructure in response to the increasing sophistication of the consumer financial services market, evolving fraud and information security landscape, and regulatory developments relating to existing and projected business activities. Our future growth will depend, among other things, on our ability to maintain an operating platform and management system apt to address such growth, and will require us to incur significant additional expenses, expand our workforce and commit additional senior management and operational resources. We may not be able to manage supporting and expanding our operations effectively, and any failure to do so would adversely affect our ability to increase the scale of our business, generate projected revenue and control expenses.
There is no assurance that our revenue and business model will be successful.
We are continually refining our revenue and business model, which is premised on creating a virtuous cycle for our members to engage in more products across our platform, a strategy we refer to as the Financial Services Productivity Loop. There is no assurance that these efforts will be successful or that we will generate revenues commensurate with our efforts and expectations, or become profitable. We may be forced to make significant changes to our revenue and business model to compete with our competitors’ offerings, and even if such changes are undertaken, there is no guarantee that they will be successful. Additionally, we will likely be required to hire, train and integrate qualified personnel to meet and further our business objectives, and our ability to successfully do so is uncertain.
23

TABLE OF CONTENTS
Our results of operations and future prospects depend on our ability to retain existing, and attract new, members. We face intense and increasing competition and, if we do not compete effectively, our competitive positioning and our operating results will be harmed.
We refer to our customers as “members”. We define a member as someone who has a lending relationship with us via origination or servicing, opened a financial services account, linked an external account to our platform, or signed up for our credit score monitoring service. We operate in a rapidly changing and highly competitive industry, and our results of operations and future prospects depend on, among others:
the continued growth of our member base;
our ability to monetize our member base, including through the use of additional products by our existing members;
our ability to acquire members at a lower cost; and
our ability to increase the overall value to us of each of our members while they remain on our platform (which we refer to as a member’s lifetime value).
We expect our competition to continue to increase, as there are generally no substantial barriers to entry to the markets we serve. In addition to established enterprises, we may also face competition from early-stage companies attempting to capitalize on the same, or similar, opportunities as we are. Some of our current and potential competitors have longer operating histories, particularly with respect to our financial services products, significantly greater financial, technical, marketing and other resources and a larger customer base than we do. This allows them, among others, to potentially offer more competitive pricing or other terms or features, a broader range of financial products, or a more specialized set of specific products or services, as well as respond more quickly than we can to new or emerging technologies and changes in member preferences. Our existing or future competitors may develop products or services that are similar to our products and services or that achieve greater market acceptance than our products and services. This could attract new members away from our services and reduce our market share in the future. Additionally, when new competitors seek to enter our markets, or when existing market participants seek to increase their market share, these competitors sometimes undercut, or otherwise exert pressure on, the pricing terms prevalent in that market, which could adversely affect our market share and/or ability to capitalize on new market opportunities.
We currently compete at multiple levels with a variety of competitors, including:
other personal loan, student loan refinancing, in-school student loan and home loan lenders, including traditional banks, as well as credit card issuers, that can offer more competitive interest rates or terms;
traditional banks and other non-bank financial institutions for cash management accounts like SoFi Money;
other brokerage firms, including online or mobile platforms, for investment accounts in SoFi Invest;
other technology platforms for the enterprise services we provide, such as technology platform services via our subsidiary, Galileo;
for subscribers to our financial services content, including content from alternative providers available to our subscribers through our Lantern service, which is an independent financial services aggregator providing marketplace lending products, and various enterprise partnerships; and
other financial services firms offering leading employers a comprehensive platform for employees to build financial well-being through student loan and 529 educational plan contributions, educational tools, and financial resources, all of which we provide through SoFi at Work.
We compete with traditional banks for many of the services we offer in our Financial Services segment. Because we do not currently control a bank or a bank holding company, we are subject to regulation by a variety of state and federal regulators across our products and services and we rely on third-party banks to provide banking
24

TABLE OF CONTENTS
services to our members. This regulation by federal, state and local authorities increases our compliance costs, particularly for our lending business, as we navigate multiple regimes with different examination schedules and processes, varying disclosure requirements, and at times conflicting consumer protection laws. In addition, our ability to compete may be hampered in certain states where the amount of interest we are permitted to charge consumers is capped and we are consequently unable to make loans to all the consumers that we believe may be qualified but to whom we cannot offer the appropriate risk-adjusted margin. See “Business — Government Regulation — Bank Acquisition” and “Management’s Discussion and Analysis of Financial Condition and Results of OperationsExecutive Overview” for a summary of the additional measures required in our efforts to acquire a national bank.
We believe that our ability to compete depends upon many factors both within and beyond our control, including, among others, the following:
the size, diversity and activity levels of our member base;
our ability to introduce successful new products or services;
the timing and market acceptance of products and services, including developments and enhancements to those products and services, offered by us and our competitors;
member service and support efforts;
selling and marketing efforts;
the ease of use, performance, price and reliability of solutions developed either by us or our competitors;
changes in economic conditions, regulatory and policy developments;
our ability to successfully acquire a national bank subsidiary;
our ability to successfully execute on the Financial Services Productivity Loop and our other business plans;
general credit markets conditions and their impact on our liquidity and ability to access funding;
the ongoing impact of the COVID-19 pandemic on the lending and financial services markets we serve; and
our brand strength relative to our competitors.
Our current and future business prospects demand that we act to meet these competitive challenges but, in doing so, our net revenue and results of operations could be adversely affected if we, for example, increase marketing expenditures or make other expenditures. Competitive pressures could also result in us reducing the annual percentage rate on the loans we originate, incurring higher member acquisition costs and could make it more difficult for us to grow our loan originations in both number of loans and volume for new as well as existing members. All of the foregoing factors and events could adversely affect our business, financial condition, results of operations, cash flows and future prospects.
We are acquiring a national bank, which is subject to regulatory approvals and other closing conditions, and, if consummated, the acquisition will subject us to significant additional regulation.
We believe a national bank charter will improve our capital efficiency, provide funding resilience and regulatory clarity, and generate improved margins. In March 2021, we entered into an agreement to acquire Golden Pacific Bancorp, Inc., a bank holding company, and its wholly-owned subsidiary, Golden Pacific Bank, National Association, a national bank. The acquisition is subject to approval from the Board of Governors of the Federal Reserve System (the “Federal Reserve”) and the Office of the Comptroller of the Currency (the “OCC”) under the Bank Holding Company Act and the National Bank Act, respectively, as well as other customary closing conditions, all of which we anticipate can be completed by the end of 2021. Our ability to obtain the requisite approvals for the acquisition depends on the bank regulators’ views as to our capital levels, quality of management, and overall
25

TABLE OF CONTENTS
condition, in addition to their assessment of a variety of other factors, including our compliance with law. In that vein, we have been developing a financial and bank capitalization plan and may need to enhance our governance, compliance, controls and management infrastructure and capabilities in order to be compliant with all applicable regulations and operate to the satisfaction of the banking regulators, which may require substantial time, monetary and human resource commitments. If we are not successful in developing a financial and bank capitalization plan or enhancing, as needed, our governance, compliance, controls and management infrastructure and capabilities, our ability to obtain a national bank charter may be jeopardized.
Ultimately, if we are unable to obtain a national bank charter due to a failure to obtain the necessary regulatory approvals for the acquisition of Golden Pacific Bancorp, Inc. and its national bank subsidiary, Golden Pacific Bank, National Association, then our ability to improve our capital efficiency, funding resilience, margins, and our stock price, may be adversely affected. Our stock price may also decline to the extent that the current market price reflects a market assumption that we would obtain a national bank charter. In addition, we will have spent substantial time and resources, and would recognize substantial expenses in connection with the negotiation and documentation of a bank acquisition without realizing the expected benefits of obtaining a bank charter. Without a national bank charter, we would be required to continue to maintain state-specific licenses for certain of our consumer loans and financial services products.
Further, if the acquisition successfully closes and we do obtain a national bank charter through our ownership of Golden Pacific Bank, National Association, we will become subject to regulation, supervision and examination by the Federal Reserve as well as other federal bank regulators. See “Business — Government Regulation — Bank Acquisition. Our efforts to comply with such additional regulation may require substantial time, monetary and human resource commitments. If any new regulations or interpretations of existing regulations to which we are subject impose requirements on us that are impractical or that we cannot satisfy, our financial performance, and our stock price, may be adversely affected.
Additionally, should we successfully acquire a national bank charter through our ownership of Golden Pacific Bank, National Association or otherwise, certain of our stockholders may need to comply with applicable federal banking statutes and regulations, including the Change in Bank Control Act and the Bank Holding Company Act. Specifically, stockholders holding 10.0% or more of our voting interests may be required to provide certain information and/or commitments on a confidential basis to, among other regulators, the Federal Reserve. This requirement may deter certain existing or potential stockholders from purchasing shares of our common stock, which may suppress demand for the stock and cause the price to decline.
Our future growth depends significantly on our marketing efforts, and if our marketing efforts are not successful, our business and results of operations will be harmed.
We have dedicated and intend to continue to dedicate significant resources to marketing efforts. Our ability to attract members depends in large part on the success of these marketing efforts and the success of the marketing channels we use to promote our products. Our marketing channels include, but are not limited to, social media, traditional media such as the press, online affiliations, search engine optimization, search engine marketing, offline partnerships, preapproved direct mailings and television advertising.
While our goal remains to increase the strength, recognition and trust in our brand by increasing our member base and expanding our products and services, if any of our current marketing channels becomes less effective, if we are unable to continue to use any of these channels, if the cost of using these channels was to significantly increase or if we are not successful in generating new channels, we may not be able to attract new members in a cost-effective manner or increase the platform activity of our members. If we are unable to recover our marketing costs through increases in the size, value or overall number of loans we originate, or other product selection and utilization, it could have a material adverse effect on our business, financial condition, results of operations, cash flows and future prospects.
26

TABLE OF CONTENTS
Legislative and regulatory policies and related actions in connection with student loans could have a material adverse effect on our student loan portfolios.
In recent years, there has been increased focus by policymakers on outstanding student loans, including, among other things, on the total volume of outstanding loans and on the number of loans outstanding per borrower. In response, there has been discussion of potential legislative and regulatory actions and other possible steps to, among other things:
permit private education loans such as our refinanced student loan and in-school student loan products to be discharged in bankruptcy without the need to show undue hardship;
amend the federal postsecondary education loan programs, including to reduce interest rates on certain loans, to revise repayment plans, to implement loan forgiveness plans, to provide for refinancing of private education loans into federal student loans at low interest rates, to reduce or eliminate the Grad PLUS program (which authorizes loans that comprise a substantial portion of our student loan refinancing business) and to provide for refinancing of existing federally held student loans into new federal student loans at low interest rates;
require private education lenders to reform loan agreements to provide for income-based repayment plans and other government payment plans; and
make sweeping changes to the entire cost structure and financial aid system for higher education in the United States, including proposals to provide free postsecondary education.
As of the date of this prospectus, the new presidential administration has endorsed canceling $10,000 in federal student debt per borrower, which among other things, would make private student loans easier to discharge in bankruptcy, and providing free public college and university tuition for certain students. Prominent politicians have also advocated for executive action to forgive student loan debt. It is unclear whether the new presidential administration would seek to accomplish these actions through an Executive Order or through legislation. If student loans were forgiven or canceled in any meaningful scale, our profitability, results of operations, financial condition, cash flows or future business prospects could be materially and adversely affected as a result. In particular, our student loan refinancing business within our Lending segment, which is our largest segment, would be materially and adversely affected. There has also been pressure on policymakers to address underlying factors that contributed to the current volume of outstanding student loans, such as the cost of higher education and the ability for additional methods by the federal government and other organizations to subsidize the same, such as through increased use of Pell grants in lieu of loans. Further, proposals to eliminate or amend Section 523(a)(8) of the Bankruptcy Code, which makes student loans non-dischargeable in bankruptcy could make investors less likely to purchase our student loans. If steps were taken to materially reduce future demand by students for student loan refinancing and in-school student loan products, our student loan originations would be materially and adversely affected. As a result of any material adverse effect to our Lending segment, our overall profitability, results of operations, financial condition, cash flows or future business prospects may be adversely affected. See “— COVID-19 Pandemic Risks — Legislative and regulatory responses to the COVID-19 pandemic and related economic uncertainty could have a material adverse effect on our student loan portfolios.
Negative publicity could result in a decline in our member growth and impact our ability to compete for lending counterparties and corporate partners, and have a material adverse effect on our business, our brand and our results of operations.
We have invested significantly in our brand. We believe that maintaining and enhancing our brand identity is critical to our relationships with existing members and partners, particularly lending counterparties, marketing partners and other corporate partners, and to our ability to attract new members and partners. Our ability to compete for and maintain members, lending counterparties and other corporate partners relies to a large extent on their trust in our business and the value of our brand. The failure or perceived failure to maintain our brand could adversely affect our brand value, financial condition and results of operations. Negative publicity can adversely affect our reputation and damage our brand, and may arise from many sources, including actual or alleged misconduct, errors or improper business practices by employees, employee claims of discrimination or harassment, product failures,
27

TABLE OF CONTENTS
existing or future litigation or regulatory actions, inadequate protection of consumer information, data breaches, matters affecting our financial reporting or compliance with SEC and exchange listing requirements, and media coverage, whether accurate or not. Negative publicity or allegations of unfavorable business practices, poor governance, or workplace misconduct can be rapidly and widely shared over social or traditional media or other means, and could reduce demand for our products, undermine the loyalty of our members and the confidence of our lending counterparties, impact our partnerships, reduce our ability to recruit and retain employees, or lead to greater regulatory scrutiny of our operations. In addition, we and our officers, directors and/or employees have been, and may in the future be, named or otherwise involved in litigation or claims, including employment-related claims such as workplace discrimination or harassment, which could result in negative publicity and/or adversely impact our business, even if we are ultimately successful in defending against such claims.
We may experience fluctuations in our quarterly operating results.
We could experience fluctuations in our quarterly operating results due to a number of factors, including changes in the fair values of our instruments (including, but not limited to, our loans and warrants assumed in connection with the Business Combination), the level of our expenses, the degree to which we encounter competition in our markets, general economic conditions, the rate and credit market environment, legal or regulatory developments, legislative or policy changes and the ongoing impact of the COVID-19 pandemic. In light of these factors, results for any period should not be relied upon as being indicative of performance in future periods.
We sell a significant percentage of our loans to a concentrated number of whole loan purchasers and the loss of one or more significant purchasers could have a negative impact on our operating results.
We sell our personal, student and home loans to a concentrated number of whole loan purchasers. Our top five whole loan purchasers by total purchase price accounted for approximately 64% and 60% of the aggregate principal balance of our loans sold during the three months ended March 31, 2021 and the year ended December 31, 2020, respectively. During the three months ended March 31, 2021 and the year ended December 31, 2020, the two largest third-party buyers accounted for a combined 41% and 49%, respectively, of our loan sales volume. See Note 14 to the Notes to Unaudited Condensed Consolidated Financial Statements and Note 15 to the Notes to Consolidated Financial Statements included elsewhere in this prospectus. There are inherent risks whenever a large percentage of a business is concentrated with a limited number of parties. It is not possible for us to predict the future level of demand for our loans by these or other purchasers. In addition, purchases of our loans by these purchasers have historically fluctuated and may continue to fluctuate based on a number of factors, some of which may be outside of our control, including economic conditions, the availability of alternative investments, changes in the or terms of the loans, loans offered by other entities and prevailing interest rates. If any of these purchasers significantly reduce the dollar amount of the loans they purchase from us, we may be unable to sell those loans to another purchaser on favorable terms or at all, which may have a material adverse effect on our revenues, results of operations, liquidity and cash flows.
Our reported financial results may be adversely affected by changes in accounting principles generally accepted in the United States.
Generally accepted accounting principles in the United States are subject to interpretation by the Financial Accounting Standards Board, the American Institute of Certified Public Accountants, the SEC and various bodies formed to promulgate and interpret appropriate accounting principles. A change in these principles or interpretations could have a significant effect on our reported financial results, and could affect the reporting of transactions completed before the announcement of a change.
COVID-19 Pandemic Risks
Our financial condition and results of operations may be adversely impacted by the COVID-19 pandemic.
Occurrences of epidemics or pandemics, depending on their scale, may cause different degrees of disruption to the regional, state and local economies in which we offer our products and services. The current COVID-19 pandemic has had and could continue to have a material adverse effect on the value, operating results and financial condition of our business.
28

TABLE OF CONTENTS
The COVID-19 pandemic has caused substantial changes in consumer and student behavior, restrictions on business and individual activities and high unemployment rates, which have led to reduced economic activity. Extraordinary actions taken by international, federal, state, and local public health and governmental authorities to contain and combat the outbreak and spread of COVID-19 in regions throughout the world, including travel bans, quarantines, “stay-at-home” orders, suspension of interest accrual and collections on certain federally-backed student loans, and similar mandates for many individuals and businesses to substantially restrict daily activities have led to a decrease in consumer activity generally. Additionally, the COVID-19 pandemic has had a negative impact on consumer finances and on employment levels, which could lead to lower demand for loans, higher loan delinquencies and less spending and investing on our platform, all of which would have a negative impact on our financial condition, results of operations and cash flows.
While the extent and duration of the economic slowdown and high unemployment rates attributable to the COVID-19 pandemic remain uncertain at this time, particularly as new strains of the virus emerge and create potential challenges to vaccination efforts, a continued significant economic slowdown could have a substantial adverse effect on our financial condition, liquidity and results of operations. As of the date of this prospectus, COVID-19 has had, and may continue to have, the following adverse effects on our business and results of operations, among others:
Reduced borrower approval rates, including as a result of credit eligibility and other adjustments;
Reduced consumer demand for our student loan products, including lower origination volume and average balances of our student loans;
Lower average balances of our personal loans as a result of changes in consumer demand and adjustments to our credit decisioning process and credit criteria;
Temporary seizing of the capital markets, including decreased demand for asset-backed securities, which seizure could become longer term or permanent;
Mark-to-market calls on certain of our securities, including negative fair value adjustments and liquidity concerns associated with the margin calls;
Impeded liquidity and negative fair value adjustments with respect to our loans and securitization investments; and
Decreased consumer loan servicing revenue as a result of the required availability of forbearances, moratoriums on certain debt collection activities, and waivers of late fees.
The COVID-19 pandemic has also had an impact on the behavior of existing and prospective university students seeking higher education. According to the National Student Clearinghouse, there has been a material decline in the number of students entering college in the class of 2024 as compared to the number of students in the class of 2023, which has contributed in part, and may continue to contribute, to a reduction in the volume and amount of the in-school loans we originate and student loans we refinance. Additionally, in response to the impacts of COVID-19, among other factors, the Federal Reserve announced in September 2020 that it plans to continue a policy of maintaining interest rates at historically low levels. While low interests rates often increase immediate demand for our student loan refinancing product, they also lock in low rates of interest for current students, which decreases demand for a refinanced student loan in the future. Our student loan origination volume declined 53% in the three months ended March 31, 2021 as compared to the same period in 2020 and declined 26% in the year ended December 31, 2020 as compared to 2019. This decline was due to both reduced demand resulting from legislative and regulatory actions taken in response to COVID-19 as described in more detail in these risk factors, and a reduced marketing effort on our part in order to ensure that we had sufficient liquidity to accommodate our student loan volume. There have been, and may continue to be, other factors that put downward pressure on demand for our student loan products. See “ — Business, Financial and Operational Risks — Legislative and regulatory policies and related actions in connection with student loans could have a material adverse effect on our student loan portfolios”.
29

TABLE OF CONTENTS
Additionally, the COVID-19 pandemic has had an impact on demand by consumers, which has contributed, and may continue to contribute, to a reduction in the volume and amount of the personal loans we originate, and the corresponding revenue we generate. Our personal loan origination volume declined 11% in the three months ended March 31, 2021 as compared to the same period in 2020 and declined 31% in the year ended December 31, 2020 as compared to 2019. There are multiple reasons for this reduction in demand, including a conscious decision on our part to reduce marketing efforts and to tighten our credit standards, but the reduction in consumer demand is also attributable to changing consumer behavior. Specifically, debt consolidation is the primary driver of demand for our personal loan product. However, credit card spend by consumers is down compared to pre-COVID-19 levels, resulting in reduced overall demand for debt consolidation products.
See “Management’s Discussion and Analysis of our Financial Condition and Results of Operations — Key Business Metrics and — Results of Operations” for further discussion of the impact of the COVID-19 pandemic in recent periods on our business and operating results. The COVID-19 pandemic, and its impact, may also have the effect of heightening many of the other risks described herein.
Changes driven by the COVID-19 pandemic in debt collection practices can harm us by leading to higher losses and depress the prices we may obtain if we seek to sell loans.
In response to the COVID-19 pandemic, states and other regulatory authorities across the United States are implementing various debt collection restrictions, including in some cases bans on collections or creditors’ normal legal remedies. To the extent these regimes apply to us, they could limit our ability to service our defaulted loans and pursue collections from members, which in turn could lead to higher losses and associated loss rates. The same restrictions could negatively impact prices available in the secondary debt markets and debt buyers’ ability to operate and finance their businesses. As a result, if we seek to sell our loans, including charged-off loans, to third-party debt buyers, sale prices may be materially lower than prices that would be available absent the current environment.
Legislative and regulatory responses to the COVID-19 pandemic and related economic uncertainty could have a material adverse effect on our loan portfolios.
Legislative and regulatory responses to the COVID-19 pandemic could have a significant impact on our student loan portfolios. On March 27, 2020, the Coronavirus Aid, Relief, and Economic Security Act (“CARES Act”) was signed into law. In compliance with the CARES Act, payments and interest accrual on all loans owned by the Department of Education were suspended through September 30, 2020 and were further extended by executive action through September 30, 2021. Additionally, on March 25, 2020, the Department of Education announced that private collection agencies were required to stop making outbound collection calls and sending letters or billing statements to borrowers in default on such federally held loans. As a result of such forbearance measures and protections, borrowers might lack the incentive to refinance their student loans with us, which could negatively impact our business.
Additionally, while the CARES Act applies only to loans owned by the Department of Education, several states have adopted various initiatives to suspend payment obligations for private student loan borrowers in those states and we have suspended payment obligations by our members and interest accrual on loans in response, where applicable. In addition, in April 2020, various restrictions around the servicing and collection of private education loans were enacted by certain states. We believe we are in compliance with all such restrictions.
We also established a number of special hardship or forbearance plans, including: (i) student loan forbearance of payments for an initial 60 days with an optional 30-day extension available to members demonstrating continued need; (ii) personal loan forbearance of payments for an initial 30 days with an optional 30-day extension available to members demonstrating continued need; and (iii) home loan forbearance of payments consistent with FNMA servicing guidelines for an initial 90 days with possible extensions available to members demonstrating continued need. We discontinued enrollment in our COVID-19 forbearance programs, which were designed to be temporary in nature, for personal loans and student loans on March 31, 2021 and April 30, 2021, respectively. Subject to eligibility, members may participate in other customary hardship programs.
30

TABLE OF CONTENTS
The various legislative and regulatory responses to the COVID-19 pandemic, particularly the mandatory suspension of payments and interest accrual on federally held loans, as well as our own forbearance measures to assist our members, are likely to serve as a disincentive for borrowers to refinance their loans through our platform, thereby reducing our loan origination volume and negatively impacting our revenue. In addition, the COVID-19 pandemic has contributed to increasing pressure on policymakers to reduce or cancel student loans at a significant scale. See “ — Business, Financial and Operational Risks — Legislative and regulatory policies and related actions in connection with student loans could have a material adverse effect on our student loan portfolios”.
Although we are evaluating the ultimate impact of recently adopted local, state and federal legislation and regulation, guidance and actions, future legislative actions, and the on-going impact of our own forbearance measures on our financial results, business operations and strategies, there is no guarantee that our estimates will be accurate or that any actions we take based on such estimates will be successful. Furthermore, we believe that the cost of responding to, and complying with, evolving laws and regulations, as well as any guidance from enforcement actions, will continue to increase, as will the risk of penalties and fines from any enforcement actions that may be imposed on our businesses. Our profitability, results of operations, financial condition, cash flows or future business prospects could be materially and adversely affected as a result.
Strategic and New Product Risks
We have in the past consummated and, from time to time we may evaluate and potentially consummate, acquisitions, which could require significant management attention, disrupt our business and adversely affect our financial results.
Our success will depend, in part, on our ability to expand our business. In some circumstances, we may determine to do so through the acquisition of complementary assets, businesses and technologies rather than through internal development. For example, in April 2020, we acquired 8 Limited, an investment business in Hong Kong, and in May 2020, we acquired Galileo, a company that provides technology platform services to financial and non-financial institutions. The identification of suitable acquisition candidates can be difficult, time-consuming and costly, and we may not be able to successfully complete identified acquisitions. The risks we face in connection with acquisitions include:
diversion of management time and focus from operating our business to addressing acquisition integration challenges;
coordination of technology, product development, risk management and sales and marketing functions;
retention of employees from the acquired company, and retention of our employees who were attracted to us because of our smaller size or for other reasons;
cultural challenges associated with integrating employees from the acquired company into our organization;
integration of the acquired company’s accounting, management information, human resources and other administrative systems;
the need to implement or improve controls, procedures and policies at a business that prior to the acquisition may have lacked effective controls, information security safeguards, procedures and policies;
potential write-offs or impairments of intangible assets or other assets acquired in the acquisition;
liability for activities of the acquired company before the acquisition, including patent and trademark infringement claims, violations of laws, commercial disputes, tax liabilities and other known and unknown liabilities;
litigation or other claims in connection with the acquired company, including claims from terminated employees, customers, former stockholders or other third parties; and
31

TABLE OF CONTENTS
geographic expansion exposes our business to known and unknown regulatory compliance risks including elevated risk factors for tax compliance, money laundering controls, and supervisory controls oversight.
Our failure to address these risks or other problems encountered in connection with our acquisitions and investments could cause us to fail to realize the anticipated benefits of these acquisitions or investments, cause us to incur unanticipated liabilities and harm our business, generally. Future acquisitions could also result in dilutive issuances of our equity securities, the incurrence of debt, contingent liabilities, regulatory obligations to further capitalize our business, and goodwill and intangible asset impairments, any of which could harm our financial condition and negatively impact our stockholders. To the extent we pay the consideration for any future acquisitions or investments in cash, it would reduce the amount of cash available to us for other purposes.
Galileo depends on a small number of customers, the loss or disruptions in operations of any of which could have a material adverse effect on its business and financial results, and negatively impact our financial results and results of operations.
In May 2020, we completed our acquisition of Galileo for a purchase price of $1.2 billion. During the three months ended March 31, 2021, our Technology Platform segment consisted entirely of net revenues from Galileo, which accounted for 24% of our consolidated total net revenue. During the year ended December 31, 2020, Galileo accounted for $91.2 million, or 95%, of the total net revenue of our Technology Platform segment, and 16% of our consolidated total net revenue. Galileo’s customers are highly concentrated, with its five largest customers contributing approximately 70% of the total net revenue within the Technology Platform segment during the three months ended March 31, 2021, which represented approximately 16% of our consolidated total net revenue for the period then ended, and 69% during the year ended December 31, 2020, which represented 12% of our consolidated total net revenue for the period then ended. There are inherent risks whenever a large percentage of net revenue is concentrated with a limited number of customers, including the loss of any one or more of those customers as a result of bankruptcy or insolvency proceedings involving the customer, the loss of the customer to a competitor, harm to that customer’s reputation or financial prospects or other reasons. In addition, disruptions in the operations of any of Galileo’s key customers have in the past disrupted and may in the future disrupt Galileo’s operations, and these disruptions could be material and have an adverse impact on our results of operations.
Demand for our products may decline if we do not continue to innovate or respond to evolving technological or other changes.
We operate in a dynamic industry characterized by rapidly evolving technology, frequent product introductions, and competition based on pricing and other differentiators. We continue to explore new product offerings and may rely on our proprietary technology to make our platform available to members, to service members and to introduce new products, which both fosters innovation and introduces new potential liabilities and risks. For example, in March 2021, we launched our IPO investment center to allow members with a SoFi active Invest account to invest in initial public offerings, that we may underwrite through SoFi Securities. While this enables us to generate underwriting fees, it could also subject us to liability under the Securities Act for the contents of the prospectuses for the initial public offerings that we underwrite, which could be material. In addition, we may increasingly rely on technological innovation as we introduce new types of products, expand our current products into new markets, and continue to streamline our platform. The process of developing new technologies and products is complex, and if we are unable to successfully innovate and continue to deliver a superior member experience, members’ demand for our products may decrease and our growth and operations may be harmed. The brokerage industry also competes on price, and our ability to meet the demand of our customers in this respect could affect our ability to maintain demand for our products and services.
SoFi Securities is a participant in the Depository Trust Company’s settlement services. Broker-dealers that settle their own trades are subject to substantially more regulatory requirements than brokers that outsource these functions to third-party providers. Errors in performing settlement functions, including clerical, technological and other errors related to the handling of funds and securities could lead to censures, fines or other sanctions imposed by applicable regulatory authorities as well as losses and liability in related lawsuits and proceedings brought by transaction counterparties and others. Any unsettled securities transactions or wrongly executed transactions may expose the broker dealer to adverse movements in the prices of such securities.
32

TABLE OF CONTENTS
An increase in fraudulent activity could lead to reputational damage to our brand and material legal, regulatory and financial exposure (including fines and other penalties), and could reduce the use and acceptance of SoFi Money and SoFi Credit Card.
Financial institutions like us, as well as our members, colleagues, regulators, vendors and other third parties, have experienced a significant increase in fraudulent activity in recent years and will likely continue to be the target of increasingly sophisticated fraudsters and fraud rings in the future. This is particularly true for our newer products where we have limited experience evaluating customer behavior and performing tailored risk assessments, such as SoFi Money and SoFi Credit Card.
We develop and maintain systems and processes aimed at detecting and preventing fraudulent activity, which require significant investment, maintenance and ongoing monitoring and updating as technologies and regulatory requirements change and as efforts to overcome security and anti-fraud measures become more sophisticated. Despite our efforts, the possibility of fraudulent or other malicious activities and human error or malfeasance cannot be eliminated entirely and will evolve as new and emerging technology is deployed, including the increasing use of personal mobile and computing devices that are outside of our network and control environments. Risks associated with each of these include theft of funds and other monetary loss, the effects of which could be compounded if not detected quickly. Indeed, fraudulent activity may not be detected until well after it occurs and the severity and potential impact may not be fully known for a substantial period of time after it has been discovered.
Fraudulent activity and other actual or perceived failures to maintain a product’s integrity and/or security has led to increased regulatory scrutiny and may lead to regulatory investigations and intervention (such as mandatory card reissuance), increased litigation (including class action litigation), remediation, fines and response costs, negative assessments of us and our subsidiaries by regulators and rating agencies, reputational and financial damage to our brand, and reduced usage of our products and services, all of which could have a material adverse impact on our business.
Successful fraudulent activity and other related incidents related to the actual or perceived failures to maintain the integrity of our processes and controls could negatively affect us, including harming the market perception of the effectiveness of our security measures or harming the reputation of the financial system in general, which could result in reduced use of our products and services. Such events could also result in legislation and additional regulatory requirements. Although we maintain insurance, there can be no assurance that liabilities or losses we may incur will be covered under such policies or that the amount of insurance will be adequate.
We rely on third parties and their systems to process transaction data and for settlement of funds on SoFi Money, and these third parties’ failure to perform these services adequately could materially and adversely affect our business.
To provide our cash management account and credit card and other products and services, we rely on third parties that we do not control, such as the payment card networks, our acquiring and issuing processors, the payment card issuers, various financial institution partners, systems like the Automated Clearing House (“ACH”), and other partners. We rely on these third parties for a variety of services, including the transmission of transaction data, processing of chargebacks and refunds, settlement of funds, and the provision of information and other elements of our services. In the event these third parties fail to provide these services adequately, including as a result of financial difficulty or insolvency, errors in their systems, outages or events beyond their control, or refuse to provide these services on terms acceptable to us or at all, and we are not able to find suitable alternatives, our business may be materially and adversely affected.
SoFi Credit Card is a new product and we may not be successful in our efforts to promote its usage through marketing and promotion, or to effectively control the costs of such investments, both of which may materially impact our profitability.
Revenue growth for SoFi Credit Card is dependent on increasing the volume of members who open an account and on growing loan balances on those accounts. We have been investing in a number of new product initiatives to attract new SoFi Credit Card members and capture a greater share of our members’ total spending and borrowings. There can be no assurance that our investments in SoFi Credit Card to acquire members, provide differentiated
33

TABLE OF CONTENTS
features and services and spur usage of our card will be effective. Further, developing our service offerings, marketing SoFi Credit Card in additional customer acquisition channels and forming new partnerships could have higher costs than anticipated, and could adversely impact our results or dilute our brand. See — “SoFi Credit Card is a new product and any failure to execute our funding strategy for it could have a negative impact on our business, operating results and financial condition.
We may continue to expand operations abroad where we have limited operating experience and may be subject to increased business, economic and regulatory risks that could adversely impact our financial results.
In April 2020, we undertook our first international expansion by acquiring 8 Limited, an investment business in Hong Kong. We may, in the future, pursue further international expansion of our business operations, either organically or through acquisitions, in new international markets where we have limited or no experience in marketing, selling and deploying our product and services. If we fail to deploy or manage our operations in these countries successfully, our business and operations may suffer. In addition, we are subject to a variety of risks inherent in doing business internationally, including:
political, social and/or economic instability;
risks related to governmental regulations in foreign jurisdictions, including regulations relating to privacy, and unexpected changes in regulatory requirements and enforcement;
fluctuations in currency exchange rates;
higher levels of credit risk and fraud;
enhanced difficulties of integrating any foreign acquisitions;
burdens of complying with a variety of foreign laws;
reduced protection for intellectual property rights in some countries;
difficulties in staffing and managing global operations and the increased travel, infrastructure and legal compliance costs associated with multiple international locations and subsidiaries;
different regulations and practices with respect to employee/employer relationships, existence of workers’ councils and labor unions, and other challenges caused by distance, language, and cultural differences, making it harder to do business in certain international jurisdictions;
compliance with statutory equity requirements; and
management of tax consequences.
If we are unable to manage the complexity of global operations successfully, our financial performance and operating results could suffer.
Credit Risks
Worsening economic conditions cause our member default rates to increase and may result in decreased demand from institutional investors for our products, each of which could harm our operational results.
Uncertainty and negative trends in general economic conditions in the United States, including significant tightening of credit markets, historically have created a difficult environment for companies in the financial services industry. Many factors, including factors that are beyond our control, may result in higher default rates by our members and decline in the demand for our products by potential and existing investors, and have a detrimental impact on our operating performance and liquidity. These factors include general economic conditions, disruptions in the credit markets, changes in unemployment rates, the level of consumer and business confidence, changes in consumer spending, as well as events such as natural disasters, public health crises, like the COVID-19 pandemic, acts of war, terrorism and catastrophes.
34

TABLE OF CONTENTS
Our Lending segment may be particularly negatively impacted by worsening economic conditions that place financial stress on our members resulting in loan defaults or charge-offs at a higher-than-expected rate. If a loan charges off while we are still the owner, the loan either enters a collections process or is sold to a third-party collection agency in exchange for a fraction of the remaining amount payable to us. In either case, we will receive less than the full outstanding interest on and principal balance of the loan. Declining economic conditions may also lead to either decreased demand for our loans or demand for a higher yield on our loans, and consequently lower prices, from institutional investors on whom we rely for liquidity.
There can be no assurance that economic conditions will remain favorable for our business or that interest in purchasing our loans by financial institutions, will remain at current levels, or that default rates by our members will not increase. Reduced demand or lower prices for our products from institutional investors and increased default rates by our members may limit our access to capital, including debt warehouse facilities and securitizations, and negatively impact our profitability.
We operate in a cyclical industry. In an economic downturn, we may not be able to grow our lending business or maintain expected levels of liquidity, maintain historic loss rates and revenue growth.
The timing, severity, and duration of an economic downturn can have a significant negative impact on our ability to generate adequate revenue and to absorb expected and unexpected losses. For example, in making a decision whether to extend credit to a new or existing member, or determine appropriate pricing for a loan, our decision strategies rely on robust data collection, including from third-party sources such as credit reporting agencies, proprietary scoring models, and market expertise. An economic downturn could place financial stress on our members, potentially impacting our ability to make accurate credit assessments or lending decisions, as well as our members’ willingness to use our products. Our ability to adapt in a manner that balances future revenue production and loss management will be tested in a downturn. The longevity and severity of a downturn will also place pressure on lenders under our debt warehouses, whole loan purchasers and investors in our securitization trusts. Furthermore, long-term market disruptions could negatively impact the securitizations market. Although certain of our debt warehouses and whole loan sale agreements contain committed terms, there can be no assurance that our financing arrangements will remain available to us through any particular business cycle or be renewed on the same terms. The timing and extent of a downturn may also require us to change, postpone or cancel our strategic initiatives or growth plans to pursue shorter-term sustainability. The longer and more severe an economic downturn, the greater the potential adverse impact on us, which could be material.
If we do not make accurate credit and pricing decisions or effectively forecast our loss rates, our business and financial results will be harmed, and the harm could be material.
In making a decision whether to extend credit to prospective or existing members, we rely upon data to assess our ability to extend credit within our risk appetite, our debt servicing capacity, and overall risk level to determine lending exposure and loan pricing. If the decision components, rapidly deteriorating macro-economic conditions or analytics are either unstable, biased, or missing key pieces of information, the wrong decisions will be made, which will negatively affect our financial results. If our credit decisioning strategy fails to adequately predict the creditworthiness of our members, including a failure to predict a member’s true credit risk profile and ability to repay their loan, higher than expected loss rates will impact the fair value of our loans. Additionally, if any portion of the information pertaining to the prospective member is false, inaccurate or incomplete, and our systems did not detect such falsities, inaccuracies or incompleteness, or any or all of the other components of our credit decision process fails, we may experience higher than forecasted losses — including losses attributed to fraud. Furthermore, we rely on credit reporting agencies to obtain credit reports and other information we rely upon in making underwriting and pricing decisions. If one of these third parties experiences an outage, if we are unable to access the third-party data used in our decision strategy, or our access to such data is limited, our ability to accurately evaluate potential members will be compromised, and we may be unable to effectively predict credit losses inherent in our loan portfolio, which would negatively impact our results of operations, which could be material.
Additionally, if we make errors in the development, validation, or implementation of any of the underwriting models or tools that we use for the loans securing our debt warehouses or included in securitization transactions or
35

TABLE OF CONTENTS
whole loan sales, such loans may experience higher delinquencies and losses, which would negatively impact our debt warehouse financing terms and future securitization and whole loan sale transactions.
If the information provided to us by members is incorrect or fraudulent, we may misjudge a member’s qualification to receive a loan and our results of operations may be harmed.
Our lending decisions are based partly on information provided to us by loan applicants. To the extent that these applicants provide information to us in a manner that we are unable to verify, our credit decisioning process may not accurately reflect the associated risk. In addition, data provided by third-party sources, including credit reporting agencies, is a significant component of our credit decisions and this data may contain inaccuracies. Inaccurate analysis of credit data that could result from false loan application information could harm our reputation, business and results of operations.
In addition, we use identity and fraud prevention tools to analyze data provided by external databases to authenticate each applicant’s identity. From time to time in the past, these checks have failed and there is a risk that these checks could fail in the future, and fraud, which may be significant, may occur. We may not be able to recoup funds underlying loans made in connection with inaccurate statements, omissions of fact or fraud, in which case our revenue, results of operations and profitability will be harmed. Fraudulent activity or significant increases in fraudulent activity could also lead to regulatory intervention, which could negatively impact our results of operations, brand and reputation, and require us to take steps to reduce fraud risk, which could increase our costs.
Internet-based loan origination processes may give rise to greater risks than paper-based processes.
We use Internet-based loan processes to obtain application information and distribute certain legally required notices to applicants for, and borrowers of, our loans, and to obtain electronically signed loan documents in lieu of paper documents with ink signatures obtained in person. These processes may entail greater risks than would paper-based loan origination processes, including regarding the sufficiency of notice for compliance with consumer protection laws, risks that borrowers may challenge the authenticity of loan documents, or the validity of the borrower’s electronic signature on loan documents, and risks that despite internal controls unauthorized changes are made to the electronic loan documents. If any of those factors were to cause our loans, or any of the terms of our loans, to be unenforceable against the relevant borrowers, or impair our ability as master servicer or servicer to service our loans, the value of our loan assets would decrease significantly to us and to our investors. In addition to increased default rates and losses on our loans, this could lead to the loss of whole loan investors and securitization investors and trigger terminations and amortizations under our debt warehouse facilities, each of which would materially adversely impact our business.
Student loans are subject to discharge in certain circumstances.
Private education loans, including the refinanced student loans and other student loans made by us, are generally not dischargeable by a borrower in bankruptcy. However, a private education loan may be discharged if the bankruptcy court determines that not discharging the debt would impose an undue hardship on the debtor and the debtor’s dependents. Further, bills have been introduced in Congress that would make student loans dischargeable in bankruptcy to the same extent as other forms of unsecured credit without regard to hardship analysis. See “Business, Financial and Operational Risks — Legislative and regulatory policies and related actions in connection with student loans could have a material adverse effect on our student loan portfolios”. It is possible that a higher percentage of borrowers will obtain relief under bankruptcy or other debtor relief laws as a result of financial and economic disruptions related to the COVID-19 pandemic than is reflected in our historical experience. A private education loan that is not a refinanced parent-student loan is also generally dischargeable as a result of the death or disability of the borrower. The discharge of a significant amount of our loans could adversely affect our business and results of operations.
We offer personal loans, which have a limited performance history, and therefore we have only limited prepayment, loss and delinquency data with respect to such loans on which to base projections.
The performance of the personal loans we offer is significantly dependent on the ability of the credit decisioning, income validation, and scoring models we use to originate such loans, which include a variety of
36

TABLE OF CONTENTS
factors, to effectively evaluate an applicant’s credit profile and likelihood of default. Despite recession-readiness planning and stress forecasting, our credit criteria has not been fully tested in a down-cycle or recessionary economic environment, or in periods of disruption such as the current environment caused by the COVID-19 pandemic. There is no assurance that our credit criteria can accurately predict loan performance under such economic conditions or governmental response which may drive unexpected outcomes. If our criteria do not accurately reflect credit risk on the personal loans, greater than expected losses may result on these loans and our business, operating results, financial condition and prospects could be materially and adversely affected.
In addition, personal loans are dischargeable in a bankruptcy proceeding involving a borrower without the need for the borrower to file an adversary claim. The discharge of a significant amount of our personal loans could adversely affect our financial condition. Furthermore, other characteristics of personal loans may increase the risk of default or fraud and there are few restrictions on the uses that may be made of personal loans by borrowers, which may result in increased levels of credit consumption. We also originate personal loans through ACH deposits directly to the borrowers, which may result in a higher risk of fraud. The effect of these factors may be to reduce the amounts collected on our personal loans and adversely affect our operating results and financial condition.
We service all of the personal loans we originate and have limited loan servicing experience, and we rely on third parties to service the student loans, home loans and credit cards that we originate. A failure by us or these third parties to service loans properly could result in lost revenue and impact our liquidity.
We service all of the personal loans we originate, and we have limited experience with such servicing. We may begin servicing the student loans that we originate at some time in the future. We rely on sub-servicers to service all of our student loans, credit cards and all of our FNMA conforming home loans. In the event that a third-party service provider for any reason fails to perform such functions, including through negligence, willful misconduct or fraud, our ability to process payments and perform other operational functions for which we currently rely on such third-party service providers will suffer and our business, cash flows and future prospects may be negatively impacted.
Any failure on our part or on the part of third parties on whom we rely to perform functions related to our servicing activities to properly service our loans could result in us being removed as the servicer on the loans we originate, including loans financed by our warehouse facilities or sold into our whole loan sales channel and securitization transactions. If we fail to monitor our student loan sub-servicer and ensure that such sub-servicer complies with its obligations under state laws that require student loan servicers to be licensed, we may face civil claims for damages under such state laws. Because we receive revenue from such servicing activities, any such removal as the servicer or, with respect to our student loans, master servicer, could adversely affect our business, operating results, financial condition or prospects, as would the cost of onboarding a new servicer. Furthermore, we have agreed in our servicing agreements to service loans in accordance with the standards set forth therein, and may be obligated to repurchase loans if we fail to meet those standards.
We rely on third-party service providers to perform various functions in connection with the origination and servicing of certain of our loans. If a third-party service provider fails to properly perform these functions, our business and our ability to service our loans may be adversely affected.
We rely on third-party service providers to perform various functions relating to our loan origination and servicing business, including underwriting, fraud detection, marketing, operational functions, cloud infrastructure services, information technology, telecommunications and processing remotely created checks, and, because we are not a bank and cannot belong to or directly access the ACH payment network, ACH processing, and debit card and credit issuance or payment processing. We rely on sub-servicers to service all of our student loans, credit cards and all of our FNMA conforming home loans that we do not sell servicing-released, and a sub-servicer to perform certain back-up servicing functions with respect to our personal loans. While we oversee these service providers to ensure they service our loans in accordance with our agreements and regulatory requirements, we do not have control over the operations of any of the third-party service providers that we utilize. In the event that a third-party service provider for any reason fails to perform such functions, including through negligence, willful misconduct or fraud, our ability to process payments and perform other operational functions for which we currently rely on such third-party service providers will suffer and our business, cash flows and future prospects may be negatively impacted.
37

TABLE OF CONTENTS
Additionally, if one or more key third-party service providers were to cease to exist, to become a debtor in a bankruptcy or an insolvency proceeding or to seek relief under any debtor relief laws or to terminate its relationship with us, there could be delays in our ability to process payments and perform other operational functions for which we are currently relying on such third-party service provider, and we may not be able to promptly replace such third-party service provider with a different third-party service provider that has the ability to promptly provide the same services in the same manner and on the same economic terms. As a result of any such delay or inability to replace such key third-party service provider, our ability to process payments and perform other business functions could suffer and our business, cash flows and future prospects may be negatively impacted.
We may make non-qualified home loans which may increase the risk of litigation by consumers.
We do not currently offer, but may expand product selection to offer, non-qualified home loans, which, unlike qualified home loans, do not benefit from a presumption that the borrower has the ability to repay the loan. If we were to make a loan for which we did not satisfy the regulatory standards for ascertaining the borrower’s ability to repay the loan and the borrower were to default, we may be prevented from collecting interest and principal on that loan in court. As such, non-qualified home loans carry increased risk of exposure to litigation and claims of borrowers.
Potential geographic concentration of our members and performance of the loans we originate may increase the risk of loss on such loans and negatively impact our business.
Any concentration of our members in specific geographic areas may increase the risk of loss on our loans. Certain regions of the United States from time to time will experience weaker economic conditions and higher unemployment and, consequently, will experience higher rates of delinquency and loss than on similar loans in other regions of the country. Moreover, a deterioration in economic conditions, outbreaks of disease (such as new or worsening outbreaks of COVID-19), extreme weather conditions and other natural events (such as hurricanes, tornadoes, floods, drought, wildfires, mudslides, earthquakes and other extreme conditions) could adversely affect the ability and willingness of borrowers in affected regions to meet their payment obligations under their loans and may consequently affect the delinquency and loss experience of such loans. In addition, we, as master servicer for all student loans and home loans and as servicer of our personal loans, have offered in the past, are currently offering as a result of the economic impact of the COVID-19 pandemic, and may in the future offer, hardship forbearance or other relief programs in certain circumstances to affected borrowers.
Conversely, an improvement in economic conditions in one or more states could result in higher prepayments of their payment obligations under their loans by borrowers in such states. As a result, we and the investors who hold our loans or securities backed by our loans may receive principal payments earlier than anticipated, and fewer interest payments than anticipated, and face certain reinvestment risks, such as the inability to acquire loans on equally attractive terms as the prepaid loans.
Further, the concentration of our loans in one or more states may have a disproportionate effect on us or investors in our loans or securities backed by our loans if governmental authorities in any of those states take action against us as originator, master servicer or servicer of those loans or take action affecting our ability as master servicer or servicer to service those loans in such states.
Market and Interest Rate Risks
We utilize a gain on sale origination model and, consequently, our business is affected by the cost and availability of funding in the capital markets.
In addition to the issuance of equity, historically, we have funded our operations and capital expenditures through sales of our loans, secured and unsecured borrowing facilities, and securitizations. We utilize a gain on sale origination model and, consequently, our earnings and financial condition are largely dependent on the price we can obtain for our products in the capital markets. Our ability to obtain these types of financing depends, among other things, on our development efforts, business plans, operating performance, lending activities, and condition of, and our access to, the capital markets at the time we seek financing. The capital markets have from time to time experienced periods of significant volatility, including recent volatility driven by the COVID-19 pandemic. This
38

TABLE OF CONTENTS
volatility can dramatically and adversely affect financing costs when compared to historical norms or make funding unavailable at any cost. Additional factors that could make financing more expensive or unavailable to us include, but are not limited to, financial losses, events that have an adverse impact on our reputation, lawsuits challenging our business practices, adverse regulatory changes, changes in the activities of our business partners, events that have an adverse impact on the financial services industry generally, counterparty availability, negative credit rating actions with respect to our rated securities, corporate and regulatory actions, interest rate changes, general economic conditions and the legal, regulatory and tax environments governing funding transactions, including existing or future securitization transactions. If financing is difficult, expensive or unavailable, our business, financial condition, results of operations, cash flows and future prospects could be materially and adversely affected.
Fluctuations in interest rates could negatively affect SoFi Money.
Falling or low interest rates may also have a negative impact on our SoFi Money product. SoFi Money is a cash management account offered through SoFi Securities LLC (“SoFi Securities”), a FINRA-registered broker dealer wholly-owned by us, which offers members the opportunity to earn a variable interest rate on their account balances. Deposits made into a SoFi Money account are swept daily to one or more banks with which we partner, and these deposits earn a variable rate of interest and are eligible for FDIC insurance. Because we are not a bank holding company, however, we are not permitted to offer members an interest rate on their SoFi Money account balance that is higher than the interest rate we receive from our partner banks. Certain of our competitors are not subject to the same restriction and we may lose current SoFi Money account holders to those competitors or fail to sign-up new SoFi Money account holders due to offering a lower interest rate.
Low interest rates may discourage investors and borrowers from using the SoFi Money, which would adversely affect our business, financial condition, results of operations, cash flows and future prospects.
Higher than expected payment speeds of loans could negatively impact our returns as the holder of the residual interests in securitization trusts holding student and personal loans. These factors could materially alter our net revenue or the value of our residual interest holdings.
The rate at which borrowers prepay their loans can have a material impact on our net revenue and the value of our residual interests in securitization trusts. Prepayment rates and levels are subject to a variety of economic, social, competitive and other factors, including fluctuations in interest rates, availability of alternative financings, regulatory changes affecting the student loan market, the home loan market, consumer lending generally, and the general economy.
While we anticipate some variability in prepayment levels, extraordinary or extended increases or decreases in prepayment rates could materially affect our liquidity and net revenue. For example, when as a result of unanticipated prepayment levels, student, and personal loans, as applicable, within a securitization trust amortize faster (due to prepayments) than originally contracted, the trust’s pool balance may decline at a rate faster than the prepayment rate assumed when the trust’s bonds were originally issued. If the trust’s pool balance declines faster than originally anticipated, in most of our securitization structures, the bonds issued by that trust will also be repaid faster than originally anticipated. In such cases, our net revenue may decrease, inclusive of the diminished value of any retained residual interest by us in the trust.
Finally, rating agencies may place bonds on watch or change their ratings on (or their ratings methodology for) the bonds issued by a securitization trust, possibly raising or lowering their ratings, based upon these prepayment rates and their perception of the risk posed by those rates to the timing of the trust cash flows. Placing bonds on watch, changing ratings negatively, proposing or making changes to ratings methodology could: (i) affect our liquidity, (ii) impede our access to the securitization markets, (iii) require changes to our securitization structures, and (iv) raise or lower the value of the residual interests of our future securitization transactions.
The transition away from LIBOR as a benchmark reference for interest rates may affect our cost of capital, our liquidity, or expose us to borrower litigation or damage to the SoFi brand.
LIBOR serves as a global benchmark for determining interest rates on commercial and consumer loans, bonds, derivatives and numerous other financial instruments. LIBOR is the reference rate for the securities issued under
39

TABLE OF CONTENTS
certain of our securitizations (such as student loan securitizations), certain secured and unsecured financing facilities (such as the loan warehouse facilities, risk retention facilities and revolving credit facility), certain hedging arrangements, and our Series 1 redeemable preferred stock dividends. LIBOR is set based on interest rate information reported by certain banks, which will stop reporting such information after 2021. In March 2021, the ICE Benchmark Administration Limited, the administrator of LIBOR, affirmed its intention to publish one week and two month USD LIBOR through December 31, 2021, and all remaining USD LIBOR tenors through June 30, 2023. In addition, it is expected that all non-USD LIBOR tenors will cease after December 31, 2021. We are unable to predict whether or when an alternative reference rate will become a standard global benchmark and suitable replacement for LIBOR. We are therefore unable to predict what the replacement reference rate or rates will be for our existing financial instruments that are currently indexed to LIBOR, the extent to which our financial instruments will transition to the same replacement reference rate, or the timing of a transition. As of March 31, 2021 and December 31, 2020, we had approximately $272 million and $312 million, respectively, of financial instruments indexed to LIBOR, consisting of loans, bonds and hedge positions. Our derivative agreements are governed by the International Swap Dealers Association, which established a 2020 IBOR Fallbacks Protocol and supplement effective in January 2021 to allow counterparties to modify legacy trades to reference amended standard definitions inclusive of the new fallback language. However, most of these legacy financial instruments do not include provisions clearly specifying a method for transitioning from LIBOR to an alternative benchmark rate, and it is not yet known how courts or regulators will view the transition away from LIBOR to an alternative benchmark rate. As a result, it is difficult to predict the impact that a cessation of LIBOR would have on the value and performance of our existing financial instruments.
As of March 31, 2021, we have identified approximately $264 million of variable-rate loans for which the repricing index was tied to LIBOR and the loan maturity date is after December 31, 2021. Our loan agreements generally allow us to choose a new alternative reference rate based upon comparable information if the current index is no longer available. We continue to originate variable-rate loans that adjust based on LIBOR.
The market transition away from LIBOR to an alternative reference rate is complex. If LIBOR rates are no longer available, and we are required to implement replacement reference rates for the calculation of interest rates under our loan agreements with borrowers, we may incur significant expense in effecting the transition and we may be subject to disputes or litigation with our borrowers over the appropriateness or comparability to LIBOR of the replacement reference rates. The replacement reference rates could also result in a reduction in our interest income. We may also receive inquiries and other actions from regulators in respect to our preparation and readiness for the replacement of LIBOR with alternative reference rates.
These uncertainties regarding the possible cessation of LIBOR or their resolution could have a material adverse impact on our funding costs, net interest margin, loan and other asset values, asset-liability management strategies, and other aspects of our business and financial results.
We are exposed to financial risks that may be partially mitigated but cannot be eliminated by our hedging activities, which carry their own risks.
We have used, and may in the future use, financial instruments for hedging and risk management purposes in order to protect against possible fluctuations in interest rates, or for other reasons that we deem appropriate. In particular, we expect our interest rate risk to increase as our home loans business grows. However, any current and future hedges we enter into will not completely eliminate the risk associated with rising interest rates and our hedging activities may prove to be ineffective.
The success of our hedging strategy will be subject to our ability to correctly assess counterparty risk and the degree of correlation between the performance of the instruments used in the hedging strategy and any changes in interest rates, along with our ability to continually recalculate, readjust and execute hedges in an efficient and timely manner. Therefore, though we may enter into transactions to seek to reduce risks, unanticipated changes may create a more negative consequence than if we had not engaged in any such hedging transactions. Moreover, for a variety of reasons, we may not seek to establish a perfect correlation between such hedging instruments and the instruments being hedged. Any such imperfect correlation may prevent us from achieving the effect of the intended hedge and
40

TABLE OF CONTENTS
expose us to risk of loss. Any failure to manage our hedging positions properly or inability to enter into hedging instruments upon acceptable terms could affect our financial condition and results of operations.
Funding and Liquidity Risks
If we are unable to retain and/or increase our current sources of funding and secure new or alternative methods of financing, our ability to finance additional loans and introduce new products will be negatively impacted.
Historically, in addition to the issuance of equity, we have funded our operations and capital expenditures primarily through access to the capital markets through sales of our loans, access to secured and unsecured borrowing facilities and utilization of securitization financing from consolidated and nonconsolidated VIEs. In each of these instances (other than for certain whole loan sales of home loans), we retain the servicing rights to our loans from which we earn a servicing fee. In securitization financing transactions, we transfer a pool of loans originated by SoFi Lending Corp. to a VIE which is sponsored by SoFi Lending Corp. and we retain risk in the VIE, typically in the form of asset-backed bonds and residual interest investments. As of March 31, 2021, we had 15 VIEs consolidated on our balance sheet. We rely on each of these outlets for liquidity and the loss or reduction of any one of these outlets could materially adversely impact our business. There can be no assurance that we will be able to successfully access the securitization markets at any given time, and in the event of a sudden or unexpected shortage of funds in the banking and financial system, we cannot be sure that we will be able to maintain necessary levels of funding without incurring high funding costs, a reduction in the term of funding instruments, an increase in the amount of equity we are required to hold or the liquidation of certain assets. Furthermore, there is risk that there will be no market at all for our loans either from whole loan buyers or through investments in securities backed by our loans.
We may require capital in excess of amounts we currently anticipate, and depending on market conditions and other factors, we may not be able to obtain additional capital for our current operations or anticipated future growth on reasonable terms or at all. As the volume of loans that we originate, and the increased suite of products that we make available to members, increases, we may be required to expand the size of our debt warehousing facilities or seek additional sources of capital. The availability of these financing sources depends on many factors, some of which are outside of our control. We may also experience the occurrence of events of default or breaches of financial performance or other covenants under our debt agreements, which could reduce or terminate our access to institutional funding.
If we are unable to increase our current sources of funding and secure new or alternative methods of financing, our ability to finance additional loans and to develop and offer new products, such as SoFi Credit Card, will be negatively impacted. The interest rates, advance rates and other costs of new, renewed or amended facilities may also be higher than those currently in effect. If we are unable to renew or otherwise replace these facilities or generally arrange new or alternative methods of financing on favorable terms, we may be forced to curtail our origination of loans or reduce lending or other operations, which would have a material adverse effect on our business, financial condition, operating results and cash flows.
If one or more of our warehouse facilities, on which we are highly dependent, is terminated, we may be unable to find replacement financing on favorable terms, or at all, which would have a material adverse effect on our business and financial condition.
We require a significant amount of short-term funding capacity for loans we originate. As of March 31, 2021, we had $5.9 billion of warehouse loan funding capacity through 20 financing partners under our warehouse facilities. Additionally, consistent with industry practice, all of our existing warehouse facilities require periodic renewal. If any of our committed warehouse facilities are terminated or are not renewed or our uncommitted facilities are not honored, we may be unable to find replacement financing on favorable terms, or at all, and we might not be able to originate an acceptable or sustainable volume of loans, which would have a material adverse effect on our business. Additionally, as our business continues to expand, we may need additional warehouse funding capacity for the loans we originate. There can be no assurance that, in the future, we will be able to obtain additional warehouse funding capacity on favorable terms, on a timely basis, or at all.
41

TABLE OF CONTENTS
If we fail to meet or satisfy any of the financial or other covenants included in our warehouse facilities, we would be in default under one or more of these facilities and our lenders could elect to declare all amounts outstanding under the facilities to be immediately due and payable, enforce their interests against loans pledged under such facilities and restrict our ability to make additional borrowings. Certain of these facilities also contain cross-default provisions. These restrictions may interfere with our ability to obtain financing or to engage in other business activities, which could materially and adversely affect us. There can be no assurance that we will maintain compliance with all financial and other covenants included in our warehouse facilities in the future.
Increases in member default rates on loans could make us and our loans less attractive to whole loan buyers, lenders under debt warehouse facilities and investors in securitizations which may adversely affect our access to financing and our business.
Increases in member default rates could make us and our loans less attractive to our existing or prospective funding sources, including whole loan buyers, securitizations and debt warehousing facilities. If our existing funding sources do not achieve their desired financial returns or if they suffer losses, they or prospective funding sources may increase the cost of providing future financing or refuse to provide future financing or purchase loans on terms acceptable to us or at all.
Our securitizations are non-recourse to SoFi Technologies and are collateralized by the pool of our loans pledged to the relevant securitization issuer. If the loans securing our securitizations fail to perform as expected, the lenders under our warehouse facilities and investors in our securitizations who purchase our loans, or future lenders or investors in similar arrangements, may increase the cost of providing future financing or refuse to provide future financing or purchase loans on terms acceptable to us or at all.
If we were to be unable to arrange new or alternative methods of financing on favorable terms, we may have to curtail or cease our origination of loans, which could have a material adverse effect on our business, financial condition, operating results and cash flows.
We make representations and warranties in connection with the transfer of loans to whole loan purchasers, government-sponsored enterprises, such as the FNMA, and our debt warehouse lenders and securitization trusts. If such representations and warranties are not correct, we could be required to repurchase loans or indemnify the purchaser, which could have an adverse effect on our ability to operate and fund our business.
We sell the home loans we originate to third parties, including counterparties like the FNMA. In the ordinary course of business, we are exposed to liability under representations and warranties made to purchasers of home loans. We make representations and warranties when we sell loans to third parties and in our financing transactions. Such representations and warranties typically include, among other things, that the loans were originated and serviced in compliance with law and with our credit risk origination policy and servicing guidelines and that, to the best of our knowledge, each loan was originated by us without any fraud or misrepresentation on our part or on the part of the borrower or any other person. In addition, purchasers require loans to meet strict underwriting and loan term criteria in order to be eligible for purchase. If those representations and warranties are breached as to a given loan, or if a certain loan we sell does not meet the relevant eligibility criteria, we will be obligated to repurchase the loan, typically at a purchase price equal to the then-outstanding principal balance of such loan, plus accrued interest and any premium. We may also be required to indemnify the purchaser for losses resulting from the breach of representations and warranties. In connection with our whole loan sales, we also typically covenant to repurchase any loan that enters delinquent status within the first thirty to sixty days following origination of the loan. Any significant increase in our obligation to repurchase home loans or indemnify purchasers of home loans, could have a significant adverse impact on our cash flows, even if they are reimbursable, and could also have a detrimental effect on our business and financial condition. If any such repurchase event occurs on a large scale, we may not have sufficient funds to meet our repurchase obligations, which would result in a default under the underlying agreements. Moreover, we may not be able to resell or refinance loans repurchased due to a breach of a representation or warranty or we may sell such loans below par. Any such event could have an adverse impact on our business, operating results, financial condition and prospects.
42

TABLE OF CONTENTS
Our agreements with our lenders contain a number of early payment triggers and covenants. A breach of such triggers or covenants or other terms of such agreements could result in an early amortization, default, and/or acceleration of the related funding facilities which could materially impact our operations.
Primary funding sources available to support the maintenance and growth of our business include, among others, securitizations, debt warehouse facilities and corporate revolving debt. Our liquidity would be materially adversely affected by our inability to comply with various covenants and other specified requirements set forth in our agreements with our lenders which could result in the early amortization, default and/or acceleration of our existing facilities. Such covenants and requirements include financial covenants, portfolio performance covenants and other events. For a description of these covenants, requirements and events, see “Management’s Discussion and Analysis of Financial Condition and Results of Operations — Liquidity and Capital Resources”.
During an early amortization period or occurrence of an event of default, principal collections from the loans in our asset-based facilities would be applied to repay principal under such facilities rather than being available to fund newly originated loans. During the occurrence of an event of default under any of our facilities, the applicable lenders could accelerate the related debt and such lenders’ commitments to extend further credit under the related facility, if any, would terminate. If we were unable to repay the amounts due and payable under such facilities and securitizations, the applicable lenders and noteholders could seek remedies, including against the collateral pledged under such facilities and by the securitization trust. An acceleration of the debt under certain facilities could also lead to a default under other facilities and, in certain instances, our hedging arrangements, due to cross-acceleration provisions.
An early amortization event or event of default would negatively impact our liquidity, including our ability to originate new loans, and require us to rely on alternative funding sources, which might increase our funding costs or which might not be available when needed. If we were unable to arrange new or alternative methods of financing on favorable terms, we might have to curtail the origination of loans, which could have a material adverse effect on our business, financial condition, operating results and cash flows, which in turn could have a material adverse effect on our ability to meet our obligations under our facilities.
We require substantial capital and, in the future, may require additional capital to pursue our business objectives and achieve recurring profitability. If adequate capital is not available to us, including due to the cost and availability of funding in the capital markets, our business, operating results and financial condition may be harmed.
Since our founding, we have raised substantial equity financing to support the growth of our business. Because we intend to continue to make investments to support the growth of our business, we may require additional capital to pursue our business objectives and growth strategy and respond to business opportunities, challenges or unforeseen circumstances, including lending to our members, increasing our marketing expenditures to attract new members and improve our brand awareness, developing our other products, introducing new services, further expanding internationally in existing or new countries or further improving existing offerings and services, enhancing our operating infrastructure and potentially acquiring complementary businesses and technologies. Accordingly, on a regular basis we need, or we may need, to engage in debt or equity financings to secure additional funds. However, additional funds may not be available when we need them, in amounts we need, or permitted to be applied to specific use cases, on terms that are acceptable to us or at all. In particular, we may require additional access to capital to support our lending operations. Volatility in the credit markets in general or in the market for student, personal and home loans and credit cards in particular may also have an adverse effect on our ability to obtain debt financing. Furthermore, the cost of our borrowing may increase due to market volatility, changes in the risk premiums required by lenders or if traditional sources of debt capital are unavailable. Volatility or depressed valuations or trading prices in the equity markets may similarly adversely affect our ability to obtain equity financing. If we raise additional funds through further issuances of equity or convertible debt securities, our existing stockholders could suffer significant dilution and any new equity securities we issue could have rights, preferences and privileges superior to those of holders of our common stock.
We expect that we will continue to use our available cash to fund our lending activities and help scale our Financial Services segment. To supplement our cash resources, we may seek to enter into additional securitizations
43

TABLE OF CONTENTS
and whole loan sale agreements or increase the size of existing debt warehousing facilities, increase the size of, or replace, our revolving credit facility, and pursue other potential options. If we are unable to adequately maintain our cash resources, we may delay non-essential capital expenditures, implement cost cutting procedures, delay or reduce future hiring, discontinue the pursuit of our strategic objectives and growth strategies, or reduce our rate of future originations compared to current level. There can be no assurance that we can obtain sufficient sources of external capital to support the growth of our business. Delays in doing so or failure to do so may require us to reduce loan originations or reduce our operations, which would harm our ability to pursue our business objectives as well as harm our business, operating results and financial condition.
We are unable to finance all of the receivables that we originate or other assets that we hold, and that illiquidity could result in a negative impact on our financial condition.
We operate a gain on sale origination model, the success of which is tied to our ability to finance the assets that we originate. Certain of our assets, however, are ineligible for sale to a whole loan buyer or securitization trust, or are ineligible for, or are subject to a higher advance rate under, warehouse funding, each of which has specific eligibility criteria for receivables it purchases or holds as collateral. Ineligible receivables include, among others, those in default or that are delinquent, receivables with defects in their origination or servicing, including fraud, or receivables generated under origination guidelines and credit policies that are no longer in effect. In addition, many of our warehouse funding sources contain excess concentration limits for loans in forbearance or with specific loan level characteristics such as time-to-maturity or loan type. Once these limits have been exceeded the advance rate applied to those receivables becomes less advantageous to us. If we are unable to sell or reasonably fund these receivables, we are required to hold them on our balance sheet which, in sufficient volume, negatively impact our financial condition.
In addition to the receivables described above, we also hold on balance sheet certain risk retention assets that we are not able to pledge to our risk retention repurchase facilities. These risk retention assets include residuals from our securitization trusts that are either ineligible for transfer or are subject to European Union regulations that prohibit transfer. The illiquidity of these positions may negatively impact our financial condition.
SoFi Credit Card is a new product and any failure to execute our funding strategy for it could have a negative impact on our business, operating results and financial condition.
SoFi Credit Card is a new product and we have limited experience originating and administering it. We began originating credit card receivables in the third quarter of 2020 (and launched it to a broader market in the fourth quarter of 2020). We anticipate establishing a credit card receivable securitization program in the future. There is no guarantee, however, that we will be successful in establishing a securitization program for these assets. In the event we are unable to finance our credit card receivables, we may be required to hold those assets on balance sheet, sell them for a loss, any of which could have a negative impact on our business, operating results and financial condition.
Regulatory, Tax and Other Legal Risks
We are subject to extensive, complex and evolving laws, rules and regulations, which are interpreted and enforced by various federal, state and local government authorities.
We are subject to various federal, state and local regulatory regimes. The principal policy objectives of these regulatory regimes are to protect borrowers, investors, and other financial services customers and to prevent fraud, money laundering, and terrorist financing. Laws and regulations, among other things, impose licensing and qualifications requirements; require various disclosures and consents; mandate or prohibit certain terms and conditions for various financial products; prohibit discrimination based on certain prohibited bases; prohibit unfair, deceptive, or abusive acts or practices; require us to submit to examinations by federal, state and local regulatory regimes; and require us to maintain various policies, procedures and internal controls. Monitoring and complying with all applicable laws and regulations can be difficult and costly. Failure to comply with any of these requirements may result in, among other things, enforcement action by governmental authorities, lawsuits, monetary damages, fines or monetary penalties, restitution or other payments to borrowers or investors, modifications to business
44

TABLE OF CONTENTS
practices, revocation of required licenses or registrations, voiding of loan contracts and reputational harm. See “Business—Legal Proceedings”.
Our Lending segment is highly regulated, and if we fail to comply with federal and state consumer protection laws, rules, regulations and guidance, our business could be adversely affected.
We are subject to extensive and complex rules and regulations, licensing and examination by various federal, state and local government authorities designed to protect borrowers and customers of other financial services. See “Business — Government Regulation. The Consumer Financial Protection Bureau (the “CFPB”), an agency which oversees compliance with and enforces federal consumer financial protection laws, has supervisory authority over the student and mortgage lending activity in which we engage. In addition, the CFPB has substantial power to regulate financial products and services received by consumers from both bank and non-bank lenders, including rulemaking authority in enumerated areas of federal law traditionally applicable to consumer lending such as truth in lending, fair credit reporting and fair debt collection. The CFPB has the authority to pursue enforcement actions against companies that offer or provide consumer financial products or services, including lenders and loan servicers that engage in unfair, deceptive or abusive acts or practices (“UDAAP”). The CFPB may also seek a range of other remedies, including rescission of contracts, refund of money, return of real property, restitution, disgorgement of profits or other compensation for unjust enrichment, damages, public notification of the violation, and “conduct” restrictions (i.e., future limits on the target’s activities or functions). In addition, where a company has violated Title X of the Dodd Frank Wall Street Reform and Consumer Protection Act (the “Dodd-Frank Act”) or CFPB regulations under Title X, the Dodd-Frank Act empowers state attorneys general and state regulators to bring certain civil actions.
We hold lending licenses or similar authorizations in multiple states, each of which has the authority to supervise and examine our activities. As a licensed consumer lender, mortgage lender, loan broker, collection agency and loan servicer in certain states, we are subject to examinations by state agencies in those states. Similarly, we are subject to licensure requirements and regulation as an education loan servicer in multiple states. An administrative proceeding, litigation, investigation or regulatory proceeding relating to allegations or findings of the violation of such laws by us, any subservicer we engage, or our collection agents, could impair our ability to service and collect on our loans or could result in requirements that we pay damages, fines or penalties and/or cancel the balance or other amounts owing under one or more of our loans. There is no assurance that allegations of violations of the provisions of applicable federal or state consumer protection laws will not be asserted against us, any subservicer we engage or our collection agents or other prior owners of our loans in the future. To the extent it is determined that any of our loans were not originated in accordance with all applicable laws, we may be obligated to repurchase such loan from a whole loan buyer, securitization trust or warehouse facility.
We must comply with federal, state and local consumer protection laws including, among others, the federal and state UDAAP laws, the Federal Trade Commission Act, the Truth in Lending Act, the Real Estate Settlement Procedures Act, the Equal Credit Opportunity Act, the Fair Housing Act, the Home Mortgage Disclosure Act, the Secure and Fair Enforcement for Mortgage Licensing Act, the Fair Credit Reporting Act (“FCRA”), the Fair Debt Collection Practices Act, the Servicemembers Civil Relief Act, the Military Lending Act, the Electronic Fund Transfer Act, the Gramm-Leach-Bliley Act, the CARES Act, and the Dodd-Frank Act. We must also comply with laws on advertising, as well as privacy laws, including the Telephone Consumer Protection Act (the “TCPA”), the Telemarketing Sales Rule, the CAN-SPAM Act, the Personal Information Protection and Electronic Documents Act, and the newly enacted California Consumer Privacy Act (the “CCPA”). Privacy and data security concerns, data collection and transfer restrictions, contractual obligations and U.S. laws and regulations related to data privacy, security and protection could materially and adversely affect our business, financial condition and results of operations.
Compliance with applicable law is costly, and our failure to comply with applicable federal, state and local law could lead to:
loss of our licenses and approvals to engage in our lending and servicing businesses;
damage to our reputation in the industry;
45

TABLE OF CONTENTS
governmental investigations and enforcement actions;
administrative fines and penalties and litigation;
civil and criminal liability, including class action lawsuits;
inability to enforce loan agreements;
diminished ability to sell loans that we originate or purchase, requirements to sell such loans at a discount compared to other loans or repurchase or address indemnification claims from purchasers of such loans;
loss or restriction of warehouse facilities to fund loans;
inability to raise capital; and
inability to execute on our business strategy, including our growth plans.
For example, in the first quarter of 2019, we were subject to a consent order from the Federal Trade Commission (the “FTC Consent Order”), which resolved allegations that we misrepresented how much money student loan borrowers have saved or would save from financing their loans with us, in violation of the Federal Trade Commission Act. Under the consent order, we are prohibited from misrepresenting to consumers how much money they would save by using our products, unless the claims are backed up by reliable evidence.
While we have developed and monitor policies and procedures designed to assist in compliance with laws and regulations and the FTC Consent Order, no assurance can be given that our compliance policies and procedures will be effective and that we will not be subject to fines and penalties, including with respect to any alleged noncompliance with the FTC Consent Order. Ambiguities in applicable statutes and regulations may leave uncertainty with respect to permitted or restricted conduct and may make compliance with laws, and risk assessment decisions with respect to compliance with laws difficult and uncertain. In addition, ambiguities make it difficult, in certain circumstances, to determine if, and how, compliance violations may be cured. We may fail to comply with applicable statutes and regulations even if acting in good faith, or because governmental bodies or courts interpret existing laws or regulations in a more restrictive manner, which may lead to regulatory investigations, governmental enforcement actions or private causes of action with respect to our compliance. To resolve issues raised in examinations or other governmental actions, we may be required to take various corrective actions, including changing certain business practices, making refunds or taking other actions that could be financially or competitively detrimental to us. In some cases, regardless of fault, it may be less time-consuming or costly to settle these matters, which may require us to implement certain changes to our business practices, provide remediation to certain individuals or make a settlement payment to a given party or regulatory body. There is no assurance that any future settlements will not have a material adverse effect on our business.
We are subject to federal and state regulatory requirements that result in substantial compliance costs, and our business would be adversely affected if our licenses are impaired as a result of non-compliance with those requirements.
We hold state licenses in connection with our lending activities, our student loan servicing activities as well as our money services business activities. We must comply with state licensing requirements and varying compliance requirements in all the states in which we operate and the District of Columbia. Changes in licensing laws may result in increased disclosure requirements, increased fees, or may impose other conditions to licensing that we or our personnel are unable to meet. In most states in which we operate, a regulatory agency or agencies regulate and enforce laws relating to loan servicers, brokers, and originators, collection agencies, and money services businesses. We are subject to periodic examinations by state and other regulators in the jurisdictions in which we conduct business, which can result in increases in our administrative costs and refunds to borrowers of certain fees earned by us, and we may be required to pay substantial penalties imposed by those regulators due to compliance errors, or we may lose our license or our ability to do business in the jurisdiction otherwise may be impaired. Fines and penalties incurred in one jurisdiction may cause investigations or other actions by regulators in other jurisdictions.
46

TABLE OF CONTENTS
We may not be able to maintain all currently requisite licenses and permits. If we change or expand our business activities, we may be required to obtain additional licenses before we can engage in those activities. If we apply for a new license, a regulator may determine that we were required to do so at an earlier point in time, and as a result, may impose penalties or refuse to issue the license, which could require us to modify or limit our activities in the relevant state. For example, in 2019, we applied, through a subsidiary, for a Pennsylvania Mortgage Servicer license. The Commonwealth of Pennsylvania, acting through the Department of Banking and Securities, issued a consent agreement and order ordering us to pay a $110,000 fine for engaging in the home loan servicing activity prior to obtaining the license.
In addition, the states that currently do not provide extensive regulation of our business may later choose to do so, and if such states so act, we may not be able to obtain or maintain all requisite licenses and permits, which could require us to modify or limit our activities in the relevant state or states. The failure to satisfy those and other regulatory requirements could result in a default under our warehouse facilities, other financial arrangements and/or servicing agreements and thereby have a material adverse effect on our business, financial condition and results of operations.
We may become subject to enforcement actions or litigation as a result of our failure to comply with laws and regulations, even though noncompliance was inadvertent or unintentional.
We maintain systems and procedures designed to ensure that we comply with applicable laws and regulations; however, some legal/regulatory frameworks provide for the imposition of fines or penalties for noncompliance even though the noncompliance was inadvertent or unintentional and even though there were systems and procedures designed to ensure compliance in place at the time.
For example, we engage in outbound telephone and text communications with consumers, and accordingly must comply with a number of statutes and regulations that govern said communications and the use of automatic telephone dialing systems (“ATDS”), and artificial or pre-recorded voice, including the TCPA and Telemarketing Sales Rules. The U.S. Federal Communications Commission (the “FCC”), and the FTC have responsibility for regulating various aspects of these laws. Among other requirements, the TCPA requires us to obtain prior express written consent for certain telemarketing calls and to adhere to “do-not-call” registry requirements which, in part, mandate we maintain and regularly update lists of consumers who have chosen not to be called and restrict calls to consumers who are on the national do-not-call list. Many states have similar consumer protection laws regulating telemarketing. These laws limit our ability to communicate with consumers and reduce the effectiveness of our marketing programs. As currently construed, the TCPA does not distinguish between voice and data, and, as such, SMS/MMS messages are also “calls” for the purpose of TCPA obligations and restrictions.
For violations of the TCPA, the law provides for a private right of action under which a plaintiff may recover monetary damages of $500 for each call or text made in violation of the prohibitions on calls made using an “artificial or pre-recorded voice” or an ATDS. A court may treble the amount of damages upon a finding of a “willful or knowing” violation. There is no statutory cap on maximum aggregate exposure (although some courts have applied in TCPA class actions constitutional limits on excessive penalties). An action may be brought by the FCC, a state attorney general, an individual, or a class of individuals. Like other companies that rely on telephone and text communications, we may be subject to putative class action suits alleging violations of the TCPA. If in the future we are found to have violated the TCPA, the amount of damages and potential liability could be extensive and adversely impact our business. Accordingly, were such a class certified or if we are unable to successfully defend such a suit, then TCPA damages could have a material adverse effect on our results of operations and financial condition.
Changes in consumer finance and other applicable laws and regulations, as well as changes in government enforcement policies and priorities, may negatively impact the management of our business, results of operations, ability to offer certain products or the terms and conditions upon which they are offered, and ability to compete.
Consumer finance regulation is constantly changing, and new laws or regulations, or new interpretations of existing laws or regulations, could have a materially adverse impact on our ability to operate as currently intended, and cause us to incur significant expense in order to ensure compliance. Federal and state financial services
47

TABLE OF CONTENTS
regulators are also enforcing existing laws, regulations, and rules aggressively and enhancing their supervisory expectations regarding the management of legal and regulatory compliance risks. These regulatory changes and uncertainties make our business planning more difficult and could result in changes to our business model and potentially adversely impact our results of operations. As a non-bank lender, we are subject to state licensing and usury laws. Furthermore, to the extent applicable, these laws can impose specific statutory liabilities upon creditors who fail to comply with their provisions and may affect the enforceability of a loan. If the application of consumer protection laws were to cause our loans, or any of the terms of our loans, to be unenforceable against the relevant borrowers, our business will be materially adversely affected. Even if we seek to comply with licensing and other requirements that we believe may be applicable to us, if we are found to not have complied with applicable laws, we could lose one or more of our licenses or authorizations or face other sanctions or penalties or be required to obtain a license in one or more such jurisdictions, which may have an adverse effect on our business.
Proposals to change the statutes affecting financial services companies are frequently introduced in Congress and state legislatures that, if enacted, may affect their operating environment in substantial and unpredictable ways. In addition, numerous federal and state regulators have the authority to promulgate or change regulations that could have a similar effect on our operating environment. We cannot determine with any degree of certainty whether any such legislative or regulatory proposals will be enacted and, if enacted, the ultimate impact that any such potential legislation or implementing regulations, or any such potential regulatory actions by federal or state regulators, would have upon our business.
New laws, regulations, policy or changes in enforcement of existing laws or regulations applicable to our business, or reexamination of current practices, could adversely impact our profitability, limit our ability to continue existing or pursue new business activities, require us to change certain of our business practices, affect retention of key personnel, or expose us to additional costs (including increased compliance costs and/or customer remediation). These changes also may require us to invest significant resources, and devote significant management attention, to make any necessary changes and could adversely affect our business.
We are subject to the risk that regulatory or enforcement agencies and/or consumer advocacy groups may assert that our business practices may violate certain rules, laws and regulations, including anti-discrimination statutes.
Antidiscrimination statutes, such as the Fair Housing Act and the Equal Credit Opportunity Act and state law equivalents, prohibit creditors from discriminating against loan applicants and borrowers based on certain characteristics, such as race, religion and national origin. Various federal regulatory and enforcement departments and agencies, including the Department of Justice and CFPB, take the position that these laws apply not only to intentional discrimination, but also to neutral practices that have a disparate impact on a group that shares a characteristic that a creditor may not consider in making credit decisions. State and federal regulators, as well as consumer advocacy groups and plaintiffs’ attorneys, are focusing greater attention on “disparate impact” claims. Similarly, these regulatory agencies and litigants could take the position that the geographical footprint within which we conduct lending activity or the manner in which we advertise loans, disproportionately excludes potential borrowers belonging to a protected class, and constitutes unlawful “redlining”. In addition to reputational harm, violations of the Equal Credit Opportunity Act and the Fair Housing Act can result in actual damages, punitive damages, injunctive or equitable relief, attorneys’ fees and civil money penalties.
Our relationships with third-party financial institutions may subject us to regulation as a service provider.
We have relationships with third parties that are subject to various federal, state, local and foreign laws and regulations. Our contracts with such parties may require us to comply with the laws to which such third parties are subject. As a service provider or partner to financial institutions, such as banks, we are or may become subject to regulatory oversight and examination by the Federal Financial Institutions Examination Council, an interagency body of the Federal Reserve, the OCC, the FDIC, and various other federal and state regulatory authorities. In addition, independent auditors annually review several of our operations to provide reports on internal controls for our partners’ auditors and regulators. We also may be subject to possible review by state agencies that regulate our partners.
48

TABLE OF CONTENTS
Changes to laws and regulations and enhanced regulatory oversight of our partners and us may compel us to divert more resources to compliance, terminate or modify our relationships with our partners, or otherwise limit the manner in which we conduct our business. If we are unable to adapt our products and services to conform to applicable laws and regulations, or if these laws and regulations have a negative impact on our partners, we may experience losses or increased operating costs, which could have a material adverse effect on our business, financial condition and results of operations.
Our Financial Services segment is subject to the regulatory framework applicable to investment managers and broker-dealers, including regulation by the SEC and FINRA.
We offer investment management services through SoFi Wealth LLC, an internet based investment adviser and SoFi Capital Advisors, LLC, which sponsors private investment funds that invest in asset-backed securitizations. Both SoFi Wealth LLC and SoFi Capital Advisors LLC are registered as investment advisers under the Investment Advisers Act of 1940, as amended (the “Advisers Act”), and are subject to regulation by the SEC. SoFi Securities is an affiliated registered broker-dealer and FINRA member. We offer cash management accounts, which are brokerage products, through SoFi Securities.
The investment advisers are subject to the anti-fraud provisions of the Advisers Act and to fiduciary duties derived from these provisions, which apply to our relationships with our members who are advisory clients, as well as the funds we manage. These provisions and duties impose restrictions and obligations on us with respect to our dealings with our members, fund investors and our investments, including for example restrictions on transactions with our affiliates. Our investment advisers have in the past and will in the future be subject to periodic SEC examinations. Our investment advisers are also subject to other requirements under the Advisers Act and related regulations primarily intended to benefit advisory members. These additional requirements relate to matters including maintaining effective and comprehensive compliance programs, record-keeping and reporting and disclosure requirements. The Advisers Act generally grants the SEC broad administrative powers, including the power to limit or restrict an investment adviser from conducting advisory activities in the event it fails to comply with federal securities laws. Additional sanctions that may be imposed for failure to comply with applicable requirements include the prohibition of individuals from associating with an investment adviser, the revocation of registrations and other censures and fines. Even if an investigation or proceeding did not result in a sanction or the sanction imposed against us or our personnel by a regulator were small in monetary amount, the adverse publicity relating to the investigation, proceeding or imposition of these sanctions could harm our reputation and cause us to lose existing members or fail to gain new members. See “Business—Legal Proceedings”.
Our subsidiary, SoFi Securities, is an affiliated registered broker-dealer and FINRA member. The securities industry is highly regulated, including under federal, state and other applicable laws, rules, and regulations, and we may be adversely affected by regulatory changes related to suitability of financial products, supervision, sales practices, advertising, application of fiduciary standards, best execution, and market structure, any of which could limit our business and damage our reputation. FINRA has adopted extensive regulatory requirements relating to sales practices, advertising, registration of personnel, compliance and supervision, and compensation and disclosure, to which SoFi Securities and its personnel are subject. FINRA and the SEC also have the authority to conduct periodic examinations of SoFi Securities, and may also conduct administrative proceedings. See “Business — Government Regulation — SoFi Invest and SoFi Money”. Additionally, material expansions of the business in which SoFi Securities engages are subject to approval by FINRA. This could delay, or even prevent, the firm’s ability to expand its securities and brokerage offerings in the future.
From time to time, SoFi Securities and SoFi Wealth may be threatened with or named as a defendant in lawsuits, arbitrations and administrative claims. The firm is also subject to periodic regulatory examinations and inspections by regulators (including the SEC and FINRA). Compliance and trading problems or other deficiencies or weakness that are reported to regulators, such as the SEC and FINRA, by dissatisfied customers or others, or that are identified by regulators themselves are investigated by such regulators, and may, if pursued, result in formal claims being filed against SoFi Securities and SoFi Wealth by customers or disciplinary action being taken by regulators against the firm or its employees. Our failure to comply with applicable laws or regulations or our own policies and procedures could result in fines, litigation, suspensions of personnel or other sanctions, which could have a material effect on our overall financial results. Even if a sanction imposed against us or our personnel is small in monetary
49

TABLE OF CONTENTS
amount, the adverse publicity arising from the imposition of sanctions against us by regulators could harm our reputation and our brand and lead to material legal, regulatory and financial exposure (including fines and other penalties), cause us to lose existing members or fail to gain new members. In addition, in the normal course of business, SoFi Securities and SoFi Wealth discuss matters with its regulators raised during regulatory examinations or otherwise subject to their inquiry. These matters could result in censures, fines, penalties or other sanctions.
Evolving laws and government regulations could adversely affect our Financial Services segment.
Governmental regulation of global financial markets and financial institutions is pervasive and continually evolving. This includes regulation of investment managers and activities, through the implementation of compliance, risk management and anti-money laundering procedures; restrictions on specific types of investments and the provision and use of leverage; capital requirements; limitations on compensation to managers; and books and records, reporting and disclosure requirements. The effects on us of future regulation, or of changes in the interpretation and enforcement of existing regulation, could have an adverse effect on our investment strategies or our business model. Policy changes and regulatory reform by the U.S. federal government may create regulatory uncertainty for our members’ portfolios and our investment strategies and adversely affect our profitability.
The regulatory regime governing blockchain technologies and cryptocurrencies is uncertain, and new regulations or policies may alter our business practices with respect to cryptocurrency.
We currently offer virtual currency and cryptocurrency-related trading services through a subsidiary that is licensed and registered with various governmental authorities as a money service business, money transmitter, virtual currency business, or the equivalent. Although many regulators have provided some guidance, regulation of digital assets based on or incorporating blockchain, such as cryptocurrencies and cryptocurrency exchanges, remains uncertain and will continue to evolve. Further, regulation varies significantly among international, federal, state and local jurisdictions. As blockchain networks and blockchain assets have grown in popularity and in market size, federal and state agencies are increasingly taking interest in, and in certain cases regulating, their use and operation. Treatment of virtual currencies continues to evolve under federal and state law. Many U.S. regulators, including the SEC, the Financial Crimes Enforcement Network, or FinCEN, the Commodity Futures Trading Commission, or the CFTC, the Internal Revenue Service, or the IRS, and state regulators including the New York State Department of Financial Services, or NYSDFS, have made official pronouncements or issued guidance or rules regarding the treatment of Bitcoin and other digital currencies. The IRS released guidance treating virtual currency as property that is not currency for U.S. federal income tax purposes, although there is no indication yet whether other courts or federal or state regulators will follow this classification. Both federal and state agencies have instituted enforcement actions against those violating their interpretation of existing laws. Other U.S. and many state agencies have offered little official guidance and issued no definitive rules regarding the treatment of cryptocurrency. The CFTC has publicly taken the position that certain virtual currencies, which term includes cryptocurrencies, are commodities. To the extent that Bitcoin is deemed to fall within the definition of a “commodity interest” under the Commodity Exchange Act, or CEA, we may be subject to additional regulation under the CEA and CFTC regulations.
As blockchain technologies and cryptocurrency business activities grow in popularity and market size, and as new cryptocurrency businesses and technologies emerge and proliferate, foreign, federal, state, and local regulators revisit and update their laws and policies, and can be expected to continue to do so in the future. Changes in this regulatory environment, including changing interpretations and the implementation of new or varying regulatory requirements by the government, may significantly affect or change the manner in which we currently conduct some aspects of our business. While the revenues we generate from offering cryptocurrency-related trading services are currently immaterial, a significant increase in these revenues would heighten our regulatory risks and other risks we face.
States may require licenses that apply to blockchain technologies and cryptocurrencies.
In the case of virtual currencies, state regulators such as the New York State Department of Financial Services (“NYSDFS”) have created regulatory frameworks. For example, in July 2014, the NYSDFS proposed the first U.S. regulatory framework for licensing participants in virtual currency business activity. The regulations, known as the “BitLicense”, are intended to focus on consumer protection. The NYSDFS issued its final BitLicense regulatory
50

TABLE OF CONTENTS
framework in June 2015. The BitLicense regulates the conduct of businesses that are involved in virtual currencies in New York or with New York customers and prohibits any person or entity involved in such activity from conducting such activities without a license. SoFi Digital Assets, LLC currently holds a BitLicense.
Other states may adopt similar statutes and regulations which will require us to obtain a license to conduct cryptocurrency activities. In July 2020, Louisiana adopted the Virtual Currency Business Act, which will require operators of virtual currency businesses to obtain a virtual currency license in order to conduct business in Louisiana, in accordance with a proposed rule, which is expected to be issued as a final rule by the Louisiana Office of Financial Institutions in early 2021. Other states, such as Texas, have published guidance on how their existing regulatory regimes governing money transmitters apply to virtual currencies. Some states, such as New Hampshire, North Carolina and Washington, have amended their state’s statutes to include virtual currencies into existing licensing regimes, while others have interpreted their existing statutes as requiring a money transmitter license to conduct certain virtual currency business activities. SoFi Digital Assets, LLC is licensed as a money transmitter or the equivalent in 32 states and the District of Columbia.
It is likely that, as blockchain technologies and the use of virtual currencies continues to grow, additional states will take steps to monitor the developing industry and perhaps require us to obtain additional licenses in connection with our virtual currency activity.
Failure to comply with anti-money laundering, economic and trade sanctions regulations, and similar laws could subject us to penalties and other adverse consequences.
Various laws and regulations in the United States and abroad, such as the Bank Secrecy Act, the Dodd-Frank Act, the USA PATRIOT Act, and the Credit Card Accountability Responsibility and Disclosure Act (the “CARD Act”), impose certain anti-money laundering requirements on companies that are financial institutions or that provide financial products and services. Under these laws and regulations, financial institutions are broadly defined to include money services businesses such as money transmitters. In 2013, FinCEN issued guidance regarding the applicability of the Bank Secrecy Act to administrators and exchangers of convertible virtual currency, clarifying that they are money service businesses, and more specifically, money transmitters. The Bank Secrecy Act requires money services businesses (“MSBs”) to develop and implement risk-based anti-money laundering programs, report large cash transactions and suspicious activity, and maintain transaction records, among other requirements. State regulators may impose similar requirements on licensed money transmitters. In addition, our contracts with financial institution partners and other third parties may contractually require us to maintain an anti-money laundering program. Our subsidiary, SoFi Digital Assets, LLC, is registered with FinCEN as an MSB. Registration as an MSB subjects us to the regulatory and supervisory jurisdiction of FinCEN and the IRS, the anti-money laundering provisions of the BSA and its implementing regulations applicable to MSBs.
We are also subject to economic and trade sanctions programs administered by the Treasury Department’s Office of Foreign Assets Control, or OFAC, which prohibit or restrict transactions to or from or dealings with specified countries, their governments, and in certain circumstances, their nationals, and with individuals and entities that are specially-designated nationals of those countries, narcotics traffickers, terrorists or terrorist organizations, and other sanctioned persons and entities.
Our failure to comply with anti-money laundering, economic and trade sanctions regulations, and similar laws could subject us to substantial civil and criminal penalties, or result in the loss or restriction of our MSB or broker-dealer registrations and state licenses, or liability under our contracts with third parties, which may significantly affect our ability to conduct some aspects of our business. Changes in this regulatory environment, including changing interpretations and the implementation of new or varying regulatory requirements by the government, may significantly affect or change the manner in which we currently conduct some aspects of our business.
We have in the past, continue to be, and may in the future be subject to inquiries, exams, pending investigations, or enforcement matters.
The financial services industry is subject to extensive regulation under federal, state, and applicable international laws. From time to time, we have been threatened with or named as a defendant in lawsuits, arbitrations and administrative claims involving securities, consumer financial services and other matters. We are
51

TABLE OF CONTENTS
also subject to periodic regulatory examinations and inspections. Compliance and trading problems or other deficiencies or weaknesses that are reported to regulators, such as the SEC, FINRA, the CFPB, or state regulators, by dissatisfied customers or others, or that are identified by regulators themselves, are investigated by such regulators, and may, if pursued, result in formal claims being filed against us by customers or disciplinary action being taken against us or our employees by regulators or enforcement agencies. For example, the CFPB has issued a civil investigative demand, or CID, to Galileo, the stated purpose of which is to determine whether Galileo violated any consumer financial laws in connection with an outage that caused difficulty for consumers to access funds in their accounts and to determine whether further CFPB action is necessary. We intend to cooperate with the CFPB in this investigation and impacted consumers were already provided with redress. See “Business—Legal Proceedings”. To resolve issues raised in examinations or other governmental actions, we may be required to take various corrective actions, including changing certain business practices, making refunds or taking other actions that could be financially or competitively detrimental to us. We expect to continue to incur costs to comply with governmental regulations. Any such claims or disciplinary actions that are decided against us could have a material impact on our financial results.
We recently entered into an agreement to acquire a national bank, which if successful would subject us to comprehensive regulation and supervision under applicable banking laws.
If we acquire control of a bank or a bank holding company, we would become subject to regulation and supervision by the Federal Reserve, and the bank would be subject to regulation and supervision by the OCC and the FDIC. The bank regulatory regime could affect many aspects of our operations, including maintenance of adequate capital and liquidity levels and our overall financial condition, permissible types, amounts and terms of extensions of credit and investments, board and management oversight, rate of growth, enterprise-wide risk management practices, compliance obligations, permissible nonbanking activities, and restrictions on dividend payments and stock buy-backs. If we acquire control of a bank, then certain changes in ownership or control of us would require prior approval of applicable banking regulators. The OCC possesses the power to issue cease and desist orders to prevent or remedy unsafe or unsound practices or violations of law by banks subject to their regulation, and the Federal Reserve possesses similar powers with respect to bank holding companies. These and other restrictions would limit the manner in which we may conduct business and obtain financing.
In general, the bank supervisory framework is intended to protect insured depositors and the safety, soundness and stability of the U.S. financial system and not shareholders in depository institutions or their holding companies. Our efforts to comply with the bank regulatory framework are likely to require substantial time, monetary and human resource commitments, and these regulatory requirements may cause us to forego other growth or potentially profitable opportunities. If any new regulations or interpretations of existing regulations to which we are subject impose requirements on us that are impractical or that we cannot satisfy, our financial performance, and our stock price, may be adversely affected.
Regulations relating to privacy, information security, and data protection could increase our costs, affect or limit how we collect and use personal information, and adversely affect our business opportunities.
We are subject to various privacy, information security and data protection laws, including requirements concerning security breach notification, and we could be negatively impacted by them. For example, we are subject to the Gramm-Leach-Bliley Act (“GLBA”) and implementing regulations and guidance. Among other things, the GLBA (i) imposes certain limitations on the ability to share consumers’ nonpublic personal information with nonaffiliated third parties and (ii) requires certain disclosures to consumers about their information collection, sharing and security practices and their right to “opt out” of the institution’s disclosure of their personal financial information to nonaffiliated third parties (with certain exceptions). The GLBA and other state laws also require that we implement and maintain certain security measures, policies and procedures to protect personal information.
Furthermore, legislators and/or regulators are increasingly adopting new and/or amending existing privacy, information security and data protection laws that potentially could have a significant impact on our current and planned privacy, data protection and information security-related practices; our policies and practices related to the collection, use, sharing, retention and safeguarding of consumer and/or employee information; and some of our
52

TABLE OF CONTENTS
current or planned business activities. New requirements, originating from new or amended laws, could also increase our costs of compliance and business operations and could reduce income from certain business initiatives.
Compliance with current or future privacy, information security and data protection laws (including those regarding security breach notification) affecting customer and/or employee data to which we are subject could result in higher compliance and technology costs and could restrict our ability to provide certain products and services (such as products or services that involve sharing information with third parties or storing sensitive credit card information), which could materially and adversely affect our profitability. Additionally, there is always a danger that regulators can attempt to assert authority over our business in the area of privacy, information security and data protection. In addition, if our vendors and/or service providers are or become subject to laws and regulations in the jurisdictions that have enacted more stringent and expansive legislation applicable to privacy, information and/or data protection, the costs that these vendors and service providers must incur in becoming compliant may be passed along to us, resulting in increasing costs on our business.
Privacy requirements, including notice and opt-out requirements, under the GLBA and the FCRA are enforced by the Federal Trade Commission and by the CFPB through UDAAP and are a standard component of CFPB examinations. State entities also may initiate actions for alleged violations of privacy or security requirements under state law. Our failure to comply with privacy, information security and data protection laws could result in potentially significant regulatory investigations and government actions, litigation, fines or sanctions, consumer or merchant actions and damage to our reputation and brand, all of which could have a material adverse effect on our business.
Should we undertake an international expansion of our business, particularly if we commence doing business in one or more countries of the European Union, we will be required to comply with stringent privacy and data protection laws. Within the European Union, legislators have adopted the General Data Protection Regulation, or GDPR, which became effective in May 2018. Should we commence doing business in Europe, the GDPR will impose additional obligations and risk upon our business, which may increase substantially the penalties to which we could be subject in the event of any non-compliance. We may incur substantial expense in complying with obligations imposed by the GDPR and we may be required to make significant changes in our business operations, all of which may adversely affect our revenues and our business overall. Further, following the withdrawal of the United Kingdom from the European Union on January 31, 2020, if we do business in the United Kingdom, we will have to comply with the GDPR and separately the GDPR as implemented in the United Kingdom, each regime having the ability to fine up to the greater of €20 million/£17 million or 4% of global turnover. The relationship between the United Kingdom and the European Union in relation to certain aspects of data protection law remains unclear, including how data transfers between European Union member states and the United Kingdom will be treated. These changes may lead to additional compliance costs and could increase our overall risk.
We may in the future be subject to federal or state regulatory inquiries regarding our business.
From time to time, in the normal course of business, we may receive or be subject to, inquiries or investigations by state and federal regulatory or enforcement agencies and bodies, such as the CFPB, state attorneys general, state financial regulatory agencies, other state or federal agencies, and self-regulatory organizations like FINRA. We also may receive inquiries from state regulatory agencies regarding requirements to obtain licenses from or register with those states, including in states where we have determined that we are not required to obtain such a license or be registered with the state. Any such inquiries or investigations could involve substantial time and expense to analyze and respond to, could divert management’s attention and other resources from running our business, and could lead to public enforcement actions or lawsuits and fines, penalties, injunctive relief, and the need to obtain additional licenses that we do not currently possess. Our involvement in any such matters, whether tangential or otherwise and even if the matters are ultimately determined in our favor, could also cause significant harm to our reputation, lead to additional investigations and enforcement actions from other agencies or litigants, and further divert management attention and resources from the operation of our business. As a result, the outcome of legal and regulatory actions arising out of any state or federal inquiries we receive could have a material adverse effect on our business, financial condition or results of operations. See “Business—Legal Proceedings”.
53

TABLE OF CONTENTS
It may be difficult and costly to protect our intellectual property rights, and we may not be able to ensure their protection.
Our ability to lend to our members depends, in part, upon our proprietary technology. We may be unable to protect our proprietary technology effectively, which would allow competitors to duplicate our business processes and know-how, and adversely affect our ability to compete with them. A third party may attempt to reverse engineer or otherwise obtain and use our proprietary technology without our consent. The pursuit of a claim against a third party for infringement of our intellectual property could be costly, and there can be no guarantee that any such efforts would be successful.
In addition, our platform may infringe upon claims of third-party intellectual property, and we may face intellectual property challenges from such other parties. We may not be successful in defending against any such challenges or in obtaining licenses to avoid or resolve any intellectual property disputes. The costs of defending any such claims or litigation could be significant and, if we are unsuccessful, could result in a requirement that we pay significant damages or licensing fees, which would negatively impact our financial performance. Furthermore, our technology may become obsolete, and there is no guarantee that we will be able to successfully develop, obtain or use new technologies to adapt our platform to stay competitive in the future. If we cannot protect our proprietary technology from intellectual property challenges, or if our platform becomes obsolete, our ability to maintain the our platform could be adversely affected.
Some aspects of our platform include open source software, and any failure to comply with the terms of one or more of these open source licenses could negatively affect our business.
We incorporate open source software into our proprietary platform and into other processes supporting our business. Such open source software may include software covered by licenses like the GNU General Public License and the Apache License or other open source licenses. The terms of various open source licenses have not been interpreted by U.S. courts, and there is a risk that such licenses could be construed in a manner that limits our use of the software, inhibits certain aspects of our platform and negatively affects our business operations.
Some open source licenses contain requirements that we make available source code for modifications or derivative works we create based upon the type of open source software we use. If portions of our proprietary platform are determined to be subject to an open source license, or if the license terms for the open source software that we incorporate change, we could be required to publicly release the affected portions of our source code, re-engineer all or a portion of our platform or change our business activities. In addition to risks related to license requirements, the use of open source software can lead to greater risks than the use of third-party commercial software, as open source licensors generally do not provide warranties or controls on the origin of the software. Many of the risks associated with the use of open source software cannot be eliminated and could adversely affect our business.
Litigation, regulatory actions and compliance issues could subject us to significant fines, penalties, judgments, remediation costs, negative publicity, changes to our business model, and requirements resulting in increased expenses.
Our business is subject to increased risks of litigation and regulatory actions as a result of a number of factors and from various sources, including as a result of the highly regulated nature of the financial services industry and the focus of state and federal enforcement agencies on the financial services industry.
From time to time, we are also involved in, or the subject of, reviews, requests for information, investigations and proceedings (both formal and informal) by state and federal governmental agencies and self-regulatory organizations, regarding our business activities and our qualifications to conduct our business in certain jurisdictions, which could subject us to significant fines, penalties, obligations to change our business practices and other requirements resulting in increased expenses and diminished earnings. Our involvement in any such matter also could cause significant harm to our reputation and divert management attention from the operation of our business, even if the matters are ultimately determined in our favor. Moreover, any settlement, or any consent order or adverse judgment in connection with any formal or informal proceeding or investigation by a government agency, may prompt litigation or additional investigations or proceedings as other litigants or other government agencies
54

TABLE OF CONTENTS
begin independent reviews of the same activities. See “— Our Lending segment is highly regulated, and if we fail to comply with federal and state consumer protection laws, rules, regulations and guidance, our business could be adversely affected” for a discussion of the FTC Consent Order and “— We are subject to state licensing and operational requirements that result in substantial compliance costs, and our business would be adversely affected if our licenses are impaired.
In addition, a number of participants in the financial services industry have been the subject of: putative class action lawsuits; state attorney general actions and other state regulatory actions; federal regulatory enforcement actions, including actions relating to alleged unfair, deceptive or abusive acts or practices; violations of state licensing and lending laws, including state usury laws; actions alleging discrimination on the basis of race, ethnicity, gender or other prohibited bases; and allegations of noncompliance with various state and federal laws and regulations relating to originating and servicing consumer finance loans. For example, we are defendants in a putative class action in which it is alleged that we engaged in unlawful lending discrimination through policies and practices making two categories of certain non-U.S. citizen loan applicants — U.S. residents who hold Deferred Action for Child Arrivals (“DACA”) and U.S. residents who hold green cards with a validity period of less than two years — ineligible for loans or eligible only with a co-signer who is U.S. citizen or lawful permanent resident. In addition, Galileo is a defendant in a putative class action in which various claims arising from an intermittent disruption in service experienced by certain holders of deposit accounts at one of Galileo’s customers, which prevented individuals from accessing or using account funds for a period of time. The CFPB is also conducting an investigation into this matter. See “Business—Legal Proceedings” for further information about this action.
The current regulatory environment, increased regulatory compliance efforts and enhanced regulatory enforcement have resulted in significant operational and compliance costs and may prevent us from providing certain products and services. There is no assurance that these regulatory matters or other factors will not, in the future, affect how we conduct our business and, in turn, have a material adverse effect on our business. In particular, legal proceedings brought under state consumer protection statutes or under several of the various federal consumer financial services statutes may result in a separate fine for each violation of the statute, which, particularly in the case of class action lawsuits, could result in damages substantially in excess of the amounts we earned from the underlying activities.
In addition, from time to time, through our operational and compliance controls, we identify compliance and other issues that require us to make operational changes and, depending on the nature of the issue, result in financial remediation to impacted members. These self-identified issues and voluntary remediation payments could be significant, depending on the issue and the number of members impacted, and also could generate litigation or regulatory investigations that subject us to additional risk. See “Business—Legal Proceedings”.
Changes in tax law and differences in interpretation of tax laws and regulations may adversely impact our financial statements.
We operate in multiple jurisdictions and are subject to tax laws and regulations of the U.S. federal, state and local and non-U.S. governments. U.S. federal, state and local and non-U.S. tax laws and regulations are complex and subject to varying interpretations. U.S. federal, state and local and non-U.S. tax authorities may interpret tax laws and regulations differently than we do and challenge tax positions that we have taken. This may result in differences in the treatment of revenues, deductions, credits and/or differences in the timing of these items. The differences in treatment may result in payment of additional taxes, interest or penalties that could have an adverse effect on our financial condition and results of operations. Further, future changes to U.S. federal, state and local and non-U.S. tax laws and regulations could increase our tax obligations in jurisdictions where we do business or require us to change the manner in which we conduct some aspects of our business.
We will be adversely affected if we are, or any of our subsidiaries is, determined to have been subject to registration as an investment company under the Investment Company Act.
We are currently not deemed an “investment company” subject to regulation under the Investment Company Act of 1940, as amended (the “Investment Company Act”). No opinion or no-action position has been requested of the SEC on our status as an Investment Company. There is no guarantee we will continue to be exempt from
55

TABLE OF CONTENTS
registration under the Investment Company Act and were we to be deemed to be an investment company under the Investment Company Act, and thus subject to regulation under the Investment Company Act, the increased reporting and operating requirements could have an adverse impact on our business, operating results, financial condition and prospects.
In addition, if the SEC or a court of competent jurisdiction were to find that we are in violation of the Investment Company Act for having failed to register as an investment company thereunder, possible consequences include, but are not limited to, the following: (i) the SEC could apply to a district court to enjoin the violation; (ii) we could be sued by investors in us and in our securities for damages caused by the violation; and (iii) any contract to which we are a party that is made in, or whose performance involves a, violation of the Investment Company Act would be unenforceable by any party to the contract unless a court were to find that under the circumstances enforcement would produce a more equitable result than nonenforcement and would not be inconsistent with the purposes of the Investment Company Act. Should we be subjected to any or all of the foregoing, our business would be materially and adversely affected.
Personnel and Business Continuity Risks
We rely on our management team and will require additional key personnel to grow our business, and the loss of key management members or key employees, or an inability to hire key personnel, could harm our business.
We believe our success has depended, and continues to depend, on the efforts and talents of our senior management, who have significant experience in the financial services and technology industries, are responsible for our core competencies and would be difficult to replace. Our future success depends on our continuing ability to attract, develop, motivate and retain highly qualified and skilled employees. Qualified individuals are in high demand, and we may incur significant costs to attract and retain them. In addition, the loss of any of our senior management or key employees could materially adversely affect our ability to execute our business plan and strategy, and we may not be able to find adequate replacements on a timely basis, or at all. Our executive officers and other employees are at-will employees, which means they may terminate their employment relationship with us at any time, and their knowledge of our business and industry would be extremely difficult to replace. We cannot ensure that we will be able to retain the services of any members of our senior management or other key employees. If we do not succeed in attracting well-qualified employees or retaining and motivating existing employees, our business could be materially and adversely affected.
The competitive job market creates a challenge and potential risk as we strive to attract and retain a highly skilled workforce.
Competition for our employees, including highly skilled technology and product professionals, is extremely intense reflecting a tight labor market. This can present a risk as we compete for experienced candidates, especially if the competition is able to offer more attractive financial terms of employment. This risk extends to our current employee population. In addition, we are based in locations that have been significantly impacted by the ongoing COVID-19 pandemic, which could cause a migration of talented employees away from our locations, making it even more challenging to attract and retain skilled professionals. We also invest significant time and expense in engaging and developing our employees, which also increases their value to other companies that may seek to recruit them. Turnover can result in significant replacement costs and lost productivity.
In addition, recent U.S. immigration policy has made it more difficult for qualified foreign nationals to obtain or maintain work visas under the H-1B classification. These H-1B visa limitations make it more difficult and/or more expensive for us to hire the skilled professionals we need to execute our growth strategy, especially engineering, data analytics and risk management personnel, and may adversely impact our business.
Due to our primarily remote workforce, we may face increased business continuity and cyber risks that could significantly harm our business and operations.
The COVID-19 pandemic has caused us to modify our business practices by migrating to a primarily remote workforce where our employees are accessing our servers remotely through home or other networks to perform their job responsibilities. While most of our operations can be performed remotely and are operating effectively at
56

TABLE OF CONTENTS
present, there is no guarantee that this will continue or that we will continue to be as effective while working remotely because our team is dispersed, many employees may have additional personal needs to attend to (such as looking after children as a result of school closures or a family member who becomes sick), and employees may become sick themselves and be unable to work. As conditions improve and restrictions are lifted, similar uncertainties exist with the return to work process.
Additionally, while we put in place additional safeguards to protect data security and privacy, a remote workforce places additional pressure on our user infrastructure and third parties that are not easily mitigated. These risks include home internet availability affecting work continuity and efficiency, and additional dependencies on third-party communication tools, such as instant messaging and online meeting platforms.
Our business is subject to the risks of natural disasters, power outages, telecommunications failures and similar events, including COVID-19 and additional public health crises, and to interruption by man-made problems such as terrorism, cyberattack, and other actions, which may impact the demand for our products or our members’ ability to repay their loans.
Events beyond our control may damage our ability to maintain our platform and provide services to our members. Such events include, but are not limited to, hurricanes, earthquakes, fires, floods and other natural disasters, public health crises, such as the ongoing COVID-19 pandemic or other infectious diseases, power outages, telecommunications failures and similar events. See “ —COVID-19 Pandemic Risks” for further discussion of risks related to COVID-19. Despite any precautions we may take, system interruptions and delays could occur if there is a natural disaster, if a third-party provider closes a facility we use without adequate notice for financial or other reasons, or if there are other unanticipated problems at our leased facilities. Because we rely heavily on our servers, computer and communications systems and the Internet to conduct our business and provide high-quality service to our members, disruptions could harm our ability to effectively run our business. Moreover, our members and customers face similar risks, which could directly or indirectly impact our business. For example, in October 2019, one of Galileo's customers experienced intermittent disruptions in service, which prevented its customers from accessing or using their deposit accounts. Galileo was named as a defendant in a putative class action as a result of the disruption in service its customer experienced, captioned as Richards, et. al v. Chime Financial, Inc., Galileo Financial Technologies and The Bancorp, Inc., Civil Action No. 4:19-cv-6864-HSG (N.D. Cal.), filed in the United States District Court for the Northern District of California in October 2019, and has agreed to a class action settlement to resolve the claims. See “Business—Legal Proceedings” for further information about this matter. We currently use Amazon Web Services (“AWS”) and would be unable to switch instantly to another system in the event of failure to access AWS. This means that an outage of AWS could result in our system being unavailable for a significant period of time. Terrorism, cyberattacks and other criminal, tortious or unintentional actions could also give rise to significant disruptions to our operations. Our business interruption insurance may not be sufficient to compensate us for losses that may result from interruptions in our service as a result of system failures or other disruptions. Comparable natural and other risks may reduce demand for our products or cause our members to suffer significant losses and/or incur significant disruption in their respective operations, which may affect their ability to satisfy their obligations towards us. All of the foregoing could materially and adversely affect our business, results of operations and financial condition.
Employee misconduct, which can be difficult to detect and deter, could harm our reputation and subject us to significant legal liability.
We operate in an industry in which integrity and the confidence of our members is of critical importance. We are subject to risks of errors and misconduct by our employees that could adversely affect our business, including:
engaging in misrepresentation or fraudulent activities when marketing or performing online brokerage and other services to our members;
improperly using or disclosing confidential information of our members or other parties;
concealing unauthorized or unsuccessful activities; or
otherwise not complying with applicable laws and regulations or our internal policies or procedures.
57

TABLE OF CONTENTS
There have been numerous highly-publicized cases of fraud and other misconduct by financial services industry employees. The precautions that we take to detect and deter employee misconduct might not be effective. If any of our employees engage in illegal, improper, or suspicious activity or other misconduct, we could suffer serious harm to our reputation, financial condition, member relationships, and our ability to attract new members. We also could become subject to regulatory sanctions and significant legal liability, which could cause serious harm to our financial condition, reputation, member relationships and prospects of attracting additional members.
Risk Management and Financial Reporting Risks
If we fail to establish and maintain proper and effective internal control over financial reporting as a public company, our ability to produce accurate and timely financial statements could be impaired, investors may lose confidence in our financial reporting and the trading price of our common stock may decline.
Pursuant to Section 404 of the Sarbanes-Oxley Act, following completion of the Business Combination, the report by management on internal control over financial reporting will be on SoFi’s financial reporting and internal controls (as accounting acquirer), and an attestation of the independent registered public accounting firm will also be required. As a private company, SoFi has not previously been required to conduct an internal control evaluation and assessment. The rules governing the standards that must be met for management to assess internal control over financial reporting are complex and require significant documentation, testing and possible remediation.
To comply with the Sarbanes-Oxley Act, the requirements of being a reporting company under the Exchange Act and any complex accounting rules in the future, we may need to upgrade SoFi’s legacy information technology systems; implement additional financial and management controls, reporting systems and procedures; and hire additional accounting and finance staff. If we are unable to hire the additional accounting and finance staff necessary to comply with these requirements, we may need to retain additional outside consultants. If we or, if required, our independent registered public accounting firm, are unable to conclude that our internal control over financial reporting is effective, investors may lose confidence in its financial reporting, which could negatively impact the price of our securities.
On April 12, 2021, the Acting Director of the Division of Corporation Finance and Acting Chief Accountant of the SEC together issued a statement regarding the accounting and reporting considerations for warrants issued by special purpose acquisition companies entitled “Staff Statement on Accounting and Reporting Considerations for Warrants Issued by Special Purpose Acquisition Companies (“SPACs”)” (the “SEC Statement”). Specifically, the SEC Statement focused on certain settlement terms and provisions related to certain tender offers following a business combination, which terms are similar to those contained in the warrant agreement governing our warrants. Following the issuance of the SEC statement, on April 22, 2021, SCH concluded that it was appropriate to restate its previously issued audited financial statements as of and for the period ended December 31, 2020, and as part of such process, SCH identified a material weakness in its internal control over financial reporting. As the accounting acquirer in the Business Combination, we inherited this material weakness and the warrants. SCH reevaluated the accounting treatment of 20,125,000 public warrants and 8,000,000 SCH warrants, and determined to classify the SCH warrants and private warrants as derivative liabilities measured at fair value, with changes in fair value each period reported in earnings. As a result, included on SCH’s unaudited condensed consolidated balance sheet as of March 31, 2021 and consolidated balance sheet as of December 31, 2020 included in this prospectus are derivative liabilities related to embedded features contained within the SCH warrants and private warrants. Accounting Standards Codification 815, Derivatives and Hedging (“ASC 815”), provides for the remeasurement of the fair value of such derivatives at each balance sheet date, with a resulting non-cash gain or loss related to the change in the fair value being recognized in earnings in the statement of operations. As a result of the recurring fair value measurement, our consolidated financial statements and results of operations may fluctuate quarterly, based on factors which are outside of our control. Due to the recurring fair value measurement, we expect that we will recognize non-cash gains or losses on the SCH and public warrants each reporting period and that the amount of such gains or losses could be material.
As a result of the material weakness, the restatement, the change in accounting for the SCH warrants and private warrants, and other matters raised or that may in the future be raised by the SEC, we may face potential litigation or other disputes, which may include, among others, claims invoking the federal and state securities laws, contractual
58

TABLE OF CONTENTS
claims or other claims arising from the restatement and material weaknesses in our internal control over financial reporting and the preparation of our financial statements. As of the date of this prospectus, we have no knowledge of any such litigation or dispute. However, we can provide no assurance that such litigation or dispute will not arise in the future. Any such litigation or dispute, whether successful or not, could have a material adverse effect on our business, results of operations and financial condition.
We cannot assure you that there will not be additional material weaknesses in our internal control over financial reporting now or in the future. Any failure to maintain internal control over financial reporting could severely inhibit our ability to accurately report our financial condition, results of operations or cash flows. If we are unable to conclude that our internal control over financial reporting is effective, or if our independent registered public accounting firm determines that we have a material weakness in our internal control over financial reporting, investors may lose confidence in the accuracy and completeness of our financial reports, the market price of our common stock could decline, and we could be subject to sanctions or investigations by Nasdaq, the SEC or other regulatory authorities. Failure to remedy any material weakness in our internal control over financial reporting, or to implement or maintain other effective control systems required of public companies, could also restrict our future access to the capital markets.
Our risk management processes and procedures may not be effective.
Our risk management processes and procedures seek to appropriately balance risk and return and mitigate risks. We have established processes and procedures intended to identify, measure, monitor and control the types of risk to which we are subject, including credit risk, deposit risk, market risk, liquidity risk, strategic risk, operational risk, cybersecurity risk, and reputational risk. Credit risk is the risk of loss that arises when a loan obligor fails to meet the terms of a loan repayment obligation, the loan enters default, and if uncured results in financial loss of remaining principal and interest to the investor. Our exposure to credit risk mainly arises from our lending activities. Deposit risk refers to accelerated availability of depositor funds, prior to settlement, risk of ACH returns or merchant settlements, and transactional limits that may be applied to deposit accounts. Market risk is the risk of loss due to changes in external market factors, such as interest rates, asset prices, and foreign exchange rates. Liquidity risk is the risk that financial condition or overall safety and soundness are adversely affected by an inability, or perceived inability, to meet obligations (e.g., current and future cash flow needs) and support business growth. We actively monitor our liquidity position and at the broker-dealer subsidiary level. Strategic risk is the risk from changes in the business environment, ineffective business strategies, improper implementation of decisions or inadequate responsiveness to changes in the business and competitive environment.
Our management is responsible for defining the priorities, initiatives, and resources necessary to execute our strategic plan, the success of which is regularly evaluated by our board of directors. Operational risk is the risk of loss arising from inadequate or failed internal processes, controls, people (e.g., human error or misconduct) or systems (e.g., technology problems), business continuity or external events (e.g., natural disasters), compliance, reputational, regulatory, or legal matters and includes those risks as they relate directly to us, fraud losses attributed to applications and any associated fines and monetary penalties as a result, transaction processing, or employees, as well as to third parties with whom we contract or otherwise do business. Operational risk is one of the most prevalent forms of risk in our risk profile. We strive to manage operational risk by establishing policies and procedures to accomplish timely and efficient processing, obtaining periodic internal control attestations from management, conducting internal process Risk Control Self-Assessments and audit reviews to evaluate the effectiveness of internal controls.
In order to be effective, among other things, our enterprise risk management capabilities must adapt and align to support any new product or loan features, capability, strategic development, or external change. Cybersecurity risk is the risk of a malicious technological attack intended to impact the confidentiality, availability, or integrity of our systems and data, including, but not limited to, sensitive client data. Our technology and information security teams rely on a layered system of preventive and detective technologies, practices, and policies to detect, mitigate, and neutralize cybersecurity threats. In addition, our information security team and third-party consultants regularly assesses our cybersecurity risks and mitigation efforts. Cyberattacks can also result in financial and reputational risk.
59

TABLE OF CONTENTS
Reputational risk is the risk arising from possible negative perceptions of us, whether true or not, among our current and prospective members, counterparties, employees, and regulators. The potential for either enhancing or damaging our reputation is inherent in almost all aspects of business activity. We manage this risk through our commitment to a set of core values that emphasize and reward high standards of ethical behavior, maintaining a culture of compliance, and by being responsive to member and regulatory requirements.
Risk is inherent in our business, and therefore, despite our efforts to manage risk, there can be no assurance that we will not sustain unexpected losses. We could incur substantial losses and our business operations could be disrupted to the extent our business model, operational processes, control functions, technological capabilities, risk analyses, and business/product knowledge do not adequately identify and manage potential risks associated with our strategic initiatives. There also may be risks that exist, or that develop in the future, that we have not appropriately anticipated, identified or mitigated, including when processes are changed or new products and services are introduced. If our risk management framework does not effectively identify and control our risks, we could suffer unexpected losses or be adversely affected, which could have a material adverse effect on our business.
Incorrect estimates or assumptions by management in connection with the preparation of our consolidated financial statements could adversely affect our reported assets, liabilities, income, revenues or expenses.
The preparation of our consolidated financial statements requires management to make critical accounting estimates and assumptions that affect the reported amounts of assets, liabilities, income, revenues or expenses during the reporting periods. Incorrect estimates and assumptions by management could adversely affect our reported amounts of assets, liabilities, income, revenues and expenses during the reporting periods. If we make incorrect assumptions or estimates, our reported financial results may be over- or understated, which could materially and adversely affect our business, financial condition and results of operations.
Our projections are subject to significant risks, assumptions, estimates and uncertainties. As a result, our projected revenues, market share, expenses and profitability may differ materially from our expectations.
We operate in a rapidly changing and competitive industry and our projections will be subject to the risks and assumptions made by management with respect to our industry. Operating results are difficult to forecast because they generally depend on a number of factors, including the competition we face, and our ability to attract and retain members and enterprise partnerships, while generating sustained revenues through the Financial Services Productivity Loop. Additionally, our business may be affected by reductions in consumer borrowing, spending and investing from time to time as a result of a number of factors which may be difficult to predict. This may result in decreased revenue levels, and we may be unable to adopt measures in a timely manner to compensate for any unexpected shortfall in income. This inability could cause our operating results in a given quarter to be higher or lower than expected. These factors make creating accurate forecasts and budgets challenging and, as a result, we may fall materially short of our forecasts and expectations, which could cause our stock price to decline and investors to lose confidence in us.
Information Technology and Data Risks
We depend on third parties for a wide array of services, systems and information technology applications, and a breach or violation of law by one of these third parties could disrupt our business or provide our competitors with an opportunity to enhance their position at our expense.
We depend on third parties for a wide array of financial, technology and insurance services, systems and information technology applications. Third-party vendors are significantly involved in many aspects of our software and systems development, servicing systems, the timely transmission of information across our data communication network, and for other telecommunications, processing, remittance and technology-related services in connection with our servicing or payment services businesses. Certain of our vendor agreements are terminable on short or no notice, and if current vendors were to stop providing services to us on acceptable terms, we may be unable to procure alternatives from other vendors in a timely and efficient manner and on acceptable terms, or at all. If a service provider fails to provide the services required or expected, or fails to meet applicable contractual or regulatory requirements such as service levels or compliance with applicable laws, the failure could negatively
60

TABLE OF CONTENTS
impact our business. Such a failure could also adversely affect the perception of the reliability of our networks and services and the quality of our brand, which could materially adversely affect our business and results of operations.
Cyberattacks and other security breaches could have an adverse effect on our business, harm our reputation and expose us to liability.
In the normal course of business, we collect, process and retain sensitive and confidential information regarding our members and prospective members. We also have arrangements in place with certain third-party service providers that require us to share consumer information. Although we devote significant resources and management focus to ensuring the integrity of our systems through information security and business continuity programs, our facilities and systems, and those of third-party service providers, are vulnerable to external or internal security breaches, acts of vandalism, computer viruses, misplaced or lost data, programming or human errors, and other similar events. We and third-party service providers have experienced such instances in the past and expect to continue to experience them in the future. We also face security threats from malicious third parties that could obtain unauthorized access to our systems and networks, which threats we anticipate will continue to grow in scope and complexity over time. These events could interrupt our business or operations, result in significant legal and financial exposure, supervisory liability, damage to our reputation and a loss of confidence in the security of our systems, products and services. Although the impact to date from these events has not had a material adverse effect on us, no assurance is given that this will be the case in the future.
Information security risks in the financial services industry have increased recently, in part because of new technologies, the use of the Internet and telecommunications technologies (including mobile devices) to conduct financial and other business transactions and the increased sophistication and activities of organized criminals, perpetrators of fraud, hackers, terrorists and others. In addition to cyberattacks and other security breaches involving the theft of sensitive and confidential information, hackers recently have engaged in attacks that are designed to disrupt key business services, such as consumer-facing websites. We may not be able to anticipate or implement effective preventive measures against all security breaches of these types, especially because the techniques used change frequently and because attacks can originate from a wide variety of sources. We employ detection and response mechanisms designed to contain and mitigate security incidents. Nonetheless, early detection efforts may be thwarted by sophisticated attacks and malware designed to avoid detection. We also may fail to detect the existence of a security breach related to the information of our members.
The access by unauthorized persons to, or the improper disclosure by us of, confidential information regarding our members or our proprietary information, software, methodologies and business secrets could interrupt our business or operations, result in significant legal and financial exposure, supervisory liability, damage to our reputation or a loss of confidence in the security of our systems, products and services, all of which could have a material adverse impact on our business. In addition, there recently have been a number of well-publicized attacks or breaches affecting companies in the financial services industry that have heightened concern by consumers, which could also intensify regulatory focus, cause users to lose trust in the security of the industry in general and result in reduced use of our services and increased costs, all of which could also have a material adverse effect on our business.
The collection, processing, use, storage, sharing and transmission of personal data could give rise to liabilities as a result of federal, state and international laws and regulations, as well as our failure to adhere to the privacy and data security practices that we articulate to our members.
We collect, process, store, use, share and/or transmit a large volume of personally identifiable information (“PII”) and other sensitive data from current, past and prospective members. There are federal, state, and foreign laws regarding privacy, data security and the collection, use, storage, protection, sharing and/or transmission of PII and sensitive data. Additionally, many states continue to enact legislation on matters of privacy, information security, cybersecurity, data breach and data breach notification requirements. For example, as of January 1, 2020, the California Consumer Privacy Act (“CCPA”) grants additional consumer rights with respect to data privacy in California. The CCPA, among other things, entitles California residents to know how their personal information is being collected and shared, to access or request the deletion of their personal information and to opt out of the sharing of their personal information. The CCPA is subject to further amendments pending certain proposed
61

TABLE OF CONTENTS
regulations that are being reviewed and revised by the California Attorney General. While personal information that we process is exempt from the GLBA, the CCPA regulates other personal information that we collect and process in connection with the business. We cannot predict the impact of the CCPA on our business, operations or financial condition, but it could require us to modify certain processes or procedures, which could result in additional costs and liability. Additionally, our broker-dealer and investment adviser are subject to SEC Regulation S-P, which requires that these businesses maintain policies and procedures addressing the protection of customer information and records. This includes protecting against any anticipated threats or hazards to the security or integrity of customer records and information and against unauthorized access to or use of customer records or information. Regulation S-P also requires these businesses to provide initial and annual privacy notices to customers describing information sharing policies and informing customers of their rights.
Additionally, a California ballot initiative, the California Privacy Rights Act (the “CPRA”) was passed in November 2020. Effective starting on January 1, 2023, the CPRA imposes additional obligations on companies covered by the legislation and will significantly modify the CCPA, including by expanding consumers’ rights with respect to certain sensitive personal information. The CPRA also creates a new state agency that will be vested with authority to implement and enforce the CCPA and the CPRA. The effects of the CCPA and the CPRA are potentially significant and may require us to modify our data collection or processing practices and policies and to incur substantial costs and expenses in an effort to comply and increase our potential exposure to regulatory enforcement and/or litigation.
We expect more states to enact legislation similar to the CCPA, which provides consumers with new privacy rights and increases the privacy and security obligations of entities handling certain personal information of such consumers. The CCPA has prompted a number of proposals for new federal and state-level privacy legislation. Such proposed legislation, if enacted, may add additional complexity, variation in requirements, restrictions and potential legal risk, require additional investment of resources in compliance programs, impact strategies and the availability of previously useful data and could result in increased compliance costs and/or changes in business practices and policies.
Any violations of these laws and regulations may require us to change our business practices or operational structure, including limiting our activities in certain states and/or jurisdictions, address legal claims, and sustain monetary penalties, reputational damage and/or other harms to our business.
Furthermore, our online privacy policy and website make certain statements regarding our privacy, information security, and data security practices with regard to information collected from our members. Failure to adhere to such practices may result in regulatory scrutiny and investigation (including the potential for fines and monetary penalties), complaints by affected members, reputational damage and other harm to our business. If either we, or the third-party service providers with which we share member data, are unable to address privacy concerns, even if unfounded, or to comply with applicable laws and regulations, it could result in additional costs and liability, damage our reputation, and harm our business.
Our ability to collect payments on loans and maintain accurate accounts may be adversely affected by computer malware, social engineering, phishing, physical or electronic break-ins, technical errors and similar disruptions.
The automated nature of our platform may make it an attractive target for hacking and potentially vulnerable to computer viruses, physical or electronic break-ins and similar disruptions. It is possible that we may not be able to anticipate or to implement effective preventive measures against all security breaches of these types, in which case there would be an increased risk of fraud or identity theft, and we may experience losses on, or delays in the collection of amounts owed on, a fraudulently induced loan. Security breaches could occur from outside our company, and also from the actions of persons inside our company who may have authorized or unauthorized access to our technology systems. In addition, the software that we have developed to use in our daily operations is highly complex and may contain undetected technical errors that could cause our computer systems to fail. Because each loan that we make involves, in part, our proprietary automated underwriting process, any failure of our computer systems involving our automated underwriting process and any technical or other errors contained in the software pertaining to our automated underwriting process could compromise our ability to accurately evaluate potential members, which would negatively impact our results of operations. Furthermore, any failure of our computer
62

TABLE OF CONTENTS
systems could cause an interruption in operations and result in disruptions in, or reductions in the amount of, collections from the loans we make to our members.
Additionally, if hackers were able to access our secure files, they might be able to gain access to the personal information of our members. If we are unable to prevent such activity, we may be subject to significant liability, negative publicity and a material loss of members, all of which may negatively affect our business.
Disruptions in the operation of our computer systems and third-party data centers could have an adverse effect on our business.
Our ability to deliver products and services to our members and partners, and otherwise operate our business and comply with applicable laws, depends on the efficient and uninterrupted operation of our computer systems and third-party data centers, as well as third-party service providers. Our computer systems and third-party providers may encounter service interruptions at any time due to system or software failure, natural disasters, severe weather conditions, health pandemics, terrorist attacks, cyberattacks or other events. Any such events could have a negative effect on our business and technology infrastructure (including our computer network systems), which could lead to member dissatisfaction or long-term disruption of our operations.
Additionally, our reliance on third-party providers may mean that we will not be able to resolve operational problems internally or on a timely basis, as our operations will depend upon such third-party service providers communicating appropriately and responding swiftly to their own service disruptions through industry standard best practices in business continuity and/or disaster recovery. As a last resort, we may rely on our ability to replace a third-party service provider if it experiences difficulties that interrupt operations for a prolonged period of time or if an essential third-party service terminates. If these service arrangements are terminated for any reason without an immediately available substitute arrangement, our operations may be severely interrupted or delayed. If such interruption or delay were to continue for a substantial period of time, our business, prospects, financial condition and results of operations could be adversely affected.
The implementation of technology changes and upgrades to maintain current and integrate new systems may cause service interruptions, transaction processing errors or system conversion delays and may cause us to fail to comply with applicable laws, all of which could have a material adverse effect on our business. We expect that new technologies and business processes applicable to the financial services industry will continue to emerge and that these new technologies and business processes may be better than those we currently use. There is no assurance that we will be able to successfully adopt new technology as critical systems and applications become obsolete and better ones become available. A failure to maintain and/or improve current technology and business processes could cause disruptions in our operations or cause our solution to be less competitive, all of which could have a material adverse effect on our business.
Risks Related to the Business Combination and Integration of Businesses
Our management has limited experience in operating a public company, and their focus and resources may be diverted from operational matters and other strategic opportunities as a result of the Business Combination.
We will incur increased costs as a result of operating as a public company, and our management will devote substantial time to new compliance initiatives. As a public company, we are subject to the reporting requirements of the Exchange Act, the Sarbanes-Oxley Act, the Dodd-Frank Wall Street Reform and Consumer Protection Act, as well as rules adopted, and to be adopted, by the SEC and Nasdaq. Our management and other personnel will need to devote a substantial amount of time to these compliance initiatives and may not effectively or efficiently manage our transition into a public company. Moreover, we expect these rules and regulations to substantially increase our legal and financial compliance costs and to make some activities more time-consuming and costly, which will increase our net loss for the foreseeable future. We cannot predict or estimate the amount or timing of additional costs we may incur to respond to these requirements. The impact of these requirements could also make it more difficult for us to attract and retain qualified persons to serve on our board of directors, its board committees or as executive officers.
63

TABLE OF CONTENTS
Our executive officers have limited experience in the management of a publicly traded company. Their limited experience in dealing with the increasingly complex laws pertaining to public companies could be a significant disadvantage in that it is likely that an increasing amount of their time may be devoted to these activities, which will result in less time being devoted to the management and growth of the post-combination company. We may not have adequate personnel with the appropriate level of knowledge, experience and training in the accounting policies, practices or internal control over financial reporting required of public companies. Our management will need to continually assess our staffing and training procedures to improve our internal control over financial reporting. Further, the development, implementation, documentation and assessment of appropriate processes, in addition to the need to remediate any potential deficiencies, will require substantial time and attention from management. The development and implementation of the standards and controls necessary for us to achieve the level of accounting standards required of a public company may require costs greater than expected. It is possible that we will be required to expand our employee base and hire additional employees to support our operations as a public company which will increase its operating costs in future periods.
The Business Combination may place a significant burden on our management and other internal resources. The diversion of management’s attention and any difficulties encountered in the transition process could harm our financial condition, results of operations and prospects. In addition, uncertainty about the effect of the Business Combination on our systems, employees, customers, partners, and other third parties, including regulators, may have an adverse effect on us. These uncertainties may impair our ability to attract, retain and motivate key personnel for a period of time after the completion of the Business Combination.
The historical financial results of SoFi and unaudited pro forma financial information included in this prospectus may not be indicative of what our actual financial position or results of operations would have been.
The historical financial results of SoFi included in this prospectus do not reflect the financial condition, results of operations or cash flows SoFi would have achieved as a combined company during the periods presented or those that we will achieve in the future. This is primarily the result of the following factors: (i) we will incur additional ongoing costs as a result of the Business Combination, including costs related to public company reporting, investor relations and compliance with the Sarbanes-Oxley Act; and (ii) our capital structure will be different from that reflected in SoFi’s historical financial statements. Our financial condition and future results of operations could be materially different from amounts reflected in its historical financial statements included elsewhere in this prospectus, so it may be difficult for investors to compare our future results to historical results or to evaluate our relative performance or trends in our business.
Similarly, the unaudited pro forma financial information in this prospectus is presented for illustrative purposes only and has been prepared based on a number of assumptions. Accordingly, such pro forma financial information may not be indicative of our future operating or financial performance and our actual financial condition and results of operations may vary materially from our pro forma results of operations and balance sheet contained elsewhere in this prospectus, including as a result of such assumptions not being accurate. Additionally, the final acquisition accounting adjustments could differ materially from the unaudited pro forma adjustments presented in this prospectus. The unaudited pro forma condensed combined financial information does not give effect to any anticipated synergies, operating efficiencies or cost savings that may be associated with the Business Combination. See “Unaudited Pro Forma Condensed Combined Financial Information”.
We will have broad discretion over the use of proceeds from the exercise of warrants and options, and we may invest or spend the proceeds in ways with which investors do not agree and in ways that may not yield a return.
We will have broad discretion over the use of proceeds from the exercises of warrants and options. Investors may not agree with our decisions, and our use of the proceeds may not yield a return on investment. We intend to use these net proceeds for working capital and other general corporate purposes, which may include sales and marketing activities, research and development, general and administrative matters and capital expenditures. We may also use a portion of the net proceeds for the acquisition of, or investment in, complementary companies, products, services, technologies or assets. However, we have no current understandings, commitments or agreements to enter into any such acquisitions or make any such investments. Our use of these proceeds may differ substantially
64

TABLE OF CONTENTS
from our current plans. Our failure to apply the net proceeds from the exercises of warrants and options effectively could impair our ability to pursue our growth strategy or could require us to raise additional capital.
65

TABLE OF CONTENTS
Risks Related to Ownership of Our Securities
The price of our common stock and warrants may be volatile.
The price of our common stock, as well as our warrants, may fluctuate due to a variety of factors, including:
changes in the industries in which we and our customers operate;
developments involving our competitors;
changes in laws and regulations affecting our business, or changes in policies with respect to student loan forgiveness;
our ability to complete the acquisition of a national bank charter;
changes in interest rates;
variations in our operating performance and the performance of our competitors in general;
actual or anticipated fluctuations in our quarterly or annual operating results;
publication of research reports by securities analysts about us or our competitors or our industry;
the public’s reaction to our press releases, our other public announcements and our filings with the SEC;
actions by stockholders, including the sale by the Third Party PIPE Investors of any of their shares of our common stock;
additions and departures of key personnel;
commencement of, or involvement in, litigation involving our company;
changes in our capital structure, such as future issuances of securities or the incurrence of additional debt;
the volume of shares of our common stock available for public sale; and
general economic and political conditions, such as the effects of the COVID-19 pandemic, recessions, interest rates, local and national elections, corruption, political instability and acts of war or terrorism.
These market and industry factors may materially reduce the market price of our common stock and warrants regardless of our operating performance.
We do not intend to pay cash dividends for the foreseeable future.
We currently intend to retain our future earnings, if any, to finance the further development and expansion of our business and do not intend to pay cash dividends in the foreseeable future. Any future determination to pay dividends will be at the discretion of our board of directors and will depend on our financial condition, results of operations, capital requirements, restrictions contained in future agreements and financing instruments, business prospects and such other factors as our board of directors deems relevant.
If analysts do not publish research about our business or if they publish inaccurate or unfavorable research, our stock price and trading volume could decline.
The trading market for our common stock depends in part on the research and reports that analysts publish about our business. We do not have any control over these analysts. If one or more of the analysts who cover us downgrade our common stock or publish inaccurate or unfavorable research about our business, the price of our common stock would likely decline. If few analysts cover us, demand for our common stock could decrease and our common stock price and trading volume may decline. Similar results may occur if one or more of these analysts stop covering us in the future or fail to publish reports on us regularly. In addition, analysts may establish and publish
66

TABLE OF CONTENTS
their own periodic projections for us. These projections may vary widely and may not accurately predict the results we actually achieve. Our share price may decline if our actual results do not match the projections of these research analysts.
We may be subject to securities litigation, which is expensive and could divert management attention.
The market price of our common stock may be volatile and, in the past, companies that have experienced volatility in the market price of their stock have been subject to securities class action litigation. We may be the target of this type of litigation in the future. Securities litigation against us could result in substantial costs and divert management’s attention from other business concerns, which could seriously harm our business.
Future resales of common stock may cause the market price of our securities to drop significantly, even if our business is doing well.
Pursuant to the lock-up restrictions agreed to into in connection with the Merger Agreement and the Bylaws, subject to certain exceptions, the Sponsor, Jay Parikh, stockholders of SoFi and holders of SoFi awards prior to the Business Combination (collectively, the “SoFi Stockholders”), and SoFi Stockholders who beneficially owned 5% or greater of SoFi and certain executive officers of SoFi will be contractually restricted from selling or transferring any of its or their shares of common stock (not including the shares of common stock issued in the PIPE Investment pursuant to the terms of the Subscription Agreements) (the “Lock-up Shares”). Such restrictions began at Closing and will end (I) in the case of the lock-up restrictions agreed to in connection with the Merger Agreement, with respect to the Sponsor and certain of the SoFi Stockholders on the earlier of (i) the date that is 180 days after Closing and (ii)(a) for 33.33% of the Lock-up Shares, the date on which the last reported sale price of our common stock equals or exceeds $12.50 per share for any 20 trading days within any 30-trading day period commencing at least 30 days after Closing and (b) for an additional 50% of the Lock-up Shares, the date on which the last reported sale price of our common stock equals or exceeds $15.00 per share for any 20 trading days within any 30-trading day period commencing at least 30 days Closing and (II) in the case of the restrictions contained in the Bylaws with respect to the SoFi Stockholders on the date that is 30 days after the Closing. As of the date of this prospectus, the Sponsor, Jay Parikh, and the SoFi Stockholders (not including the shares of common stock issued in the PIPE Investment pursuant to the terms of the Subscription Agreements) will collectively own approximately 74.5% of the outstanding shares of our common stock.
Following the expiration of the respective lock-ups described above, the Sponsor and the SoFi Stockholders will not be restricted from selling the shares of common stock held by them, other than by applicable securities laws. Additionally, the Third Party PIPE Investors are not restricted from selling any of the shares of common stock acquired in the PIPE Investment following the closing of the Business Combination, other than by applicable securities laws. As such, sales of a substantial number of shares of common stock in the public market could occur at any time. These sales, or the perception in the market that the holders of a large number of shares intend to sell shares, could cause the market price of our common stock to decline or increase the volatility in the market price of our common stock.
Our warrants are exercisable for shares of common stock, which could increase the number of shares eligible for future resale in the public market and result in dilution to our stockholders.
Outstanding warrants to purchase an aggregate of 40,295,990 shares of common stock will become exercisable in accordance with the terms of the warrant agreements governing those securities. As of the date of this prospectus, 12,170,990 of our warrants are exercisable and 28,125,000 warrants will become exercisable at any time commencing 30 days after the completion of the Business Combination. To the extent such warrants are exercised, additional shares of common stock will be issued, which will result in dilution to the holders of our common stock and increase the number of shares eligible for resale in the public market. Sales of substantial numbers of such shares in the public market or the fact that such warrants may be exercised could adversely affect the market price of our common stock. However, there is no guarantee that the public warrants will ever be in the money prior to their expiration, and as such, the warrants may expire worthless.
67

TABLE OF CONTENTS
The terms of the SCH warrants may be amended in a manner adverse to a holder if holders of at least 65% of the then outstanding public warrants approve of such amendment.
The warrant agreement governing the SCH warrants provides that (a) the terms of the SCH warrants may be amended without the consent of any holder for the purpose of (i) curing any ambiguity or correct any mistake, including to conform the provisions of the warrant agreement to the description of the terms of the warrants and the warrant agreement set forth in this prospectus, or defective provision or (ii) adding or changing any provisions with respect to matters or questions arising under the warrant agreement as the parties to the warrant agreement may deem necessary or desirable and that the parties deem to not adversely affect the rights of the registered holders of the SCH warrants under the warrant agreement and (b) all other modifications or amendments require the vote or written consent of at least 65% of the then outstanding SCH warrants; provided that any amendment that solely affects the terms of the Sponsor-held SCH warrants or any provision of the warrant agreement solely with respect to the Sponsor-held SCH warrants will also require at least 65% of the then outstanding Sponsor-held SCH warrants.
Accordingly, we may amend the terms of the SCH warrants in a manner adverse to a holder if holders of at least 65% of the then outstanding SCH warrants approve of such amendment. Although our ability to amend the terms of the SCH warrants with the consent of at least 65% of the then outstanding SCH warrants is unlimited, examples of such amendments could be amendments to, among other things, increase the exercise price of the SCH warrants, shorten the exercise period or decrease the number of ordinary shares purchasable upon exercise of an SCH warrant.
We may redeem unexpired SCH warrants prior to their exercise at a time that is disadvantageous to you, thereby making your warrants worthless.
We have the ability to redeem outstanding SCH warrants at any time after they become exercisable and prior to their expiration, at a price of $0.01 per warrant if, among other things, the reference value equals or exceeds $18.00 per share (as adjusted for adjustments to the number of shares issuable upon exercise or the exercise price of a warrant). If and when the SCH warrants become redeemable by us, we may exercise our redemption right even if we are unable to register or qualify the underlying securities for sale under all applicable state securities laws. As a result, we may redeem the SCH warrants as set forth above even if the holders are otherwise unable to exercise the SCH warrants. Redemption of the outstanding SCH warrants as described above could force you to: (i) exercise your SCH warrants and pay the exercise price therefor at a time when it may be disadvantageous for you to do so; (ii) sell your SCH warrants at the then-current market price when you might otherwise wish to hold your SCH warrants; or (iii) accept the nominal redemption price which, at the time the outstanding SCH warrants are called for redemption, we expect would be substantially less than the market value of your SCH warrants. None of the Sponsor-held SCH warrants are redeemable by us (subject to limited exceptions) so long as they are held by Sponsor or its permitted transferees.
In addition, we have the ability to redeem the outstanding SCH warrants at any time after they become exercisable and prior to their expiration, at a price of $0.10 per warrant if, among other things, the last reported sale price of our common stock for any 20 trading days within a 30-trading day period ending on the third trading day prior to the date on which we send the notice of redemption to the warrant holders equals or exceeds $10.00 per share (as adjusted for share splits, share dividends, rights issuances, subdivisions, reorganizations, recapitalizations and the like). In such a case, the holders will be able to exercise their SCH warrants prior to redemption for a number of shares of common stock determined based on the redemption date and the fair market value of common stock. The value received upon exercise of the SCH warrants (i) may be less than the value the holders would have received if they had exercised their SCH warrants at a later time where the underlying share price is higher and (ii) may not compensate the holders for the value of the SCH warrants, including because the number of ordinary shares received is capped at 0.361 shares of common stock per warrant (subject to adjustment) irrespective of the remaining life of the SCH warrants.
We currently intend to retain our future earnings, if any, to finance the further development and expansion of our business and do not intend to pay cash dividends in the foreseeable future. Any future determination to pay dividends will be at the discretion of our board of directors and will depend on our financial condition, results of operations, capital requirements and future agreements and financing instruments, business prospects and such other factors as our board of directors deems relevant.
68

TABLE OF CONTENTS
Our issuance of additional capital stock in connection with financings, acquisitions, investments, our stock incentive plans or otherwise will dilute all other stockholders.
Our issuance of additional capital stock in connection with financings, acquisitions, investments, our stock incentive plans or otherwise will dilute our stockholders. We expect to issue additional capital stock in the future that will result in dilution to all other stockholders. We expect to grant equity awards to employees, directors, and consultants under our stock incentive plans. We may also raise capital through equity financings in the future. As part of our business strategy, we may acquire or make investments in complementary companies, products, or technologies and issue equity securities to pay for any such acquisition or investment. Any such issuances of additional capital stock may cause stockholders to experience significant dilution of their ownership interests and the per share value of our common stock to decline.
Delaware law and our organizational documents contain certain provisions, including anti-takeover provisions that limit the ability of stockholders to take certain actions and could delay or discourage takeover attempts that stockholders may consider favorable.
The DGCL and our organizational documents contain provisions that could have the effect of rendering more difficult, delaying, or preventing an acquisition that stockholders may consider favorable, including transactions in which stockholders might otherwise receive a premium for their shares. These provisions could also limit the price that investors might be willing to pay in the future for shares of our common stock, and therefore depress the trading price of our common stock. Additionally, these provisions could also make it difficult for stockholders to take certain actions, including electing directors who are not nominated by the current members of our board of directors or taking other corporate actions, including effecting changes in our management. Among other things, our organizational documents include provisions regarding:
the ability of our board of directors to issue shares of preferred stock, including “blank check” preferred stock and to determine the price and other terms of those shares, including preferences and voting rights, without stockholder approval, which could be used to significantly dilute the ownership of a hostile acquirer;
the prohibition of cumulative voting in the election of directors, which limits the ability of minority stockholders to elect director candidates;
limitations on the liability of, and the indemnification of, our directors and officers;
the ability of our board of directors to amend the Bylaws, which may allow our board of directors to take additional actions to prevent an unsolicited takeover and inhibit the ability of an acquirer to amend the bylaws to facilitate an unsolicited takeover attempt; and
advance notice procedures with which stockholders must comply to nominate candidates to our board of directors or to propose matters to be acted upon at a stockholders’ meeting, which could preclude stockholders from bringing matters before annual or special meetings of stockholders and delay changes in our board of directors and also may discourage or deter a potential acquirer from conducting a solicitation of proxies to elect the acquirer’s own slate of directors or otherwise attempting to obtain control of our company.
These provisions, alone or together, could delay or prevent hostile takeovers and changes in control or changes in the board of directors or management of our company.
The provisions of the Bylaws requiring exclusive forum in the Court of Chancery of the State of Delaware and the federal district courts of the United States for certain types of lawsuits may have the effect of discouraging certain lawsuits, including derivative lawsuits and lawsuits against our directors and officers, by limiting plaintiffs’ ability to bring a claim in a judicial forum that they find favorable.
The Bylaws provide that, to the fullest extent permitted by law, and unless we consent in writing to the selection of an alternative forum, the Court of Chancery of the State of Delaware (or, in the event that such court does not
69

TABLE OF CONTENTS
have jurisdiction, the federal district court for the District of Delaware or other state courts of the State of Delaware) will be the sole and exclusive forum for any state law claims for (i) any derivative action or proceeding brought on our behalf, (ii) any action asserting a claim for or based on a breach of a fiduciary duty owed by any of our current or former directors, officers or other employees to us or our stockholders, (iii) any action asserting a claim against us or any of our current or former directors, officers or other employees arising pursuant to any provision of the DGCL or the Bylaws or Certificate of Incorporation (as either may be amended from time to time), (iv) any action asserting a claim related to or involving our company that is governed by the internal affairs doctrine, and (v) any action asserting an “internal corporate claim” as that term is defined in Section 115 of the DGCL (the “Delaware Forum Provision”). The Delaware Forum Provision, however, does not apply to actions or claims arising under the Exchange Act. The Bylaws also provide that, unless we consent in writing to the selection of an alternate forum, the sole and exclusive forum for the resolution of any complaint asserting a cause of action arising under the Securities Act, and the rules and regulations promulgated thereunder, will be the United States Federal District Courts. Section 27 of the Exchange Act creates exclusive federal jurisdiction over all suits brought to enforce any duty or liability created by the Exchange Act or the rules and regulations thereunder; our stockholders cannot and will not be deemed to have waived compliance with the U.S. federal securities laws and the rules and regulations thereunder.
These provisions may have the effect of discouraging certain lawsuits, including derivative lawsuits and lawsuits against our directors and officers, by limiting plaintiffs’ ability to bring a claim in a judicial forum that they find favorable. The enforceability of similar choice of forum provisions in other companies’ certificates of incorporation or bylaws has been challenged in legal proceedings, and it is possible that, in connection with any applicable action brought against our company, a court could find the choice of forum provisions contained in the Bylaws to be inapplicable or unenforceable in such action.
70

TABLE OF CONTENTS
USE OF PROCEEDS
All of the securities offered by the Selling Securityholders pursuant to this prospectus will be sold by the Selling Securityholders for their respective accounts. We will not receive any of the proceeds from these sales.
Assuming the exercise of all outstanding warrants for cash, we will receive an aggregate of approximately $431 million, but will not receive any proceeds from the sale of the shares of common stock issuable upon such exercise. Assuming the exercise of all outstanding stock options for cash, we will receive an aggregate of approximately $166 million, but will not receive any proceeds from the sale of the shares of common stock issuable upon exercise. We expect to use the net proceeds from the exercise of the warrants, if any, for general corporate purposes. We will have broad discretion over the use of any proceeds from the exercise of the warrants. There is no assurance that the holders of the warrants will elect to exercise for cash any or all of such warrants. To the extent that any warrants are exercised on a “cashless basis”, the amount of cash we would receive from the exercise of the warrants will decrease.
The Selling Securityholders will pay any underwriting discounts and commissions and expenses incurred by them for brokerage, accounting, tax or legal services or any other expenses incurred in disposing of the securities. We will bear the costs, fees and expenses incurred in effecting the registration of the securities covered by this prospectus, including all registration and filing fees, Nasdaq listing fees and fees and expenses of our counsel and our independent registered public accounting firm.
71

TABLE OF CONTENTS
MARKET PRICE OF OUR COMMON STOCK AND WARRANTS AND DIVIDEND INFORMATION
Market Price of Our Common Stock and Warrants
Our common stock and warrants are currently listed on Nasdaq under the symbols “SOFI” and “SOFIW,” respectively. Prior to the Domestication and the transfer to Nasdaq, SCH Class A ordinary shares and SCH warrants traded on the NYSE under the ticker symbols “IPOE” and “IPOE.WS”, respectively. On June 11, 2021, the closing sale prices of our common stock and warrants were $22.40 and $8.84, respectively. We do not currently intend to list the Series 1 preferred stock on any securities exchange. As of June 11, 2021, there were approximately 1,300 holders of record of our common stock and 6 holders of record of our warrants. Such numbers do not include beneficial owners holding our securities through nominee names.
Dividend Policy
We have not paid any cash dividends on our common stock to date and prior to the Business Combination, SCH had not paid any dividends on its ordinary shares. The payment of cash dividends in the future will be dependent upon our revenues and earnings, if any, capital requirements and general financial condition. The payment of any cash dividends will be within the discretion of our board of directors. Our ability to declare dividends may be limited by the terms of financing or other agreements entered into by us or our subsidiaries from time to time.
72

TABLE OF CONTENTS
UNAUDITED PRO FORMA CONDENSED COMBINED FINANCIAL INFORMATION
Defined terms included below have the same meaning as terms defined and included elsewhere in this prospectus. Unless the context otherwise requires, the “Company” refers to SoFi Technologies, Inc. and its subsidiaries after the Closing, and Social Capital Hedosophia Holdings Corp. prior to the Closing.
The following unaudited pro forma condensed combined balance sheet of the Combined Company as of March 31, 2021 and the unaudited pro forma condensed combined statement of operations of the Combined Company for the three months ended March 31, 2021 and the year ended December 31, 2020 present the combination of the financial information of Social Capital Hedosophia Holdings Corp. V (“SCH”) and Social Finance, Inc. (“SoFi”) after giving effect to the Business Combination and related adjustments described in the accompanying notes. SCH and SoFi are collectively referred to herein as the Companies, and the Companies, subsequent to the Business Combination, are referred to herein as the Combined Company.
The unaudited pro forma condensed combined statement of operations for the three months ended March 31, 2021 and for the year ended December 31, 2020 gives pro forma effect to the Business Combination as if it had occurred on January 1, 2020. The unaudited pro forma condensed combined balance sheet as of March 31, 2021 gives pro forma effect to the Business Combination as if it was completed on March 31, 2021.
The unaudited pro forma condensed combined financial information is based on and should be read in conjunction with:
the accompanying notes to the unaudited pro forma condensed combined financial information;
the historical unaudited condensed consolidated financial statements of SCH as of and for the three months ended March 31, 2021, and the historical audited consolidated financial statements of SCH as of December 31, 2020 and for the period from July 10, 2020 (date of inception) through December 31, 2020, and the related notes, in each case, included elsewhere in this prospectus;
the historical unaudited condensed consolidated financial statements of SoFi as of and for the three months ended March 31, 2021, and the historical consolidated financial statements of SoFi as of and for the year ended December 31, 2020, and the related notes, in each case, included elsewhere in this prospectus; and
other information contained in this prospectus, including in the section titled “Management’s Discussion and Analysis of Financial Condition and Results of Operations”.
The unaudited pro forma condensed combined financial information has been presented for illustrative purposes only and does not necessarily reflect what the Combined Company’s financial condition or results of operations would have been had the Business Combination occurred on the dates indicated. Further, the unaudited pro forma condensed combined financial information also may not be useful in predicting the future financial condition and results of operations of the Combined Company. The actual financial position and results of operations may differ significantly from the pro forma amounts reflected herein due to a variety of factors. The unaudited pro forma transaction accounting adjustments represent management’s estimates based on information available as of the date of this unaudited pro forma condensed combined financial information and are subject to change as additional information becomes available and analyses are performed.
On May 28, 2021, SCH consummated the previously announced Business Combination pursuant to the Merger Agreement dated January 7, 2021 between SCH, Merger Sub and SoFi, under which Merger Sub merged with and into SoFi, with SoFi being the surviving corporation as a wholly-owned subsidiary of SCH. In connection with the Business Combination, SCH changed its name to SoFi Technologies, Inc., referred to herein as SoFi Technologies.
At the Closing, all outstanding shares of capital stock (with the exception of Series 1 redeemable preferred stock), options, restricted stock units and warrants of the Company were converted into SoFi Technologies common shares, options and warrants to purchase SoFi Technologies common shares, and SoFi Technologies restricted stock units. Series 1 redeemable preferred stock prior to the Closing were converted into SoFi Technologies Series 1 redeemable preferred stock and remained in temporary equity.
73

TABLE OF CONTENTS
The following pro forma condensed combined financial statements presented herein reflect the actual redemption of 146,111 shares of Class A ordinary shares by SCH’s shareholders in conjunction with the shareholder vote on the Business Combination contemplated by the Merger Agreement at a meeting held on May 27, 2021.
COMBINED COMPANY
UNAUDITED PRO FORMA CONDENSED COMBINED BALANCE SHEET
MARCH 31, 2021
(In Thousands)
SCH
(Historical)
SoFi
(Historical)
Transaction
Accounting
Adjustments
Note
Pro Forma
Assets
Cash and cash equivalents $ 40  $ 351,283  $ 253,233 
3(a), 3(b)
$ 604,556 
Restricted cash and restricted cash equivalents —  347,284  — 
347,284 
Loans —  4,486,828  — 
4,486,828 
Servicing rights —  161,240  — 
161,240 
Securitization investments —  462,109  — 
462,109 
Property, equipment and software —  82,825  — 
82,825 
Goodwill —  899,270  — 
899,270 
Intangible assets —  335,719  — 
335,719 
Operating lease right-of-use assets —  116,553  — 
116,553 
Marketable securities held in Trust Account 805,037  —  (805,037)
3(c)
— 
Other assets 740  139,126  (7,770)
3(b)
132,096 
Total assets $ 805,817  $ 7,382,237  $ (559,574)
$ 7,628,480 
Liabilities, temporary equity and permanent equity (deficit)
Liabilities:
Accounts payable, accruals and other liabilities 158,183  421,061  (140,679)
3(b), 3(d), 3(f)
438,565 
Promissory note – related party 1,415  —  (1,415) 3(e) — 
Operating lease liabilities —  138,822  — 
138,822 
Debt —  3,827,424  (1,540,000)
3(f)
2,287,424 
Residual interests classified as debt —  114,882  — 
114,882 
Deferred underwriting fee payable 28,175  —  (28,175)
3(b)
— 
Total liabilities 187,773  4,502,189  (1,710,269)
2,979,693 
Temporary equity:
Class A ordinary shares, subject to possible redemption 613,044  —  (613,044)
3(g)
— 
Redeemable preferred stock —  3,173,686  (2,853,312)
3(g)
320,374 
Permanent equity (deficit):
Common stock —  —  — 
3(g)
— 
Preferred shares —  —  — 
3(g)
— 
Class A ordinary shares —  77 
3(g)
79 
Class B ordinary shares —  (2)
3(g)
— 
Additional paid-in capital 121,162  583,349  4,521,991 
3(g)
5,226,502 
Accumulated other comprehensive loss —  (246) — 
3(g)
(246)
Accumulated deficit (116,166) (876,741) 94,985 
3(g)
(897,922)
Total permanent equity (deficit) 5,000  (293,638) 4,617,051 
4,328,413 
Total liabilities, temporary equity and permanent equity (deficit) $ 805,817  $ 7,382,237  $ (559,574)
$ 7,628,480 
74

TABLE OF CONTENTS
COMBINED COMPANY
UNAUDITED PRO FORMA CONDENSED COMBINED STATEMENT OF OPERATIONS
FOR THE THREE MONTHS ENDED MARCH 31, 2021
(In Thousands, Except Share and Per Share Amounts)
SCH
(Historical)
SoFi
(Historical)
Transaction
Accounting
Adjustments
Note Pro Forma
Interest income
Loans $ —  $ 77,221  $ —  $ 77,221 
Securitizations —  4,467  —  4,467 
Related party notes —  211  —  211 
Other 20  629  (20) 3(h) 629 
Total interest income 20  82,528  (20) 82,528 
Interest expense
Securitizations and warehouses —  29,808  (7,021) 3(i) 22,787 
Corporate borrowings —  5,008  —  5,008 
Other  —  432  —  432 
Total interest expense —  35,248  (7,021) 28,227 
Net interest income 20  47,280  7,001  54,301 
Noninterest income
Loan origination and sales —  110,345  —  110,345 
Securitizations —  (2,036) —  (2,036)
Servicing —  (12,109) —  (12,109)
Technology Platform fees —  45,659  —  45,659 
Other —  6,845  —  6,845 
Total noninterest income —  148,704  —  148,704 
Total net revenue 20  195,984  7,001  203,005 
Noninterest expense
Technology and product development —  65,948  —  65,948 
Sales and marketing —  87,234  —  87,234 
Cost of operations —  57,570  —  57,570 
General and administrative 60,415  161,697  (89,920) 3(j) 132,192 
Total noninterest expense 60,415  372,449  (89,920) 342,944 
Loss before income taxes (60,395) (176,465) 96,921  (139,939)
Income tax expense —  (1,099) —  (1,099)
Net loss (60,395) (177,564) 96,921  (141,038)
Other comprehensive loss
Foreign currency translation adjustments, net —  (80) —  (80)
Total other comprehensive loss —  (80) —  (80)
Comprehensive loss $ (60,395) $ (177,644) $ 96,921  $ (141,118)
Net loss per share
Basic and diluted weighted average shares outstanding, Class A ordinary shares subject to possible redemption 67,342,389  n/a n/a
Basic and diluted net income per share, Class A ordinary shares subject to possible redemption $ 0.00  n/a n/a
Basic and diluted weighted average shares outstanding(1)
33,282,611  66,647,192  3(l) 794,692,813 
Basic and diluted net loss per share(1)
$ (1.82) $ (2.81) 3(l) $ (0.18)
___________________
(1)Net loss per share is based on:
SCH — weighted average number of shares of SCH Class A and Class B ordinary shares outstanding for the three months ended March 31, 2021.
SoFi — weighted average number of shares of SoFi common stock outstanding for the three months ended March 31, 2021.
Pro forma — number of shares of Class A ordinary shares of SoFi Technologies outstanding after giving effect to the Business Combination.
75

TABLE OF CONTENTS
COMBINED COMPANY
UNAUDITED PRO FORMA CONDENSED COMBINED STATEMENT OF OPERATIONS
FOR THE YEAR ENDED DECEMBER 31, 2020
(In Thousands, Except Share and Per Share Amounts)
SCH
(Historical)
SoFi
(Historical)
Transaction
Accounting
Adjustments
Note
Pro Forma
Interest income
Loans $ —  $ 330,353  $ — 
$ 330,353 
Securitizations —  24,031  — 
24,031 
Related party notes —  3,189  — 
3,189 
Other 17  5,964  (17)
3(h)
5,964 
Total interest income 17  363,537  (17)
363,537 
Interest expense
Securitizations and warehouses —  155,150  (37,118)
3(i)
118,032 
Other  —  30,456  —  30,456 
Total interest expense —  185,606  (37,118)
148,488 
Net interest income 17  177,931  37,101 
215,049 
Noninterest income
Loan origination and sales —  371,323  — 
371,323 
Securitizations —  (70,251) — 
(70,251)
Servicing —  (19,426) — 
(19,426)
Technology Platform fees —  90,128  — 
90,128 
Other —  15,827  — 
15,827 
Total noninterest income —  387,601  — 
387,601 
Total net revenue 17  565,532  37,101 
602,650 
Noninterest expense
Technology and product development —  201,199  — 
201,199 
Sales and marketing —  276,577  — 
276,577 
Cost of operations —  178,896  — 
178,896 
General and administrative 55,788  237,381  656 
3(j), 3(k)
293,825 
Total noninterest expense 55,788  894,053  656 
950,497 
Loss before income taxes (55,771) (328,521) 36,445 
(347,847)
Income tax benefit —  104,468  — 
104,468 
Net loss (55,771) (224,053) 36,445 
(243,379)
Other comprehensive loss
Foreign currency translation adjustments, net —  (145) — 
(145)
Total other comprehensive loss —  (145) — 
(145)
Comprehensive loss $ (55,771) $ (224,198) $ 36,445 
$ (243,524)
Net loss per share
Basic and diluted weighted average shares outstanding, Class A ordinary shares subject to possible redemption 72,920,468  n/a
n/a
Basic and diluted net income per share, Class A ordinary shares subject to possible redemption $ 0.00  n/a n/a
Basic and diluted weighted average shares outstanding(1)
22,074,445  42,374,976 
3(l)
794,692,813 
Basic and diluted net loss per share(1)
$ (2.53) $ (7.49)
3(l)
$ (0.31)
___________________
(1)Net loss per share is based on:
SCH — weighted average number of shares of SCH Class A and Class B ordinary shares outstanding for the period from July 10, 2020 (date of inception) through December 31, 2020.
SoFi — weighted average number of shares of SoFi common stock outstanding for the year ended December 31, 2020.
Pro forma — number of shares of Class A ordinary shares of SoFi Technologies outstanding after giving effect to the Business Combination.
76

TABLE OF CONTENTS
Note 1 — Description of the Business Combination
On May 28, 2021, SCH consummated the previously announced Business Combination pursuant to the Merger Agreement dated January 7, 2021 between SCH, Merger Sub and SoFi, under which Merger Sub merged with and into SoFi, with SoFi being the surviving corporation as a wholly-owned subsidiary of SCH. In connection with the Business Combination, SCH changed its name to SoFi Technologies, Inc., referred to herein as SoFi Technologies.
Upon the Closing of the Business Combination, SoFi’s stockholders received consideration of $6,570,000 in shares of SoFi Technologies common shares, or 657,000,000 shares based on a stock price of $10 per share, including the dilutive effect (via the treasury stock method for options and warrants) of outstanding stock options, restricted stock units and common stock warrants.
The following table summarizes the pro forma ordinary shares of the Combined Company Class A Common Stock outstanding after giving effect to the Business Combination, excluding the potential dilutive effect of outstanding stock options, restricted stock units and common stock warrants:
Shares
Ownership (%)
SoFi Stockholders
571,813,924  71.9  %
SCH’s public shareholders
80,353,889  10.1  %
SCH Sponsor V LLC and related parties
47,525,000  6.0  %
Third Party PIPE Investors
95,000,000  12.0  %
Total
794,692,813  100.0  %
Note 2 — Basis of Presentation
The historical financial information of SCH and SoFi has been adjusted in the unaudited pro forma condensed combined financial information to reflect transaction accounting adjustments related to the Business Combination in accordance with accounting principles generally accepted in the United States.
The Business Combination will be accounted for as a reverse recapitalization because SoFi is the accounting acquirer under Financial Accounting Standards Board’s Accounting Standards Codification Topic 805, Business Combinations (“ASC 805”). The determination is primarily based on the evaluation of the following facts and circumstances:
The pre-combination equity holders of SoFi hold the majority of voting rights in the Combined Company;
The pre-combination equity holders of SoFi have the right to appoint a majority of directors on the Combined Company Board;
Senior management of SoFi comprise the senior management of the Combined Company; and
Operations of SoFi prior to the Business Combination comprise the only ongoing operations of the Combined Company.
Under the reverse recapitalization model, the Business Combination will be reflected as the equivalent of SoFi issuing stock for the net assets of SCH, accompanied by a recapitalization whereby no goodwill or other intangible assets are recorded.
Business Combination costs that are directly attributable and incremental to the Business Combination were deferred and recorded as other assets in the balance sheet leading up until the Business Combination closed. For pro forma purposes, to the extent not already paid, such costs are recorded as a reduction in cash with a corresponding reduction of additional paid-in capital.
The Unaudited Pro Forma Condensed Combined Statements of Operations for the three months ended March 31, 2021 and for the year ended December 31, 2020 include SCH Business Combination expenses of $4,956 and
77

TABLE OF CONTENTS
$462, respectively, which are not expected to have a continuing impact on the results of the Combined Company beyond a year from the Closing.
Note 3 — Pro Forma Adjustments
Adjustments to the Unaudited Pro Forma Condensed Combined Balance Sheet as of March 31, 2021
The transaction accounting adjustments included in the unaudited pro forma condensed combined balance sheet as of March 31, 2021 are as follows:
3(a)Cash and cash equivalents.   Represents the impact of the Business Combination on the cash and cash equivalents balance of the Combined Company.
The table below represents the sources and uses of funds as it relates to the Business Combination:
Note
SCH cash and cash equivalents as of March 31, 2021 – pre Business Combination $ 40 
SoFi cash and cash equivalents as of March 31, 2021 – pre Business Combination 351,283 
Total pre Business Combination 351,323 
SCH marketable securities held in Trust Account (1) 805,037 
PIPE Financing proceeds – Sponsor and related parties (2) 275,000 
PIPE Financing proceeds – Third parties (2) 950,000 
Payment to redeeming SCH public shareholders (3) (1,461)
Payment related to SoFi preferred shareholders (4) (21,181)
Payment of loan warehouse facility debt and accrued interest (5) (1,541,390)
Payment of deferred underwriting fee payable (6) (28,175)
Payment of accrued Business Combination costs of SoFi (7) (5,673)
Payment of accrued Business Combination costs and other costs of SCH (8) (3,737)
Payment of incremental Business Combination costs of SoFi (9) (18,356)
Payment of incremental Business Combination costs and other costs of SCH (10) (5,416)
Payment of SCH promissory note (11) (1,415)
Repurchase of redeemable common stock (12) (150,000)
Total Business Combination adjustments 253,233 
Post Business Combination cash and cash equivalents $ 604,556 
__________________
(1)Represents the amount of the restricted investments and marketable securities held in the Trust account upon consummation of the Business Combination at Closing. (See Note 3(c) Trust account).
(2)Represents the issuance, in a private placement consummated concurrently with the Closing, to PIPE investors of up to 122,500,000 ordinary shares assuming stock price of $10 per share. (See Note 3(g) Impact on equity).
(3)Represents the amount paid to SCH public shareholders who exercised redemption rights. (See Note 3(g) Impact on equity).
(4)In conjunction with the Business Combination, the Series 1 Holders received a cash payment of $21,181, and the Special Payment provision contemplated in Note 9 to the Unaudited Condensed Consolidated Financial Statements of SoFi included elsewhere in this prospectus will no longer be of any effect. (See Note 3(g) Impact on equity).
(5)Represents payment of a portion of our outstanding loan warehouse facility debt and related accrued interest. (See Note 3(f) Payment of loan warehouse facility debt and accrued interest).
(6)Represents payment of deferred underwriting fee payable by SCH (See Note 3(b)(1) Business Combination costs).
(7)Represents payment of SoFi accrued Business Combination costs. (See Note 3(b)(3) Business Combination costs).
(8)Represents payment of accrued Business Combination costs and other costs of SCH. (See Note 3(b)(2) Business Combination costs).
(9)Represents payment of SoFi incremental Business Combination costs. (See Note 3(b)(5) Business Combination costs).
(10)Represents payment of SCH incremental Business Combination costs and other costs. (See Note 3(b)(6) Business Combination costs).
(11)Represents payment of SCH promissory note. (See Note 3(e) Payment of SCH promissory note)
(12)Immediately following the finalization of the Business Combination and on the same date as the Business Combination, SoFi committed to repurchase up to $150,000 of common shares, or 15,000,000 common shares, from a previous SoFi redeemable preferred stockholder. At
78

TABLE OF CONTENTS
the finalization of the Business Combination and immediately prior to the repurchase, these common shares were classified within temporary equity as Class A ordinary shares subject to redemption. (See Note 3(g) Impact on equity).
3(b) Business Combination costs.
SCH
Business Combination and other costs
SoFi
Business Combination costs
Incremental Business Combination costs of SoFi (5) Total Business Combination costs adjustments
Payment of deferred underwriting fee (1) Payment of accrued expenses (2) Payment of accrued expenses (3) Recognition of capitalized unpaid expenses as a reduction to equity proceeds (4) Recognition of capitalized paid expenses as a reduction to equity proceeds (4) Incremental Business Combination Costs and other costs of SCH (6)
Cash and cash equivalents $ (28,175) $ (3,737) $ (5,673) $ —  $ —  $ (18,356) $ (5,416) $ (61,357)
Other assets —  —  —  (5,673) (2,097) —  —  (7,770)
Accounts payable, accruals and other liabilities —  (3,737) (5,673) —  —  —  —  (9,410)
Deferred underwriting fee payable (28,175) —  —  —  —  —  —  (28,175)
Additional paid-in capital —  —  —  (5,673) (2,097) (18,356) (5,416) (31,542)
___________________
(1)Payment of deferred underwriting fee payable incurred by SCH in the amount of $28,175. (See Note 3(a)(6) Cash and cash equivalents). The unaudited pro forma condensed combined balance sheet reflects payment of these costs as a reduction of cash and cash equivalents, with a corresponding decrease in deferred underwriting fee payable.
(2)Payment of SCH’s accrued transaction costs related to the Business Combination and other costs in the amount of $3,737. The unaudited pro forma condensed combined balance sheet reflects these costs as a reduction of cash and cash equivalents, with a corresponding decrease in accounts payable, accruals and other liabilities. (See Note 3(a)(8) Cash and cash equivalents).
(3)Payment of accrued transaction costs specific to SoFi related to the Business Combination in the amount of $5,673. The unaudited pro forma condensed combined balance sheet reflects these costs as a reduction of cash and cash equivalents, with a corresponding decrease in accounts payable, accruals and other liabilities. (See Note 3(a)(7) Cash and cash equivalents).
(4)Recognition of SoFi’s capitalized expenses related to the Business Combination in the amount of $7,770 as a reduction to equity proceeds. The unaudited pro forma condensed combined balance sheet reflects these costs as a decrease in other assets, with a corresponding decrease in additional paid-in capital. (See Note 3(g) Impact on equity).
(5)Payment of incremental transaction costs related to the Business Combination incurred by SoFi in the amount of $18,356. (See Note 3(a)(9) Cash and cash equivalents). The unaudited pro forma condensed combined balance sheet reflects these costs as a reduction of cash and cash equivalents, with a corresponding decrease in additional paid-in capital. (See Note 3(g) Impact on equity).
(6)Payment of incremental transaction costs and other costs related to the Business Combination incurred by SCH in the amount of $5,416. (See Note 3(a)(10) Cash and cash equivalents). The unaudited pro forma condensed combined balance sheet reflects these costs as a reduction of cash and cash equivalents, with a corresponding decrease in additional paid-in capital. (See Note 3(g) Impact on equity).
3(c) Trust Account. Represents release of the restricted investments and marketable securities held in the Trust Account upon consummation of the Business Combination. (See Note 3(a)(1) Cash and cash equivalents).
3(d) Series H warrant liabilities. Represents conversion of the Series H warrants into warrants to purchase common stock of the Combined Company upon consummation of the Business Combination. The unaudited pro forma condensed combined balance sheet reflects this adjustment as a reduction of accounts payable, accruals and other liabilities in the amount of $129,879, with a corresponding increase in additional paid-in capital (See Note 3(g) Impact on equity).
3(e) Payment of SCH promissory note. Represents funds from the Business Combination used to repay the SCH promissory note in the amount of $1,415 (See Note 3(a)(11) Cash and cash equivalents).
3(f) Payment of loan warehouse facility debt and accrued interest. Represents funds from the Business Combination used to repay SoFi’s loan warehouse facility debt in the amount of $1,541,390, which is inclusive of accrued interest in the amount of $1,390. The unaudited pro forma condensed combined balance sheet reflects this payment as a reduction of debt in the amount of $1,540,000 and a reduction of accounts payable, accruals and
79

TABLE OF CONTENTS
other liabilities in the amount of $1,390, with a corresponding decrease in cash and cash equivalents. (See Note 3(a)(5) Cash and cash equivalents).
80

TABLE OF CONTENTS
3(g) Impact on equity. The following table represents the impact of the Business Combination on the number of Class A ordinary shares and represents the total equity section impact of redemptions by SCH’s shareholders:
SCH / Combined Company ordinary shares SoFi Common Stock Accumulated other comprehensive loss Additional paid-in capital Accumulated deficit Total permanent equity (deficit) SCH / Combined Company temporary equity SoFi temporary equity
Class A Class B Class A ordinary shares, subject to possible redemption Redeemable preferred stock Redeemable preferred
stock
Note Shares Amount Shares Amount Shares Amount Shares Amount Shares Amount Shares Amount
SCH equity as of March 31, 2021 – pre Business Combination
19,198,460  $ 20,125,000  $ —  $ —  $ —  $ 121,162  $ (116,166) $ 5,000  61,301,540  $ 613,044  —  $ —  —  $ — 
SoFi equity as of March 31, 2021 – pre Business Combination —  —  —  —  68,291,780  —  (246) 583,349  (876,741) (293,638) —  —  —  —  256,459,941  3,173,686 
Business Combination pro forma equity adjustments:

Conversion of redeemable preferred stock warrants
3(d)
—  —  —  —  —  —  —  129,879  —  129,879  —  —  —  —  —  — 
Reclassification of SCH’s redeemable shares to Class A ordinary shares
61,301,540  —  —  —  —  —  613,038  —  613,044  (61,301,540) (613,044) —  —  —  — 
Less: redeemed shares 3(a)(3) (146,111) —  —  —  —  —  —  (1,461) —  (1,461) —  —  —  —  —  — 
Sponsor and related parties 20,025,000  (20,025,000) (2) —  —  —  —  —  —  —  —  —  —  —  — 
Forfeiture of Class B ordinary shares —  —  (100,000) —  —  —  —  —  —  —  —  —  —  —  —  — 
PIPE Financing proceeds – Sponsor and related parties
3(a)(2)
27,500,000  —  —  —  —  —  274,997  —  275,000  —  —  —  —  —  — 
PIPE Financing proceeds – Third parties
3(a)(2)
95,000,000  —  —  —  —  —  949,991  —  950,000  —  —  —  —  —  — 
Elimination of historical SoFi common stock
—  —  —  —  (68,291,780) —  —  —  —  —  —  —  —  —  —  — 
Elimination of historical SoFi redeemable preferred stock
—  —  —  —  —  —  —  2,853,312  —  2,853,312  —  —  —  —  (253,225,941) (2,853,312)
Conversion of Series 1 preferred shares
—  —  —  —  —  —  —  —  —  —  —  —  3,234,000  320,374  (3,234,000) (320,374)
Shares issued to SoFi stockholders as consideration
571,813,924  57  —  —  —  —  —  (150,057) —  (150,000) 15,000,000  150,000  —  —  —  — 
Repurchase of common stock
3(a)(12)
—  —  —  —  —  —  —  —  —  —  (15,000,000) (150,000) —  —  —  — 
SoFi’s capitalized expenses related to the Business Combination 3(b)(4) —  —  —  —  —  —  —  (7,770) —  (7,770) —  —  —  —  —  — 
Incremental Business Combination costs of SoFi 3(b)(5) —  —  —  —  —  —  —  (18,356) —  (18,356) —  —  —  —  —  — 
Incremental Business combination costs and other costs of SCH 3(b)(6) —  —  —  —  —  —  —  (5,416) —  (5,416) —  —  —  —  —  — 
Payment related to SoFi redeemable preferred stockholders
3(a)(4)
—  —  —  —  —  —  —  —  (21,181) (21,181) —  —  —  —  —  — 
Elimination of historical accumulated deficit of SCH
—  —  —  —  —  —  —  (116,166) 116,166  —  —  —  —  —  —  — 
Total Business Combination pro forma equity adjustments:
775,494,353  77  (20,125,000) (2) (68,291,780) —  —  4,521,991  94,985  4,617,051  (61,301,540) (613,044) 3,234,000  320,374  (256,459,941) (3,173,686)
Post-Business Combination
794,692,813  $ 79    $     $   $ (246) $ 5,226,502  $ (897,922) $ 4,328,413    $   3,234,000  $ 320,374    $  
81

TABLE OF CONTENTS
Adjustments to the Unaudited Pro Forma Condensed Combined Statement of Operations for the three months ended March 31, 2021 and the year ended December 31, 2020
The transaction accounting adjustments included in the unaudited pro forma condensed combined statement of operations for the three months ended March 31, 2021 and the year ended December 31, 2020 are as follows:
3(h) Exclusion of interest earned on marketable securities held in Trust Account. Represents elimination of interest earned on marketable securities held in Trust Account.
3(i) Interest expense. Represents elimination of the interest expense incurred during the three months ended March 31, 2021 and the year ended December 31, 2020 following the repayment of SoFi’s loan warehouse facility debt in connection with the Business Combination (See Note 3(f) Payment of loan warehouse facility debt and accrued interest).
3(j) Change in fair value of the Series H warrant liabilities. Represents elimination of the change in fair value of the warrant liabilities as a result of conversion of the Series H warrants into warrants to purchase common stock of the Combined Company upon consummation of the Business Combination (See Note 3(d) Series H warrant liabilities).
3(k) Nonrecurring expense related to payment made to SoFi redeemable preferred stockholders. Reflects expense related to a payment made to certain redeemable preferred stockholders in conjunction with the Business Combination, in the amount of $21,181 for the year ended December 31, 2020 (See Note 3(a)(4) Cash and cash equivalents). This payment was accounted for as an embedded derivative, which was not clearly and closely related to the host contract.Therefore, the redeemable preferred stockholder payment made at the closing of the Business Combination is recognized as noninterest expense — general and administrative in SoFi’s Consolidated Statements of Operations and Comprehensive Loss.
3(l) Net loss per share. Represents pro forma net loss per share based on pro forma net loss and 794,692,813 total shares outstanding upon consummation of the Business Combination (See Note 3(g) Impact on equity). For each period presented, there is no difference between basic and diluted pro forma net loss per share, as the inclusion of all potential Class A ordinary shares of the Combined Company outstanding would have been anti-dilutive.
82

TABLE OF CONTENTS
Letter From Our Chief Executive Officer to New Employees
Upon arriving to SoFi, new employees receive the below letter from Anthony Noto, our chief executive officer, welcoming them to the company and underscoring his passion for our company mission and culture alike.
IPOE-20210614_G3.JPG
83

TABLE OF CONTENTS
BUSINESS
Unless the context otherwise requires, all references in this section to the “company”, “we”, “us”, or “our” refer to the business of Social Finance, Inc. and its subsidiaries prior to the consummation of the Business Combination.
Company Overview
We are a member-centric, one-stop shop for financial services that allows members to borrow, save, spend, invest and protect their money. Our mission is to help our members achieve financial independence in order to realize their ambitions. To us, financial independence does not mean being wealthy, but rather represents the ability of our members to have the financial means to achieve their personal objectives at each stage of life, such as owning a home, having a family, or having a career of their choice — more simply stated, to have enough money to do what they want. We were founded in 2011 and have developed a comprehensive suite of financial products that offers the speed, selection, content and convenience that only an integrated digital platform can provide.
In order for us to achieve our mission, we have to help people get their money right, which means providing them with the ability to borrow better, save better, spend better, invest better and protect better. Everything we do today is geared toward helping our members “Get Your Money Right” and we strive to innovate and build ways for our members to achieve this goal.
We believe that consumers with high earnings and very good credit are underserved by the disparate financial services offerings available in today’s market. There are approximately 500 million U.S. accounts in FDIC insured banks and approximately 50% of those accounts are with the largest 15 U.S. banks. In addition, more than 50% of Americans use more than one bank for their financial services, and a majority of these people cite the lack of a single platform capable of providing the services and solutions they need as the reason. Based on the market capitalization of leading U.S. financial institutions, we estimate the market for financial services to be approximately $2.0 trillion, representing a substantial and compelling opportunity for us to attract members to our digital native, technology-driven platform with products and services that satisfy the needs of members at every important financial decision in their lives.
We have created an innovative financial services platform designed to offer best-in-class products to meet the broad objectives of our members and the lifecycle of their financial needs. Since our inception through March 31, 2021, we have served approximately 2.3 million members who have used approximately 3.2 million products on our platform. We define a member as someone who has a lending relationship with us through origination or servicing, has opened a financial services account, has linked an external account to our platform, or has signed up for our credit score monitoring service. Once someone becomes a member, they are always considered a member unless they violate our terms of service. This means that our members have continuous access to our CFPs, our career advice services, our member events, all of our content, educational material, news, tools and calculators at no cost to the member. Additionally, our mobile app and website have been designed with a member home feed that is personalized and delivers content to a member about what they must do that day in their financial life, what they should consider doing that day in their financial life, and what they can do that day in their financial life. We have experienced accelerating year-over-year member growth for the past seven consecutive quarters. We believe we have just scratched the surface, and that we are in the early stages of the digital transformation of financial services. As a result, we have a substantial opportunity to continue to grow our member base and increase the number of products members use on our platform.
Our Differentiation
In order to build best-in-class offerings, we focus on four differentiators: fast, selection, content and convenience.
(1)Fast — We aspire to be the fastest place for our members to responsibly do anything, whether it’s applying for a loan, getting a funded loan, opening an account, buying or selling a stock, uploading a mobile check, getting access to money, paying a friend, or accessing relevant financial content. Our products are all digital and we have a culture of iteration to help drive faster and faster services.
84

TABLE OF CONTENTS
(2)Selection — Given the digital nature of our products, the permutations of features and services that can be made available to our members across their needs to borrow, save, spend, invest and protect are significant. We will continue to iterate, learn and innovate to broaden our selection in the same way we did by providing our members with the ability to buy single stocks without commissions, purchase fractional shares, invest in SoFi proprietary robo-advisory portfolios, and invest in SoFi-branded Exchange-Traded Funds.
(3)Content — Our financial education, insights, research content, actionable tools and advice are designed to provide meaningful value for our members. Our carefully-crafted and personalized content is offered through our member home feed and is designed to help our members get their money right. We strive to provide digestible financial education, meaningful answers, salient information, advice, credit scores, financial calculators, investment research and financial news that enhance member loyalty and increase the likelihood that members will use additional SoFi products in the future.
(4)Convenience — We hold ourselves accountable to providing the most convenient member experience possible in terms of ease of use, ubiquity, functionality, simplicity and responsive customer service. Our long-term goal is to provide the most convenient 24x7 service and dispel the historical construct of financial service availability based on a 9-5 Monday through Friday work day.
Each product we offer is delivered in a member-centric way and is built and enhanced with these differentiators in mind. We believe that our member-centric one stop shop for financial services serves as a competitive differentiator for us relative to other financial services providers.
We offer our members a full suite of financial products and services all in one common mobile platform. To complement these products and services, we believe in building vertically-integrated technology platforms designed to manage and deliver the suite of our solutions to our members in a low-cost and differentiated manner.
Lending Solutions:   We offer multiple loan products, such as student loans, personal loans and home loans, designed to serve the lifecycle needs of our members. Since our inception through March 31, 2021, we have originated approximately $63 billion of loans and believe our proprietary underwriting models predicated on data and scale help us better understand and manage risk and help us achieve a potential gain on sale through our whole loan or securitizations channels.
Financial Services Solutions:   We offer a suite of financial services solutions, including cash management and investment services across our SoFi Money, SoFi Invest, SoFi Credit Card and SoFi Relay products. SoFi Money is a digitally-native, mobile cash management experience for our members. SoFi Invest is a mobile-first investment platform offering members access to trading and advisory solutions, such as active investing, robo-advisory and cryptocurrency accounts. SoFi Credit Card offers a rewards program that provides double the rewards when the cardholder redeems them into SoFi Money, SoFi Invest or SoFi personal or student loans. To complement these products, we offer financial tracking through SoFi Relay, and partner with other enterprises through loan referrals and our SoFi At Work service. We have also developed a financial services marketplace platform branded Lantern Credit to help applicants that do not qualify for SoFi products with alternative products, as well as providing a product comparison experience. Finally, through SoFi Protect, we offer third-party insurance products through partnerships.
Our Strategy 
The Financial Services Productivity Loop
We believe that gaining our members’ trust and developing a relationship with our members is central to our success as a financial services platform. Moreover, we believe that some of the current frictions faced by other financial institutions are caused by a disjointed and non-seamless product experience, and an inability to offer a comprehensive, integrated suite of products in one digital native experience to meet a customer’s holistic financial needs. Through our mobile technology and continuous effort to improve each of our financial services offerings, we believe we are building a digital mobile native financial services platform that members can access for all of their financial services needs.
85

TABLE OF CONTENTS
Our strategy, what we refer to as the “Financial Services Productivity Loop”, is centered around building trust and a lifetime relationship with our members, which we believe will help build a sustainable competitive advantage. In order to deliver on our strategy, we must develop best in class unit economics and best in class products that build trust and reliability between our members and our platform. When we do this on a member’s first product, and they later consider using a second product, we believe they are more likely to start with our platform and that we have a higher chance that they will select one of our products to meet their other financial needs. This would result in delivering more revenue per member without incurring additional member acquisition costs, resulting in higher lifetime value per member. This also reinforces the benefits of our platform, which simplifies the entire financial ecosystem for our members, helping them get their money right. We are able to use the increased profits to further improve member benefits and product experience.
We believe we are in the early stages of realizing the benefits of the Financial Services Productivity Loop, as increasing numbers of our members are using multiple products on our platform. From the first quarter of 2020 to the first quarter of 2021, the number of our members who have used more than one of our product offerings grew 171% from approximately 216,000 to approximately 585,000.
In addition to realizing the benefits of more of our members adopting multiple SoFi products, both in terms of additional revenue and lower member acquisition costs per product, the Financial Services Productivity Loop strategy delivers operating and technology efficiencies to deliver better unit economics on a per product basis. One of the success factors of our lending business is that it is vertically integrated across our technology stack, risk protocols and operations processes. This vertical integration has led to strong lending unit economics and first quarter 2021 contribution profit margin of 59%, which is defined as contribution profit divided by total net revenue for the Lending segment.
IPOE-20210614_G1.JPG
We believe that by participating in the entire technology ecosystem powering digital financial services, we not only reduce costs to operate our member-centric business, but also deliver increasing value to our enterprise customers. To that end, in May 2020, we acquired Galileo, which has allowed us to vertically integrate across more of our financial services, which we believe will help us achieve better unit economics.
National Bank Charter
A key element of our long-term strategy is to secure a national bank charter, which we believe would enhance the profitability of our Lending segment and SoFi Money. While we currently rely on third-party bank holding companies to provide banking services to our members, securing a national bank charter would, among other things, allow us to provide members and prospective members broader and more competitive options across their financial services needs, including deposit accounts, and lower our cost to fund loans (by utilizing our SoFi Money members’ deposits to fund our loans), which would enable us to offer lower interest rates on loans to members as well as offer higher interest rates on SoFi Money accounts, all while continuing not to charge non-interest based fees.
86

TABLE OF CONTENTS
In October 2020, we received preliminary, conditional approval from the OCC for our application for a national bank charter. Final OCC approval is subject to a number of preopening requirements. In March 2021, we entered into an agreement to acquire Golden Pacific Bancorp, Inc., a bank holding company (“Golden Pacific”), and its wholly-owned subsidiary, Golden Pacific Bank, National Association, a national bank (“Golden Pacific Bank”), for a total cash purchase price of $22.3 million. The acquisition is subject to regulatory approval, including approval from the OCC of a revised business plan for the acquiree national bank, and approval from the Federal Reserve to become a bank holding company and for a change of control, and other customary closing conditions. In March 2021, we submitted an application to the Federal Reserve to become a bank holding company. The application review process is ongoing.
In order to be compliant with all applicable regulations, to operate to the satisfaction of the banking regulators, and to successfully execute our business plan for the bank, SoFi has been building out the required infrastructure to run the bank and to operate as a bank holding company. This effort spans our people and organization, technology, marketing/product management, risk management, compliance, and control functions. We have invested and expect to continue to invest substantial time, money and human resources towards bank readiness, and towards the regulatory approval process. During the three months ended March 31, 2021, we incurred direct costs associated with securing a national bank charter of $5.5 million, which consisted primarily of professional fees and compensation and benefits costs. While largely dependent on the timing of the regulatory approvals, we estimate that we could incur additional costs of approximately $6 million to $10 million through the remainder of the regulatory approval process.
See “Management’s Discussion and Analysis of Financial Condition and Results of Operations—Key Factors Affecting Operating Results—National Bank Charter” included elsewhere in this prospectus for our expectations of costs associated with the operation of a national bank after securing a national bank charter. See “—Government Regulation—Bank Acquisition” herein and “Risk Factors—Regulatory, Tax and Other Legal Risks” included elsewhere in this prospectus for additional information.
Our Products
We offer a suite of financial products all in one digital native application to help members get their money right. In 2011, we started our company with an innovative approach to the private student loan market and later expanded our lending product offerings to include personal loans and home loans. Over the last two years, we have expanded our overall strategy to not only include products that enable our members to borrow better, but also to save better, spend better, invest better and protect better. In the first quarter of 2019, we launched SoFi Money, SoFi Invest and SoFi Relay. In that same quarter, we also redesigned our end-to-end approach to mortgage lending and relaunched home loans. In the third quarter of 2019, we introduced in-school loans and in the third quarter of 2020, we launched SoFi Credit Card, which was expanded to a broader market in the fourth quarter of 2020.
In addition, we built a social area within our mobile application, which we refer to as the member home feed. In the member home feed, we show our members what is happening in their financial lives through personalized cards with relevant content, news and tools. Our goal is for these cards to help our members answer three questions every day: what must you do in your financial life; what should you consider doing in your financial life; and what can you do in your financial life. Through the member home feed, there are significant opportunities to build frequent engagement and, to date, the member home feed has been an important and additional driver of new product adoption. The member home feed is an important part of our strategy and our ability to use data as a competitive advantage.
87

TABLE OF CONTENTS
IPOE-20210614_G2.JPG
Lending Segment
Our origins are in student loans. On the strength of our capabilities in student lending, we expanded into personal loans and home loans and, since 2011 through March 31, 2021, we have originated approximately $63 billion of loans. We believe that our market opportunity within each of these lending channels is significant. Our lending process primarily leverages an in-application, digital borrowing experience, which we believe serves as a competitive advantage as digital lending becomes increasingly ubiquitous.
Student Loans.   We primarily operate in the student loan refinance space, with a focus on super-prime graduate school loans. Recently, we expanded into “in-school” lending, which allows members to borrow funds while they attend school. We offer flexible loan sizes and repayment options, as well as competitive rates, on our student loan refinancing and in-school loan products. The weighted average origination FICO of our student loan members who took out a loan in the first quarter of 2021 was 774.
Personal Loans.   We primarily originate personal loans for debt consolidation purposes and home improvement projects. We offer fixed and variable rate loans with no origination fees and flexible repayment terms, such as unemployment protection. The weighted average origination FICO of our personal loan members who took out a loan in the first quarter of 2021 was 762. There are other personal loan purposes or channels that we have not aggressively pursued, which we believe could represent opportunities for us in the future.
Home Loans.   We have historically offered agency and non-agency loans for members purchasing a home or refinancing an existing mortgage. On our home loan products, we offer competitive rates, flexible down-payment options for as little as 5% and educational tools and calculators. The weighted average origination FICO of our home loan members who took out a loan in the first quarter of 2021 was 762.
A key element of our underwriting process is the ability to facilitate risk-based interest rates that are appropriate for each loan. Using our proprietary risk models, we project quarterly loan performance results, including expected losses and prepayments. The outcome of this process helps us determine a more data-driven, risk-based interest rate that we can offer our members.
We have built a comprehensive underwriting process across each lending product that is focused on willingness to pay (credit), ability to pay (income verification), and capacity to pay (debt service in relation to other loans). Our student loan and personal loan underwriting models consider credit reports, industry credit and bankruptcy prediction models, custom credit assessment models, and debt capacity analysis, as indicated by borrower free cash
88

TABLE OF CONTENTS
flow (defined as borrower monthly net income less revolving and installment payments less housing payments). Our minimum FICO requirements are 650 for student loan refinancing, 680 for in-school loans (primary or co-signer) and 680 for personal loans. Home loans originated by us that are agency conforming loans are subject to Automated Underwriting System credit, debt service, and collateral eligibility established by Fannie Mae. Existing members generally experience a higher approval rate than new members, subject to the member being in good standing on their existing products. Home loans originated by us that are non-agency are subject to SoFi Home Loans credit criteria, including a minimum tri-bureau credit score, established credit history requirements, income verification, as well as maximum qualified mortgage limits on debt to income service and caps on LTV (loan to value) based on an accredited appraisal. We also leverage our data to streamline the application process for our members through automation.
The following table presents additional information on our terms for our lending products as of March 31, 2021:
Product Loan Size
Rates(1)
Term
Student Loan Refinancing
$5,000+ (2)
Variable rate: 2.25% – 6.62% 5 – 20 years
Fixed rate: 2.99% – 7.18%
In-School Loans
$5,000+ (2)
Variable rate: 1.84% – 12.63% 5 – 15 years
Fixed rate: 4.23% – 11.26%
Personal Loans
$5,000 – $100,000 (2)
Fixed rate: 5.99% – 19.10% 2 – 7 years
Home Loans $98,000 – $548,250
(Conforming 2021 Normal Cost Areas)
Fixed rate: 2.13% – 4.75% 15 or 30 years
OR
$822,375 (2)
(Conforming 2021 High Cost Areas)
15 or 30 years
__________________
(1)Loan annual percentage rates presented reflect an auto-pay discount.
(2)Minimum loan size may be higher within certain states due to legal or licensing requirements.
Our lending business is primarily a gain-on-sale model, whereby we seek to originate loans at an efficient cost and profit on these loans when we sell them into either our whole loan or securitization channels, the former of which are primarily comprised of large financial institutions, such as bank holding companies. We aim to sell our loans at a premium to par, which compensates us for the costs to originate the loans and provides us a profit. Prior to selling our loans, we hold our loans on our consolidated balance sheets at fair value and primarily rely upon warehouse financing and our own capital to enable us to expand our origination capabilities. We finance our personal loans, home loans and student loans via a combination of warehouse facilities, which had $5.9 billion and $6.4 billion of capacity as of March 31, 2021 and December 31, 2020, respectively, and our equity capital. As of March 31, 2021 and December 31, 2020, we utilized $1.9 billion and $2.4 billion, respectively, of our warehouse facility capacity. If we are successful in securing a national bank charter, we believe we would be able to lower our cost of funding by utilizing our SoFi Money members’ deposits to fund our loans.
We retain servicing rights to our originated loans (other than home loans), and believe our servicing function is an important asset because of the connection to the member it affords us throughout the life of the loan. We directly service all of the personal loans that we originate. We act as master servicer for, and rely on sub-servicers to directly service, all of our student loans, credit cards and FNMA conforming home loans. We believe this ongoing relationship with our members enhances the effectiveness of our Financial Services Productivity Loop by increasing member touchpoints and driving the number of products per member.
Our platform supports the full transaction lifecycle, including credit application, underwriting, approval, funding and servicing. Through data derived at loan origination and throughout the servicing process, SoFi has life of loan performance data on each loan in its ecosystem, which provides a meaningful data asset.
89

TABLE OF CONTENTS
Financial Services Segment
Our digital suite of financial services products, by nature, provide more daily interactions with our members and is, therefore, differentiated from our lending products, which inherently have less consistent touchpoints with our members. Our Financial Services segment primarily includes SoFi Money, SoFi Invest (including active investing, robo-advisory and cryptocurrency accounts), content (including SoFi Relay, a product which allows members to track all of their financial accounts in one place and track their credit score), SoFi Credit Card, and SoFi Protect (whereby we offer third-party insurance products through partnerships).
We earn revenues in connection with our Financial Services segment through various partnerships and our SoFi Money and SoFi Invest products in the following ways:
Referral fees: Through strategic partnerships, we earn a specified referral fee in connection with referral activity we facilitate through our platform, which is not directly tied to a particular Financial Services product. The referral fee is paid to us by third-party partners that offer services to end users who do not use one of our product offerings, but who were referred to the partners through our platform. As such, the third-party enterprise partners are our customers in these referral arrangements.
Payment network fees: We earn payment network fees, which primarily constitute interchange fees, from our SoFi Money product. These fees are remitted by merchants and are calculated by multiplying a set fee percentage (as stipulated by the debit card payment network) by the transaction volume processed through such network. We arrange for performance by a card association and the bank issuer to enable certain aspects of the SoFi branded transaction card process. We enter into contracts with both parties that establish the shared economics of SoFi Money branded transaction cards. Historically, these fees have not been a significant portion of total net revenue.
Enterprise service fees: These fees are earned in connection with services we provide to enterprise partners to facilitate transactions for the benefit of their employees, such as 529 plan contributions or student loan payments through our At Work product, which represents our single performance obligation in the arrangements. Historically, these fees have been an immaterial component of our total net revenue.
Brokerage fees: We earn brokerage fees from our share lending and pay for order flow arrangements related to our SoFi Invest product (for which Apex serves as principal), exchange conversion services and digital assets activity. In our share lending arrangements and pay for order flow arrangements with Apex, we do not oversee the execution of the transactions by our members, but benefit through a negotiated multi-year revenue sharing arrangement, since our members' brokerage activity drives the share lending and pay for order flow volume. Apex connects with market makers (order flow) and institutions (share lending) to facilitate the service and is responsible for execution. Apex carries inventory risk with the share lending program and ultimately is responsible for successful order routing to market makers that trigger the pay for order flow revenue. Apex sets the gross price and negotiates with market makers and institutions as part of our order flow and share lending arrangements. We have no discretion or visibility into this pricing and, instead, negotiate a net fee for our order flow and share lending arrangements, which is settled with Apex rather than with market makers or other institutions. In our digital assets arrangements, our fee is calculated as a negotiated percentage of the transaction volume. In our exchange conversion arrangements, we earn fees for exchanging one currency for another. Historically, these fees have not been a significant portion of our total net revenue. Our arrangements with Apex are governed by an agreement which contains certain minimum monthly requirements and which is terminable by either party upon notice. Although we no longer have an equity method investment in Apex as of March 31, 2021, Apex will continue to provide the services under this agreement.
Net interest income: Our SoFi Invest and SoFi Money products also generate net interest income based on the cash balances held in these accounts. Historically, this income has not been a significant portion of our total net revenue.
90

TABLE OF CONTENTS
SoFi Money
SoFi Money is a mobile-first cash management account offered by SoFi Securities LLC, a FINRA registered broker dealer. The SoFi Money account is a brokerage account powered by the SoFi application and SoFi Money Debit Card. We believe SoFi Money is well positioned with our members and prospective members because our digital money platform allows members to spend, save and earn interest and rewards in flexible ways, all within our mobile application. Finally, our “vaults” feature provides a nimble account balance mechanism that can facilitate budgeting and saving, and provides members with enhanced tracking visibility toward their financial goals.

As we are not currently a bank holding company, we rely on partner bank holding companies to provide cash management services to our members through our bank sweep program at our broker-dealer subsidiary, wherein our members may place funds on deposit with us that are then swept out and placed on deposit with partner banks. As part of this program, interest income is generated through the deposits sitting at the Member Banks (as defined later in this prospectus), which rates are determined with each bank and are variable in nature. We create and manage the digital, mobile cash management experience for our members. Currently, we invest in member acquisition marketing and member rewards to incentivize our members to house their cash management on the SoFi platform. We earn payment network fees on member expenditures through SoFi-branded debit cards issued by one of our partner bank holding companies. These payment network fees are reduced by fees payable to card associations and the issuing bank holding company.
IPOE-20210614_G4.JPG
The Bancorp Bank (“Bancorp”) is the issuer of all SoFi Money debit cards and sponsors access to debit networks for payment transactions, funding transactions and associated settlement of funds under a sponsorship agreement with SoFi Securities. Additionally, Bancorp provides sponsorship and support for ACH, check, and wire transactions along with associated funds settlement. The SoFi Money product also utilizes a sweep administrator, UMB Bank, National Association (“UMB”), to sweep funds to and from the SoFi Money program banks, as necessary, under a program broker agreement between SoFi Securities and UMB and program account and program bank agreements with a variety of sweep program banks. The SoFi Securities agreement with Bancorp provides for receipt by Bancorp of program revenue and transaction fees, and is subject to a minimum monthly card activity fee. The agreement with Bancorp is terminable by SoFi Securities with 120 days prior notice. The program broker agreement between SoFi Securities and UMB provides for one-year terms that automatically renew and is terminable by either party with at least 90 days’ written notice prior to the end of the current term. The program account agreements and program bank agreements between SoFi Securities, UMB and the sweep banks provide for the rate of interest payable on the balances in a member’s SoFi Money account and include certain maximum transfer requirements on transfers. These arrangements are generally terminable upon termination of SoFi Securities’ sweep arrangement with UMB.
91

TABLE OF CONTENTS
SoFi Invest
SoFi Invest is a digital brokerage service that offers multiple ways to invest, and gives members access to active investing, robo-advisory and cryptocurrency services. Our active investing service enables members to buy and sell stocks and ETFs. Our robo-advisory service offers managed portfolios of stocks, bonds and ETFs. Our cryptocurrency service allows members to buy and sell select cryptocurrencies. Furthermore, our innovative “stock bits” feature allows members to purchase fractional shares in various companies. Through our “stock bits” offering, members with SoFi Invest active brokerage accounts may buy or sell fractional shares in a variety of equity securities. Members can place orders in dollars or shares. During the course of a trading day, all member orders are consolidated into a single order for each equity security, which may be a sell or buy order. These fractional orders are rounded up to the next whole share and executed as a market order prior to market close on a standard trading day. Following market close, we allocate the trades to each individual member. We maintain an insignificant stock inventory of between two and ten shares for each issuer for whose securities we provide fractional trading in order to facilitate “stock bits” trades. This stock inventory is recorded within other assets in our Consolidated Balance Sheets and was not material as of any of the balance sheet dates presented in this prospectus, nor were our revenues earned and expenses incurred associated with the “stock bits” feature material during any of the income statement periods presented in this prospectus.
IPOE-20210614_G5.JPG
Our interactive investing experience fosters virality by allowing members to engage with other investors’ activity on the platform. Finally, consistent with our aim to “Get Your Money Right” and as part of our commitment to helping our members, we provide access to CFPs at no cost to the member. Additionally, we provide introductory brokerage services to our members and have invested heavily over the past few years to create an appealing mobile investing experience. Although we currently do not charge trading fees, with the exception of cryptocurrency trades, our ecosystem benefits from increasing SoFi Invest members by virtue of interest income we earn on cash balances, and we view SoFi Invest as an attractive first product for members who may later become SoFi Money product holders or borrow with SoFi. We also earn brokerage revenue through share lending and pay for order flow arrangements.
Other
Our remaining activities within the financial services space relate to: our SoFi Credit Card product, which we launched to a broader market in the fourth quarter of 2020; SoFi Relay, (as further discussed below); other financial content on our member home feed, which is native to the SoFi mobile application; insurance partnerships under SoFi Protect; Lantern Credit, which is an independent financial services aggregator providing marketplace lending product offerings; and various enterprise partnerships. SoFi Relay personal finance management product is a complementary offering to our members through which they can intuitively track both their short-term and long-term financial health within our mobile application. We believe that the content and features we provide within our mobile application can spur more financial education, which leads to more ways for our members to engage in getting their money right and will ultimately demonstrate the effectiveness of our Financial Services Productivity Loop. SoFi Relay also provides us with unified intelligence about our members and offers us meaningful insights about what SoFi products may help our members best achieve their financial goals.
IPOE-20210614_G6.JPG
Technology Platform Segment
The revenue we have earned in our Technology Platform segment historically included Apex equity method income. During 2020, Technology Platform revenue was predominantly attributable to Galileo following our
92

TABLE OF CONTENTS
acquisition in May 2020. During 2021, the seller exercised its call rights on our Apex investment. Therefore, we did not recognize any Apex equity method investment income during the three months ended March 31, 2021, nor will we have such equity method investment income in future periods.
Galileo Financial Technologies
In May 2020, we acquired Galileo, which operates as a platform-as-a-service for a variety of financial services providers. Galileo has significantly grown its client base over the past few years and provides services to a large percentage of financial technology and financial services companies. Additionally, Galileo has maintained a strong focus on client retention and renewal. Galileo provides the infrastructure to facilitate core customer-facing and back-end capabilities, such as account setup, account funding, direct deposit, authorizations and processing, payments functionality, and check account balance features. Additionally, Galileo provides vertical integration benefits with SoFi Money. In addition to growth in its U.S. client base, Galileo is increasingly focused on international opportunities, including in Latin America and Asia.
Since Galileo is a platform-based business model, we track the number of accounts, which is defined as an open account as of the reporting date. As of March 31, 2021, there were over 69 million total accounts on the Galileo platform (excluding SoFi accounts). We view total accounts as an important indicator of the number of Galileo’s customers’ own customers who depend on the technology platform for a variety of products and services, including virtual card products, virtual wallets, peer-to-peer and bank-to-bank transfers, early paychecks, and real-time authorizations.
We earn revenue on Galileo’s platform in the following two ways:
Technology Platform Fees.   The platform fees we earn are based on access to the platform and are specific to the type of transaction. For example, we offer “event pricing”, which includes a specific charge for an account setup, an active account on file, use of program, event and authorization Application Programming Interfaces (“APIs”), card activation, authorizations and processing, and card loads. In addition, we offer “partner pricing”, which is the back-end support we provide to Galileo’s customers, such as live agent customer service, chargeback and fraud analysis and credit bureau reporting, all within one integrated solution for our customers.
Program Management Fees.   Also referred to as “card program fees”, these transaction fees are generated from the creation and management of card programs issued by banks and requested by enterprise partners. In these arrangements, Galileo performs card management services and the revenue stems from the payment network and card program fees generated by the card program. This revenue is reduced by association and bank issuer costs, and a revenue share passed along to the enterprise partner that markets the card program. We categorize this class of revenue as payment network fees.
Galileo typically enters into multi-year service contracts with its customers. The contracts provide for a variety of integrated platform services, which vary by customer and are generally either non-cancellable or cancellable with a substantive payment. Pricing structures under these contracts are typically volume-based, or a combination of activity- and volume-based, and payment terms are predominantly monthly in arrears. Most of Galileo’s contracts contain minimum monthly payments with agreed upon monthly service levels and may contain penalties if service levels are not met. See “Management’s Discussion and Analysis of Financial Condition and Results of Operations — Results of Operations” under the section titled “Noninterest income and net revenue” for the year ended December 31, 2020 for a discussion of the integrated services offered on the Galileo platform from which we generate technology platform fees.
See Note 2 to the Notes to Unaudited Condensed Consolidated Financial Statements and to the Notes to Consolidated Financial Statements included elsewhere in this prospectus for additional information on our business acquisitions.
93

TABLE OF CONTENTS
Apex
In December 2018, we purchased a 16.7% interest in Apex, which resulted in partial integration of the transaction clearing and asset custody functions integral to SoFi Invest. The investment also enabled us to participate in earnings from Apex’s customer base.
The seller of the Apex interest had call rights over our equity interest in Apex for an aggregate purchase price of $100 million plus a per diem amount of $27,397 for each day elapsed from April 14, 2020 (the option start date) to the date the option is called, which call expires in 2023. During January 2021, the seller exercised its call rights on our Apex equity investment. Therefore, we no longer recognized Apex equity method investment income subsequent to the date the option was called. Additionally, we measured the carrying value of the Apex equity method investment as of December 31, 2020 equal to the call payment that we received in January 2021, which resulted in the recognition of an impairment charge of $4.3 million during the fourth quarter of 2020. Although following the seller call we no longer have an equity method investment in Apex or recognize equity method investment income, Apex continues to provide investment custody and clearing services for SoFi Invest, including for our brokerage activities, under a multi-year revenue sharing arrangement.
94

TABLE OF CONTENTS
Our Culture
We believe building a durable culture will be a key determinate in our ability to help our members get their money right and ultimately to achieve our mission.
IPOE-20210614_G7.JPG
Competition
We compete at multiple levels, including: (i) competition among other personal loan, student loan, credit card and residential mortgage lenders; (ii) competition for money deposits among traditional banks and some challenger banks; (iii) competition for investment accounts among other introductory brokerage firms; (iv) competition for
95

subscribers to financial services content; and (v) competition among other technology platforms for the enterprise services we provide, such as platform-as-a-service through Galileo.
Competition to fund prime loans. The prime lending market is highly fragmented and competitive. We face competition from a diverse landscape of consumer lenders, including traditional banks, credit unions and specialty finance lenders, as well as alternative technology-enabled lenders.
Competition to acquire money accounts. Traditional banks are typically larger, have been in business longer and generally have greater brand awareness than us.
Competition to acquire investment brokerage accounts. The leading incumbent brokerage firms are larger, have been in business longer and generally have greater brand awareness than us. We also face competition from neo-brokerage platforms that provide some of the same features as us, such as a mobile brokerage experience and fractional share investing.
Competition to attract financial services content viewership. There are many sources of financial news in the marketplace, many of which are more established and have a larger subscriber base.
Competition for debit and credit card sponsors, particularly some challenger banks who need a platform-as-a-service solution, such as the one provided by Galileo. Generally, these arrangements are multi-year contracts, which require us to spend the necessary resources on implementation and interconnecting new customers onto our platform. We face competition from larger institutions that could make investments into an integrated platform-as-a-service solution, and also undercut our pricing, preventing our current customers from renewing, while also impeding our attempts to acquire new members.
Marketing
Our sales and marketing efforts are designed to drive brand awareness, improve member acquisition efficiency and accelerate our Financial Services Productivity Loop. We attract and retain members through multiple marketing channels, including social media, traditional media such as the press, online affiliations, search engine optimization, search engine marketing, offline partnerships, preapproved direct mailings and television advertising. We continue to optimize our marketing strategy through a focus on our full suite of financial products and iterate on referral and products per member opportunities to accelerate the Financial Services Productivity Loop.
Government Regulation
We are subject to extensive and complex rules and regulations, licensing and examination by various federal, state and local government authorities designed to, among other things, protect borrowers (such as truth in lending, equal credit opportunity, fair credit reporting and fair debt collection practices laws), customers (such as payment regulations, state and federal money transmitter and money service business laws) and investors (such as the anti-fraud provisions of the federal securities laws). State and federal laws require extensive disclosure to, and consents from, borrowers and investors, prohibit discrimination and unfair, deceptive, or abusive acts or practices and impose multiple qualification and licensing obligations on our activities and the loans originated by us. Failure to comply with any of these rules, regulations or requirements may result in, among other things, lawsuits (including class action lawsuits) or administrative enforcement actions seeking monetary damages, fines or civil monetary penalties, restitution or other payments to borrowers or investors, modifications to business practices, revocation of required licenses or registrations, or voiding of loan contracts.
The following is a summary of certain aspects of the various statutes and regulations applicable to us and our subsidiaries. This summary is not a comprehensive analysis of all applicable laws, and is qualified by reference to the full text of statutes and regulations referenced below.
CFPB
We are subject to regulation and examination by the Consumer Financial Protection Bureau (the “CFPB”), which oversees compliance with and enforces federal consumer financial protection laws. The CFPB directly and significantly influences the regulation of consumer financial services, including the origination, brokering, servicing,
96

transfer, and collection of consumer loans, including personal loans, educational loans and home loans, and other consumer financial services we may provide. The CFPB has substantial power to regulate financial products and services received by consumers from both bank and non-bank lenders and their respective service providers, including rulemaking authority in enumerated areas of federal law traditionally applicable to consumer lending such as truth in lending, fair credit reporting and fair debt collection. Under Title X of the Dodd-Frank Wall Street Reform and Consumer Protection Act (the “Dodd-Frank Act”), the CFPB has the authority to pursue enforcement actions against companies that offer or provide consumer financial products or services, including private education lenders and mortgage lenders, that engage in unfair, deceptive or abusive acts or practices, which can be referred to as “UDAAP”. The CFPB may also seek a range of other remedies, including rescission of contracts, refund of money, return of real property, restitution, disgorgement of profits or other compensation for unjust enrichment, damages, public notification of the violation, and “conduct” restrictions (i.e., future limits on the target’s activities or functions). Where a company has violated Title X of the Dodd-Frank Act or CFPB regulations under Title X, the Dodd-Frank Act empowers state attorneys general and state regulators to bring civil actions to enforce such laws and regulations.
State Licensing Requirements
We or one or more of our subsidiaries may need, and have obtained, one or more state licenses to broker, acquire, service and/or enforce loans, and to engage in money transmitter activities. Where we have obtained licenses, state licensing statutes may impose a variety of requirements and restrictions on us, including:
record-keeping requirements;
restrictions on servicing and collection practices, including limits on finance charges and fees;
restrictions on collections;
usury rate caps;
restrictions on permissible terms in consumer agreements;
disclosure requirements;
examination requirements;
surety bond and minimum net worth requirements;
permissible investment requirements;
financial reporting requirements;
annual or biennial activity reporting and license renewal requirements;
notification and approval requirements for changes in principal officers, directors, stock ownership or corporate control;
restrictions on marketing and advertising;
qualified individual requirements;
anti-money laundering and compliance program requirements;
data security and privacy requirements; and
review requirements for loan forms and other customer-facing documents.
These statutes may also subject us to the supervisory and examination authority of state regulators in certain cases, and we have experienced, are currently and will likely continue to be subject to and experience exams by state regulators. These examinations have and may continue to result in findings or recommendations that require us to
97

modify our internal controls and/or business practices. If we are found to have engaged in activities that require a state license without having the requisite license, the licensing authority may impose fines, impose restrictions on our operations in the relevant state, or seek other remedies for activities conducted in the state.
Pandemic Response and the CARES Act
On March 27, 2020, the Coronavirus Aid, Relief, and Economic Security Act, or CARES Act, was signed into law. In compliance with the CARES Act, payments and interest accrual on all loans owned by the Department of Education were suspended through September 30, 2020, which suspension was further extended by executive action through September 30, 2021. Additionally, on March 25, 2020, the Department of Education announced that private collection agencies were required to stop making outbound collection calls and sending letters or billing statements to borrowers in default on federal student loans. In response to the COVID-19 pandemic, states and other regulatory authorities across the United States implemented various debt collection restrictions, including in some cases bans on collections or creditors’ normal legal remedies.
Laws and Regulation
Federal and State UDAAP Laws.   The Dodd-Frank Act grants the CFPB the power to enforce UDAAP prohibitions and to adopt UDAAP rules defining unlawful acts and practices. Additionally, provisions of the Federal Trade Commission Act (“FTC Act”) prohibit “unfair” and “deceptive” acts and practices in business or commerce and give the FTC enforcement authority to prevent and redress violations of this prohibition. Virtually all states have similar laws. Whether a particular act or practice violates these laws frequently involves a highly subjective and/or fact-specific judgment.
State Disclosure Requirements and Other Substantive Lending Regulations.   We are subject to state laws and regulations that impose requirements related to loan disclosures and terms, home loan and application reporting, credit discrimination, credit reporting, loan brokering, loan servicing, loan rescission, and debt collection.
Truth in Lending Act.   The Truth in Lending Act (“TILA”) and Regulation Z, which implements it, require lenders to provide consumers with uniform, understandable information concerning certain terms and conditions of their loan and credit transactions prior to the consummation of a credit transaction and, in the case of certain education, mortgage, and open-end loans, at the time of a loan solicitation, application, approval, and origination of a credit transaction. TILA also regulates the advertising of credit and gives borrowers, among other things, certain rights regarding updated disclosures and periodic statements, security interests taken to secure the credit, the right to rescind certain loan transactions, a right to an investigation and resolution of billing errors, and the treatment of credit balances. For certain types of credit transactions, lenders are not permitted to originate loans with certain high-risk features, such as negative amortization and balloon payments, and must provide certain consumer protections during the underwriting and origination process, such as providing a right to an appraisal of mortgaged property, and verifying the consumer’s ability to repay the loan prior to making a decision to approve an application for the loan. Private Education Lenders must provide multiple disclosures to applicants under TILA and must provide applicants with 30 days in which to accept or reject a loan offer as well as the right to rescind the loan transaction for three days following receipt of the Final TILA disclosure.
Real Estate Settlement Procedures Act.   The federal Real Estate Settlement Procedures Act (“RESPA”) and Regulation X, which implements it, require certain disclosures to be made to the borrower at application, as to the lender’s good faith estimate of loan origination costs, and at closing with respect to the real estate settlement statement; apply to certain loan servicing practices including escrow accounts, member complaints, servicing transfers, lender-placed insurance, error resolution and loss mitigation. RESPA also prohibits giving or accepting any fee, kickback or a thing of value for the referral of real estate settlement services, and giving or accepting any portion of any fee charged for rendering a real estate settlement service other than for services actually performed. To the extent that a lender makes or receives a referral to an affiliate, with whom it has an affiliated business arrangement, for settlement services, RESPA requires a disclosure of the affiliation to the person whose business is referred. For most home loans, the time of application (loan estimate) and time of loan closing disclosure requirements for RESPA and TILA have been combined into integrated disclosures under the TILA-RESPA Integrated Disclosure rule.
98

Equal Credit Opportunity Act.   The federal Equal Credit Opportunity Act (“ECOA”) prohibits creditors from discriminating against credit applicants on the basis of race, color, sex, age, religion, national origin, marital status, the fact that all or part of the applicant’s income derives from any public assistance program or the fact that the applicant has in good faith exercised any right under the federal Consumer Credit Protection Act or any applicable state law. Regulation B, which implements ECOA, restricts creditors from requesting certain types of information from loan applicants and from using advertising or making statements that would discourage on a prohibited basis a reasonable person from making or pursuing an application. ECOA also requires creditors to provide consumers and certain small businesses with timely responses to applications for credit, including notices of adverse action taken on credit applications.
Fair Housing Act.   The federal Fair Housing Act (“FHA”) applies to credit related to housing and prohibits discrimination on the basis of race or color, national origin, religion, sex, familial status, and handicap. The FHA prohibits discrimination in advertising regarding the sale or rental of a dwelling, which includes mortgage credit discrimination. The FHA may place restrictions on a creditor’s targeted marketing strategies, due to the risk that such strategies may increase a creditor’s fair lending risk.
Home Mortgage Disclosure Act.   The federal Home Mortgage Disclosure Act (“HMDA”) lenders to collect, report, and disclose certain information about their mortgage lending activity to the CFPB. Much of the data reported pursuant to HMDA is made public and can be used by regulators and third parties to ascertain information about our mortgage lending activity. Regulators and litigants may use the data to make inferences about our compliance with ECOA, FHA, and similar anti-discrimination laws. Effective in 2018, the CFPB issued a final rule which greatly expanded the amount of data that mortgage lenders are required to collect and report under HMDA. The CFPB has proposed and is expected to issue another final rule amending HMDA.
Secure and Fair Enforcement for Mortgage Licensing Act.   We employ and contract with mortgage loan originators which are required by state and federal law to be licensed as mortgage loan originators in the relevant jurisdictions where they operate. To obtain and maintain licensure, the mortgage loan originator must meet the minimum education, experience, and character requirements set forth by the relevant state’s law, and periodically renew their licenses. We may not be permitted to employ, take applications from, or originate loans processed by mortgage loan originators who fail to maintain a license in good standing in each relevant jurisdiction.
Fair Credit Reporting Act.   The federal Fair Credit Reporting Act (“FCRA”), as amended by the Fair and Accurate Credit Transactions Act (“FACTA”), promotes the accuracy, fairness and privacy of information in the files of consumer reporting agencies. FCRA requires a permissible purpose to obtain a consumer credit report and requires persons that furnish loan payment information to credit bureaus to report such information accurately. FCRA also imposes disclosure requirements on creditors who take adverse action on credit applications based on information contained in a consumer report or received from a third party and requires creditors who use consumer reports in establishing loan terms to provide risk-based pricing or credit score notices to affected consumers. The FCRA also imposes rules and disclosure requirements on creditors’ use of consumer reports for marketing purposes, which impacts our ability to use consumer reports and prescreened lists to market consumer loans through direct mail and other means.
Fair Debt Collection Practices Act.   The federal Fair Debt Collection Practices Act (“FDCPA”) provides guidelines and limitations on the conduct of third-party debt collectors in connection with the collection of consumer debts. The FDCPA limits certain communications with third parties, imposes notice and debt validation requirements, and prohibits threatening, harassing or abusive conduct in the course of debt collection. While the FDCPA applies to third-party debt collectors, debt collection and loan servicing laws of certain states impose similar requirements on creditors who collect their own debts or contract with third parties to collect their debts. In addition, the CFPB prohibits UDAAP in debt collection, including first-party debt collection. In May 2019, the CFPB issued a proposed amendment to Regulation F, implementing the FDCPA, which would, among other things, address communications in connection with debt collection, interpret and apply prohibitions on harassment or abuse, false or misleading representations, and unfair practices in debt collection, and clarify requirements for certain consumer-facing debt collection disclosures. The CFPB is expected to issue a final rule, which may require us to adjust our debt collection practices and build or change our compliance controls to comply with the new rule.
99

Servicemembers Civil Relief Act.   The federal Servicemembers Civil Relief Act (“SCRA”) allows military members to suspend or postpone certain civil obligations so that the military member can devote his or her full attention to military duties. The SCRA requires us to adjust the interest rate of borrowers who qualify for and request relief. The SCRA also places limitations on remedies that may otherwise be available to a creditor, such as foreclosures and default judgments.
Military Lending Act.   The Military Lending Act (“MLA”) restricts, among other things, the interest rate and other terms that can be offered to active military personnel and their dependents. The MLA caps the interest rate that may be offered to a covered borrower for most types of consumer credit to a 36% military annual percentage rate, or “MAPR”, which includes certain fees such as application fees, participation fees and fees for add-on products. The MLA also requires certain disclosures and prohibits certain terms, such as mandatory arbitration if a dispute arises concerning the consumer credit product.
Electronic Fund Transfer Act and NACHA Rules.   The federal Electronic Fund Transfer Act (“EFTA”) and Regulation E that implements it provide guidelines and restrictions on the provision of electronic fund transfer services to consumers, and on making an electronic transfer of funds from consumers’ bank accounts. In addition, transfers performed by ACH electronic transfers are subject to detailed timing and notification rules and guidelines administered by the National Automated Clearinghouse Association (“NACHA”). Most transfers of funds in connection with the origination and repayment of loans are performed by electronic fund transfers, such as ACH transfers. We obtain necessary electronic authorization from borrowers and investors for such transfers in compliance with such rules. EFTA requires that lenders make available loan payment methods other than automatic preauthorized electronic fund transfers, and prohibits lenders from conditioning the approval of a loan transaction on the borrower’s agreement to repay the loan through automatic fund transfers. Recently, the NACHA Board of Directors approved a change in the NACHA Operating Rules that requires ACH Originators to utilize commercially reasonable fraudulent transaction detection systems. The rule change, effective on March 19, 2021, will require ACH Originators, including lenders, to perform account validation as part of their commercially reasonable fraudulent transaction detection system. This rule change may require changes to our fraud detection systems and increase our costs associated with ACH electronic transfers.
Electronic Signatures in Global and National Commerce Act/Uniform Electronic Transactions Act.   The federal Electronic Signatures in Global and National Commerce Act (“ESIGN”), and similar state laws, particularly the Uniform Electronic Transactions Act (“UETA”), authorize the creation of legally binding and enforceable agreements utilizing electronic records and signatures. ESIGN and UETA require businesses that want to use electronic records or signatures in consumer transactions and to provide electronic disclosures and other electronic communications to consumers, to obtain the consumer’s consent to receive information electronically.
Bank Secrecy Act.   We have implemented various anti-money laundering policies and procedures to comply with applicable federal anti-money laundering laws, regulations and requirements, such as designating a Bank Secrecy Act (“BSA”) officer, conducting an annual risk assessment, developing internal controls, independent testing, training, and suspicious activity monitoring and reporting. We apply the customer identification and verification program rules pursuant to the USA PATRIOT Act amendments to the BSA and its implementing regulations and screen certain customer information against the list of specially designated nationals and other lists of sanctioned countries, persons, and entities maintained by OFAC. Additionally, SoFi Digital Assets, LLC is registered with and regulated by FinCEN as a money services business (“MSB”) with respect to its cryptocurrency business activities. As an MSB, we are subject to FinCEN regulations implementing the BSA, which requires MSBs to develop and implement risk-based anti-money laundering programs, report large cash transactions and suspicious activity, and maintain transaction records, among other requirements. In addition, our contracts with financial institution partners and other third parties may contractually require us to maintain an anti-money laundering program.
Loan Servicing.   With respect to our private education loan business, we are subject to the CFPB’s rule that enables it to supervise certain non-bank student loan servicers that service more than one million borrower accounts. The rule covers servicers of both federal and private education loans and is designed to ensure that bank and non-bank servicers follow the same rules in the student loan servicing market. We are impacted by the rule because we have engaged the Missouri Higher Education Loan Authority (“MOHELA”) to service our private education loans.
100

MOHELA currently services more than one million student loan borrower accounts. In addition, we are subject to state licensing requirements applicable to loan servicers even though we have engaged MOHELA to service our private education loans, as we retain master servicing rights. With respect to our broader consumer loan business, we are subject to federal and state laws regulating loan servicers. We are impacted by these rules even though we service loans we originate, and engage third parties like MOHELA to service certain types of loans, because some state laws, such as the California Rosenthal Act, apply to creditors and first party servicers. Some state laws also apply to parties that indirectly service loans through the use of third-party servicer contracts. Additionally, we sell some of the loans we originate to third parties and are therefore subject to laws governing parties that service loans on behalf of another person to whom the debt is owed. We are currently licensed as a loan servicer in several states and may be required to seek additional licenses. If we seek additional licenses, a state may impose fines, restrict our activity in that state, or seek other relief for activity conducted prior to the issuance of a license. For example, in 2019, we entered into a consent order with the Commonwealth of Pennsylvania Department of Banking and Securities, requiring us to pay a civil fine for conducting mortgage servicing activity as a master servicer before we obtained a mortgage servicing license in Pennsylvania.
Other State Lending and Money Transmission Laws.   In addition to applicable federal laws and regulations governing our operations, our ability to originate and service loans in any particular state, and transmit money to or from any particular state, is subject to that state’s laws, regulations and licensing requirements, which may differ from the laws, regulations and licensing requirements of other states. State laws often include fee limitations and disclosure and other requirements. Many states have adopted lending regulations that prohibit various forms of high-risk or sub-prime lending and place obligations on lenders to substantiate that a member will derive a tangible benefit from the proposed credit transaction and/or have the ability to repay the loan. These laws have required most lenders to devote considerable resources to building and maintaining automated systems to perform loan-by-loan analysis of points, fees and other factors set forth in the laws, which often vary depending on the location of the mortgaged property. Many of these state lending and money transmitter laws are vague and subject to differing interpretation, which exposes us to some risks. The number and complexity of these laws, and vagaries in their interpretations, present compliance and litigation risks from inadvertent error and omissions which we may not be able to eliminate from our operations or activities. The laws, regulations and rules described above are subject to legislative, administrative and judicial interpretation, and some of these laws and regulations have been infrequently interpreted or only recently enacted. Infrequent interpretations of these laws and regulations or an insignificant number of interpretations of recently-enacted laws and regulations can result in ambiguity with respect to permitted conduct under these laws and regulations. Any ambiguity under the laws and regulations to which we are subject may lead to regulatory investigations or enforcement actions and private causes of action, such as class-action lawsuits, with respect to our compliance with applicable laws and regulations.
Risk Retention.   Our balance sheet is impacted by the risk retention regulations adopted by the SEC that became effective for non-mortgage securitizations in 2016. These rules require issuers of asset-backed securities or persons who organize and initiate asset-backed securities transactions to retain a portion of the underlying assets’ credit risk.
Marketing.   Our marketing and other business practices are subject to federal and state regulation and our expansion into new product offerings including cryptocurrency and exchange-traded funds under the SoFi Invest product subject us to additional regulatory scrutiny. For example, we and the FTC entered the FTC Consent Order regarding savings calculations in our student loan refinancing advertisements. In addition, we are subject to the Federal Telephone Consumer Protection Act (“TCPA”), which regulates the use of automated telephone dialing systems to contact cellphones (including, as currently construed, via text messages), and the Federal CAN-SPAM Act and the Telemarketing Sales Rule, and analogous state laws, to the extent that we market credit or other products and services by use of email or telephone marketing.
Bankruptcy.   We are subject to the United States Bankruptcy Code, which limits the extent to which creditors may seek to enforce debts against parties who have filed for bankruptcy protection.
Federal and State Securities Laws.  We offer the securities issued in our sponsored securitizations only to, or for the account or benefit of, “qualified institutional buyers” (as defined in Rule 144A under the Securities Act) in compliance with Rule 144A and to “non-U.S. persons” outside of the United States in reliance on Regulation S
101

under the Securities Act. The securities issued in the securitizations that we sponsor are not registered under the Securities Act or registered or qualified under any state securities laws. We do not offer securitized products to retail investors. We receive opinions from legal counsel for each securitization confirming that the relevant issuing entity is not required to register under the Investment Company Act in reliance on the exclusion available under Rule 3a-7 of the Investment Company Act, although other exemptions or exceptions may also be available.
SoFi Invest and SoFi Money.  We offer investment management services through SoFi Wealth LLC, an internet-based investment adviser and SoFi Capital Advisors, LLC, which sponsors private investment funds that invest in asset-backed securitizations. Both SoFi Wealth LLC and SoFi Capital Advisors, LLC are registered as investment advisers under the Investment Advisers Act of 1940, as amended (the “Advisers Act”), and are subject to regulation by the SEC. SoFi Securities LLC (“SoFi Securities”) is an affiliated registered broker-dealer and FINRA member, and SoFi Digital Assets, LLC is a FinCEN registered money service business that also holds money transmitter or money service licenses in 31 states and the District of Columbia. We offer cash management accounts, which are brokerage products, through SoFi Securities. Our cash management accounts are not deposits insured by the FDIC.
The investment advisers are subject to the anti-fraud provisions of the Advisers Act and to fiduciary duties derived from these provisions, which apply to our relationships with our advisory members including the funds we manage. These provisions and duties impose restrictions and obligations on us with respect to our dealings with our members, fund investors and our investments, including for example restrictions on transactions with our affiliates.
Our investment advisers and our broker-dealer have in the past and will in the future be subject to periodic SEC examinations. Our investment advisers and our broker-dealer are also subject to other requirements under the Advisers Act and the Exchange Act and related regulations primarily intended to benefit advisory and brokerage members. These additional requirements relate to matters including maintaining effective and comprehensive compliance programs, record-keeping and reporting and disclosure requirements. The Advisers Act and the Exchange Act generally grants the SEC broad administrative powers, including the power to limit or restrict an investment adviser or our broker-dealer from conducting advisory or brokerage activities, respectively, in the event they fail to comply with federal securities laws. Additional sanctions that may be imposed for failure to comply with applicable requirements include the prohibition of individuals from associating with an investment adviser or broker-dealer, the revocation of registrations and other censures and fines. Even if an investigation or proceeding did not result in a sanction or the sanction imposed against us or our personnel by a regulator were small in monetary amount, the adverse publicity relating to the investigation, proceeding or imposition of these sanctions could harm our reputation and cause us to lose existing members or fail to gain new members. See “Business—Legal Proceedings”.
SoFi Securities is subject to Rule 15c3-1 under the Exchange Act, the “SEC Net Capital Rule”, which requires the maintenance of minimum levels of net capital. The SEC Net Capital Rule is designed to protect members, counterparties, and creditors by requiring a broker-dealer to have sufficient liquid resources available to satisfy its financial obligations. Net capital is a measure of a broker-dealer’s readily available liquid assets, reduced by its total liabilities (other than approved subordinated debt). Among other things, the SEC Net Capital Rule requires that a broker-dealer provide notice to the SEC and FINRA if its net capital is below certain required levels. There are also certain “early warning” requirements that apply. Our affiliates operating outside the U.S. may also be subject to other regulatory capital requirements imposed by non-U.S. regulatory authorities.
SoFi Securities is an “introducing” broker that does not carry customer security accounts; rather, customer security accounts are carried by an unaffiliated broker-dealer that also clears transactions for these accounts and maintains segregated cash and investments pursuant to Rule 15c3-3 under the Exchange Act (the “Customer Protection Rule”). SoFi Securities carries customer cash accounts (related to SoFi Money) that are subject to the Customer Protection Rule.
FINRA has adopted extensive regulatory requirements relating to sales practices, registration of personnel, compliance and supervision, and compensation and disclosure, to which SoFi Securities and its personnel are subject. FINRA and the SEC also have the authority to conduct periodic examinations of SoFi Securities, and may also conduct administrative proceedings, and have the authority to levy fines and other penalties on SoFi Securities.
102

SoFi Securities has applied for registration with the Municipal Securities Rulemaking Board (“MSRB”) and, if such registration is granted, will become subject to the MSRB’s regulatory regime, including applicable MSRB rules.
SoFi Securities recently became a Participant of DTC and therefore is subject to DTC’s regulatory regime, including applicable DTC rules and bylaws.
Moreover, through SoFi Securities, we are licensed to underwrite securities offerings and are exploring potential opportunities to serve as an underwriter of registered equity securities offerings. For further detail, see “Management’s Discussion and Analysis of Financial Condition and Results of Operations—Business Overview”.
Bank Acquisition
On October 27, 2020, the OCC issued preliminary conditional approval of our application to establish a new national bank to be called SoFi Bank, National Association. Final OCC approval was subject to a number of preopening requirements. In March 2021, we entered into an agreement to acquire Golden Pacific Bancorp, Inc., a bank holding company, and its wholly-owned subsidiary, Golden Pacific Bank, National Association, a national bank, for a total cash purchase price of $22.3 million. The acquisition is subject to regulatory approval, including approval from the OCC of a revised business plan for Golden Pacific Bank, National Association, and approval from the Federal Reserve to become a bank holding company and for a change of control, and other customary closing conditions. In March 2021, we submitted an application to the Federal Reserve to become a bank holding company. The application review process is ongoing. As a bank holding company, we would be subject to regulation, supervision and examination by the Federal Reserve under the Bank Holding Company Act of 1956, as amended (“BHCA”). A national bank subsidiary of ours would be subject to regulation, supervision and examination by the OCC. References to the Bank in the discussion below are to any national bank subsidiary of ours, whether formed or acquired.
Bank Holding Company Regulation.   The Federal Reserve has the authority, among other things, to order bank holding companies to cease and desist from unsafe or unsound banking practices; to assess civil money penalties; and to order termination of non-banking activities or termination of ownership and control of a non-banking subsidiary by a bank holding company.
Source of Strength.   Under the Dodd-Frank Wall Street Reform and Consumer Protection Act (“Dodd-Frank Act”), we would be required to serve as a source of financial strength for the Bank. This means that we may be required to provide capital or liquidity support to the Bank, even at times when we may not have the resources to provide such support to the Bank.
Acquisitions and Activities.   The BHCA prohibits a bank holding company, without prior approval of the Federal Reserve, from acquiring all or substantially all the assets of a bank, acquiring control of a bank, merging or consolidating with another bank holding company, or acquiring direct or indirect ownership or control of any voting shares of another bank or bank holding company if, after such acquisition, the acquiring bank holding company would control more than 5% of any class of the voting shares of such other bank or bank holding company. The BHCA also prohibits a bank holding company from engaging directly or indirectly in activities other than those of banking, managing or controlling banks or furnishing services to its subsidiary banks. However, a bank holding company may engage in and may own shares of companies engaged in activities that the Federal Reserve has determined, by order or regulation, to be so closely related to banking as to be a proper incident thereto.
In becoming a bank holding company, the Company would also elect financial holding company status pursuant to the provisions of the Gramm-Leach-Bliley Act of 1999 (“GLBA”). As a financial holding company, the Company would be authorized to engage in certain financial activities in which a bank holding company that has not elected to be a financial holding company may not engage. “Financial activities” is broadly defined to include not only banking, insurance and securities activities, but also merchant banking and additional activities that the Federal Reserve, in consultation with the Secretary of the Treasury, determines to be financial in nature, incidental to such financial activities, or complementary activities that do not pose a substantial risk to the safety and soundness of depository institutions or the financial system generally.
103

If a financial holding company or any depository institution subsidiary of a financial holding company fails to remain well capitalized and well managed, the Federal Reserve may impose such limitations on the conduct or activities of the financial holding company as the Federal Reserve determines to be appropriate, and the company and its affiliates may not commence any new activity or acquire control of shares of any company engaged in any activity that is authorized particularly for financial holding companies without first obtaining the approval of the Federal Reserve. The company must also enter into an agreement with the Federal Reserve to comply with all applicable requirements to qualify as a financial holding company. If a financial holding company remains out of compliance for 180 days or such longer period as the Federal Reserve permits, the Federal Reserve may require the financial holding company to divest either its insured depository institution or all of its non-banking subsidiaries engaged in activities not permissible for a financial holding company. If an insured depository institution subsidiary of a financial holding company fails to maintain a “satisfactory” or better record of performance under the Community Reinvestment Act, the financial holding company will be prohibited, until the rating is raised to “satisfactory” or better, from engaging in new activities authorized particularly for financial holding companies or acquiring companies engaged in such activities.
Limitations on Acquisitions of Our Common Stock.   The Change in Bank Control Act prohibits a person or group of persons acting in concert from acquiring “control” of a bank holding company unless the Federal Reserve has been notified and has not objected to the transaction. Under a rebuttable presumption established by the Federal Reserve, the acquisition by a person or group of persons acting in concert of 10% or more of a class of voting securities of a bank holding company with a class of securities registered under Section 12 of the Exchange Act constitutes the acquisition of control of a bank holding company for purposes of the Change in Bank Control Act. In addition, the BHCA prohibits any company from acquiring control of a bank or bank holding company without first having obtained the approval of the Federal Reserve. Under the BHCA, a company is deemed to control a bank or bank holding company if the company owns, controls or holds with power to vote 25% or more of a class of voting securities of the bank or bank holding company, controls in any manner the election of a majority of directors or trustees of the bank or bank holding company, or the Federal Reserve determines that the company has the power to exercise a controlling influence over the management or policies of the bank or bank holding company. Under a rebuttable presumption of control established by the Federal Reserve, the acquisition of control of more than 5% of a class of voting securities of a bank holding company, together with other factors enumerated by the Federal Reserve, could constitute the acquisition of control of a bank holding company under the BHCA.
Enhanced Prudential Supervision.   The Dodd-Frank Act and other federal banking laws subject companies with $10 billion or more of consolidated assets to additional regulatory requirements. More specifically, among other things, section 1075 of the Dodd-Frank Act, which is commonly known as the “Durbin Amendment”, amended the Electronic Fund Transfer Act to restrict the amount of interchange fees that may be charged and prohibit network exclusivity for debit card transactions. The restrictions on interchange fees in the Durbin Amendment do not apply to any issuer that, together with its affiliates, has assets of less than $10 billion. The Volcker rule, which generally prohibits banking entities from engaging in proprietary trading and from acquiring or retaining an ownership interest in or sponsoring certain types of investment funds, does not apply to an insured depository institution if it has and if every company that controls it has total consolidated assets of $10 billion or less and consolidated trading assets and liabilities that are 5% or less of consolidated assets. If the Bank or the Company exceed these thresholds, they would become subject to the Volcker rule. Section 1025 of the Dodd-Frank Act provides that the CFPB has authority to examine any insured depository institution with total assets of more than $10 billion and any affiliate thereof.
Bank Regulation.   The Bank would be subject to regulation, supervision, and examination by the OCC. Additionally, the FDIC has secondary supervisory authority as the insurer of the Bank’s deposits. The Bank is also subject to regulations issued by the CFPB, as enforced by the OCC. Pursuant to the Dodd-Frank Act, the Federal Reserve may directly examine the subsidiaries of the Company, including the Bank. The enforcement powers available to the federal banking regulators include, among other things, the ability to issue cease and desist or removal orders; to terminate insurance of deposits; to assess civil money penalties; to issue directives to increase capital; to place the Bank into receivership; and to initiate injunctive actions against banking organizations and institution-affiliated parties.
104

Deposit Insurance.   Under the Federal Deposit Insurance Act (“FDIA”), insurance of deposits may be terminated by the FDIC if the FDIC finds that the insured depository institution has engaged in unsafe and unsound practices, is in an unsafe or unsound condition to continue operations or has violated any applicable law, regulation, rule, order or condition imposed by the FDIC. In addition, the Bank would be subject to deposit insurance assessments.
Activities and Investments of National Banking Associations.   National banking associations must comply with the National Bank Act and the regulations promulgated thereunder by the OCC, which generally limit the activities of national banking associations to those that are deemed to be part of, or incidental to, the “business of banking”. Activities that are part of, or incidental to, the business of banking include taking deposits, borrowing and lending money and discounting or negotiating promissory notes, drafts, bills of exchange, and other evidences of debt. Subsidiaries of national banking associations generally may only engage in activities permissible for the parent national bank.
Community Reinvestment Act.   The Community Reinvestment Act (“CRA”) requires the OCC to evaluate the Bank’s performance in helping to meet the credit needs of the entire communities it serves, including low and moderate-income neighborhoods, consistent with its safe and sound banking operations, and to take this record into consideration when evaluating certain applications. The OCC’s CRA regulations are generally based upon objective criteria of the performance of institutions under three key assessment tests: (i) a lending test, to evaluate the institution’s record of making loans in its service areas; (ii) an investment test, to evaluate the institution’s record of investing in community development projects, affordable housing, and programs benefiting low- or moderate-income individuals and businesses; and (iii) a service test, to evaluate the institution’s delivery of services through its branches, ATMs, and other offices. The OCC rates a national bank’s compliance with the CRA as “Outstanding”, “Satisfactory”, “Needs to Improve” or “Substantial Noncompliance”. Failure of the Bank to receive at least a “Satisfactory” rating could inhibit the Bank or the Company from undertaking certain activities, including acquisitions of other financial institutions.
In June 2020, the OCC adopted a final rule that expands the types of activities that qualify for CRA credit; revises how banks delineate their CRA assessment areas; and establishes new standards for evaluating banks with more than $500 million in assets, including, among others, the number of qualifying retail loan originations to low- and moderate-income individuals. In December 2020, the OCC issued a proposed rule that would establish an approach for determining CRA evaluation benchmarks, retail lending distribution test thresholds, and community development minimums under the framework for general performance standards established by the amended CRA rule adopted by the OCC. In May 2021, the OCC announced that it was reconsidering the June 2020 rule, and does not plan to finalize the December 2020 rule. The impact on the Bank from any changes to the CRA regulations will depend on the final form of the proposed benchmark rule and how it is implemented and applied.
Regulatory Capital Requirements.   We and the Bank would be subject to risk-based capital requirements and rules issued by the Federal Reserve and the OCC. The capital rules are intended to reflect the relationship between the banking organization’s capital and the degree of risk associated with its operations based on transactions recorded on-balance sheet as well as off-balance sheet items. The FDIA requires the federal banking agencies to take prompt corrective action with respect to depository institutions that do not meet the minimum capital requirements set forth in the capital rules. These capital requirements are different from, and may be in addition to, those required of SoFi Securities under the SEC’s Net Capital Rule.
Regulation of Other Activities
Through SoFi Protect, we offer life insurance, auto insurance, homeowners insurance and renters insurance through Social Finance Life Insurance Agency LLC and its licensed agents, which are subject to state insurance, insurance brokering and insurance agency statutes and regulations.
Privacy and Consumer Information Security
In the ordinary course of our business, we access, collect, store, use, transmit and otherwise process certain types of data, including PII, which subjects us to certain federal and state privacy and information security laws, rules, industry standards and regulations designed to regulate consumer information and data privacy, security and
105

protection, and mitigate identity theft. These laws impose obligations with respect to the collection, processing, storage, disposal, use, transfer, retention and disclosure of PII, and, with limited exceptions, give consumers the right to prevent use of their PII and disclosure of it to third parties. The GLBA requires us to disclose certain information sharing practices to consumers, and any subsequent changes to such practices, and provide an opportunity for consumers to opt out of certain sharing of their PII. This may limit our ability to share PII with third parties for certain purposes, such as marketing. In addition, the CFPB is expected to issue a new rule regulating the disclosure of consumer and information, which may limit our ability to receive or use PII and other consumer information and records supplied by third parties, or share information with third parties. Further, all 50 states and the District of Columbia have adopted data breach notification laws that impose, in varying degrees, an obligation to notify affected individuals and government authorities in the event of a data or security breach or compromise, including when a consumer’s PII has or may have been accessed by an unauthorized person. These laws may also require us to notify relevant law enforcement, regulators or consumer reporting agencies in the event of a data breach. Some laws may also impose physical and electronic security requirements regarding the safeguarding of PII.
On January 1, 2020, the California Consumer Privacy Act (“CCPA”) took effect, directly impacting our California business operations and indirectly impacting our operations nationwide. The CCPA provides for civil penalties for violations, as well as a private right of action for certain data breaches that result in the loss of personal information. While personal information that we process that is subject to the GLBA is exempt from the CCPA, the CCPA regulates other personal information that we collect and process in connection with the business. A new California ballot initiative, the California Privacy Rights Act (“CPRA”) was passed in November 2020. Effective starting on January 1, 2023, the CPRA imposes additional obligations on companies covered by the legislation and will significantly modify the CCPA, including by expanding consumers’ rights with respect to certain sensitive personal information. The CPRA also creates a new state agency that will be vested with authority to implement and enforce the CCPA and the CPRA. Certain other state laws impose similar privacy obligations. We anticipate that more states may enact legislation similar to the CCPA, which provides consumers with new privacy rights and increases the privacy and security obligations of entities handling certain personal information of such consumers. The CCPA has prompted a number of proposals for new federal and state-level privacy legislation. These proposals, if enacted, may add additional complexity, variation in requirements, restrictions and potential legal risk, require additional investment of resources in compliance programs, impact strategies and the availability of previously useful data and could result in increased compliance costs and/or changes in business practices and policies.
Our broker-dealer and investment advisers are subject to SEC Regulation S-P, which requires that these businesses maintain policies and procedures addressing the protection of customer information and records. This includes protecting against any anticipated threats or hazards to the security or integrity of customer records and information and against unauthorized access to or use of customer records or information. Regulation S-P also requires these businesses to provide initial and annual privacy notices to customers describing information sharing policies and informing customers of their rights.
Legal Proceedings
In limited instances, the Company may be subject to a variety of claims and lawsuits in the ordinary course of business. Regardless of the final outcome, defending lawsuits, claims, government investigations, and proceedings in which we are involved is costly and can impose a significant burden on management and employees, and there can be no assurances that favorable final outcomes will be obtained.
Juarez et al v. SoFi Lending Corp. SoFi Lending Corp. and SoFi (collectively, the “SoFi Defendants”) are defendants in a putative class action, captioned as Juarez v. Social Finance, Inc. et al., Civil Action No. 4:20-cv-03386-HSG, filed against them in the United States District Court for the Northern District of California in May 2020 (the “Action”). Plaintiffs, who are non-U.S. citizens, allege that the SoFi Defendants engaged in unlawful lending discrimination in violation of 42 U.S.C. § 1981 and California Civil Code, § 51, et seq., through policies and practices making two categories of certain non-United States citizen loan applicants — i.e., United States residents who hold Deferred Access for Childhood Arrivals (“DACA”) status or who hold green cards with a validity period of less than two years — ineligible for loans or eligible only with a co-signer who is a United States citizen or lawful permanent resident. Plaintiffs further allege that the SoFi Defendants violated 15 U.S.C. § 1981, the Fair Credit Reporting Act, by accessing the credit reports of non-United States citizen loan applicants who hold green cards with a validity period of less than two years without a permissible purpose. As relief, Plaintiffs seek, on behalf of
106

themselves and a purported class of similarly-situated non-United States citizen loan applicants, a declaratory judgment that the challenged policies and practices violate federal and state law, an injunction against future violations, actual and statutory damages, exemplary and punitive damages, and attorneys’ fees. The SoFi Defendants filed a motion to, among other things, dismiss Plaintiffs’ claims for failure to state a claim, and/or compel arbitration. By order dated April 12, 2021, the court dismissed Plaintiffs’ California Civil Code, § 51 claim without prejudice, and declined the SoFi Defendants’ motion to dismiss the remaining counts. Thereafter, on June 2, 2021, the SoFi Defendants filed an answer to Plaintiffs’ complaint, denying liability, denying that class treatment is appropriate, and asserting various defenses. The plaintiffs have filed an amended consolidated complaint adding two new named plaintiffs including a California resident. Although there can be no assurance as to the ultimate disposition of the Action, the SoFi Defendants continue to deny liability to Plaintiffs and the putative class members, believe that they have meritorious defenses against Plaintiffs’ claims, and intend to vigorously defend themselves and oppose class certification. We cannot reasonably estimate an amount of loss or range of possible loss associated with this matter.
Galileo Class Action Litigation. Galileo was a defendant in a putative class action, captioned as Richards, et. al v. Chime Financial, Inc., Galileo Financial Technologies and The Bancorp, Inc., Civil Action No. 4:19-cv-6864-HSG (N.D. Cal.), filed in the United States District Court for the Northern District of California in October 2019. Plaintiff asserted various claims against the defendants arising from an intermittent disruption in service experienced by certain holders of Chime Financial, Inc. (“Chime”) deposit accounts preventing them from accessing or using account funds for portions of time between October 16, 2019 and October 19, 2019. The parties have entered into a class action settlement agreement to resolve the claims in the action. By Order dated May 24, 2021, the Court granted final approval of that settlement and, on June 1, 2021, entered final judgment and closed the case. The period for the lone objector to appeal expires July 1, 2021. Galileo has an obligation to make a contribution to fund the settlement, which is due in August 2021 in the absence of any appeal.
The CFPB is also conducting investigations into whether Chime or other deposit accountholders were harmed by Galileo in connection with the intermittent service disruption covering several time periods. We may in the future be subject to additional lawsuits and disputes. We are also involved in other claims, government investigations, and proceedings arising from the ordinary course of our business. Although the results of such lawsuits, claims, government investigations and proceedings cannot be predicted with certainty, we do not believe that the final outcome of these other matters will have a material adverse effect on our business, financial condition, or results of operations.
SoFi Wealth Consent Agreement. We and the staff of the SEC Division of Enforcement have agreed in principle to a consent agreement, without admitting or denying the SEC’s findings, which includes, among other things, a civil penalty of $300,000, to close a pending investigation of SoFi Wealth for alleged violations of Section 206(2) and Section 206(4) of the Investment Advisers Act and Rule 206(4)-7 thereunder by SoFi Wealth. The SEC staff’s allegations relate to actions undertaken by SoFi Wealth in April 2019 to rebalance certain holdings of unaffiliated exchange traded funds (“ETFs”) in clients’ automated investment advisory accounts with holdings of SoFi-branded ETFs which had lower operating expense ratios sponsored and managed by an affiliate of SoFi Wealth. In particular, although SoFi Wealth had disclosed to clients in its Form ADV that it could use affiliated ETFs, such as SoFi-branded ETFs, in the automated investment advisory accounts, the SEC staff alleges that SoFi Wealth also should have disclosed certain alleged conflicts of interest concerning use of the SoFi-branded ETFs: specifically that SoFi Wealth preferred to use the SoFi-branded ETFs, because SoFi expected to receive a marketing benefit from use of the SoFi-branded ETFs, and that the automated investment advisory accounts would be an important early source of assets in connection with the launch of the SoFi-branded ETFs.
The consent agreement is subject to formal acceptance by the SEC and could change, and a final settlement cannot be assured. By its current terms, and without admitting or denying the SEC staff’s findings, SoFi Wealth would agree to the following: a censure, an order to cease-and-desist from future violations of Section 206(2), Section 206(4), and Rule 206(4)-7, a civil penalty of $300,000, and undertakings to review all relevant disclosure documents, to review SoFi Wealth’s compliance policies and to notify clients concerning the terms of the prospective order. The offer of settlement would not require any disgorgement to customers by SoFi Wealth. We do not believe such a resolution, if accepted by the SEC, would result in any material limitations on the ongoing business or operations of SoFi or SoFi Wealth.
107

In re Renren Inc. Derivative Litigation. On March 22, 2021, SoFi was named as a newly added defendant in an Amended and Supplemental Consolidated Stockholder Derivative Complaint (the “Amended Complaint”) filed in an ongoing action pending in the Supreme Court of New York, captioned In re Renren, Inc. Derivative Litigation, Index No. 653564/2018. The plaintiffs, Hen Ren Silk Road Investments LLC, Oasis Investments II Master Fund Ltd., and Jodi Arama, allege that the Chairman and Chief Executive Officer of Renren, Inc. (“Renren”), Joseph Chen, and others, breached their fiduciary duties to Renren’s shareholders in connection with a transaction in which Renren spun off its holdings of SoFi shares (as well as stock in other entities) to Oak Pacific Investments (“OPI”), an entity allegedly controlled by Mr. Chen. The Amended Complaint alleges that SoFi’s receipt of approximately 17 million of its own securities from OPI pursuant to a call option transfer during the pendency of the lawsuit constituted a fraudulent conveyance. The sole claim asserted against SoFi is that SoFi allegedly received a fraudulent conveyance pursuant to D.C.L. Section 276 (as in effect in March 2019) that should be voided and set aside pursuant to D.C.L. Sections 278 and 279 (as effective in 2019), as well as unspecified compensatory damages. The Amended Complaint seeks, among other things, an order to impose a constructive trust over the SoFi shares transferred from Renren or the proceeds thereof, voiding and setting aside the call option transfer of approximately 17 million SoFi shares as a fraudulent conveyance, and requiring the Company to pay over the value of the call option transfer. The Company intends to vigorously defend against the action and believes that any claims against it are meritless. We cannot reasonably estimate an amount of loss or range of possible loss associated with this matter.
Intellectual Property
We seek to protect our intellectual property by relying on a combination of federal, state and common law in the United States, as well as on contractual measures. We use a variety of measures, such as trademarks and trade secrets, to protect our intellectual property. We also place appropriate restrictions on our proprietary information to control access and prevent unauthorized disclosures, a key part of our broader risk management strategy.
We have registered several trademarks related to our name, “SoFi” as well as SoFi’s logo, our company motto “Get Your Money Right” and certain SoFi products, such as “SoFi Money” and “SoFi Invest”. We believe our name, logo, motto and products are important brand identifiers for our members and enterprise partners.
Properties
We primarily operate through a network of leased properties, including largely office spaces, two properties of which are located outside of the U.S. We believe our existing facilities are adequate to meet our current business requirements and that we will be able to find suitable space to accommodate any potential future expansion. Although the majority of our employees who utilize our office spaces are currently working remotely due to the COVID-19 pandemic, as of the date of this filing we still intend to occupy these locations when conditions safely permit.
108

Our leased properties total approximately 430,000 square feet, with the most significant properties and the reportable segments that primarily utilize those properties as follows:
Location Approximate Square Footage
Segments(1)
San Francisco, California 99,000  L, FS
Cottonwood Heights, Utah 51,000  L, FS
Jacksonville, Florida 37,000  L, FS
Murray, Utah 29,000  FS
Holladay, Utah 29,000  TP
Claymont, Delaware 28,000  L, FS
Helena, Montana 27,000  L
New York, New York 13,000  L, FS
Frisco, Texas 13,000  L
__________________
(1)Segment references include: L = Lending, FS = Financial Services, and TP = Technology Platform.
Human Capital Resources
Our top priority is building a durable culture of diversity and a company where people love where they work following our core values. Our employee initiatives are designed to support, develop and inspire employees, ultimately unlocking the potential of the organization, driving excellence across the business and solidifying SoFi as a top career destination where people love to work.
We have established guiding principles to help us achieve our top priority:
Embodying SoFi’s culture and values to ensure everyone feels welcome, included and able to contribute;
Integrating a diversity and inclusion lens into everything we do;
Guiding team members regarding where they are and where they are going — and giving them the tools and resources to get there;
Supporting managers to become effective people leaders;
Taking a principled approach to providing fair, relevant and competitive compensation and benefits to a dynamic workforce with diverse needs; and
Leveraging data to better understand the employee experience and measure our success.
Diversity and Inclusion
Our Diversity, Inclusion, Equity and Belonging objective is to be a company where each of us genuinely belongs, is respected and valued, and can do our best work, and where diversity and inclusion is a competitive advantage.
To help achieve these goals, we will focus on attraction, retention and development at all levels. This means that we will ensure fair and transparent processes in talent assessment and hiring, performance management and career progression and retention.
As a foundation to this work, we have developed competency-based assessments for roles in marketing, operations and engineering to reduce unconscious biases in both our hiring and promotion practices. We have also invested in formalizing a university hiring program and returning military program to ensure we are bringing in talent at all levels of our organization and helping them nurture lasting careers within SoFi.
109

We are working to create a stronger sense of inclusion and belonging for our employees in general. Our recent employee surveys showed that feelings of belonging are driven by many aspects of our experiences at work, which drives engagement. Engagement and belonging are fueled by having a meaningful connection to others and opportunities to grow and develop our careers. Across all of these dimensions, we are committed to building programs, systems and tools that foster greater belonging.
We are formalizing career paths within our operations organization to provide better transparency to our careers and promotion criteria. We will continue to invest and further develop our manager training and support to ensure that all managers — those promoted, developing or hired — understand how to manage, keeping our Diversity and Inclusion principles top of mind in every aspect of their role.
We have also established a range of educational programs in line with our values that reinforce our Diversity and Inclusion practices, which are required training for our global employee base as well as future employees: Unconscious Bias Training; Inclusive Culture Training; and Hiring the SoFi Way.
We have introduced a vision for what we want our workforce to look like in three years, including a career pathways program in our operations organization, a formalized university program, mentorship for underrepresented minorities, and targeted executive recruiting for leadership roles. We believe that a combination of these approaches will help increase the representation, engagement and retention of women, Black, Latinx and all employees who identify as being from an underrepresented group across all levels, roles and organizations.
We have expanded accountability metrics for Diversity and Inclusion to include retention, promotion and engagement alongside hiring, and regularly review these practices to ensure accountability and progress.
Training and Manager Excellence
We believe strongly in investing in our employees and this is a focus throughout the employee lifecycle. Great care is taken to onboard new hires and set them up for success, both in terms of a broad understanding of SoFi’s mission, values, strategic point of differentiation and products, as well as role-specific learning. To this end, throughout the year we offer ongoing learnings, including: weekly company-level All Hands meetings, monthly programming on a diverse range of topics spanning general business updates to developmental topics, and other opportunities for learning from internal and external speakers, including financial wellness and personal wellness topics.
We also offer ongoing learning opportunities for our people managers to ensure they are well equipped to support their employees. In addition to training on our compensation philosophy and tools, manager effectiveness and other basic ongoing processes administered by the people team, we also launched in the fourth quarter of 2020 a seven-week manager onboarding program. This program covers a variety of topics, including Diversity and Inclusion, how to give effective feedback, a recruiting overview and best practices and various other components to set new leaders at SoFi up for success.
Compensation
Our compensation programs are designed to attract, retain and motivate talented, deeply qualified and committed individuals who believe in our mission, while rewarding employees for long-term value creation. We have a pay-for-performance culture in which employee compensation is aligned to Company performance, as well as individual contributions and impacts. Our equity program aligns employee compensation to the long-term interests of our shareholders, while encouraging them to think and act like owners. While we are still evolving our programs and practices, we strive for a fair, competitive, transparent and equitable approach in recognizing and rewarding our employees.
Health and Wellness
The health and wellness of our employees and their families is integral to SoFi’s success. We have a comprehensive benefits program to support the physical, mental and financial wellbeing of our employees. We have two core medical plans in which SoFi pays 100% of the monthly premiums. In addition to core medical, we offer
110

fertility and maternity benefits to help employees who are looking to grow their family. To support the mental health of our employees, we offer a digital benefit that allows our employees to meet with coaches and clinical care providers at no cost to them. Our tuition reimbursement and student loan repayment programs provide financial support to our employees that allows them to advance their education and pay off existing student loan debt.
In response to the COVID-19 pandemic, we transitioned to a remote workforce to help protect the health and wellness of our employees while continuing to provide the proper support to SoFi members. We recognize that these are trying times for everyone, including our employees. To support our employees through this time, we introduced additional programs focused on mental health, childcare and balancing the demand of work and personal family needs. In June 2020, we implemented “SoFridays” in which employees are encouraged to end their work week at 2:00 pm local time each Friday.
Employee Experience and Data
As of March 31, 2021, we employed approximately 2,182 employees, primarily located in California, Utah, Delaware, Montana, Texas, Florida, and New York. None of our employees are currently represented by a labor union or have terms of employment that are subject to a collective bargaining agreement. We consider our relationship with our employees to be good and have not historically experienced any work stoppages.
We believe it is critical to leverage the collective feedback of our workforce to continue to build upon the employee experience. We launched our first employee engagement survey in 2019 and have followed up with additional surveys in 2020 and 2021. In all periods, employee participation was at or above 94%. The insight and data provided by our employees will be key in helping us achieve our priority of building a durable culture of diversity and becoming a place where people are loyal to the company and love working at the company.
111

SELECTED HISTORICAL FINANCIAL INFORMATION
The selected consolidated statements of operations data for each of the years ended December 31, 2020, 2019 and 2018 and the consolidated balance sheet data as of December 31, 2020 and 2019 were derived from SoFi’s audited consolidated financial statements included elsewhere in this prospectus. The selected consolidated statements of operations data for each of the years ended December 31, 2017 and 2016 and the consolidated balance sheet data as of December 31, 2018, 2017 and 2016 were derived from SoFi’s audited consolidated financial statements that are not included in this prospectus. The selected consolidated statements of operations data for each of the three months ended March 31, 2021 and 2020 and the consolidated balance sheet data as of March 31, 2021 were derived from SoFi’s unaudited condensed consolidated financial statements included elsewhere in this prospectus. The unaudited consolidated financial statements were prepared on a consistent basis with the audited consolidated financial statements. In the opinion of management, the selected historical financial information reflects all adjustments, which are of a normal recurring nature, necessary for a fair statement of the financial information set forth in these statements. SoFi’s historical results are not necessarily indicative of the results that may be expected for any future period.
The information below should be read in conjunction with SoFi’s consolidated financial statements and accompanying footnotes included elsewhere in this prospectus, as well as “Risk Factors — Business, Financial and Operational Risks” and “Management’s Discussion and Analysis of Financial Condition and Results of Operations.
($ in thousands, except per share data) Three Months Ended March 31, Year Ended December 31,
2021(2)
2020
2020(2)
2019 2018 2017 2016
Consolidated Statements of Operations Data(1):
Net interest income $ 47,280  $ 47,149  $ 177,931  $ 329,834  $ 259,064  $ 266,220  $ 136,731 
Total noninterest income 148,704  31,153  387,601  112,825  10,335  240,488  141,392 
Total net revenue 195,984  78,302  565,532  442,659  269,399  506,708  278,123 
Total noninterest expense 372,449  184,612  894,053  682,258  522,756  456,625  265,592 
Net income (loss) (177,564) (106,367) (224,053) (239,697) (252,399) 49,772  12,233 
Comprehensive income (loss) (177,644) (106,374) (224,198) (239,706) (252,378) 49,746  12,226 
Earnings (loss) per share – basic(3)
(2.81) (2.93) (7.49) (7.00) (7.19) —  — 
Earnings (loss) per share – diluted(2)
(2.81) (2.93) (7.49) (7.00) (7.19) —  — 
___________________
(1)The Consolidated Statements of Operations Data reflects the adoption of certain accounting standards updates (“ASU”), for which not all historical periods were required to be updated based on the transition method selected. See Note 1 to SoFi’s Notes to Unaudited Condensed Consolidated Financial Statements and to SoFi’s Notes to Consolidated Financial Statements included elsewhere in this prospectus under “Recently Adopted Accounting Standards” for a discussion of newly adopted ASUs and their impact on the consolidated financial statements.
(2)See Note 2 to SoFi’s Notes to Unaudited Condensed Consolidated Financial Statements and to SoFi’s Notes to Consolidated Financial Statements included elsewhere in this prospectus for information regarding two acquisitions during the year ended December 31, 2020, one of which was a material acquisition in accordance with ASC 805, Business Combinations, but was not a significant acquisition under Regulation S-X, Rule 3-05, Financial Statements of Businesses Acquired or to be Acquired.
(3)See Note 15 to SoFi’s Notes to Unaudited Condensed Consolidated Financial Statements and Note 16 to SoFi’s Notes to Consolidated Financial Statements included elsewhere in this prospectus for a description of the computation of basic and diluted loss per share.
112

TABLE OF CONTENTS

($ in thousands) As of March 31, As of December 31,
2021(2)
2020(2)
2019 2018 2017 2016
Consolidated Balance Sheet Data(1):
Cash and cash equivalents $ 351,283  $ 872,582  $ 499,486  $ 325,114  $ 245,584  $ 218,023 
Restricted cash and restricted cash equivalents 347,284  450,846  190,720  211,889  235,165  144,745 
Loans 4,486,828  4,879,303  5,387,958  7,211,989  8,754,825  6,606,189 
Total assets 7,382,237  8,563,499  7,289,160  8,549,928  9,673,562  7,083,609 
Debt 3,827,424  4,798,925  4,688,378  6,201,523  6,913,043  5,211,354 
Total liabilities 4,502,189  5,509,928  5,188,491  6,727,796  7,642,879  5,678,860 
Redeemable preferred stock(3)
3,173,686  3,173,686  2,439,731  1,890,554  1,890,554  1,409,888 
Total permanent equity (deficit) (293,638) (120,115) (339,062) (68,422) 140,129  (5,139)
___________________
(1)The Consolidated Balance Sheet Data reflects the adoption of certain ASUs, for which not all historical periods were required to be updated based on the transition method selected. See Note 1 to SoFi’s Notes to Unaudited Condensed Consolidated Financial Statements and to SoFi’s Notes to Consolidated Financial Statements included elsewhere in this prospectus under “Recently Adopted Accounting Standards” for a discussion of newly adopted ASUs and their impact on the consolidated financial statements.
(2)See Note 2 to SoFi’s Notes to Unaudited Condensed Consolidated Financial Statements and to SoFi’s Notes to Consolidated Financial Statements included elsewhere in this prospectus for information regarding two acquisitions during the year ended December 31, 2020, one of which was a material acquisition in accordance with ASC 805, but was not a significant acquisition under Regulation S-X, Rule 3-05, Financial Statements of Businesses Acquired or to be Acquired.
(3)Redeemable preferred stock is presented within temporary equity on the consolidated balance sheets. See Note 9 to SoFi’s Notes to Unaudited Condensed Consolidated Financial Statements and Note 10 to SoFi’s Notes to Consolidated Financial Statements included elsewhere in this prospectus for more information on the SoFi preferred stock.
113

TABLE OF CONTENTS
MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
Unless the context otherwise requires, all references in this section to “we”, “us” or “our” refer to the combined business of Social Finance, Inc. and its consolidated subsidiaries (collectively, “SoFi”) prior to the Business Combination and SoFi Technologies, Inc. and its consolidated subsidiaries after giving effect to the Business Combination.
The following discussion and analysis provides information that management believes is relevant to an assessment and understanding of our consolidated results of operations and financial condition. You should read this discussion and analysis in conjunction with “Selected Historical Financial Information” and our consolidated financial statements and notes thereto included elsewhere in this prospectus. Certain amounts may not foot due to rounding. This discussion and analysis contains forward-looking statements and involves numerous risks and uncertainties, including, but not limited to, those described under “Risk Factors” and “Cautionary Note Regarding Forward-Looking Statements”. We assume no obligation to update any of these forward-looking statements. Actual results may differ materially from those contained in any forward-looking statements.
Business Overview
We are a member-centric, one-stop shop for digital financial services that allows members to borrow, save, spend, invest and protect their money. Our mission is to help our members achieve financial independence in order to realize their ambitions. To us, financial independence does not mean being wealthy, but rather represents the ability of our members to have the financial means to achieve their personal objectives at each stage of life, such as owning a home, having a family, or having a career of their choice — more simply stated, to have enough money to do what they want. We were founded in 2011 and have developed a suite of financial products that offers the speed, selection, content, and convenience that only an integrated digital platform can provide. In order for us to achieve our mission, we have to help people get their money right, which means providing them with the ability to borrow better, save better, spend better, invest better and protect better. Everything we do today is geared toward helping our members “Get Your Money Right” and we strive to innovate and build ways for our members to achieve this goal.
Our three reportable segments and their respective products are as follows:
Lending Financial Services Technology Platform
Student Loans (in school and student loan refinancing)
SoFi Money
Technology Platform Services (Galileo)
Personal Loans
SoFi Invest(1)
Clearing Brokerage Services (Apex)(2)
Home Loans
SoFi Relay
SoFi Credit Card
SoFi At Work
SoFi Protect
Lantern Credit
__________________
(1)Our SoFi Invest service is comprised of three products: active investing accounts, robo-advisory accounts and cryptocurrency accounts.
(2)During January 2021, the initial Apex seller exercised its call rights on our Apex equity investment. See “— Our Reportable Segments—Technology Platform segment” for additional information.
We refer to our customers as “members”. We define a member as someone who has a lending relationship with us through origination or servicing, opened a financial services account, linked an external account to our platform, or signed up for our credit score monitoring service. Once someone becomes a member, they are always considered a member unless they violate our terms of service given our members have continuous access to our CFPs, our career advice services, our member events, all of our content, educational material, news, tools and calculators at no cost to the member. Additionally, our mobile app and website have a member home feed that is personalized and delivers content to a member about what they must do that day in their financial life, what they should consider
114

TABLE OF CONTENTS
doing that day in their financial life, and what they can do that day in their financial life. Since our inception through March 31, 2021, we have served approximately 2.3 million members who have used approximately 3.2 million products on the SoFi platform and have experienced accelerating year-over-year member growth for the past seven consecutive quarters. We believe we are in the early stages of the digital transformation of financial services and, as a result, have a substantial opportunity to continue to grow our member base and increase the number of products that our members use on the SoFi platform.
IPOE-20210614_G8.JPG
We offer our members a suite of financial products and services, enabling them to borrow, save, spend, invest and protect within one integrated platform. Our aim is to create a best-in-class, integrated financial services platform that will generate a virtuous cycle whereby positive member experiences will lead to more products adopted per member and enhanced profitability for each additional product by lowering overall member acquisition costs and increasing the lifetime value of our members. We refer to this virtuous cycle as our “Financial Services Productivity Loop”.
We believe that developing a relationship with our members and gaining their trust is central to our success as a financial services platform. Moreover, we believe that some of the current frictions faced by other financial institutions are caused by a disjointed and non-seamless product experience, a lack of digital acquisition, subpar mobile web products instead of digital native apps and incomplete product offerings to meet a customer’s holistic financial needs. Through our mobile technology and continuous effort to improve our financial services products, we are seeking to build a financial services platform that members can access for all of their financial services needs.
We believe we are in the early stages of realizing the benefits of the Financial Services Productivity Loop, as increasing numbers of our members are using multiple products on our platform. From the first quarter of 2020 through the first quarter of 2021, the number of our members who have used more than one of our product offerings grew 171% from approximately 216,000 to approximately 585,000.
In addition to benefiting our members, our products and capabilities are also designed to appeal to enterprises, such as financial services institutions that subscribe to our enterprise services called SoFi At Work, and have become interconnected with the SoFi platform. While these enterprises are not considered members, they are important contributors to the growth of the SoFi platform, and also have their own constituents who might benefit from our products in the future. Further, Galileo has over 69 million total accounts on its platform (excluding SoFi accounts). Galileo started contributing new accounts to the SoFi ecosystem during the second quarter of 2020.
While we primarily operate in the United States, in 2020, we expanded into Hong Kong with our acquisition of 8 Limited, an investment business. Additionally, with the acquisition of Galileo in May 2020, we gained clients in Mexico.
115

TABLE OF CONTENTS
National Bank Charter.  A key element of our long-term strategy is to secure a national bank charter, which we believe would enhance the profitability of our Lending segment and SoFi Money. While we currently rely on third-party bank holding companies to provide banking services to our members, securing a national bank charter would, among other things, allow us to provide members and prospective members broader and more competitive options across their financial services needs, including deposit accounts, and lower our cost to fund loans (by utilizing our SoFi Money members’ deposits to fund our loans), which would enable us to offer lower interest rates on loans to members as well as offer higher interest rates on SoFi Money accounts, all while continuing not to charge non-interest based fees.
In October 2020, we received preliminary, conditional approval from the OCC for our application for a national bank charter. Final OCC approval is subject to a number of preopening requirements. In March 2021, we entered into an agreement to acquire Golden Pacific Bancorp, Inc., a bank holding company (“Golden Pacific”), and its wholly-owned subsidiary, Golden Pacific Bank, National Association, a national bank (“Golden Pacific Bank”), for a total cash purchase price of $22.3 million. The acquisition is subject to regulatory approval, including approval from the OCC of a revised business plan for the acquiree national bank, and approval from the Federal Reserve to become a bank holding company and for a change of control, and other customary closing conditions. In March 2021, we submitted an application to the Federal Reserve to become a bank holding company. The application review process is ongoing.
In order to be compliant with all applicable regulations, to operate to the satisfaction of the banking regulators, and to successfully execute our business plan for the bank, SoFi has been building out the required infrastructure to run the bank and to operate as a bank holding company. This effort spans our people and organization, technology, marketing/product management, risk management, compliance, and control functions. We have invested and expect to continue to invest substantial time, money and human resources towards bank readiness, and towards the regulatory approval process. During the three months ended March 31, 2021, we incurred direct costs associated with securing a national bank charter of $5.5 million, which consisted primarily of professional fees and compensation and benefits costs. While largely dependent on the timing of the regulatory approvals, we estimate that we could incur additional costs of approximately $6 million to $10 million through the remainder of the regulatory approval process.
Our Reportable Segments
We conduct our business through three reportable segments: Lending, Financial Services and Technology Platform. Below is a discussion of our segments and their corresponding products.
Lending Segment
Through our Lending segment, we offer student loans, personal loans, home loans and related services.
Student Loans. We primarily operate in the student loan refinance space, with a focus on super-prime graduate school loans. Subsequently, we expanded into “in-school” lending, which allows members to borrow funds while they attend school. We offer flexible loan sizes and repayment options, as well as competitive rates, on our student loan refinancing and in-school loan products.
Personal Loans. We primarily originate personal loans for debt consolidation purposes and home improvement projects. We offer fixed and variable rate loans with no origination fees and flexible repayment terms, such as unemployment protection. We believe there are opportunities for us to pursue additional personal loan channels.
Home Loans. We have historically offered agency and non-agency loans for members purchasing a home or refinancing an existing mortgage. On our home loan products, we offer competitive rates, flexible down-payment options for as little as 5% and educational tools and calculators.
A key element of our underwriting process is the ability to facilitate risk-based interest rates that are appropriate for each loan. Using SoFi’s proprietary risk models, we project quarterly loan performance results, including
116

TABLE OF CONTENTS
expected losses and prepayments. The outcome of this process helps us determine a more data-driven, risk-based interest rate that we can offer our members.
SoFi has built a comprehensive underwriting process across each lending product that is focused on willingness to pay (credit), ability to pay (income verification), and capacity to pay (debt service in relation to other loans). Our student loan and personal loan underwriting models consider credit reports, industry credit and bankruptcy prediction models, custom credit assessment models, and debt capacity analysis, as indicated by borrower free cash flow (defined as borrower monthly net income less revolving and installment payments less housing payments). Our minimum FICO requirements are 650 for student loan refinancing, 680 for in-school loans (primary or co-signer) and 680 for personal loans. Home loans originated by SoFi that are agency conforming loans are subject to Automated Underwriting System credit, debt service, and collateral eligibility established by Fannie Mae. Existing members generally experience a higher approval rate than new members, subject to the member being in good standing on their existing products. Home loans originated by SoFi that are non-agency are subject to SoFi Home Loans credit criteria, including minimum tri-bureau credit score, established credit history requirements, income verification, as well as maximum qualified mortgage limits on debt to income service and caps on LTV (loan to value) based on an accredited appraisal. We also leverage SoFi data to allow existing members to have a streamlined application process through automation.
Our lending business is primarily a gain-on-sale model, whereby we originate loans and recognize a gain from these loans when we sell them into either our whole loan or securitization channels. We sell our whole loans primarily to large financial institutions, such as bank holding companies, typically at a premium to par, and in excess of our costs to originate the loans. Our loan premiums fluctuate from time to time based on benchmark rates and credit spreads, and we are not guaranteed a gain on all or any of our loan sales. When securitizing loans, we first isolate the underlying loans in a trust and then sell the beneficial interests in the trust to a bankruptcy-remote entity. In securitization transactions that do not qualify for sale accounting, the related assets remain on our balance sheet and cash proceeds received are reported as liabilities, with related interest expense recognized over the life of the related borrowing. In securitization transactions that qualify for sale accounting, we typically have insignificant continuing involvement as an investor. In the case of both whole loan sales and securitizations, we also typically continue to retain servicing rights following transfer. We therefore view servicing as an integral component of the Lending segment.
Prior to selling our loans, we hold them on our balance sheet at fair value and rely upon warehouse financing arrangements. Net interest income, which we define as the difference between the earned interest income and interest expense to finance loans, is a key component of the profitability of our Lending segment.
We retain servicing rights to our originated loans (other than home loans), and believe our servicing function is an important asset because of the connection to the member it affords us throughout the life of the loan. We directly service all of the personal loans that we originate. We act as master servicer for, and rely on sub-servicers to directly service, all of our student loans, credit cards and FNMA conforming home loans. We believe this ongoing relationship with our members enhances the effectiveness of our Financial Services Productivity Loop by increasing member touchpoints and driving the number of products per member.
Our platform supports the full transaction lifecycle, including credit application, underwriting, approval, funding and servicing. Through data derived at loan origination and throughout the servicing process, SoFi has life of loan performance data on each loan in its ecosystem, which provides a meaningful data asset.
Financial Services Segment
Our Financial Services segment consists of cash management, investment and other related services.
SoFi Money
Through SoFi Money, a digital, mobile cash management experience for our members, we invest in member acquisition and marketing activities to attract new members, including by offering rewards to incentivize prospective members to house their cash management activities on the SoFi platform.
117

TABLE OF CONTENTS
We generate interest income from deposits sitting in the various Member Banks, which is reduced by the interest fees paid to members. We also earn payment network fees on member expenditures via SoFi-branded debit cards issued by one of our member bank holding companies (each a “Member Bank”). Payment network fees are reduced by direct fees payable to card associations and the Member Bank.
The Bancorp Bank (“Bancorp”) is the issuer of all SoFi Money debit cards and sponsors access to debit networks for payment transactions, funding transactions and associated settlement of funds under a sponsorship agreement with SoFi Securities. Additionally, Bancorp provides sponsorship and support for ACH, check, and wire transactions along with associated funds settlement. The SoFi Money product also utilizes a sweep administrator, UMB Bank, National Association (“UMB”), to sweep funds to and from the SoFi Money program banks, as necessary, under a program broker agreement between SoFi Securities and UMB and program account and program bank agreements with a variety of sweep program banks. The SoFi Securities agreement with Bancorp provides for receipt by Bancorp of program revenue and transaction fees, and is subject to a minimum monthly card activity fee. The agreement with Bancorp is terminable by SoFi Securities with 120 days prior notice. The program broker agreement between SoFi Securities and UMB provides for one-year terms that automatically renew and is terminable by either party with at least 90 days’ written notice prior to the end of the current term. The program account agreements and program bank agreements between SoFi Securities, UMB and the sweep banks provide for the rate of interest payable on the balances in a member’s SoFi Money account and include certain maximum transfer requirements on transfers. These arrangements are generally terminable upon termination of SoFi Securities’ sweep arrangement with UMB.
SoFi Invest
We also provide introductory brokerage services to our members, and have invested significantly in creating SoFi Invest, a streamlined mobile investing experience through which we offer multiple ways to invest and give members access to active investing, robo-advisory and cryptocurrency services. While we do not charge trading fees, other than for cryptocurrency trading, our platform benefits from increasing assets under management as we generate interest income on cash balances that we hold, and we also earn brokerage revenue through share lending and pay for order flow arrangements. We also believe there are opportunities to generate incremental future revenue through margin lending and options. Through our acquisition of 8 Limited in 2020, we expanded SoFi Invest into the Hong Kong market. With respect to our cryptocurrency trading activities, which we initiated in 2019, we do not hold or store members' cryptocurrencies, but instead rely on a third party custodian, and we hold an immaterial amount of cryptocurrencies in order to facilitate paying new cryptocurrency member bonuses when members initiate their first cryptocurrency trade. We do this for member convenience to facilitate a seamless payment of cryptocurrency. Historically, cryptocurrency buy and sell volume has had an immaterial impact on our results of operations.
Furthermore, our innovative “stock bits” feature allows members to purchase fractional shares in various companies. Through our “stock bits” offering, members with SoFi Invest active brokerage accounts may buy or sell fractional shares in a variety of equity securities. Members can place orders in dollars or shares. During the course of a trading day, all member orders are consolidated into a single order for each equity security, which may be a sell or buy order. These fractional orders are rounded up to the next whole share and executed as a market order prior to market close on a standard trading day. Following market close, we allocate the trades to each individual member. We maintain an insignificant stock inventory of between two and ten shares for each issuer for whose securities we provide fractional trading in order to facilitate “stock bits” trades. This stock inventory is recorded within other assets in our balance sheet and was not material as of any of the balance sheet dates presented in the consolidated financial statements included elsewhere in this prospectus, nor were our revenues earned and expenses incurred associated with the “stock bits” feature material during any of the income statement periods presented.
Other
In August 2020, we began offering the SoFi Credit Card, which we expanded to a broader market in the fourth quarter of 2020. Additionally, we developed SoFi Relay within the SoFi mobile application, a personal finance management product which allows members to track all of their financial accounts in one place and utilize credit score monitoring services. Further, we leverage our technology and information infrastructure to offer services to
118

TABLE OF CONTENTS
other enterprises, such as loan referrals and SoFi At Work, which is a platform we offer to enterprises that are looking for a seamless way to provide financial benefits to their employees, such as student loan payments made on their employees’ behalf, for which we earn a fee. We have also developed a financial services marketplace platform branded Lantern Credit to help applicants that do not qualify for SoFi products with alternative products, as well as providing a product comparison experience. Finally, through SoFi Protect, we offer third-party insurance products through partnerships.
We earn revenues in connection with our Financial Services segment through various partnerships and our SoFi Money and SoFi Invest products in the following ways:
Referral fees: Through strategic partnerships, we earn a specified referral fee in connection with referral activity we facilitate through our platform, which is not directly tied to a particular Financial Services product. The referral fee is paid to us by third-party partners that offer services to end users who do not use one of our product offerings, but who were referred to the partners through our platform. As such, the third-party enterprise partners are our customers in these referral arrangements.
Payment network fees: We earn payment network fees, which primarily constitute interchange fees, from our SoFi Money product. These fees are remitted by merchants and are calculated by multiplying a set fee percentage (as stipulated by the debit card payment network) by the transaction volume processed through such network. We arrange for performance by a card association and the bank issuer to enable certain aspects of the SoFi branded transaction card process. We enter into contracts with both parties that establish the shared economics of SoFi Money branded transaction cards. Historically, these fees have not been a significant portion of total net revenue.
Enterprise service fees: These fees are earned in connection with services we provide to enterprise partners to facilitate transactions for the benefit of their employees, such as 529 plan contributions or student loan payments through our At Work product, which represents our single performance obligation in the arrangements. Historically, these fees have been an immaterial component of our total net revenue.
Brokerage fees: We earn brokerage fees from our share lending and pay for order flow arrangements related to our SoFi Invest product (for which Apex serves as principal), exchange conversion services and digital assets activity. In our share lending arrangements and pay for order flow arrangements with Apex, we do not oversee the execution of the transactions by our members, but benefit through a negotiated multi-year revenue sharing arrangement, since our members' brokerage activity drives the share lending and pay for order flow volume. Apex connects with market makers (order flow) and institutions (share lending) to facilitate the service and is responsible for execution. Apex carries inventory risk with the share lending program and ultimately is responsible for successful order routing to market makers that trigger the pay for order flow revenue. Apex sets the gross price and negotiates with market makers and institutions as part of our order flow and share lending arrangements. We have no discretion or visibility into this pricing and, instead, negotiate a net fee for our order flow and share lending arrangements, which is settled with Apex rather than with market makers or other institutions. In our digital assets arrangements, our fee is calculated as a negotiated percentage of the transaction volume. In our exchange conversion arrangements, we earn fees for exchanging one currency for another. Historically, these fees have not been a significant portion of our total net revenue. Our arrangements with Apex are governed by an agreement which contains certain minimum monthly requirements and which is terminable by either party upon notice. Although we no longer have an equity method investment in Apex as of March 31, 2021, Apex will continue to provide the services under this agreement.
Net interest income: Our SoFi Invest and SoFi Money products also generate net interest income based on the cash balances held in these accounts. Historically, this income has not been a significant portion of our total net revenue.
Technology Platform Segment
Our Technology Platform segment consists of Galileo, and historically included our minority ownership of Apex, a technology-enabled provider of investment custody and clearing brokerage services, in which we invested
119

TABLE OF CONTENTS
in December 2018. During January 2021, the seller exercised its call rights on our Apex investment. Therefore, we did not recognize any Apex equity method investment income subsequent to the date the option was called, nor will we have such equity method investment income in future periods. Additionally, we measured the carrying value of the Apex equity method investment as of December 31, 2020 equal to the call payment that we received in January 2021, which resulted in the recognition of an impairment charge of $4.3 million during the fourth quarter of 2020. Although following the seller call we no longer have an equity method investment in Apex or recognize equity method investment income, Apex continues to provide investment custody and clearing services for SoFi Invest, including for our brokerage activities, under a multi-year revenue sharing arrangement.
In May 2020, we acquired Galileo, a provider of technology platform services to financial and non-financial institutions. Through Galileo, we provide services through a suite of program, event and authorization application programming interfaces for financial and non-financial institutions. Additionally, Galileo provides vertical integration benefits with SoFi Money. In addition to growth in its U.S. client base, Galileo is increasingly focused on international opportunities, including in Latin America and Asia.
We earn revenue on Galileo’s platform in the following two ways:
Technology Platform Fees:   The platform fees we earn are based on access to the platform and are specific to the type of transaction. For example, we offer “event pricing”, which includes a specific charge for an account setup, an active account on file, use of Program, Event and Authorization Application Programming Interfaces (“APIs”), card activation, authorizations and processing, and card loads. In addition, we offer “partner pricing”, which is the back-end support we provide to Galileo’s clients, such as live agent customer service, chargeback and fraud analysis and credit bureau reporting, all within one integrated solution for our clients.
Program Management Fees:   Also referred to as “card program fees”, these transaction fees are generated from the creation and management of card programs issued by banks and requested by enterprise partners. In these arrangements, Galileo performs card management services and the revenue stems from the payment network and card program fees generated by the card program. This revenue is reduced by association and bank issuer costs, and a revenue share passed along to the enterprise partner that markets the card program. We categorize this class of revenue as payment network fees.
Galileo typically enters into multi-year service contracts with its clients. The contracts provide for a variety of integrated platform services, which vary by client and are generally either non-cancellable or cancellable with a substantive payment. Pricing structures under these contracts are typically volume-based, or a combination of activity- and volume-based, and payment terms are predominantly monthly in arrears. Most of Galileo’s contracts contain minimum monthly payments with agreed upon monthly service levels and may contain penalties if service levels are not met.
COVID-19 Pandemic
On March 11, 2020, the World Health Organization designated the novel coronavirus (“COVID-19”) as a global pandemic. In an effort to manage the spread of the virus, federal, state and local governments enacted various restrictions, including closing schools and businesses, limiting or restricting social or public gatherings, implementing travel restrictions and mandating stay-at-home orders. Although the long-term effects of the COVID-19 pandemic globally and in the United States remain unknown, we are seeing signs of recovery from the impacts of the pandemic due to the increased availability of vaccinations and evolving government stimulus programs, particularly in the U.S., including businesses and schools reopening, improved employment metrics, and increased consumer spending and confidence levels. In response to the COVID-19 pandemic, we expanded our business continuity program to communicate with employees on a regular basis regarding the implementation of a company-wide work-from-home program, planning for contingencies related to the pandemic, providing updated information and policies, and monitoring the ongoing crisis for new developments in accordance with recommendations and protocols published by the U.S. Centers for Disease Control and Prevention (“CDC”) and the World Health Organization, as well as state and local governments.
120

TABLE OF CONTENTS
In response to the economic and financial effects of the COVID-19 pandemic, the Federal Reserve reduced the target range for the federal funds rate to 0% to 0.25%, a level it suggested could remain until 2023, and instituted quantitative easing measures as well as domestic and global capital market support programs. Additionally, on March 27, 2020, the President of the United States signed into law the CARES Act. The CARES Act included, among other things, expanded eligibility for Small Business Administration loans under a Paycheck Protection Program (“PPP”), direct economic assistance to American workers, provisions for payroll tax credits and deferrals, net operating loss carryback periods, alternative minimum tax credits, technical corrections to tax depreciation methods for qualified improvement property, and temporary relief from certain trouble debt restructuring programs. The CARES Act also enacted automatic suspension of principal and interest payments on federally-held student loans, which was extended most recently by executive action through September 30, 2021. We continue to analyze and evaluate the direct and indirect impacts that the CARES Act and additional government relief measures may have on our business, including impacts associated with the expiration of select CARES Act provisions, and we continue to monitor developments in the United States Congress with respect to the potential passage of additional relief measures. See “—Key Factors Affecting Operating Results—Industry Trends and General Economic Conditions” for discussion of the impacts to our business of measures taken in response to the economic and financial effects of the COVID-19 pandemic.
Through our business continuity program, we recently communicated to employees updated information and corporate policies for a safe return to the office. Notably, in May 2021, the CDC issued guidance advising that people fully vaccinated against COVID-19 do not need to wear masks or practice social distancing indoors or outdoors, except under certain circumstances. As the guidance issued by governments and regulators continues to evolve, we will likewise continue to assess the impacts on us and to adjust our business operations, policies and procedures as needed to best accommodate our ecosystem of members and prospective members, Member Banks, employees and investors.
Since the onset of the COVID-19 pandemic, we have continued to adapt our response and strategies to navigate uncertain economic, workplace and market conditions. We have taken a number of measures to proactively support our members, applicants for new loans, employees and investors.
Members:   We have and will continue to approach hardship programs from a member-first perspective. In addition to our Unemployment Protection Plan, which remains available to all eligible members, we launched comprehensive forbearance programs that provided meaningful Federal Emergency Management Agency (“FEMA”) disaster hardship relief. Starting in March 2020, we made available a web-enabled self-service forbearance request process to enable members who faced unemployment, reduction in income or general economic uncertainty to defer their loan payment for an initial period with options to extend. For student loans and personal loans, when a forbearance request was accepted, interest on the loan continued to accrue and is amortized over the remaining life of the loan, and the maturity date of the loan is extended for the length of the deferment. Home loans are subject to FNMA servicing guidelines, which provide certain options to the borrower. For home loans, after the forbearance period has ended, members are required to repay the amount that was suspended, but are not required to repay the amount all at once, though they have that option. Other potential options allow members to make an additional payment each month for a period of time until the past due amounts are repaid, move the deferred amount to the end of the loan term, or set up a loan modification, if they are eligible. In all instances, interest continues to accrue during the forbearance period. In response to the hardship brought on by the COVID-19 pandemic, we also deferred certain collection recovery activities, while taking every opportunity to work with our members to find a path to repayment. We discontinued enrollment in our COVID-19 forbearance programs, which were designed to be temporary in nature, for personal loans and student loans on March 31, 2021 and April 30, 2021, respectively. Subject to eligibility, members may participate in other customary hardship programs.
The following tables present information about our loan products that were in active short-term hardship relief or payment deferral as of March 31, 2021 and December 31, 2020 due to the COVID-19 pandemic or that were
121

TABLE OF CONTENTS
classified as performing (current or paid in full) as of March 31, 2021 and December 31, 2020 after exiting payment deferral due to the COVID-19 pandemic:
As of March 31, 2021 Student Loans Personal Loans Home Loans
Active short-term hardship relief or payment deferral due to COVID-19 pandemic
Number of loans 3,450  12  108 
Aggregate balance ($ in millions) $ 249.4  $ 0.3  $ 31.0 
Classified as performing after exiting payment deferral due to COVID-19 pandemic
Number of loans ever enrolled in COVID-19 forbearance program 38,771  44,046  317 
Number of loans enrolled classified as performing at measurement date 33,436  37,692  212 
Aggregate balance of loans ever enrolled in COVID-19 forbearance program ($ in billions) $ 2.90  $ 1.21  $ 0.07 
Aggregate balance of loans enrolled classified as performing at measurement date ($ in billions) $ 2.53  $ 1.02  $ 0.04 
As of December 31, 2020 Student Loans Personal Loans Home Loans
Active short-term hardship relief or payment deferral due to COVID-19 pandemic
Number of loans 4,532  1,061  122 
Aggregate balance ($ in millions) $ 317.4  $ 26.8  $ 35.6 
Classified as performing after exiting payment deferral due to COVID-19 pandemic
Number of loans ever enrolled in COVID-19 forbearance program 37,744  43,585  292 
Number of loans enrolled classified as performing at measurement date 31,012  37,022  189 
Aggregate balance of loans ever enrolled in COVID-19 forbearance program ($ in billions) $ 2.84  $ 1.20  $ 0.07 
Aggregate balance of loans enrolled classified as performing at measurement date ($ in billions) $ 2.38  $ 1.01  $ 0.04 
During the first quarter of 2021, we experienced lower enrollment rates into hardship programs across all loan products, indicating that our members are regaining financial confidence as we continue the economic recovery from the pandemic. Additionally, as indicated in the tables above, those members who were distressed at the time of enrolling in a hardship program have demonstrated continued strong resiliency, with 85%, 82% and 65% of personal loan, student loan and home loan accounts, respectively, either current or paid-in-full as of December 31, 2020, which increased to 86%, 86% and 67%, respectively, as of March 31, 2021. Based on the combination of these factors, the number of loans in active short-term hardship relief or payment deferral due to the pandemic decreased by 38% as of March 31, 2021 compared to December 31, 2020.
Applicants: In response to deteriorating economic conditions and market uncertainty amid the pandemic, in 2020 we proactively executed our recession readiness credit risk strategies. This included introducing elevated credit eligibility requirements for personal loans, thorough validation of income and income continuity, and limiting loan amounts. As a result of actions taken, for the fourth quarter of 2020 compared to the fourth quarter of 2019, we observed an 11-point increase in personal loan FICO scores at origination. We expected originations incorporating credit risk strategy changes, when stressed using external loss forecasting models with stressed econometric scenarios, to perform similarly to previous vintages. Our student loan refinance business is substantially comprised
122

TABLE OF CONTENTS
of applicants refinancing federal loans and/or existing private student loans. We developed objective content and calculators to educate applicants about the Federal relief available to them through the CARES Act and subsequent extensions, which enabled them to maximize their savings. Throughout the first quarter of 2021, we eased our elevated credit eligibility requirements for personal loans through phases of reopening.
Employees: In order to safeguard the health and safety of our team members and their families, we virtualized our entire organization beginning in March 2020, enabling all of our team members to work virtually. We have taken a proactive approach to enable ongoing communication and engagement. In February 2021, we announced that our employees may work with their managers to determine the best place for them to work from, including continuing to work virtually. Additionally, based on feedback we received from an employee engagement survey, we intend to move forward with a pilot reopening of our U.S. offices in the summer of 2021 on a voluntary basis. We will continue to align our protocols with evolving CDC, state and local guidelines to continue to safeguard the health and safety of our team members and their families. We are proud to offer these flexible work arrangements to our employees.
Investors: Durability of, and confidence in, the performance of our originated asset classes has never been more important. Despite uncertain market and economic conditions, our serviced assets continue to perform at historic low delinquency and loss metrics for our Company, even when adjusted for forbearance. The majority of our members have validated their income resiliency and have returned to making full or partial payments on their loan or have paid in full. We have identified members who have sustained hardships and we have worked constructively with the investor community to establish expanded loss mitigation tools to maximize recovery while providing empathy for distressed members. Our team has worked to provide greater transparency to our investor community through access to our Capital Markets and Risk Management team and by providing internal and external analytical and stress testing forecasts, which provide a range of economic scenarios that could manifest in performance of their owned assets. Investors continue to not only have demand for our assets, but have grown their demand for our assets in light of their demonstrated performance.
Delinquencies: Members enrolled in forbearance or hardship relief programs do not appear in delinquency metrics and are not subject to collection activity. Despite this, during any re-enrollment, SoFi works with members to determine when a short-term hardship becomes long-term, which requires differing solutions to ensure a member has the best chance for repayment success. At the onset of the COVID-19 pandemic, we provided online self-service opportunities to members to request initial relief and subsequently extend that short-term forbearance relief as needed (subject to approval). COVID-19 hardship relief was available to members that were current or delinquent at the time of request, although the majority of student loan and personal loan initial enrollments were members that were “current” at the time of enrollment. As indicated in the table above, the majority of members that entered COVID-19 hardship programs have exited such programs.
Liquidity: We took action to prepare for potential liquidity needs by securing additional committed warehouse capacity in May 2020. Additionally, in the first quarter of 2020, we received approximately $46 million of margin calls on certain positions, which had been marked down by our lenders based on trading activity observed in the market. By the end of the second quarter, approximately half of that margin had been returned to us, and by the end of the fourth quarter, all but $0.3 million had been returned to us as markets continued to stabilize. See “Liquidity and Capital Resources—Borrowings” for additional information on margin calls. We were able to manage these needs along with other liquidity needs of our business by relying on our strong liquidity position going into the crisis, having a deep and diversified portfolio of warehouse lenders, being proactive and forward looking as it related to anticipated liquidity risks and needs, and managing decisions conservatively with regard to loan origination growth and loan sales.
The COVID-19 pandemic had a significant impact on consumer spending and money management behavior that has, in turn, impacted our business. See “—Key Factors Affecting Operating Results—Industry Trends and General Economic Conditions” for more information.
We remain committed to serving our members, applicants and investors, while caring for the safety of our employees and their families. See “Risk Factors—COVID-19 Pandemic Risks” included elsewhere in this prospectus for additional discussion of the risks and uncertainties associated with the repercussions of the COVID-19 pandemic.
123

TABLE OF CONTENTS
Executive Overview
The following tables display key financial measures for our three reportable segments and our consolidated company that are used, along with our key business metrics, by management to evaluate our business, measure our performance, identify trends and make strategic decisions. Contribution profit (loss) is the primary measure of segment-level profit and loss reviewed by management and is defined as total net revenue for each reportable segment less expenses directly attributable to the corresponding reportable segment and, in the case of our Lending segment, less fair value adjustments attributable to assumption changes associated with our servicing rights and residual interests classified as debt. See “—Results of Operations”, “—Summary Results by Segment” and “—Non-GAAP Financial Measures” for discussion and analysis of these key financial measures.
Three Months Ended March 31, Year Ended December 31,
($ in thousands) 2021 2020 2020 2019 2018
Lending
Total interest income $ 81,547  $ 93,177  $ 354,383  $ 593,644  $ 587,509 
Total interest expense (29,770) (47,516) (155,038) (268,055) (330,165)
Total noninterest income 96,200  28,217  281,521  108,712  9,404 
Total net revenue 147,977  73,878  480,866  434,301  266,748 
Adjusted net revenue(1)(2)
168,037  81,755  536,541  442,971  238,070 
Contribution profit (loss)(1)
87,686  4,095  241,729  92,460  (109,278)
Financial Services
Total interest income 540  1,737  2,796  5,950  173 
Total interest expense (311) (1,522) (2,312) (5,336) (143)
Total noninterest income 6,234  1,939  11,386  3,318  844 
Total net revenue(1)
6,463  2,154  11,870  3,932  874 
Contribution loss (35,519) (26,983) (131,410) (118,800) (19,243)
Technology Platform(3)
Total interest expense (36) —  (107) —  — 
Total noninterest income 46,101  997  95,737  795  117 
Total net revenue(1)
46,065  997  95,630  795  117 
Contribution profit 15,685  997  53,203  795  117 
Other(4)
Total interest income 441  2,368  6,358  8,599  1,936 
Total interest expense (5,131) (1,095) (28,149) (4,968) (246)
Total noninterest income (loss) 169  —  (1,043) —  (30)
Total net revenue (loss) (4,521) 1,273  (22,834) 3,631  1,660 
Consolidated
Total interest income $ 82,528  $ 97,282  $ 363,537  $ 608,193  $ 589,618 
Total interest expense (35,248) (50,133) (185,606) (278,359) (330,554)
Total noninterest income 148,704  31,153  387,601  112,825  10,335 
Total net revenue 195,984  78,302  565,532  442,659  269,399 
Adjusted net revenue(1)(2)
216,044  86,179  621,207  451,329  240,721 
Net loss (177,564) (106,367) (224,053) (239,697) (252,399)
Adjusted EBITDA(2)
4,132  (66,152) (44,576) (149,222) (226,931)
_________________
(1)Adjusted net revenue within our Lending segment is used by management to evaluate our Lending segment and our consolidated results. For the Lending segment, total net revenue is adjusted to exclude the fair value changes in servicing rights and residual interests classified as debt due to valuation inputs and assumption changes (including conditional prepayment and default and discount rates). We use this adjusted measure in our determination of contribution profit (loss) in the Lending segment, as well as to evaluate our consolidated results, as
124

TABLE OF CONTENTS
it removes non-cash charges that are not realized during the period and, therefore, do not impact the cash available to fund our operations, and our overall liquidity position. For our Financial Services and Technology Platform segments, there are no adjustments from total net revenue to arrive at the consolidated adjusted net revenue shown in this table.
(2)Adjusted net revenue and adjusted EBITDA are non-GAAP financial measures. For information regarding our uses and definitions of these measures and for reconciliations to the most directly comparable GAAP measures, net loss and total net revenue, respectively, see “— Non-GAAP Financial Measures”.
(3)There was no interest income recorded within our Technology Platform segment for any of the periods presented.
(4)“Other” includes total net revenue associated with corporate functions that are not directly related to a reportable segment. For further discussion, see Note 16 to the Notes to Unaudited Condensed Consolidated Financial Statements and Note 17 to the Notes to Consolidated Financial Statements included elsewhere in this prospectus.
125

TABLE OF CONTENTS
Quarter Ended
($ in thousands) March 31,
2021
December 31, 2020 September 30, 2020 June 30, 2020 March 31, 2020 December 31, 2019 September 30, 2019 June 30, 2019 March 31, 2019
Lending
Total interest income $ 81,547  $ 90,753  $ 86,468  $ 83,985  $ 93,177  $ 125,041  $ 161,926  $ 153,956  $ 152,721 
Total interest expense (29,770) (33,626) (34,246) (39,650) (47,516) (57,497) (67,989) (68,609) (73,960)
Total noninterest income (loss) 96,200  91,865  109,890  51,549  28,217  (6,655) 33,133  71,294  10,940 
Total net revenue 147,977  148,992  162,112  95,884  73,878  60,889  127,070  156,641  89,701 
Adjusted net revenue(1)(3)
168,037  159,520  178,084  117,182  81,755  58,602  135,402  154,971  93,996 
Contribution profit (loss)(1)
87,686  85,204  103,011  49,419  4,095  (33,362) 35,674  67,283  22,865 
Financial Services
Total interest income 540  378  365  316  1,737  1,924  2,071  1,406  549 
Total interest expense (311) (290) (267) (233) (1,522) (1,798) (1,798) (1,242) (498)
Total noninterest income 6,234  3,963  3,139  2,345  1,939  1,524  760  609  425 
Total net revenue(1)
6,463  4,051  3,237  2,428  2,154  1,650  1,033  773  476 
Contribution loss (35,519) (36,067) (37,467) (30,893) (26,983) (34,517) (33,533) (27,855) (22,895)
Technology Platform(6)
Total interest expense (36) (42) (47) (18) —  —  —  —  — 
Total noninterest income 46,101  36,838  38,865  19,037  997  325  206  149  115 
Total net revenue(1)
46,065  36,796  38,818  19,019  997  325  206  149  115 
Contribution profit 15,685  16,120  23,986  12,100  997  325  206  149  115 
Other(2)
Total interest income 441  942  1,284  1,764  2,368  2,533  2,434  2,316  1,316 
Total interest expense (5,131) (19,292) (4,345) (3,417) (1,095) (1,155) (1,351) (1,355) (1,107)
Total noninterest income (loss) 169  (319) (726) —  —  —  —  — 
Total net revenue (loss)(5)
(4,521) (18,348) (3,380) (2,379) 1,273  1,378  1,083  961  209 
Consolidated
Total interest income $ 82,528  $ 92,073  $ 88,117  $ 86,065  $ 97,282  $ 129,498  $ 166,431  $ 157,678  $ 154,586 
Total interest expense (35,248) (53,250) (38,905) (43,318) (50,133) (60,450) (71,138) (71,206) (75,565)
Total noninterest income 148,704  132,668  151,575  72,205  31,153  (4,806) 34,099  72,052  11,480 
Total net revenue(4)
195,984  171,491  200,787  114,952  78,302  64,242  129,392  158,524  90,501 
Adjusted net revenue(1)(3)
216,044  182,019  216,759  136,250  86,179  61,955  137,724  156,854  94,796 
Net income (loss) (177,564) (82,616) (42,878) 7,808  (106,367) (122,541) (57,559) (10,218) (49,379)
Adjusted EBITDA(3)
4,132  11,817  33,509  (23,750) (66,152) (101,004) (27,656) 6,611  (27,173)
__________________
(1)Adjusted net revenue within our Lending segment is used by management to evaluate our Lending segment and our consolidated results. For the Lending segment, total net revenue is adjusted to exclude the fair value changes in servicing rights and residual interests classified as debt due to valuation inputs and assumption changes (including conditional prepayment and default and discount rates). We use this
126

TABLE OF CONTENTS
adjusted measure in our determination of contribution profit (loss) in the Lending segment, as well as to evaluate our consolidated results, as it removes non-cash charges that are not realized during the period and, therefore, do not impact the cash available to fund our operations, and our overall liquidity position. For the Financial Services and Technology Platform segments, there are no adjustments from total net revenue.
(2)“Other” includes total net revenue associated with corporate functions that are not directly related to a reportable segment. For further discussion, see Note 16 to the Notes to Unaudited Condensed Consolidated Financial Statements and Note 17 to the Notes to Consolidated Financial Statements included elsewhere in this prospectus.
(3)Adjusted net revenue and adjusted EBITDA are non-GAAP financial measures. For information regarding our uses and definitions of these measures and for reconciliations to the most directly comparable GAAP measures, net income (loss) and total net revenue, respectively, see “—Non-GAAP Financial Measures”.
(4)The significant trends in consolidated total net revenue throughout the periods presented were attributable to the following:
The $29.1 million decrease from the second quarter to the third quarter of 2019 was primarily attributable to an unfavorable change in securitization loans of $49.9 million resulting primarily from an increase in yields based on expected declines in personal loan securitization credit performance. In addition, securitization loan charge-offs increased by $5.0 million period over period. This negative trend was partially offset by a $31.2 million positive variance associated with our loan origination and sale activities, net of hedges, which reflected improved sales execution to whole loan buyers period over period and was a significant factor in our quarterly whole loan valuations.
The $65.2 million decrease from the third quarter to the fourth quarter of 2019 was primarily attributable to a $38.7 million loss related to the deconsolidation of three personal loan securitizations. In addition, net interest income decreased $26.2 million period over period, which was primarily attributable to a decline in the average total loans held on our balance sheet.
The $14.1 million increase from the fourth quarter of 2019 to the first quarter of 2020 was primarily attributable to a $33.7 million lower loss related to the deconsolidations of two personal loan securitizations during the first quarter of 2020 as compared to the aforementioned three deconsolidations in the fourth quarter of 2019. The positive trend was partially offset by a decrease in net interest income of $21.9 million, which was primarily attributable to a decline in the average total loans held on our balance sheet.
The $36.7 million increase from the first quarter to the second quarter of 2020 was primarily attributable to increases in securitization loan fair values of $71.7 million related to credit loss performance expectations improving, when we determined that delinquencies were better than expected during the period. This increase was offset by a decline of $38.1 million in loan origination and sales activities, net of hedges, a significant portion of which was related to a $22.5 million gain on credit default swaps in the first quarter of 2020 (which position we then closed during the same quarter), and because credit spreads widened significantly during the escalation of the COVID-19 pandemic, positively impacting our derivatives position.
The $85.8 million increase from the second quarter to the third quarter of 2020 was attributable to a $45.8 million increase in loan origination and sales activities, net of hedges, which was a function of us carrying a larger average loan balance on our balance sheet for all loan products and a meaningful increase in student loan fair values due to a decrease in expected prepayment speeds. This prepayment speed expectation also contributed to an improvement in servicing of $12.1 million period over period. The increased average loan balance also contributed to an increase in net interest income of $6.4 million. Moreover, the lower total net revenue in the second quarter was attributable to a loss on deconsolidation of securitizations of $8.6 million. Finally, securitization loan write-offs decreased $5.5 million, as we continued to see an improvement in credit performance from the early stages of the COVID-19 pandemic.
The $29.3 million decrease from the third quarter to the fourth quarter of 2020 was primarily attributable to interest expense related to the Galileo seller note in our Technology Platform segment and a decrease in noninterest income in our Lending segment. On November 14, 2020, when the promotional period on the seller note lapsed and we did not pay off the note, we incurred incremental interest expense of $12.5 million. We incurred an additional $3.7 million of interest expense related to our outstanding seller note obligation during the fourth quarter of 2020. The primary driver of the decrease in noninterest income in our Lending segment was related to decreases of $12.6 million in the gains recognized related to securitization loan fair values as a result of securitization loan valuations remaining materially consistent from the third quarter to the fourth quarter of 2020 after two consecutive quarters of improvement related to credit loss expectations. Additionally, we recognized an impairment charge of $4.3 million during the fourth quarter to measure the carrying value of our Apex equity investment equal to the call payment that we received in January 2021 upon the seller exercising its call option on our equity interest in Apex.
The $24.5 million increase from the fourth quarter of 2020 to the first quarter of 2021 was primarily attributable to $14.1 million lower corporate borrowing expense that was largely related to our seller note, as further discussed in footnote (5) below. Additionally, technology platform fees increased $7.1 million quarter over quarter, which was indicative of continued account growth and activity at Galileo. These increases were partially offset by a decrease in servicing income of $11.0 million, which was primarily due to the impact of prepayments on the fair value of our servicing rights. The remaining variance was primarily driven by our lending activities and was a function of our average loan balance, amounts pledged to our warehouse facilities and loan sale execution during the 2021 period.
(5)The significant trends in Other total net revenue (loss) during the periods presented were attributable to the following:
Our cash balances, along with market interest rates, declined during the first three quarters of 2020, which resulted in declines in other total net revenue of: $0.2 million in the first quarter of 2020 compared to the fourth quarter of 2019; $0.4 million in the second quarter compared to the first quarter of 2020; and $0.4 million in the third quarter compared to the second quarter of 2020. From the third quarter of 2020 through the first quarter of 2021, interest income attributable to bank balances was lower each successive quarter due to declines in interest rates. Cash balances were higher in the fourth quarter of 2020 versus the third quarter of 2020, which offset some of the interest rate impact. Our cash balances were lower in the first quarter of 2021 versus the fourth quarter of 2020.
Interest expense on our revolving credit facility increased by $0.7 million from the first quarter to the second quarter of 2020 due to an incremental $325.0 million borrowing and decreased by $0.5 million from the second quarter to the third quarter of 2020 due to decreases in one-month LIBOR.
During the second quarter of 2020, we had a one-time investment impairment of $0.8 million.
127

TABLE OF CONTENTS
During the second quarter of 2020, we acquired Galileo and used a seller note to finance a portion of the purchase. We recorded seller note interest expense of $1.6 million, $3.0 million and $17.6 million during the second, third and fourth quarters of 2020, respectively, and $3.6 million during the first quarter of 2021. The fair value of the seller note was initially recorded below the stated face value, with the difference accreted into interest expense over time during 2020. Additionally, we incurred an incremental $12.5 million of interest during the fourth quarter of 2020 because we did not pay off the seller note before the promotional period ended. Finally, we paid off the seller note in February 2021 and, thus, did not incur a full quarter of seller note interest for the first quarter of 2021.
(6)There was no interest income recorded within our Technology Platform segment for any of the periods presented.
Key Recent Developments
We continue to execute on our growth and other strategic initiatives and, in recent years, we have celebrated launches across our product suite and strategic partnerships, establishing ourselves as a platform that enables individuals to borrow, save, spend, invest, and protect their assets. Some of our key recent achievements are discussed below:
Acquisitions
During January 2021, Social Finance, Inc. entered into the Merger Agreement. The transactions contemplated by the terms of the Merger Agreement were completed on May 28, 2021, in which Merger Sub merged with and into SoFi, with SoFi surviving the Merger as a wholly-owned subsidiary of SCH, which concurrently changed its name to “SoFi Technologies, Inc.” Shares of our common stock and warrants began trading on Nasdaq under the symbols “SOFI” and “SOFIW”, respectively, on June 1, 2021, in lieu of the ordinary shares, warrants and units of SCH. See Note 2 to the Notes to Unaudited Condensed Consolidated Financial Statements included elsewhere in this prospectus for additional information on the transaction.
As an alternative to establishing a de novo bank, for which we received preliminary conditional approval from the U.S. Office of the Comptroller of the Currency (“OCC”) in October 2020, we evaluated the acquisition of a national bank. In March 2021, we entered into an agreement to acquire Golden Pacific Bancorp, Inc., a bank holding company, and its wholly-owned subsidiary, Golden Pacific Bank, National Association, a national bank, for a total cash purchase price of $22.3 million. The acquisition is subject to regulatory approval, including approval from the OCC of a revised business plan for Golden Pacific Bank, and approval from the Federal Reserve to become a bank holding company and for a change of control, and other customary closing conditions, which we anticipate can be completed by the end of 2021. In March 2021, we submitted an application to the Federal Reserve to become a bank holding company. The application review process is ongoing.
In May 2020, we completed our acquisition of Galileo for a purchase price of $1.2 billion. Galileo provides technology platform services to financial and non-financial institutions. Our acquisition of Galileo represents a material addition to our Technology Platform segment, but was not a significant acquisition under Regulation S-X, Rule 3-05, Financial Statements of Businesses Acquired or to be Acquired.
In April 2020, we acquired 8 Limited, a Hong Kong based investment business, for a purchase price of $16.1 million. Our acquisition of 8 Limited marked our first expansion outside the United States and enables our non-U.S. members to experience many of the product features we have developed in the United States for SoFi Invest, including zero commission non-cryptocurrency trading.
In December 2018, we acquired a 16.7% interest in Apex for $100.0 million, which enabled us to earn income from Apex’s customers and provided partial integration of transaction clearing and asset custody functions integral to SoFi Invest. During January 2021, the seller exercised its call rights on our Apex equity investment. Therefore, we will no longer recognize Apex equity method investment income subsequent to the date the option was called. Additionally, we measured the carrying value of the Apex equity method investment as of December 31, 2020 equal to the call payment that we received in January 2021, which resulted in the recognition of an impairment charge of $4.3 million during the fourth quarter of 2020. Although following the seller call we no longer have an equity method investment in Apex or recognize equity method investment income, Apex continues to provide investment custody and clearing services for SoFi Invest, including for our brokerage activities, under a multi-year revenue sharing arrangement.
128

TABLE OF CONTENTS
Product Development and Partnerships
We celebrated launches across our product suite and strategic partnerships, establishing ourselves as a platform that enables individuals to borrow, save, spend, invest, and protect their assets. Recent notable product launches, developments and partnerships include:
Through our registered broker-dealer subsidiary, SoFi Securities LLC, we are licensed to underwrite securities offerings. In March 2021, we launched an IPO investment center that may allow members with a SoFi active Invest account that has at least $3,000 in total account value across SoFi Invest (inclusive of automated and active investing) to invest in initial public offerings before they trade on an exchange. As we receive mandates for any such initial public offerings, and as such offerings are registered with the SEC, we serve as an underwriter or member of the selling group with respect to such offerings, which may include offerings involving SCH Sponsor V LLC or its affiliates. We expect to generate revenues in future periods for our IPO investment center activities in the form of underwriting fees and could become subject to liability for the contents of the prospectuses for the initial public offerings that we underwrite.
In 2020, we celebrated the official opening of SoFi Stadium and the establishment of a 20-year partnership with LA Stadium and Entertainment District at Hollywood Park in Inglewood, California, a multi-purpose sports and entertainment district that serves as the stadium for the National Football League teams the Los Angeles Chargers and Los Angeles Rams. SoFi's partnership with the owner of the LA Stadium and Entertainment District at Hollywood Park (“StadCo”) provides SoFi with exclusive naming rights of the stadium and official partnerships with the Los Angeles Chargers and Los Angeles Rams and with the performance venue, which shares a roof with the stadium, and the surrounding planned entertainment district, which is anticipated to include office space, retail space and hotel and dining options. SoFi's exclusive naming rights include naming the stadium “SoFi Stadium” a requirement that StadCo, the Los Angeles Chargers and the Los Angeles Rams use the name “SoFi Stadium” in all references to the stadium complex, and rights to signage and the use of certain suites and event space within the SoFi Stadium complex. SoFi's partnership with StadCo also provides SoFi with category exclusivity in the businesses of banking, lending and financial services, meaning StadCo, with certain limited exclusions, may not grant licenses to companies other than SoFi for advertising or sponsorship services within such categories. SoFi's 20-year partnership with the LA Stadium and Entertainment District at Hollywood Park, across the naming rights and sponsorship agreements, collectively requires SoFi to pay sponsorship fees quarterly in each contract year beginning in 2020 and ending in 2040 for an aggregate total of $625.0 million, which includes operating lease obligations, finance lease obligations and sponsorship and advertising opportunities at the stadium complex. See Note 14 to the Notes to Unaudited Condensed Consolidated Financial Statements and Note 15 to the Notes to Consolidated Financial Statements included elsewhere in this prospectus for payments under this arrangement in each of 2021 through 2025 and thereafter and for discussion of an associated contingent matter.
In the second half of 2020, we launched our SoFi Credit Card, which carries no annual membership fee and provides up to two percent unlimited cash back when the cash back rewards are applied to a SoFi Money or SoFi Invest account, or used to pay down SoFi student loans or personal loans, as well as a one-percent annual percentage rate reduction after 12 consecutive on-time credit card payments, with the reduced rate sustained with continued on-time payments.
In 2019, we launched SoFi Invest, a consumer investing service that offers stocks, Exchange-Traded Funds (“ETFs”) and robo-advising with no commissions or management fees, for which we conducted limited product testing beginning in 2017 with an official launch in early 2019. Additionally, during 2019 we: (i) relaunched home loans, a refreshed mortgage offering complete with a reengineered process that helps members buy or refinance a home with an online application, no hidden fees or prepayment penalties; (ii) launched in-school loans, which are private loans available for undergraduate and graduate school students and parents with competitive rates, flexible payment options and a mobile-first experience; and (iii) launched SoFi Money, a digital, mobile banking experience for our members.
129

TABLE OF CONTENTS
Non-GAAP Financial Measures
Our management and board of directors use adjusted net revenue and adjusted EBITDA, which are non-GAAP financial measures, to evaluate our operating performance, formulate business plans, help better assess our overall liquidity position, and make strategic decisions, including those relating to operating expenses and the allocation of internal resources. Accordingly, we believe that adjusted net revenue and adjusted EBITDA provide useful information to investors and others in understanding and evaluating our operating results in the same manner as our management and board of directors.
Adjusted Net Revenue
Adjusted net revenue is defined as total net revenue, adjusted to exclude the fair value changes in servicing rights and residual interests classified as debt due to valuation inputs and assumptions changes, which relate only to our Lending segment. We adjust total net revenue to exclude these items, as they are non-cash charges that are not realized during the period, and therefore positive or negative changes do not impact the cash available to fund our operations. This measure helps provide our management with an understanding of the net revenue available to finance our operations and helps management better decide on the proper expenses to authorize for each of our operating segments, to ultimately help achieve target contribution profit margins, which are set by our CODM on an annual basis. Therefore, the measure of adjusted net revenue serves as both the starting point for how we think about the liquidity generated from our operations and also the starting point for our annual financial planning, the latter of which focuses on the cash we expect to generate from our operating segments to help fund the current year’s strategic objectives. Adjusted net revenue has limitations as an analytical tool and should not be considered in isolation from, or as a substitute for, the analysis of other GAAP financial measures, such as total net revenue. The primary limitation of adjusted net revenue is its lack of comparability to other companies that do not utilize this measure or that use a similar measure that is defined in a different manner. We reconcile adjusted net revenue to total net revenue, the most directly comparable GAAP measure, as presented for the periods indicated below:
IPOE-20210614_G9.JPG
Three Months Ended March 31, Year Ended December 31,
($ in thousands) 2021 2020 2020 2019 2018
Total net revenue $ 195,984  $ 78,302  $ 565,532  $ 442,659  $ 269,399 
Servicing rights – change in valuation inputs or assumptions(1)
12,109  (7,059) 17,459  (8,487) (1,197)
Residual interests classified as debt – change in valuation inputs or assumptions(2)
7,951  14,936  38,216  17,157  (27,481)
Adjusted net revenue $ 216,044  $ 86,179  $ 621,207  $ 451,329  $ 240,721 
__________________
(1)Reflects changes in fair value inputs and assumptions on servicing rights, including conditional prepayment and default rates and discount rates. These assumptions are highly sensitive to market interest rate changes and are not indicative of our performance or results of operations. Moreover, these non-cash charges are unrealized during the period and, therefore, have no impact on our cash flows from
130

TABLE OF CONTENTS
operations. As such, these positive and negative changes are adjusted out of total net revenue to provide management and financial users with better visibility into the net revenue available to finance our operations and our overall performance.
(2)Reflects changes in fair value inputs and assumptions on residual interests classified as debt, including conditional prepayment and default rates and discount rates. When third parties finance our consolidated securitization VIEs by purchasing residual interests, we receive proceeds at the time of the closing of the securitization and, thereafter, pass along contractual cash flows to the residual interest owner. These residual debt obligations are measured at fair value on a recurring basis, but they have no impact on our initial financing proceeds, our future obligations to the residual interest owner (because future residual interest claims are limited to contractual securitization collateral cash flows), or the general operations of our business. As such, these positive and negative non-cash changes in fair value attributable to assumption changes are adjusted out of total net revenue to provide management and financial users with better visibility into the net revenue available to finance our operations.
Quarter Ended
($ in thousands) March 31,
2021
December 31,
2020
September 30,
2020
June 30,
2020
March 31,
2020
December 31,
2019
September 30,
2019
June 30,
2019
March 31,
2019
Total net revenue(1)
$ 195,984  $ 171,491  $ 200,787  $ 114,952  $ 78,302  $ 64,242  $ 129,392  $ 158,524  $ 90,501 
Servicing rights – change in valuation inputs or assumptions(2)
12,109  1,127  4,671  18,720  (7,059) (3,142) (2,268) (2,751) (326)
Residual interests classified as debt – change in valuation inputs or assumptions(3)
7,951  9,401  11,301  2,578  14,936  855  10,600  1,081  4,621 
Adjusted net revenue
$ 216,044  $ 182,019  $ 216,759  $ 136,250  $ 86,179  $ 61,955  $ 137,724  $ 156,854  $ 94,796 
__________________
(1)See “—Executive Summary” for a discussion of the significant trends in consolidated total net revenue.
(2)See footnote (1) to the table above.
(3)See footnote (2) to the table above.
The reconciling items to determine our non-GAAP measure of adjusted net revenue are applicable only to the Lending segment. The table below presents adjusted net revenue for the Lending segment for the periods indicated:
Three Months Ended March 31, Year Ended December 31,
($ in thousands) 2021 2020 2020 2019 2018
Total net revenue – Lending
$ 147,977  $ 73,878  $ 480,866  $ 434,301  $ 266,748 
Servicing rights – change in valuation inputs or assumptions(1)
12,109  (7,059) 17,459  (8,487) (1,197)
Residual interests classified as debt – change in valuation inputs or assumptions(2)
7,951  14,936  38,216  17,157  (27,481)
Adjusted net revenue – Lending
$ 168,037  $ 81,755  $ 536,541  $ 442,971  $ 238,070 
__________________
(1)See footnote (1) to the table above.
(2)See footnote (2) to the table above.
Adjusted EBITDA
Adjusted EBITDA is defined as net income (loss), adjusted to exclude: (i) corporate borrowing-based interest expense (our adjusted EBITDA measure is not adjusted for warehouse or securitization-based interest expense, nor deposit interest expense and finance lease liability interest expense, as discussed further below), (ii) income taxes, (iii) depreciation and amortization, (iv) stock-based expense (inclusive of equity-based payments to non-employees), (v) impairment expense (inclusive of goodwill impairment and of property, equipment and software abandonments), (vi) transaction-related expenses, (vii) warrant fair value adjustments, and (viii) fair value changes in servicing rights and residual interests classified as debt due to valuation assumptions. We believe adjusted EBITDA provides a useful measure for period-over-period comparisons of our business, as it removes the effect of certain non-cash items and certain charges that are not indicative of our core operating performance or results of operations. It is also a measure that management relies upon to evaluate cash flows generated from operations, and therefore the extent of additional capital, if any, required to invest in strategic initiatives. Adjusted EBITDA has limitations as an analytical
131

TABLE OF CONTENTS
tool and should not be considered in isolation from, or as a substitute for, the analysis of other GAAP financial measures, such as net income (loss). Some of the limitations of adjusted EBITDA include that it does not reflect the impact of working capital requirements or capital expenditures and it is not a universally consistent calculation among companies in our industry, which limits its usefulness as a comparative measure.
IPOE-20210614_G10.JPG
We reconcile adjusted EBITDA to net loss, the most directly comparable GAAP measure, for the periods indicated below:
Three Months Ended March 31, Year Ended December 31,
($ in thousands) 2021 2020 2020 2019 2018
Net loss $ (177,564) $ (106,367) $ (224,053) $ (239,697) $ (252,399)
Non-GAAP adjustments:
Interest expense – corporate borrowings(1)
5,008  1,088  27,974  4,962  233 
Income tax expense (benefit)(2)
1,099  57  (104,468) 98  (958)
Depreciation and amortization(3)
25,977  4,715  69,832  15,955  10,912 
Stock-based expense 37,454  19,685  100,778  61,419  43,459 
Impairment expense(4)
—  —  —  2,205  500 
Transaction-related expense(5)
2,178  3,914  9,161  —  — 
Fair value changes in warrant liabilities(6)
89,920  2,879  20,525  (2,834) — 
Servicing rights – change in valuation inputs or assumptions(7)
12,109  (7,059) 17,459  (8,487) (1,197)
Residual interests classified as debt – change in valuation inputs or assumptions(8)
7,951  14,936  38,216  17,157  (27,481)
Total adjustments 181,696  40,215  179,477  90,475  25,468 
Adjusted EBITDA $ 4,132  $ (66,152) $ (44,576) $ (149,222) $ (226,931)
___________________
(1)Our adjusted EBITDA measure adjusts for corporate borrowing-based interest expense, which includes interest on our revolving credit facility and, for periods subsequent to May 2020, the seller note issued in connection with our acquisition of Galileo and other financings assumed in the acquisition, as these expenses are a function of our capital structure. Our adjusted EBITDA measure does not adjust for interest expense on warehouse facilities and securitization debt, which are recorded within interest expense — securitizations and warehouses in the Consolidated Statements of Operations and Comprehensive Loss, as these interest expenses are direct operating expenses driven by loan origination and sales activity. Additionally, our adjusted EBITDA measure does not adjust for interest expense on SoFi Money deposits or interest expense on our finance lease liability in connection with SoFi Stadium, which are recorded within interest
132

TABLE OF CONTENTS
expense — other, as these interest expenses are direct operating expenses driven by SoFi Money deposits and finance leases, respectively. During 2020 and the three months ended March 31, 2021, we had a higher average balance on our revolving credit facility as a result of the Galileo acquisition, as well as interest expense related to the Galileo seller note issued in May 2020, which was comprised of non-cash interest expense accretion incurred because of the seller note discount to face value and interest expense incurred related to the outstanding seller note balance. We repaid the seller note in February 2021. The higher interest expense in 2019 relative to 2018 was due to increased borrowings under the revolving credit facility in 2019 and because we had a full year of interest expense in 2019, as we obtained our revolving credit facility in September 2018.
(2)The increase in income tax expense for the three months ended March 31, 2021 compared to the same period in 2020 was primarily a function of SoFi Lending Corp’s profitability in state jurisdictions where separate filing is required. See Note 12 to the Notes to Unaudited Condensed Consolidated Financial Statements included elsewhere in this prospectus for additional information. Income tax benefit during 2020 was primarily attributable to a decrease in our valuation allowance as a result of the deferred tax liabilities recognized in connection with our acquisition of Galileo.
(3)Depreciation and amortization expense for the three months ended March 31, 2021 compared to the same period in 2020 and for the full year 2020 compared to the full year 2019 increased primarily due to: (i) amortization expense on intangible assets acquired during the second quarter of 2020 from Galileo and 8 Limited, (ii) acceleration of core banking infrastructure amortization, as Galileo’s infrastructure rendered the existing core banking infrastructure redundant, and (iii) amortization of purchased and internally-developed software.
(4)Impairment expense includes primarily software abandonment during 2019 and fixed asset abandonment during 2018.
(5)During the three months ended March 31, 2021, transaction-related expenses included financial advisory and professional services costs associated with our pending purchase of Golden Pacific Bancorp, Inc. During 2020, transaction-related expenses included certain costs, such as financial advisory and professional services costs, associated with our acquisitions of Galileo and 8 Limited.
(6)We issued warrants in connection with certain redeemable preferred stock issuances during 2019, which are accounted for as liabilities and are measured at fair value on a recurring basis. Our adjusted EBITDA measure excludes the non-cash fair value changes in those warrants. The change during the three months ended March 31, 2021 was primarily attributable to a significant increase in our assumed Series H redeemable preferred stock share price. See Note 9 to the Notes to Unaudited Condensed Consolidated Financial Statements and Note 10 to the Notes to Consolidated Financial Statements included elsewhere in this prospectus for additional information.
(7)Reflects changes in fair value inputs and assumptions, including market servicing costs, conditional prepayment and default rates and discount rates. This non-cash change is unrealized during the period and, therefore, has no impact on our cash flows from operations. As such, these positive and negative changes in fair value attributable to assumption changes are adjusted out of net loss to provide management and financial users with better visibility into the earnings available to finance our operations.
(8)Reflects changes in fair value inputs and assumptions, including conditional prepayment and default rates and discount rates. When third parties finance our consolidated VIEs through purchasing residual interests, we receive proceeds at the time of the securitization close and, thereafter, pass along contractual cash flows to the residual interest owner. These obligations are measured at fair value on a recurring basis, which has no impact on our initial financing proceeds, our future obligations to the residual interest owner (because future residual interest claims are limited to contractual securitization collateral cash flows), or the general operations of our business. As such, these positive and negative non-cash changes in fair value attributable to assumption changes are adjusted out of net loss to provide management and financial users with better visibility into the earnings available to finance our operations.
133

TABLE OF CONTENTS
Quarter Ended
($ in thousands) March 31,
2021
December 31,
2020
September 30,
2020
June 30,
2020
March 31,
2020
December 31,
2019
September 30,
2019
June 30,
2019
March 31,
2019
Net income (loss) $ (177,564) $ (82,616) $ (42,878) $ 7,808  $ (106,367) $ (122,541) $ (57,559) $ (10,218) $ (49,379)
Non-GAAP adjustments:
Interest expense – corporate borrowings 5,008  19,125  4,346  3,415  1,088  1,155  1,350  1,354  1,103 
Income tax expense (benefit) 1,099  (4,949) 192  (99,768) 57  (411) 472  32 
Depreciation and amortization 25,977  25,486  24,676  14,955  4,715  5,155  4,265  3,362  3,173 
Stock-based expense 37,454  30,089  26,551  24,453  19,685  17,615  15,673  14,528  13,603 
Impairment expense —  —  —  —  —  384  1,821  —  — 
Transaction-related expenses 2,178  —  297  4,950  3,914  —  —  —  — 
Fair value changes in warrant liabilities 89,920  14,154  4,353  (861) 2,879  (74) (2,010) (750) — 
Servicing rights – change in valuation inputs or assumptions 12,109  1,127  4,671  18,720  (7,059) (3,142) (2,268) (2,751) (326)
Residual interests classified as debt – change in valuation inputs or assumptions 7,951  9,401  11,301  2,578  14,936  855  10,600  1,081  4,621 
Total adjustments 181,696  94,433  76,387  (31,558) 40,215  21,537  29,903  16,829  22,206 
Adjusted EBITDA $ 4,132  $ 11,817  $ 33,509  $ (23,750) $ (66,152) $ (101,004) $ (27,656) $ 6,611  $ (27,173)
Key Business Metrics
The table below presents the key business metrics that management uses to evaluate our business, measure our performance, identify trends and make strategic decisions.
March 31, 2021 vs. 2020
% Change
December 31, 2020 vs. 2019
% Change
2019 vs. 2018
% Change
2021 2020 2020 2019 2018
Members 2,281,092  1,086,409  110  % 1,850,871  976,459  652,801  90  % 50  %
Total Products 3,184,554  1,442,481  121  % 2,523,555  1,185,362  691,255  113  % 71  %
Lending
Total Products 945,227  841,615  12  % 917,645  798,005  640,350  15  % 25  %
Financial Services
Total Products 2,239,327  600,866  273  % 1,605,910  387,357  50,905  315  % 661  %
Technology Platform
Total Accounts 69,572,680  —  n/m 59,359,843  —  —  n/m n/m

See “—Summary Results by Segment” for additional metrics we review at the segment level.
Members
We refer to our customers as “members”. We define a member as someone who has a lending relationship with us through origination or servicing, opened a financial services account, linked an external account to our platform, or signed up for our credit score monitoring service. Once someone becomes a member, they are always considered a member unless they violate our terms of service given our members have continuous access to our CFPs, our
134

TABLE OF CONTENTS
career advice services, our member events, all of our content, educational material, news, tools and calculators at no cost to the member. Additionally, our mobile app and website have been designed with a member home feed that is personalized and delivers content to a member about what they must do that day in their financial life, what they should consider doing that day in their financial life, and what they can do that day in their financial life. We view members as an indication not only of the size and a measurement of growth of our business, but also as a measure of the significant value of the data we have collected over time. The data we collect from our members helps us to, among other things: (i) assess loan life performance data on each loan in our ecosystem, which can inform risk-based interest rates that we can offer our members, (ii) understand our members’ spending behavior to identify and suggest other products we offer that may align with the members’ financial needs; and (iii) enhance our opportunities to sell additional products to our members, as our members represent a vital source of marketing opportunities. When we provide additional products to members, it helps improve our unit economics per member, as we save on marketing costs we would otherwise incur to attract new members. It also increases the lifetime value of an individual member. This in turn enhances our Financial Services Productivity Loop. Member growth is generally an indicator of future revenue, but is not directly correlated with revenues, since not all members who sign up for one of our products fully utilize or continue to use our products, and not all of our products (such as our complementary product, SoFi Relay) provide direct sources of revenue.
Total Products
Total products refers to the aggregate number of lending and financial services products that our members have selected on our platform since our inception through the reporting date, whether or not the members are still registered for such products. In our Lending segment, total products refers to the number of home loans, personal loans and student loans that have been originated through our platform through the reporting date, whether or not such loans have been paid off. If a member has multiple loan products of the same loan product type, such as two personal loans, that is counted as a single product. However, if a member has multiple loan products across loan product types, such as one personal loan and one home loan, that is counted as two products. In our Financial Services segment, total products refers to the number of SoFi Money accounts, SoFi Invest accounts, SoFi Credit Card accounts, SoFi At Work accounts and SoFi Relay accounts (with either credit score monitoring enabled or external linked accounts) that have been opened through our platform through the reporting date. Our SoFi Invest service is comprised of three products: active investing accounts, robo-advisory accounts and cryptocurrency accounts. If a member has multiple SoFi Invest products of the same account type, such as two active investing accounts, that is counted as a single product. However, if a member has multiple SoFi Invest products across account types, such as one active investing account and one robo-advisory account, those separate account types are considered separate products. Total products is a primary indicator of the size and reach of our Lending and Financial Services segments. Management relies on total product metrics to understand the effectiveness of our member acquisition efforts and to gauge the propensity for members to use more than one product. As of March 31, 2021, we had 3,184,554 total products.
IPOE-20210614_G11.JPG
135

TABLE OF CONTENTS
As of March 31, 2021, we had 945,227 total lending products, of which 517,042 were personal loans, 406,293 were student loans, 15,961 were home loans and 5,931 were in-school loans. The growth in our lending products over time reflects our continued emphasis on origination of personal loans, student loans and home loans, inclusive of our entrance into in-school student lending in the third quarter of 2019.
As of March 31, 2021, we had 2,239,327 total financial services products, of which 823,003 were SoFi Money products, 854,383 were SoFi Invest products, 19,365 were SoFi Credit Card products, 523,451 were SoFi Relay products and 19,125 were SoFi At Work accounts. Growth in our financial services products over time reflects the impacts of our official launches of SoFi Money, SoFi Invest and SoFi Relay in early 2019 and SoFi Credit Card in late 2020.
IPOE-20210614_G12.JPG
Technology Platform Total Accounts
In our Technology Platform segment, total accounts refers to the number of open accounts at Galileo as of the reporting date, excluding SoFi accounts. We exclude SoFi accounts because revenue generated by Galileo from the SoFi relationship is eliminated in consolidation. No information is reported prior to our acquisition of Galileo on May 14, 2020. Total accounts is a primary indicator of the accounts dependent upon Galileo’s technology platform to use virtual card products, virtual wallets, make peer-to-peer and bank-to-bank transfers, receive early paychecks, separate savings from spending balances, make debit transactions and rely upon real-time authorizations, all of which result in technology platform fees for the Technology Platform segment.
Key Factors Affecting Operating Results
Our future operating results and cash flows are dependent upon a number of opportunities, challenges and other factors, including our loan origination volume, financial services products and member activity on our platform, growth in Galileo accounts, competition and industry trends, general economic conditions and whether or not we are able to secure a national bank charter.
Origination Volume
Our Lending segment is our largest segment, comprising 76% and 94% of our total net revenue during the three months ended March 31, 2021 and 2020, respectively, and 85% and 98% during the year ended December 31, 2020 and 2019, respectively. We are dependent upon the addition of new members and new activity from existing members within our Lending segment to generate origination volume, which we believe is a contributor to Lending segment net revenue. We believe we have a high-quality loan portfolio, as indicated by our weighted average origination FICO score of 767 and 768 during the three months ended March 31, 2021 and the year ended December 31, 2020, respectively. See “—Industry Trends and General Economic Conditions” below for the impact of specific economic factors, including the COVID-19 pandemic, on origination volume.
136

TABLE OF CONTENTS
Member Growth and Activity
We have invested heavily in our platform and are dependent on continued member growth, as well as our ability to generate additional revenues from our existing members using additional products and services. Member growth and activity is critical to our ability to increase our scale and earn a return on our technology and product investments. Growth in members and member activity will depend heavily on our ability to continue to offer attractive products and services at sustainable costs and our continued member acquisition and marketing efforts.
Product Growth
Our aim is to develop and offer a best-in-class integrated financial services platform with products that meet the broad objectives of our members and the lifecycle of their financial needs. We have invested, and continue to invest, heavily in the development, improvement and marketing of our suite of lending and financial services products and are dependent on continued growth in the number of products selected by our members, as well as our ability to build trust and reliability between our members and our platform to reinforce the effects of the Financial Services Productivity Loop. In order to deliver on our strategy, we aim to foster positive member experiences designed to lead to more products per member, leading to enhanced profitability for each additional product by lowering overall member acquisition costs.
Galileo Account Growth
During 2020, we acquired Galileo, which primarily provides technology platform services to financial and non-financial institutions, to enable us to diversify our business from a primarily consumer-based business to also serve enterprises that rely upon Galileo’s integrated platform as a service to serve their clients. We are dependent on growth in the number of accounts at Galileo, which is an indication of the amount of users that are dependent upon the technology platform for a variety of products and services, including virtual card products, virtual wallets, peer-to-peer and bank-to-bank transfers, early paychecks and relying on real-time authorizations, all of which generate revenues for Galileo.
Competition
We face competition from several financial services institutions given our status as a diversified financial services provider. In each of our reportable segments, we may compete with more established financial institutions, some of which have more financial resources than we do. We compete at multiple levels, including competition among other personal loan, student loan, credit card and residential mortgage lenders, competition for deposits in our SoFi Money product from traditional banks and other non-bank lenders, competition for investment accounts in our SoFi Invest product from other brokerage firms, including those based on online or mobile platforms, competition for subscribers to our financial services content, and competition with other technology platforms for the enterprise services we provide. Some of our competitors may at times seek to increase their market share by undercutting pricing terms prevalent in that market, which could adversely affect our market share for any of our products and services or require us to incur higher member acquisition costs. Furthermore, our competitors could offer relatively attractive benefits to our current members, which could limit members using more than one product.
Industry Trends and General Economic Conditions
Our results of operations have historically been relatively resilient to economic downturns but in the future may be impacted by the relative strength of the overall economy and its effect on unemployment, asset markets and consumer spending. As general economic conditions improve or deteriorate, the amount of consumer disposable income tends to fluctuate, which in turn impacts consumer spending levels and the willingness of consumers to take out loans to finance purchases or invest in financial assets. Specific economic factors, such as interest rate levels, changes in monetary and related policies, unemployment rates, market volatility and consumer confidence also influence consumer spending, saving, investing and borrowing patterns. Increased focus by policymakers and the new presidential administration on outstanding student loans has led to discussions of potential legislative and regulatory actions, among other possible steps, to reduce outstanding balances of loans, or cancel loans at a significant scale, including the potential forgiveness of federal student debt. Such actions resulting in forgiveness or
137

TABLE OF CONTENTS
cancellation at a meaningful scale would likely have an adverse impact on our results of operations and overall business.
Additionally, our business has been, and may continue to be, impacted by some of the national measures taken to counteract the economic impact of the COVID-19 pandemic. For example, the CARES Act and subsequent extensions of certain hardship provisions have led to decreased demand for our student loan refinancing products. The Federal Reserve’s actions to reduce interest rates to near-zero benchmark levels have led to increased demand for home loan refinancing and we believe have increased the attractiveness of our SoFi Invest product, as members look for alternative ways to earn higher returns on their cash. Conversely, these lower benchmark rates have reduced deposit interest rates we can offer on our SoFi Money product, which we believe has adversely impacted demand for the product. As consumer spending behavior has changed during the COVID-19 pandemic, we believe there has also been decreased demand for debt consolidation products, which negatively impacts our personal loan origination volume. In addition, the increases in forbearance during 2020 led to lower valuations on our loans. The impacts of the COVID-19 pandemic on our products and measures we have taken to help our Company and our members navigate the uncertain economic environment caused by the COVID-19 pandemic are discussed further throughout this “Management’s Discussion and Analysis of Financial Condition and Results of Operations”.
National Bank Charter
A key element of our long-term strategy is to secure a national bank charter. In March 2021, we entered into an Agreement and Plan of Merger to acquire Golden Pacific, a registered bank holding company, and its wholly owned subsidiary Golden Pacific Bank, a national banking association. See “Business—Government Regulation—Bank Acquisition” for additional information on the regulatory approvals required to close the proposed acquisition. If we are successful in securing a national bank charter through the proposed acquisition, we expect to incur additional costs in our operation of the bank primarily associated with headcount, technology infrastructure, governance, compliance and risk management, marketing, and other general and administrative expenses.
The key expected financial benefits to us of obtaining a national bank charter include: (i) lowering our cost to fund loans, as we can utilize SoFi Money deposits to fund loans, which have a lower borrowing cost of funds than our current financing model, (ii) holding loans on our balance sheet for longer periods, thereby enabling us to earn interest on these loans for a longer period and increasing our net interest margin, and (iii) supporting origination volume growth by providing an alternative financing option, while also maintaining our warehouse capacity. There can be no guarantee that we will be able to secure a national bank charter, either through the proposed acquisition or through the formation of a de novo national bank or, if we do, that we will realize the anticipated benefits. See “Risk Factors—We are acquiring a national bank, which is subject to regulatory approvals and other closing conditions and, if consummated, the acquisition will subject us to significant additional regulation” included elsewhere in this prospectus.
Key Components of Results of Operations
Interest Income
Interest income is predominantly driven by loan origination volume, prevailing interest rates that we receive on the loans we make and the amount of time we hold loans on our balance sheet. Securitizations interest income is driven by our securitization-related investments in bonds and residual interest positions, which are required under securitization risk retention rules. See Note 1 to the Notes to Unaudited Condensed Consolidated Financial Statements and to the Notes to Consolidated Financial Statements included elsewhere in this prospectus for additional information on our securitization-related investments. Moreover, we earn other interest income on excess corporate cash balances and SoFi Money member balances. Related party interest income was derived from notes extended to Apex and one of our stockholders, and was not core to our operations. We received full repayment of all related party notes prior to the date of this filing.
Interest Expense
Interest expense primarily includes interest we incur under our warehouse facilities, inclusive of the amortization of debt issuance costs, and under our securitization debt, inclusive of debt issuance costs and discounts.
138

TABLE OF CONTENTS
We incur securitization-related interest expense when securitization transfers do not qualify as true sales pursuant to ASC 810, Consolidation. Securitization-related interest expense fluctuates depending on the level of our securitization activity, market rates and whether and how much such activity results in true sale treatment. We also incur interest expense related to our revolving credit facility and on the seller note issued in connection with our acquisition of Galileo in May 2020, which was fully repaid in February 2021, as well as on the other financings assumed in the acquisition. For our residual interests classified as debt, we recognize interest expense over the expected life using the effective yield method, which represents a portion of the overall fair value change in the residual interests classified as debt. On a quarterly basis, we reevaluate the cash flow estimates to determine if a change to the accretable yield is required on a prospective basis, which is a reclassification between two income statement line items, and therefore has no net impact on net income (loss). We also pay interest income to our members who have SoFi Money account balances, which is interest expense to us. Interest expense is dependent on market interest rates, such as LIBOR, interest rate spreads versus benchmark rates, the amount of warehouse capacity we can access, warehouse advance rates and the amount of loans we ultimately pledge to our warehouse facilities. Finally, we incur interest on our finance lease liabilities associated with SoFi Stadium, which relate to certain physical signage within the stadium. Our interest expense has historically fluctuated due to changes in the interest rate environment and we expect it will continue to fluctuate in future periods.
Noninterest Income
Noninterest income primarily consists of: (i) fair value changes in loans while we hold them on our balance sheet; (ii) gains on sales of loans transferred into the securitization or whole loan sale channels; (iii) the income we receive from our loan servicing activities; (iv) fair value changes related to our securitization activities; and (v) revenue recognized pursuant to ASC 606, Revenue from Contracts with Customers, which primarily relates to our Technology Platform fees.
When we originate a loan, we generally expect that we will sell the loan for more than its par value, which will result in positive loan origination and sales results. Moreover, loan origination and sales also includes recognized servicing assets at the time of a loan sale. The subsequent measurement of our servicing asset at fair value impacts the servicing line in our Consolidated Statements of Operations and Comprehensive Loss. When we sell a loan into a securitization trust that qualifies for true sale accounting, the gain or loss on sale is recorded within loan origination and sales. The securitizations line item is impacted by fair value changes in securitization loan collateral, residual interests classified as debt and our securitization investments associated with our continuing interest in the securitization subsequent to the sale. Historically, revenue recognized in accordance with ASC 606 has been relatively immaterial given our significant lending operations. However, our acquisition of Galileo during 2020 led to increased revenue from contracts with customers, primarily in the form of Technology Platform fees. Moreover, revenue generated in our Financial Services segment continues to grow over time.
Noninterest Expense
Noninterest expense relates to the following categories of expenses: (i) technology and product development, (ii) sales and marketing, (iii) cost of operations, and (iv) general and administrative. Certain costs are included within each of these line items, such as compensation and benefits-related expense (inclusive of stock-based compensation expense), professional services, depreciation and amortization and occupancy and travel-related costs. We allocate certain costs to each of these four categories based on department-level headcounts. We generally expect the expenses within each such category to increase in absolute dollars as our business continues to grow.
Directly Attributable Expenses
As presented within “—Summary Results by Segment”, in our determination of the contribution profit (loss) for our Lending, Financial Services and Technology Platform segments, we allocate certain expenses that are directly attributable to the corresponding segment. Directly attributable expenses primarily include compensation and benefits and sales and marketing, and vary based on the amount of activity within each segment. Directly attributable expenses also include loan origination and servicing expenses, professional services, occupancy and travel, tools and subscriptions, and bank service charge expenses. Expenses are attributed to the reportable segments
139

TABLE OF CONTENTS
using either direct costs of the segment or labor costs that can be attributed based upon the allocation of employee time for individual products.
Results of Operations
Three Months Ended March 31, 2021 Compared to Three Months Ended March 31, 2020
The following table sets forth condensed consolidated statements of income data for the periods indicated:
Three Months Ended March 31,
2021 vs 2020
% Change
($ in thousands)
2021 2020
Interest income
Loans $ 77,221  $ 86,116  (10) %
Securitizations 4,467  7,061  (37) %
Related party notes 211  1,052  (80) %
Other 629  3,053  (79) %
Total interest income 82,528  97,282  (15) %
Interest expense
Securitizations and warehouses 29,808  47,523  (37) %
Corporate borrowings 5,008  1,088  360  %
Other 432  1,522  (72) %
Total interest expense 35,248  50,133  (30) %
Net interest income 47,280  47,149  —  %
Noninterest income
Loan origination and sales 110,345  104,255  %
Securitizations (2,036) (83,104) (98) %
Servicing (12,109) 7,059  (272) %
Technology Platform fees 45,659  —  n/m
Other 6,845  2,943  133  %
Total noninterest income 148,704  31,153  377  %
Total net revenue 195,984  78,302  150  %
Noninterest expense
Technology and product development 65,948  40,171  64  %
Sales and marketing 87,234  62,670  39  %
Cost of operations 57,570  32,657  76  %
General and administrative 161,697  49,114  229  %
Total noninterest expense 372,449  184,612  102  %
Loss before income taxes (176,465) (106,310) 66  %
Income tax expense (1,099) (57) n/m
Net loss $ (177,564) $ (106,367) 67  %
Other comprehensive loss
Foreign currency translation adjustments, net $ (80) $ (7) n/m
Total other comprehensive loss (80) (7) n/m
Comprehensive loss $ (177,644) $ (106,374) 67  %
140

TABLE OF CONTENTS
Interest Income
The following table presents the components of our total interest income for the periods indicated:
Three Months Ended March 31,
2021 vs 2020
% Change
($ in thousands)
2021 2020
Loans
$ 77,221  $ 86,116  (10) %
Securitizations
4,467  7,061  (37) %
Related party notes
211  1,052  (80) %
Other
629  3,053  (79) %
Total interest income
$ 82,528  $ 97,282  (15) %
Total interest income decreased by $14.8 million, or 15%, for the three months ended March 31, 2021 compared to the three months ended March 31, 2020 due to the following:
Loan interest income decreased by $8.9 million, or 10%, primarily driven by a decline of $29.3 million in interest income from consolidated securitizations, partially offset by increases in non-securitization personal loan and student loan interest income of $16.6 million and $3.6 million, respectively. The decrease in interest income from consolidated securitizations was impacted by a 50% decline in average balance, which was attributable to payment activity and partially the result of the deconsolidation of two securitizations in the first quarter of 2020. The increases in non-securitization loan interest income were primarily a function of increases in average balances for personal loans and student loans of 111% and 45%, respectively.
Securitizations interest income decreased by $2.6 million, or 37%, which was attributable to decreases in residual investment interest income of $0.8 million and asset-backed bonds of $0.8 million related to decreases in average securitization investment balances period over period, and a decrease in securitization float interest income of $1.0 million related to decreases in average securitization loan balances and a decline in interest rates period over period.
Related party notes interest income decreased by $0.8 million, or 80%, due to a decrease in interest income on a stockholder loan, which was fully settled in the fourth quarter of 2020, and a decrease in interest income related to our loans to Apex, which were fully settled in February 2021. See Note 13 to the Notes to Unaudited Condensed Consolidated Financial Statements included elsewhere in this prospectus for additional information on our related party notes.
Other interest income decreased by $2.4 million, or 79%, primarily due to interest rate decreases period over period, and a decrease in our cash balances. The interest rate decreases impacted the interest income we earn on both our bank balances and Member Bank deposits.
Interest Expense
The following table presents the components of our total interest expense for the periods indicated:
Three Months Ended March 31,
2021 vs 2020
% Change
($ in thousands)
2021 2020
Securitizations and warehouses
$ 29,808  $ 47,523  (37) %
Corporate borrowings 5,008  1,088  360  %
Other
432  1,522  (72) %
Total interest expense
$ 35,248  $ 50,133  (30) %
141

TABLE OF CONTENTS
Total interest expense decreased by $14.9 million, or 30%, for the three months ended March 31, 2021 compared to the three months ended March 31, 2020, due to the following:
Interest expense related to securitizations and warehouses decreased by $17.7 million, or 37%. The following tables present the components of securitizations and warehouses interest expense and other pertinent information.
Three Months Ended March 31,
2021 vs 2020
% Change
($ in thousands)
2021 2020
Securitization debt interest expense $ 10,948  $ 21,311  (49) %
Warehouse debt interest expense 10,531  14,114  (25) %
Residual interests classified as debt interest expense 2,199  3,846  (43) %
Debt issuance cost interest expense 6,130  8,252  (26) %
Securitizations and warehouses interest expense
$ 29,808  $ 47,523  (37) %
Three Months Ended March 31, 2021 vs 2020
% Change
($ in thousands) 2021 2020
Average debt balances
Securitization debt $ 1,134,366  $ 2,289,941  (50) %
Warehouses facilities 2,397,899  1,766,276  36  %
Residual interests classified as debt 57,032  204,763  (72) %
Weighted average interest rates(1)
Securitization debt(2)
3.9  % 3.7  % n/m
Warehouse facilities(2)
1.8  % 3.2  % n/m
Residual interests classified as debt 15.4  % 7.5  % n/m
___________________
(1)Calculated as annualized interest expense divided by average debt balance for the respective debt category.
(2)Interest rates on securitization debt and warehouse facilities exclude the effect of debt issuance cost interest expense.
The decrease in interest expense related to securitizations and warehouses was driven by the following:
Securitization debt interest expense (exclusive of debt issuance and discount amortization) decreased by $10.4 million, which was correlated with the deconsolidation of securitizations discussed in the interest income section above. Further, our student loan securitization debt is primarily tied to one-month LIBOR, which decreased period over period;
Warehouse debt interest expense (exclusive of debt issuance amortization) decreased by $3.6 million, which was related to decreases in one- and three-month LIBOR period over period, partially offset by a higher average warehouse debt balance outstanding period over period;
Residual interests classified as debt interest expense decreased by $1.6 million, which was correlated with a lower balance of residual interests classified as debt during the 2021 period, a significant driver of which was the aforementioned deconsolidation of securitizations during the 2020 period; and
Debt issuance cost interest expense decreased by $2.1 million, which was driven by the acceleration of the amortization of debt issuance costs of $1.0 million in the 2020 period upon the deconsolidation of two securitizations, and an acceleration of warehouse facility debt issuance cost amortization related to a reduction in warehouse facility capacity during the 2020 period, partially offset by interest expense from new debt issuance costs during the 2021 period.
142

TABLE OF CONTENTS
Corporate borrowings interest expense increased by $3.9 million, or 360%, primarily due to the following:
Interest expense incurred for a portion of the 2021 period on the Galileo seller note issued in May 2020 of $3.6 million, as the seller note was repaid in February 2021; and
An increase of $0.2 million in revolving credit facility interest expense, which reflects a higher average balance during the 2021 period, as we drew $325.0 million on the facility during the second quarter of 2020, partially offset by a decline in one-month LIBOR period over period.
Other interest expense decreased by $1.1 million, or 72%, primarily due to a decrease of $1.2 million associated with SoFi Money balances, which was correlated with the decline in interest rates period over period.
Noninterest Income and Net Revenue
The following table presents the components of our total noninterest income and total net revenue for the periods indicated:
Three Months Ended March 31,
2021 vs 2020
% Change
($ in thousands)
2021 2020
Loan origination and sales
$ 110,345  $ 104,255  %
Securitizations
(2,036) (83,104) (98) %
Servicing
(12,109) 7,059  (272) %
Technology Platform fees
45,659  —  n/m
Other
6,845  2,943  133  %
Total noninterest income
$ 148,704  $ 31,153  377  %
Total net revenue
$ 195,984  $ 78,302  150  %
Total noninterest income increased by $117.6 million, or 377%, for the three months ended March 31, 2021 compared to the three months ended March 31, 2020, due to the following:
Loan origination and sales increased by $6.1 million, or 6%. We experienced a $10.8 million period-over-period increase in home loan originations and sales related income, net of hedges and related interest rate lock commitments. The increase was primarily driven by a 112% increase in home loan origination volume and gains on mortgage pipeline hedges, as discussed further in the table below, which was partially offset by losses on interest rate lock commitments due to a decline in our home loan origination pipeline during the 2021 period. In addition, home loan origination fees increased by $2.3 million period over period in conjunction with the increase in origination volume.
These gains were offset by a decrease of $7.0 million in aggregate personal loan and student loan origination and sales income, which was attributable to lower gain on sale execution for both personal loan and student loan sales in the 2021 period, lower origination volume, and higher combined write-offs and repurchase expense of $4.4 million. Student loan origination volume declined 53% period over period, primarily due to lower demand for our student loan refinancing products as a result of the payment deferral period on federal student loans enacted through the CARES Act in late March 2020. Personal loan origination volume declined 11% period over period, primarily due to lower demand for personal loan financing, which we believe is a result of lower consumer spending behavior during the COVID-19 pandemic. Partially offsetting these decreases were period-over-period gains in our student loan and personal loan economic hedge positions, as discussed further in the table below. See “—Key Factors Affecting Operating Results—Industry Trends and General Economic Conditions”.
Securitization income increased by $81.1 million, or 98%, primarily due to a reduction in securitization loan write-offs of $14.8 million, which was correlated with the deconsolidation of securitizations in the 2020 period and stronger securitization loan credit performance during the 2021 period. The decrease in securitization loan write-offs also had the impact of improving our assumed future credit outlook for our securitization loans, which contributed to an aggregate increase of $62.6 million period over period in securitization loan fair market value changes.
143

TABLE OF CONTENTS
These increases were offset by residual debt fair value increases of $13.5 million, which were correlated with underlying securitization performance and residual interest positions representing a greater percentage of securitization claims (which occurs over time as securitization loans are paid off and, accordingly, securitization debt gets paid off) period over period, of which $7.0 million was related to non-cash favorable fair value changes in residual interests classified as debt valuation assumptions and inputs.
Lastly, the aggregate period-over-period increase was driven by a positive variance in our securitization investment earnings of $17.2 million, which was due to a $5.1 million loss realized in the 2020 period related to the deconsolidation of two personal loan securitizations and the aforementioned improvement in credit outlook, which resulted in lower period-over-period bond and residual investment yields, and therefore improved fair market values for both asset classes.
The table below presents additional information related to loan gains and losses and overall performance:
Three Months Ended March 31,
2021 vs 2020
% Change
($ in thousands) 2021 2020
Gains from non-securitization loan transfers $ 70,900  $ 38,699  83  %
Gains from loan securitization transfers(1)
29,027  110,307  (74) %
Economic derivative hedges of loan fair values(2)
36,071  (35,721) (201) %
Home loan origination fees(3)
4,020  1,764  128  %
Loan write-off expense – whole loans(4)
(5,125) (2,299) 123  %
Loan write-off expense – securitization loans(5)
(4,381) (19,155) (77) %
Loan repurchase (expense) benefit(6)
(1,483) 79  n/m
___________________
(1)Represents the gain recognized on loan securitization transfers qualifying for sale accounting treatment. For the three months ended March 31, 2020, the gain is exclusive of deconsolidation losses of $5.1 million.
(2)During the three months ended March 31, 2021, we had gains of $22.5 million on interest rate swap positions due to increases in interest rates during the period and a $13.5 million gain on mortgage pipeline hedges due to decreases in the underlying hedge price index. During the three months ended March 31, 2020, we had a $7.0 million loss on mortgage pipeline hedges due to increases in the underlying hedge price index and additional losses of $51.2 million on interest rate swap positions due to declines in interest rates during the period. These losses were offset by a gain on our credit default swaps of $22.5 million. Amounts presented herein exclude interest rate lock commitments, as they are not an economic hedge of loan fair values. We had a (loss) gain of $(8.5) million and $10.7 million during the three months ended March 31, 2021 and 2020, respectively, related to interest rate lock commitments. The period-over-period change was largely a function of quarterly changes in the home loan origination pipeline during each respective period.
(3)This variance was correlated with an increase in home loan origination volume period over period.
(4)Includes gross write-offs of $7.4 million and $4.7 million for the three months ended March 31, 2021 and 2020, respectively. During the 2021 period, $0.5 million of the $2.3 million of recoveries were captured via loan sales to a third-party collection agency. During the 2020 period, $0.3 million of the $2.4 million of recoveries were captured via loan sales to a third-party collection agency.
(5)Includes gross write-offs of $7.4 million and $23.3 million for the three months ended March 31, 2021 and 2020, respectively. During the 2021 period, $1.3 million of the $3.0 million of recoveries were captured via loan sales to a third-party collection agency. During the 2020 period, $2.0 million of the $4.1 million of recoveries were captured via loan sales to a third-party collection agency.
(6)Represents the expense or benefit associated with our estimated loan repurchase obligation. See Note 14 to the Unaudited Condensed Consolidated Financial Statements included elsewhere in this prospectus for additional information.
Servicing income decreased by $19.2 million, or 272%, and was primarily related to fair value changes in our servicing assets that were largely attributable to an increase in servicing asset prepayment speed assumptions period over period. We experienced an increase in loan prepayments during the 2021 period, which we believe is correlated with the market interest rate declines compared to the 2020 period, and is related to the effects of the COVID-19 pandemic. We expect prepayments to continue to remain at a higher than historical level in the current low interest rate environment.
144

TABLE OF CONTENTS
We own the master servicing on all the servicing rights that we retain and, in each case, recognize the gross servicing rate applicable to each serviced loan. Subservicers are utilized for all serviced student loans and home loans, which represents a cost to SoFi, but these arrangements do not impact our calculation of the weighted average basis points earned for each loan type serviced. Further, there is no impact on servicing income due to forbearance and moratoriums on certain debt collection activities, and there are no waivers of late fees. The table below presents additional information related to our loan servicing activities:
Three Months Ended March 31, 2021 vs 2020
% Change
($ in thousands) 2021 2020
Servicing income recognized
Home loans(1)
$ 1,744  $ 891  96  %
Student loans(2)
12,160  13,037  (7) %
Personal loans(3)
8,475  11,341  (25) %
Servicing rights fair value change
Home loans(4)
8,124  1,259  545  %
Student loans(5)
5,701  9,208  (38) %
Personal loans(6)
(2,182) (2,166) (1) %
______________
(1)The weighted average basis points ("bps") earned for home loan servicing during the three months ended March 31, 2021 and 2020 was 24 bps and 25 bps, respectively.
(2)The weighted average bps earned for student loan servicing during the three months ended March 31, 2021 and 2020 was 41 bps and 37 bps, respectively.
(3)The weighted average bps earned for personal loan servicing during the three months ended March 31, 2021 and 2020 was 70 bps and 71 bps, respectively.
(4)The impact on the fair value change resulting from changes in valuation inputs and assumptions was $3.3 million and $(1.0) million during the three months ended March 31, 2021 and 2020, respectively.
(5)The impact of the fair value change resulting from changes in valuation inputs and assumptions was $(15.7) million and $4.6 million during the three months ended March 31, 2021 and 2020, respectively. The 2020 period included the impact of the derecognition of servicing due to loan purchases, which had an effect of $(0.2) million on the total fair value change.
(6)The impact of the fair value change resulting from changes in valuation inputs and assumptions was $0.3 million and $3.4 million during the three months ended March 31, 2021 and 2020, respectively.
Technology Platform fees of $45.7 million during the three months ended March 31, 2021 were earned by Galileo, which we acquired on May 14, 2020 and, therefore, had no impact during the three months ended March 31, 2020. We earn Technology Platform revenues for providing continuous delivery of an integrated technology platform as an outsourced service for financial and non-financial institutions, which is a stand-ready performance obligation that comprises a series of distinct days of service. Our Technology Platform fees are billed based on the actual fulfillment activities to provide the technology platform, which vary from day to day and from client to client.
During the three months ended March 31, 2021, our Technology Platform fees were billed on a monthly basis for an integrated, seamless and comprehensive solution suite, which predominantly includes: virtual card product support; real time push provisioning for virtual cards; enablement of transfers from challenger bank accounts to other banks or individuals; enabling card loads and load transfers directly through ACH debits and credits; facilitating person-to-person transfers; maintenance and support for active and inactive accounts on the platform; processing of chargebacks, fraud analysis, credit bureau reporting, facilitating the ability to receive early paychecks; supporting savings as a separate balance in our system; calculating and assessing interest based on account balance tiers; providing access to our native Program, Authorization, and Events APIs, which provide alerts on all transaction types (e.g., notification of card roundups); authorization, routing and processing of payment transactions (debit, credit, online purchases); debit card production and shipment and real-time data analytics and reporting.
Other income increased by $3.9 million, or 133%, primarily due to increases of $4.4 million in brokerage-related fees, $1.3 million in payment network fees and $0.7 million in referral fees. The brokerage fees and payment network fees earned during the 2021 period were bolstered by our acquisitions of 8 Limited and Galileo in the second quarter of 2020. The increase in brokerage fees was also reflective of an increase in cryptocurrency trading volume on our platform. Payment network fees (which include interchange fees) were directly correlated with
145

TABLE OF CONTENTS
increased spending and card transactions on our platform in addition to the impact from the acquisition of Galileo. Lastly, the increase in referral fees was primarily attributable to growth in our partner relationships and related activity, as we continue to onboard new partners and help drive volume to our partners.
These gains were offset by a trading error loss of $2.2 million during the 2021 period related to our SoFi Invest business. Further, we had $1.0 million less equity method investment income during the 2021 period, as our Apex equity method investment was called during the period.
Noninterest Expense
The following table presents the components of our total noninterest expense for the periods indicated:
Three Months Ended March 31,
2021 vs 2020
% Change
($ in thousands)
2021 2020
Technology and product development
$ 65,948  $ 40,171  64  %
Sales and marketing
87,234  62,670  39  %
Cost of operations
57,570  32,657  76  %
General and administrative
161,697  49,114  229  %
Total noninterest expense
$ 372,449  $ 184,612  102  %
Total noninterest expense increased by $187.8 million, or 102%, for the three months ended March 31, 2021 compared to the three months ended March 31, 2020, due to the following:
Technology and product development expenses increased by $25.8 million, or 64%, primarily due to:
an increase in amortization expense on intangible assets of $10.1 million, of which $7.9 million was associated with intangible assets acquired during the second quarter of 2020, and of which $2.3 million was related to the acceleration of our core banking infrastructure amortization;
an increase in purchased and internally-developed software amortization of $1.3 million, which was reflective of increased investments in technology to support our growth;
an increase in employee compensation and benefits of $11.6 million, inclusive of an increase in share-based compensation expense of $5.6 million, which was related to a 20% increase in technology and product personnel in support of our growth. We also had an increase in average compensation in the 2021 period; and
an increase in software licenses and tools and subscriptions spend of $3.1 million related to headcount increases and internal technology initiatives.
Sales and marketing expenses increased by $24.6 million, or 39%, primarily due to:
an increase in amortization expense of $8.7 million associated with the customer-related intangible assets acquired in the second quarter of 2020;
an increase in employee compensation and benefits of $5.1 million, inclusive of an increase in share-based compensation expense of $1.3 million, which was correlated with a 66% increase in sales and marketing personnel to support our growth, partially offset by a decrease in average compensation in the 2021 period;
SoFi Stadium related expenditures of $3.9 million, which is exclusive of depreciation and interest expense on the embedded lease portion of our SoFi Stadium agreement;
an increase in direct customer promotional expenditures of $3.8 million, primarily related to the launch and promotion of our Financial Services segment products; and
146

TABLE OF CONTENTS
an increase in advertising expenditures of $3.2 million, which was attributable to an increase in online, social and television advertising spend in the 2021 period, partially offset by a decrease in direct mail marketing.
Cost of operations increased by $24.9 million, or 76%, primarily due to:
an increase in loan origination and servicing expenses of $6.1 million, of which $5.4 million was related to home loans, which supported the growth in home loan origination volume period over period;
an increase of $6.4 million in third-party fulfillment costs, which was primarily attributable to post-acquisition Galileo operations;
an increase in employee compensation and benefits of $6.6 million, which was correlated with a 31% increase in cost of operations personnel in support of our growth in addition to an increase in average compensation in the 2021 period. A portion of this increase was also attributable to an increase in home loan commissions of $1.3 million related to home loan origination growth;
an increase in occupancy-related costs of $0.7 million;
an increase in software licenses and tools and subscriptions of $0.8 million related to headcount increases and internal technology initiatives; and
an increase in brokerage-related costs of $1.5 million related to the growth of SoFi Invest and our wholly-owned subsidiary, 8 Limited, which we acquired in the second quarter of 2020.
General and administrative expenses increased by $112.6 million, or 229%, primarily due to:
an increase in employee compensation and benefits of $17.3 million, inclusive of an increase in share-based compensation expense of $11.1 million, which was related to a 45% increase in general and administrative personnel to support our growing infrastructure and administrative needs in addition to an increase in average compensation in the 2021 period;
an increase in the fair value of our warrant liabilities of $87.0 million, which was primarily related to an increase in the fair value of our Series H redeemable preferred stock;
an increase in non-transaction related professional services of $4.8 million, which included accounting and legal services;
an increase in occupancy-related expenses of $0.8 million; and
an increase in software licenses and tools and subscriptions of $1.2 million;
partially offset by a decrease in transaction-related expenses of $1.7 million, which largely consisted of financial advisory and professional services costs in both periods and was related to our pending purchase of Golden Pacific in the 2021 period and related to our acquisitions of Galileo and 8 Limited in the 2020 period.
Net Loss
Our net loss for the three months ended March 31, 2021 increased by $71.2 million, or 67%, compared to the three months ended March 31, 2020, primarily due to the factors discussed above, as well as the change in income taxes. The primary driver of the $1.0 million period-over-period increase in income taxes was associated with an increase in the profitability of SoFi Lending Corp, which incurs income tax expense in some state jurisdictions where separate company filing is required.
147

TABLE OF CONTENTS
Summary Results by Segment
Lending Segment
In the table below, we present certain metrics related to our Lending segment:
March 31,
2021 vs 2020
% Change
Metric
2021 2020
Total products (number) 945,227  841,615  12  %
Origination volume ($ in thousands, during period)
Home loans $ 735,604  $ 346,808  112  %
Personal loans 805,689  901,694  (11) %
Student loans 1,004,685  2,134,506  (53) %
Total $ 2,545,978  $ 3,383,008  (25) %
Loans with a balance (number) 582,069  636,275  (9) %
Average loan balance ($)
Home loans $ 285,654  $ 293,762  (3) %
Personal loans 21,515  24,000  (10) %
Student loans 52,493  59,346  (12) %
The following table presents additional information on our terms for our lending products as of March 31, 2021:
Product Loan Size
Rates(1)
Term
Student Loan Refinancing
$5,000+ (2)
Variable rate: 2.25% – 6.62% 5 – 20 years
Fixed rate: 2.99% – 7.18%
In-School Loans
$5,000+ (2)
Variable rate: 1.84% – 12.63% 5 – 15 years
Fixed rate: 4.23% – 11.26%
Personal Loans
$5,000 – $100,000 (2)
Fixed rate: 5.99% – 19.10% 2 – 7 years
Home Loans $98,000 – $548,250
(Conforming 2021 Normal Cost Areas)
Fixed rate: 2.13% – 4.75% 15 or 30 years
OR
$822,375 (2)
(Conforming 2021 High Cost Areas)
15 or 30 years
__________________
(1)Loan annual percentage rates presented reflect an auto-pay discount.
(2)Minimum loan size may be higher within certain states due to legal or licensing requirements.
148

TABLE OF CONTENTS
In the table below, we present additional information related to our lending products:
Three Months Ended March 31,
2021 2020
Student Loans
Weighted average origination FICO 774  773 
Weighted average interest rate earned(1)
4.62  % 5.38  %
Interest income recognized ($ in thousands)(1)
$ 32,277  $ 35,855 
Sales of loans ($ in thousands)(2)
$ 936,160  $ 2,256,059 
Time between loan origination and loan sale (days) 50  30 
Home Loans
Weighted average origination FICO 762  759 
Weighted average interest rate earned(1)
1.58  % 2.74  %
Interest income recognized ($ in thousands)(1)
$ 731  $ 712 
Sales of loans ($ in thousands) $ 677,566  $ 313,042 
Time between loan origination and loan sale (days) 13  11 
Personal Loans
Weighted average origination FICO 762  757 
Weighted average interest rate earned(1)
10.92  % 10.56  %
Interest income recognized ($ in thousands)(1)
$ 44,001  $ 49,549 
Sales of loans ($ in thousands)(2)
$ 779,441  $ 777,346 
Time between loan origination and loan sale (days) 41  25 
__________________
(1)Represents annualized interest income recognized divided by our monthly average outstanding loan balance for the period.
(2)Excludes the impact of loans transferred into consolidated securitizations.
Total Products
Total products refers to the number of home loans, personal loans and student loans that have been originated through our platform since our inception through the reporting date, whether or not such loans have been paid off. See “—Key Business Metrics” for further discussion of this measure as it relates to our Lending segment.
Origination Volume
We refer to the aggregate dollar amount of loans originated through our platform in a given period as origination volume. Origination volume is an indicator of the size and health of our Lending segment and an indicator (together with the relevant loan characteristics, such as interest rate and prepayment and default expectations) of revenues and profitability. Changes in origination volume are driven by the addition of new members and existing members, the latter of which at times will either refinance into a new SoFi loan or secure an additional, concurrent loan, as well as macroeconomic factors impacting consumer spending and borrowing behavior. Since the profitability of the Lending segment is largely correlated with origination volume, management relies on origination volume trends to assess the need for external financing to support the Financial Services segment and the expense budgets for unallocated expenses.
During the three months ended March 31, 2021, home loan origination volume increased significantly relative to the 2020 period due to increased demand for home loan products following the Federal Reserve’s actions to reduce interest rates to near-zero benchmark levels amid the COVID-19 pandemic.
During the three months ended March 31, 2021, personal loan origination volume decreased relative to the 2020 period primarily due to lower consumer spending behavior during the COVID-19 pandemic, which we believe decreased the overall demand for debt consolidation loans, one of the primary stated purposes for our personal loan originations.
149

TABLE OF CONTENTS
Demand for our student loan refinancing products decreased during the three months ended March 31, 2021 relative to the 2020 period, primarily due to the automatic suspension of principal and interest payments on federally-held student loans enacted through the CARES Act that was extended by executive action through September 30, 2021. We believe this suspension has contributed to decreased overall demand for student loan refinancing.
Loans with a Balance and Average Loan Balance
Loans with a balance refers to the number of loans that have a balance greater than zero dollars as of the reporting date. Loans with a balance allows management to better understand the unit economics of acquiring a loan in relation to the lifetime value of that loan. Average loan balance is defined as the total unpaid principal balance of the loans divided by loans with a balance within the respective loan product category as of the reporting date.
The home loan average balance declined modestly during the three months ended March 31, 2021 relative to the 2020 period and did not present any notable trends.
The decline in personal loan average balance during the three months ended March 31, 2021 relative to the 2020 period was driven primarily by the impact of the COVID-19 pandemic, which caused a decline in consumption demand as well as a reduction in the average size of requested personal loans.
The decline in student loan average balance during the three months ended March 31, 2021 relative to the 2020 period was due in part to the growth of in-school student loans, which have a lower average balance.
The following table presents the measure of contribution profit for the Lending segment for the periods indicated. The information is derived from our internal financial reporting used for corporate management purposes. Refer to Note 16 to the Notes to Unaudited Condensed Consolidated Financial Statements included elsewhere in this prospectus for more information regarding Lending segment performance.
Three Months Ended March 31,
2021 vs 2020
% Change
($ in thousands)
2021 2020
Net revenue
Net interest income $ 51,777  $ 45,661  13  %
Noninterest income 96,200  28,217  241  %
Total net revenue 147,977  73,878  100  %
Servicing rights – change in valuation inputs or assumptions(1)
12,109  (7,059) (272) %
Residual interests classified as debt – change in valuation inputs or assumptions(2)
7,951  14,936  (47) %
Directly attributable expenses(3)
(80,351) (77,660) %
Contribution Profit $ 87,686  $ 4,095  n/m
___________________
(1)Reflects changes in fair value inputs and assumptions, including market servicing costs, conditional prepayment and default rates and discount rates. This non-cash change, which is recorded within noninterest income in the accompanying Unaudited Condensed Consolidated Statements of Operations and Comprehensive Loss is unrealized during the period and, therefore, has no impact on our cash flows from operations. As such, the changes in fair value attributable to assumption changes are adjusted to provide management and financial users with better visibility into the cash flows available to finance our operations.
(2)Reflects changes in fair value inputs and assumptions, including conditional prepayment and default rates and discount rates. When third parties finance our consolidated securitizations through purchasing residual interests, we receive proceeds at the time of the securitization close and, thereafter, pass along contractual cash flows to the residual interest owner. These obligations are measured at fair value on a recurring basis, with fair value changes recorded within noninterest income in the accompanying Unaudited Condensed Consolidated Statements of Operations and Comprehensive Loss. The fair value change attributable to assumption changes has no impact on our initial financing proceeds, our future obligations to the residual interest owner (because future residual interest claims are limited to contractual securitization collateral cash flows), or the general operations of our business. As such, this non-cash change in fair value is adjusted to provide management and financial users with better visibility into the cash flows available to finance our operations.
(3)For a disaggregation of the directly attributable expenses allocated to the Lending segment in each of the periods presented, see “—Directly Attributable Expenses” below.
150

TABLE OF CONTENTS
Net interest income
Net interest income in our Lending segment for the three months ended March 31, 2021 increased by $6.1 million, or 13%, compared to the three months ended March 31, 2020 due to the following:
Loan interest income decreased by $8.9 million, or 10%, primarily driven by a decline of $29.3 million in interest income from consolidated securitizations, partially offset by increases in non-securitization personal loan and student loan interest income of $16.6 million and $3.6 million, respectively. The decrease in interest income from consolidated securitizations was impacted by a 50% decline in average balance, which was attributable to payment activity and partially the result of the deconsolidation of two securitizations in the first quarter of 2020. The increases in non-securitization loan interest income were primarily a function of increases in average balances for personal loans and student loans of 111% and 45%, respectively.
Securitizations interest income decreased by $2.6 million, or 37%, which was attributable to decreases in residual investment interest income of $0.8 million and asset-backed bonds of $0.8 million related to decreases in average securitization investment balances period over period, and a decrease in securitization float interest income of $1.0 million related to decreases in average securitization loan balances and a decline in interest rates period over period.
Interest expense related to securitizations and warehouses decreased by $17.7 million, or 37%, primarily due to:
a decline in securitization debt interest expense (exclusive of debt issuance and discount amortization) of $10.4 million, which was correlated with the deconsolidation of securitizations discussed in the interest income section above. Further, our student loan securitization debt is primarily tied to one-month LIBOR, which decreased period over period;
a decline in warehouse debt interest expense (exclusive of debt issuance amortization) of $3.6 million, which was related to decreases in one- and three-month LIBOR period over period, partially offset by a higher average warehouse debt balance outstanding period over period;
a decline in residual interests classified as debt interest expense of $1.6 million, which was correlated with a lower balance of residual interests classified as debt during the 2021 period, a significant driver of which was the aforementioned deconsolidation of securitizations during the 2020 period; and
a decline in debt issuance cost interest expense of $2.1 million, which was driven by the acceleration of the amortization of debt issuance costs of $1.0 million in the 2020 period upon the deconsolidation of two securitizations, and an acceleration of warehouse facility debt issuance cost amortization related to a reduction in warehouse facility capacity during the 2020 period, partially offset by interest expense from new debt issuance costs during the 2021 period.
Noninterest income
Noninterest income in our Lending segment for the three months ended March 31, 2021 increased by $68.0 million, or 241%, compared to the three months ended March 31, 2020 due to the following:
Loan origination and sales increased by $6.1 million, or 6%. We experienced a $10.8 million period-over-period increase in home loan originations and sales related income, net of hedges and related interest rate lock commitments. The increase was primarily driven by a 112% increase in home loan origination volume and gains on mortgage pipeline hedges, which was partially offset by losses on interest rate lock commitments due to a decline in our home loan origination pipeline during the 2021 period. In addition, home loan origination fees increased by $2.3 million period over period in conjunction with the increase in origination volume.
These gains were offset by a decrease of $7.0 million in aggregate personal loan and student loan origination and sales income, which was attributable to lower gain on sale execution for both personal loan and student loan sales in the 2021 period, lower origination volume, and higher combined write-offs and repurchase expense of $4.4 million. Student loan origination volume declined 53% period over period, primarily due to lower demand for our student loan refinancing products as a result of the payment deferral period on federal student loans enacted through
151

TABLE OF CONTENTS
the CARES Act in late March 2020. Personal loan origination volume declined 11% period over period, primarily due to lower demand for personal loan financing, which we believe is a result of lower consumer spending behavior during the COVID-19 pandemic.
Partially offsetting these decreases were period-over-period gains in our student loan and personal loan economic hedge positions, which are further discussed in the consolidated results of operations discussion under the section titled “—noninterest income and net revenue” within the table presenting additional information related to loan gains and losses and overall performance.
Securitization income increased by $81.1 million, or 98%, primarily due to a reduction in securitization loan write-offs of $14.8 million, which was correlated with the deconsolidation of securitizations in the 2020 period and stronger securitization loan credit performance during the 2021 period. The decrease in securitization loan write-offs also had the impact of improving our assumed future credit outlook for our securitization loans, which contributed to an aggregate increase of $62.6 million period over period in securitization loan fair market value changes.
These increases were offset by residual debt fair value increases of $13.5 million, which were correlated with underlying securitization performance and residual interest positions representing a greater percentage of securitization claims (which occurs over time as securitization loans are paid off and, accordingly, securitization debt gets paid off) period over period, of which $7.0 million was related to non-cash favorable fair value changes in residual interests classified as debt valuation assumptions and inputs.
Lastly, the aggregate period-over-period increase was driven by a positive variance in our securitization investment earnings of $17.2 million, which was due to a $5.1 million loss realized in the 2020 period related to the deconsolidation of two personal loan securitizations and the aforementioned improvement in credit outlook, which resulted in lower period-over-period bond and residual investment yields, and therefore improved fair market values for both asset classes.
Servicing income decreased by $19.2 million, or 272%, and was primarily related to fair value changes in our servicing assets that were largely attributable to an increase in servicing asset prepayment speed assumptions period over period. We experienced an increase in loan prepayments during the 2021 period, which we believe is correlated with the market interest rate declines compared to the 2020 period, and is related to the effects of the COVID-19 pandemic. We expect prepayments to continue to remain at a higher than historical level in the current low interest rate environment.
Directly attributable expenses
The directly attributable expenses allocated to the Lending segment that were used in the determination of the segment's contribution profit were as follows:
Three Months Ended March 31,
2021 vs 2020
% Change
($ in thousands) 2021 2020
Direct advertising $ 27,849  $ 30,607  (9) %
Compensation and benefits 21,398  19,367  10  %
Loan origination and servicing costs 13,992  7,872  78  %
Affiliate referrals 6,710  10,196  (34) %
Unused warehouse line fees 3,701  2,350  57  %
Occupancy and travel 1,138  2,146  (47) %
Professional services 1,441  2,106  (32) %
Other(1)
4,122  3,016  37  %
Directly attributable expenses $ 80,351  $ 77,660  %
______________
(1)Other expenses primarily include loan marketing expenses and tools and subscriptions costs.
152

TABLE OF CONTENTS
Lending segment directly attributable expenses for the three months ended March 31, 2021 increased by $2.7 million, or 3%, compared to the three months ended March 31, 2020 primarily due to:
an increase of $6.1 million in loan origination and servicing costs driven primarily by volume increases in our home loan product;
an increase of $1.4 million in unused warehouse line fees correlated with an increase in committed warehouse facility capacity period over period;
an increase of $2.0 million in allocated employee compensation and related benefits primarily driven by an overall increase in headcount;
an increase of $1.1 million in other expenses, primarily related to a servicing receivable write-off and loan marketing expenses;
an offsetting decrease of $1.0 million in allocated occupancy and travel expenses, primarily driven by the impacts of the COVID-19 pandemic on travel;
an offsetting decrease of $3.5 million in affiliate referral expense related to lower origination volume through our affiliate channels;
an offsetting decrease of $2.8 million in direct advertising related to a decrease in direct mail marketing, partially offset by an increase in online, social and television advertising spend; and
an offsetting decrease of $0.7 million in professional services costs related to third party technology and product consulting.
Financial Services Segment
Three Months Ended March 31,
2021 vs 2020
% Change
($ in thousands)
2021 2020
Net revenue
Net interest income $ 229  $ 215  %
Noninterest income 6,234  1,939  222  %
Total net revenue 6,463  2,154  200  %
Directly attributable expenses(1)
(41,982) (29,137) 44  %
Contribution loss $ (35,519) $ (26,983) 32  %
___________________
(1)For a disaggregation of the directly attributable expenses allocated to the Financial Services segment in each of the periods presented, see "—Directly Attributable Expenses" below.
Three Months Ended March 31, 2021 Compared to Three Months Ended March 31, 2020
Net interest income
Net interest income in our Financial Services segment for the three months ended March 31, 2021was relatively flat compared to the three months ended March 31, 2020 due to the offsetting effects of an increase in SoFi Money account balances and lower interest rates during the 2021 period.
Noninterest income
Noninterest income in our Financial Services segment for the three months ended March 31, 2021 increased by $4.3 million, or 222%, compared to the three months ended March 31, 2020, which was primarily due to a $4.4 million increase in brokerage-related fees, a $0.9 million increase in payment network fees, and a $0.7 million increase in affiliate referral fees. The brokerage fees and payment network fees earned during the 2021 period were bolstered by our acquisition of 8 Limited in the second quarter of 2020, by an increase in cryptocurrency trading
153

TABLE OF CONTENTS
volume on our platform and by increased member activity in both the SoFi Invest and SoFi Money products. The increase in affiliate referral fees was primarily attributable to growth in our partner relationships and related activity, as we continue to onboard new partners and help drive volume to these partners. These gains were offset by a trading error loss of $2.2 million during the 2021 period related to our SoFi Invest business.
Directly attributable expenses
The directly attributable expenses allocated to the Financial Services segment that were used in the determination of the segment's contribution loss were as follows:
Three Months Ended March 31,
2021 vs 2020
% Change
($ in thousands) 2021 2020
Compensation and benefits $ 18,784  $ 18,695  —  %
Product fulfillment 5,043  2,574  96  %
Member incentives 4,981  2,054  143  %
Direct advertising 3,768  388  871  %
Occupancy and travel 1,851  2,274  (19) %
Professional services 1,568  1,167  34  %
Other(1)
5,987  1,985  202  %
Directly attributable expenses $ 41,982  $ 29,137  44  %
___________________
(1)Other expenses primarily include tools and subscriptions, SoFi Money and SoFi Invest account write offs and marketing expenses.
Financial Services directly attributable expenses for the three months ended March 31, 2021 increased by $12.8 million, or 44%, compared to the three months ended March 31, 2020 primarily due to the following:
an increase of $4.0 million in other expenses primarily related to tools and subscription costs, marketing and write offs of SoFi Money accounts;
an increase of $3.4 million in direct advertising costs, such as social media and search engine advertising costs, which was primarily related to the continued promotion of, and growth in, our Financial Services products;
an increase of $2.9 million related to direct member incentives for SoFi Money and SoFi Invest;
an increase of $2.5 million in product fulfillment costs related to SoFi Invest and SoFi Money, which included such activities as operating our cash management sweep program, brokerage expenses and debit card fulfillment services;
an increase of $0.4 million in professional services costs related to third party technology and product consulting for SoFi Money; and
an offsetting decrease in occupancy and travel of $0.4 million, primarily driven by the impacts of the COVID-19 pandemic on travel.
Compensation and benefits within the Financial Services segment was relatively consistent period over period, as the costs were aligned with the segment initiatives in the respective periods.
154

TABLE OF CONTENTS
Technology Platform Segment
In the table below, we present a metric that is exclusive to the Galileo portion of our Technology Platform segment:
March 31, 2021 March 31, 2020
2021 vs 2020
% Change
Total accounts
69,572,680  —  n/m
In our Technology Platform segment, total accounts refers to the number of open accounts at Galileo as of the reporting date, excluding SoFi accounts, as such accounts are eliminated in consolidation. We acquired Galileo on May 14, 2020. As such, no information is reported for the three months ended March 31, 2020, as it preceded our acquisition. Total accounts is a primary indicator of the amount of accounts that are dependent upon Galileo’s technology platform to use virtual card products, virtual wallets, make peer-to-peer and bank-to-bank transfers, receive early paychecks, separate savings from spending balances and rely upon real-time authorizations, all of which result in technology platform fees for the Technology Platform segment.
The following table presents the measure of contribution profit for the Technology Platform segment for the periods indicated. The information is derived from our internal financial reporting used for corporate management purposes. Refer to Note 16 in the accompanying unaudited condensed consolidated financial statements included elsewhere in this prospectus for further details regarding Technology Platform segment performance.
Three Months Ended March 31, 2021 vs 2020
% Change
($ in thousands)
2021 2020
Net revenue
Net interest income (loss) $ (36) $ —  n/m
Noninterest income 46,101  997  n/m
Total net revenue 46,065  997  n/m
Directly attributable expenses(1)
(30,380) —  n/m
Contribution Profit $ 15,685  $ 997  n/m
___________________
(1)For a disaggregation of the directly attributable expenses allocated to the Technology Platform segment in the three months ended March 31, 2021, see “—Directly Attributable Expenses” below.
Three Months Ended March 31, 2021 Compared to Three Months Ended March 31, 2020
Total net revenue of $46.1 million during the three months ended March 31, 2021 was primarily related to Technology Platform fees at Galileo, which we acquired in the second quarter of 2020. Total net revenue during the three months ended March 31, 2020 was comprised of our equity method investment income from our investment in Apex. We did not recognize any equity method investment income during the 2021 period, as our Apex equity method investment was called during the period.
Directly Attributable Expenses
The directly attributable expenses allocated to the Technology Platform segment that were used in the determination of the segment's contribution profit for the three months ended March 31, 2021 were related to the operations of Galileo and consisted of the items discussed below. There were no directly attributable expenses allocated to the Technology Platform segment during the three months ended March 31, 2020.
$16.2 million in employee compensation and related benefits expenses;
$7.0 million in technology platform third-party fulfillment costs;
$2.1 million in professional services costs;
155

TABLE OF CONTENTS
$1.4 million in occupancy and travel expenses; and
$3.7 million of other expenses, primarily related to tools and subscription costs, marketing expenses and data center expenses, the latter of which was associated with the operation of our technology platform-as-a-service.
Reconciliation of Directly Attributable Expenses
The following table reconciles directly attributable expenses allocated to our reportable segments to total noninterest expense in the accompanying Unaudited Condensed Consolidated Statements of Operations and Comprehensive Loss for the periods indicated:
Three Months Ended March 31,
2021 2020
Reportable segments directly attributable expenses $ (152,713) $ (106,797)
Expenses not allocated to segments:
Stock-based compensation expense (37,454) (19,685)
Depreciation and amortization expense (25,977) (4,715)
Fair value changes in warrant liabilities (89,920) (2,879)
Employee-related costs(1)
(32,280) (27,896)
Other corporate and unallocated expenses(2)
(34,105) (22,640)
Total noninterest expense $ (372,449) $ (184,612)
___________________
(1)Includes compensation, benefits, recruiting, certain occupancy-related costs and various travel costs of executive management, certain technology groups and general and administrative functions that are not directly attributable to the reportable segments.
(2)Includes corporate overhead costs that are not allocated to reportable segments, such as certain tools and subscription costs, corporate marketing costs and professional services costs.
156

TABLE OF CONTENTS
Years Ended December 31, 2020, 2019 and 2018
The following table sets forth consolidated statements of income data for the years indicated:
Year ended December 31, 2020 vs. 2019 % Change 2019 vs. 2018 % Change
($ in thousands)
2020 2019 2018
Interest income
Loans
$ 330,353  $ 570,466  $ 568,209  (42) % —  %
Securitizations
24,031  23,179  19,300  % 20  %
Related party notes
3,189  3,338  —  (4) %
n/m
Other
5,964  11,210  2,109  (47) % 432  %
Total interest income
363,537  608,193  589,618  (40) % %
Interest expense

Securitizations and warehouses
155,150  268,063  330,186  (42) % (19) %
Other
30,456  10,296  368  196  %
n/m
Total interest expense 185,606  278,359  330,554  (33) % (16) %
Net interest income
177,931  329,834  259,064  (46) % 27  %
Noninterest income


Loan origination and sales
371,323  299,265  123,046  24  % 143  %
Securitizations
(70,251) (199,125) (114,705) (65) % 74  %
Servicing
(19,426) 8,486  1,197  (329) % 609  %
Technology Platform fees
90,128  —  —  n/m
n/m
Other
15,827  4,199  797  277  % 427  %
Total noninterest income
387,601  112,825  10,335  244  % 992  %
Total net revenue 565,532  442,659  269,399  28  % 64  %
Noninterest expense


Technology and product development
201,199  147,458  99,319  36  % 48  %
Sales and marketing
276,577  266,198  212,604  % 25  %
Cost of operations
178,896  116,327  88,885  54  % 31  %
General and administrative
237,381  152,275  121,948  56  % 25  %
Total noninterest expense
894,053  682,258  522,756  31  % 31  %
Loss before income taxes
(328,521) (239,599) (253,357) 37  % (5) %
Income tax (expense) benefit
104,468  (98) 958  n/m (110) %
Net loss
$ (224,053) $ (239,697) $ (252,399) (7) % (5) %
Other comprehensive income (loss)


Foreign currency translation adjustments, net
$ (145) $ (9) $ 21  n/m (143) %
Total other comprehensive income (loss)
(145) (9) 21  n/m (143) %
Comprehensive loss $ (224,198) $ (239,706) $ (252,378) (6) % (5) %
157

TABLE OF CONTENTS
Year Ended December 31, 2020 Compared to Year Ended December 31, 2019
Interest Income
The following table presents the components of our total interest income for the years indicated:
Year Ended December 31,
($ in thousands) 2020 2019 $ Variance % Change
Loans $ 330,353  $ 570,466  $ (240,113) (42) %
Securitizations 24,031  23,179  852  %
Related party notes 3,189  3,338  (149) (4) %
Other 5,964  11,210  (5,246) (47) %
Total interest income $ 363,537  $ 608,193  $ (244,656) (40) %
Total interest income decreased by $244.7 million, or 40%, for the year ended December 31, 2020 compared to the year ended December 31, 2019 due to the following:
Loan interest income decreased by $240.1 million, or 42%, primarily driven by a $218.3 million decrease in personal loan interest income year over year. A significant portion of this decrease was related to a decline in securitization loan interest income of $209.4 million, which was a function of our deconsolidation of three variable interest entities (“VIEs”) during 2020 that were previously consolidated during 2019 (we recognized a loss of $6.1 million during 2020 within noninterest income related to these VIE deconsolidations), and earning interest income from loans in three consolidated VIEs in 2019 that were deconsolidated in the fourth quarter of 2019 (we recognized a loss of $38.7 million within noninterest income related to the fourth quarter 2019 VIE deconsolidations). In all cases, our deconsolidations of previously consolidated VIEs were triggered by a third party purchasing enough residual interest ownership in the VIEs from us such that we owned less than 10% of the VIE residual interest. As we no longer had a significant financial interest in the VIEs, we deconsolidated them, which included the related securitization loans.
Further, we did not consolidate any personal loan VIEs during 2020. In addition, our monthly average non-securitization personal loan balance during 2020 was 5% lower than in 2019, which contributed to an $8.9 million decline in loan interest income year over year. This decline was heavily influenced by the COVID-19 pandemic, which contributed to a year-over-year decline in personal loan origination volume of 31%. Student loan securitization interest income declined by $34.1 million, which was correlated with an increase in prepayments and was also negatively impacted by the COVID-19 pandemic. These declines in interest were offset by an $11.6 million increase in non-securitization student loan interest income, which was consistent with a 33% higher average balance year over year as a result of a longer holding period for loans on the balance sheet and a significant strategic purchase of loans during 2020.
Securitizations interest income increased by $0.9 million, or 4%, which was attributable to an increase in residual investment interest income of $2.9 million and asset-backed bonds of $1.2 million. These increases were offset by a decline in securitization float interest income of $3.2 million, which was largely attributable to declining interest rates during 2020.
Related party notes interest income decreased by $0.1 million, or 4%, due to a decrease in interest income on a stockholder loan, which was fully settled in 2020, partially offset by an increase in interest income related to our loans to Apex, as the first loan was issued in November 2019 with additional amounts loaned during 2020.
In March 2019, we entered into a $58.0 million note receivable agreement with a stockholder (the “Note Receivable Stockholder”), which accrued interest at 7.0%. In October 2019, we assigned a portion of our call option rights pursuant to such agreement to another stockholder who paid $15.2 million to purchase an aggregate of 1,722,144 common and preferred shares held by the Note Receivable Stockholder. The Note Receivable Stockholder then paid us $15.2 million to settle a portion of the outstanding note receivable and accrued interest owed to us. During the year ended December 31, 2020, the Note Receivable Stockholder made payments totaling $47.8 million to settle the remaining outstanding note receivable and accrued interest.
158

TABLE OF CONTENTS
As of December 31, 2020, we had three notes receivable outstanding from Apex with a total principal balance of $16.7 million, of which $7.6 million was loaned by us during the year ended December 31, 2020 in two transactions and accrues interest annually at a fixed rate of 10.0%. The initial note receivable of $9.1 million was loaned by us in November 2019 and accrues interest annually at a fixed rate of 5.0% as of December 31, 2020. In February 2021, Apex repaid the total outstanding principal balances and accrued interest.
See Note 14 to the Notes to Consolidated Financial Statements included elsewhere in this prospectus for additional information on our related party notes.
Other interest income decreased by $5.2 million, or 47%, primarily due to interest rate decreases during 2020, which impacted the interest income we earn on our bank balances and Member Bank deposits.
Interest Expense
The following table presents the components of our total interest expense for the years indicated:
Year Ended December 31,
($ in thousands)
2020 2019
$ Variance
% Change
Securitizations and warehouses
$ 155,150  $ 268,063  $ (112,913) (42) %
Other
30,456  10,296  20,160 196  %
Total interest expense
$ 185,606  $ 278,359  $ (92,753) (33) %
Total interest expense decreased by $92.8 million, or 33%, for the year ended December 31, 2020 compared to the year ended December 31, 2019, due to the following:
Interest expense related to securitizations and warehouses decreased by $112.9 million, or 42%. The following tables present the components of securitizations and warehouses interest expense and other pertinent information.
Year Ended December 31,
($ in thousands) 2020 2019 $ Variance % Change
Securitization debt interest expense $ 66,110  $ 132,811  $ (66,701) (50) %
Warehouse debt interest expense 51,983  80,895  (28,912) (36) %
Residual interests classified as debt interest expense 12,678  30,562 (17,884) (59) %
Debt issuance cost interest expense 24,379  23,795 584 %
Securitizations and warehouses interest expense
$ 155,150  $ 268,063  $ (112,913) (42) %
Year Ended December 31,
($ in thousands) 2020 2019 % Change
Average debt balances

Securitization debt $ 1,794,758  $ 3,888,058  (54) %
Warehouses facilities 2,266,694  1,800,902  26  %
Residual interests classified as debt 123,212  379,030  (67) %
Weighted average interest rates(1)

Securitization debt 3.7  % 3.4  % n/m
Warehouse facilities 2.3  % 4.5  % n/m
Residual interests classified as debt 10.3  % 8.1  % n/m
__________________
(1)Interest rates on securitization debt and warehouse facilities exclude the effect of debt issuance cost interest expense.
159

TABLE OF CONTENTS
The decrease in interest expense related to securitizations and warehouses was driven by the following:
Securitization debt interest expense (exclusive of debt issuance and discount amortization) decreased $66.7 million, which was correlated with the deconsolidation of VIEs discussed above and the absence of new consolidated VIEs, with the exception of one student loan VIE, which was only briefly consolidated before we transferred the significant portion of our financial interest and subsequently deconsolidated it. Moreover, the majority of our student loan securitization debt is tied to one-month LIBOR, which decreased during 2020;
Warehouse debt interest expense (exclusive of debt issuance amortization) decreased $28.9 million, which was related to a decrease in one- and three-month LIBOR during 2020. Interest rate declines were partially offset by a higher average warehouse debt balance outstanding during 2020;
Residual interests classified as debt interest expense decreased $17.9 million, which was correlated with a lower balance of residual interests classified as debt during 2020, a significant driver of which was the aforementioned deconsolidation of VIEs during 2020 and 2019; and
Debt issuance cost interest expense increased $0.6 million, which was associated with an initiative to increase our warehouse borrowing capacity to protect against potential future funding constraints attributable to the COVID-19 pandemic, partially offset by a decrease in securitization debt issuance costs in 2020, which was driven by the deconsolidations discussed above.
Other interest expense increased by $20.2 million, or 196%, primarily due to the following:
interest expense related to the Galileo seller note issued in May 2020, which was comprised of two components: (i) non-cash interest expense accretion of $6.0 million incurred because of the seller note discount to face value, and (ii) interest expense incurred of $16.2 million related to the outstanding seller note balance of $250.0 million at a stated rate of 10.0%;
an increase of $0.8 million in our revolving credit facility interest expense, which reflects our higher average balance during 2020, as we drew $325.0 million on the facility during 2020, partially offset by a decline in one-month LIBOR during 2020; and
an offsetting decrease in interest expense of $3.0 million associated with SoFi Money balances, which was correlated with the decline in interest rates during 2020.
Noninterest Income and Net Revenue
The following table presents the components of our total noninterest income and total net revenue for the years indicated:
Year Ended December 31,
($ in thousands)
2020 2019
$ Variance
% Change
Loan origination and sales
$ 371,323  $ 299,265  $ 72,058  24  %
Securitizations
(70,251) (199,125) 128,874  (65) %
Servicing
(19,426) 8,486  (27,912) (329) %
Technology Platform fees
90,128  —  90,128  n/m
Other
15,827  4,199  11,628  277  %
Total noninterest income
$ 387,601  $ 112,825  $ 274,776  244  %
Total net revenue
$ 565,532  $ 442,659  $ 122,873  28  %
160

TABLE OF CONTENTS
Total noninterest income increased by $274.8 million, or 244%, for the year ended December 31, 2020 compared to the year ended December 31, 2019, due to the following:
Loan origination and sales increased by $72.1 million, or 24%. We experienced an $81.1 million year-over-year increase in home loan originations and sales related income, net of hedges, and related interest rate lock commitments, which was driven by a 182% increase in home loans origination volume and a mix shift toward more FNMA loans during 2020, which sell for a greater loan premium compared to non-agency home loans. Home loan origination fees also increased by $7.9 million year over year in conjunction with the increase in origination volume. Additionally, improved loan credit and underwriting performance of personal and student loans resulted in lower combined write-offs and repurchase expense year over year.
Offsetting these increases was a $16.9 million decline in aggregate personal and student loan origination and sales income, which was attributable to lower origination volumes, partially offset by combined lower write-offs and repurchase expense. Student loan origination volume declined 26% year over year, primarily due to lower demand for our student loan refinancing products as a result of the payment deferral period on federal student loans enacted through the CARES Act in 2020. Personal loan origination volume declined 31% year over year, primarily due to our efforts in 2020 to further tighten our underwriting and credit policies to mitigate our credit risk exposure during the economic downturn combined with lower demand for personal loan financing, which we believe is a result of lower consumer spending behavior during the COVID-19 pandemic. See “— Key Factors Affecting Operating Results — Industry Trends and General Economic Conditions”.
Securitization income increased by $128.9 million, or 65%, due to a reduction in securitization loan write-offs of $82.5 million, which was related to the deconsolidation of VIEs and stronger securitization loan credit performance during 2020. The decrease in securitization loan write-offs also had the impact of improving our assumed future credit outlook for our securitization loans, which contributed to an aggregate increase of $39.0 million year over year in securitization loan fair market value changes.
These increases were offset by residual debt fair value increases of $16.4 million, which were correlated with underlying securitization performance and residual interest positions representing a greater percentage of securitization claims (which occurs over time as securitization loans are paid off and accordingly securitization debt gets paid off) year over year, of which $21.1 million was related to non-cash unfavorable fair value changes in residual interests classified as debt valuation assumptions and inputs. Further, we experienced an increase in our residual investment earnings of $23.7 million, which was largely due to a $38.7 million loss realized in the fourth quarter of 2019 related to the deconsolidation of three personal loan VIEs compared to losses in 2020 of $8.6 million attributable to a previously consolidated VIE that was both consolidated and deconsolidated in 2020 and $6.1 million attributable to the deconsolidation of three additional VIEs.
The table below presents additional information related to loan gains and losses and overall performance:
Year Ended December 31,
($ in thousands) 2020 2019 $ Variance % Change
Gains from non-securitization loan transfers $ 259,451  $ 129,989  $ 129,462  100  %
Gains from loan securitization transfers(1)
129,855  226,394  (96,539) (43) %
Economic derivative hedges of loan fair values(2)
(54,829) (24,803) (30,026) 121  %
Home loan origination fees(3)
11,576  3,639  7,937  218  %
Loan write-off expense – whole loans(4)
(5,873) (13,888) 8,015  (58) %
Loan write-off expense – securitization loans(5)
(38,621) (121,102) 82,481  (68) %
Loan repurchase expense(6)
(342) (2,337) 1,995  (85) %
__________________
(1)Represents the gain recognized on loan securitization transfers qualifying for sale accounting treatment during the years presented.
(2)Although not an economic hedge of loan fair values, we also had gains of $14.5 million and $0.9 million during the year ended December 31, 2020 and 2019, respectively, related to interest rate lock commitments. The year over year change was correlated with a significant increase in home loan origination volume.
(3)This variance was correlated with an increase in home loan origination volume year over year.
161

TABLE OF CONTENTS
(4)Includes gross write-offs of $17.1 million and $22.3 million for the year ended December 31, 2020 and 2019, respectively. During 2020, $3.6 million of the $11.2 million of recoveries were captured via loan sales to a third-party collection agency. During 2019, $0 of the $8.4 million of recoveries were captured via loan sales to a third-party collection agency.
(5)Includes gross write-offs of $54.7 million and $139.2 million for the year ended December 31, 2020 and 2019, respectively. During 2020, $7.2 million of the $16.1 million of recoveries were captured via loan sales to a third-party collection agency. During 2019, $7.6 million of the $18.1 million of recoveries were captured via loan sales to a third-party collection agency.
(6)Loan repurchase expense trends were generally correlated with the prior quarter's origination volume.
Servicing income decreased by $27.9 million, or 329%, and was primarily related to fair value changes in our servicing assets that were largely attributable to an increase in servicing asset prepayment speed assumptions year over year. We experienced an increase in loan prepayments during 2020, which we believe is correlated with the market interest rate declines in 2020 compared to 2019. We expect prepayments to continue to remain at a higher than historical level in the current low interest rate environment that is expected to persist into the next fiscal year.
We own the master servicing on all the servicing rights that we retain and, in each case, recognize the gross servicing rate applicable to each serviced loan. Subservicers are utilized for all serviced student and home loans, which represents a cost to SoFi, but these arrangements do not impact our calculation of the weighted average basis points earned for each loan type serviced. Further, there is no impact on servicing income due to forbearance and moratoriums on certain debt collection activities, and there are no waivers of late fees. The table below presents additional information related to our loan servicing activities:
Year Ended December 31,
($ in thousands) 2020 2019 $ Variance % Change
Servicing income recognized
Home loans(1)
$ 4,651  $ 2,648  $ 2,003  76  %
Student loans(2)
50,491  47,489  3,002  %
Personal loans(3)
42,646  34,290  8,356  24  %
Servicing rights fair value change
Home loans(4)
10,733  4,558  6,175  135  %
Student loans(5)
(37,945) 16,507  (54,452) (330) %
Personal loans(6)
(24,809) 14,849  (39,658) (267) %
_________________
(1)The weighted average basis points ("bps") earned for home loan servicing during the year ended December 31, 2020 and 2019 was 24 bps and 26 bps, respectively.
(2)The weighted average bps earned for student loan servicing during the year ended December 31, 2020 and 2019 was 37 bps and 39 bps, respectively.
(3)The weighted average bps earned for personal loan servicing during the year ended December 31, 2020 and 2019 was 74 bps and 72 bps, respectively.
(4)The impact on the fair value change resulting from changes in valuation inputs and assumptions was $(5.1) million and $1.5 million during the year ended December 31, 2020 and 2019, respectively.
(5)The impact of the fair value change resulting from changes in valuation inputs and assumptions was $(20.2) million and $0.2 million during the year ended December 31, 2020 and 2019, respectively. The 2020 period includes the impact of the derecognition of servicing due to loan purchases, which had an effect of $(12.9) million on the total fair value change.
(6)The impact of the fair value change resulting from changes in valuation inputs and assumptions was $7.8 million and $6.8 million during the year ended December 31, 2020 and 2019, respectively.
Technology Platform fees of $90.1 million during 2020 were earned by Galileo, which we acquired on May 14, 2020 and, therefore, had no impact in 2019. We earn Technology Platform revenues for providing continuous delivery of an integrated technology platform as an outsourced service for financial and non-financial institutions, which is a stand-ready performance obligation that comprises a series of distinct days of service. Our Technology Platform fees are billed based on the actual fulfillment activities to provide the technology platform, which vary from day to day and from customer to customer.
During 2020, our Technology Platform fees were billed on a monthly basis for an integrated, seamless and comprehensive solution suite, which predominantly includes: virtual card product support; real time push provisioning for virtual cards; enablement of transfers from challenger bank accounts to other banks or individuals; enabling card loads and load transfers directly through ACH debits and credits; facilitating person-to-person
162

TABLE OF CONTENTS
transfers; maintenance and support for active and inactive accounts on the platform; processing of chargebacks, fraud analysis, credit bureau reporting, facilitating the ability to receive early paychecks; supporting savings as a separate balance in our system; calculating and assessing interest based on account balance tiers; providing access to our native Program, Authorization, and Events APIs, which provide alerts on all transaction types (e.g., notification of card roundups); authorization, routing and processing of payment transactions (debit, credit, online purchases); debit card production and shipment and real-time data analytics and reporting.
Other income increased by $11.6 million, or 277%, primarily due to increases of $3.4 million in equity method investment income, $3.4 million in brokerage-related fees, $2.9 million in payment network fees and $2.2 million in referral fees. The brokerage fees and payment network fees earned during 2020 were bolstered by our acquisitions of 8 Limited and Galileo. The equity method investment income increase was reflective of an increase in trading volume at our equity method investee, Apex. This trend in trading volume also positively impacted our brokerage-related fees. Equity method investment income included a $4.3 million impairment charge recognized during the fourth quarter of 2020, which was incurred because the seller of our Apex interest exercised its call option on our equity investment in January 2021 and we measured the carrying value of our Apex equity method investment as of December 31, 2020 equal to the call payment. Payment network fees (which include interchange fees) were directly correlated with increased spending and card transactions on our platform during 2020 compared to 2019. Lastly, the referral fee increase was primarily attributable to our material affiliate revenue relationships launched during the third quarter of 2019; therefore, 2019 is not fully comparable to 2020.
Noninterest Expense
The following table presents the components of our total noninterest expense for the years indicated:
Year Ended December 31,
($ in thousands)
2020 2019
$ Variance
% Change
Technology and product development
$ 201,199  $ 147,458  $ 53,741  36  %
Sales and marketing
276,577  266,198  10,379  %
Cost of operations
178,896  116,327  62,569  54  %
General and administrative
237,381  152,275  85,106  56  %
Total noninterest expense
$ 894,053  $ 682,258  $ 211,795  31  %
Total noninterest expense increased by $211.8 million, or 31%, for the year ended December 31, 2020 compared to the year ended December 31, 2019, due to the following:
Technology and product development expenses increased by $53.7 million, or 36%, primarily due to:
an increase in amortization expense on intangible assets of $24.6 million, of which $19.9 million was associated with intangible assets acquired during 2020, and of which $5.8 million was related to the acceleration of our core banking infrastructure amortization. These increases were offset by lower amortization in 2020 due to certain smaller intangible assets that were fully amortized during 2019;
an increase in purchased and internally-developed software amortization of $4.2 million, which was reflective of increased investments in technology to support our growth;
an increase in employee compensation and benefits of $27.1 million, inclusive of an increase in share-based compensation expense of $12.2 million, which was related to a 12% increase in technology and product personnel in support of our growth in addition to an increase in compensation per person in 2020;
an increase in software licenses and tools and subscriptions spend of $6.9 million related to headcount increases and internal technology initiatives, which was partially offset by $2.1 million of software abandonment in 2019 ; and
partially offset by a decrease in the utilization of professional services of $2.3 million.
163

TABLE OF CONTENTS
Sales and marketing expenses increased by $10.4 million, or 4%, primarily due to:
an increase in amortization expense of $22.1 million associated with the customer-related intangible assets acquired during 2020;
an increase in employee compensation and benefits of $10.5 million, inclusive of an increase in share-based compensation expense of $3.9 million, which was correlated with a 29% increase in sales and marketing personnel to support our growth. The headcount-related compensation increase was partially offset by higher severance expense of $1.0 million and higher bonus and commission expenses of $0.8 million during 2019;
an increase in professional services of $3.2 million during 2020; and
SoFi Stadium related marketing expenditures of $11.5 million related to the opening of SoFi Stadium, which is exclusive of depreciation and interest expense on the embedded lease portion of our SoFi Stadium agreement;
partially offset by a decrease in marketing referrals of $4.0 million, which was reflective of an initiative to rely less on this channel for member growth during 2020; and
further partially offset by a decrease in advertising expenditures of $31.1 million, which was attributable to the impact of the COVID-19 pandemic on our live sports marketing strategy, the aforementioned SoFi Stadium related marketing expenditures in lieu of advertising expenditures, and the expected advertising benefits we expected to derive from the opening of SoFi Stadium.
Cost of operations increased by $62.6 million, or 54%, primarily due to:
an increase in loan origination expenses of $16.2 million, of which $16.6 million was related to home loans, which supported the growth in home loan origination volume year over year;
an increase in third-party fulfillment expenses of $12.5 million, which was primarily attributable to post-acquisition Galileo operations, and primarily relates to the fees we pay to payment networks to route authorized transactions;
an increase in employee compensation and benefits of $20.0 million, inclusive of an increase in share-based compensation expense of $4.4 million, which was correlated with a 15% increase in cost of operations personnel in support of our growth in addition to an increase in home loan commissions of $5.8 million related to growth in the home loan product. The headcount-related compensation increase was partially offset by higher severance expense of $0.7 million during 2019;
an increase in occupancy-related costs of $5.6 million;
an increase in software licenses and tools and subscriptions of $5.1 million related to headcount increases and internal technology initiatives;
an increase of $3.3 million associated with SoFi Money account write-offs; and
an increase in brokerage-related costs of $2.1 million related to the growth of SoFi Invest and our wholly-owned subsidiary, 8 Limited, which we acquired in April 2020;
partially offset by a decrease in professional services of $5.2 million, primarily due to non-recurring operations costs related to SoFi Money incurred in 2019.
General and administrative expenses increased by $85.1 million, or 56%, primarily due to:
an increase in employee compensation and benefits of $37.0 million, inclusive of an increase in share-based compensation expense of $18.5 million, which was related to a 46% increase in general and administrative
164

TABLE OF CONTENTS
personnel to support our growing infrastructure and administrative needs in addition to an increase in compensation per person in 2020;
an increase in bank service charges of $5.8 million, which was primarily related to an increase in unused line fees as a result of increased capacity on our warehouse lines partially offset by a decrease in bank fees year over year;
an increase in software licenses and tools and subscriptions of $3.6 million;
transaction-related expenses of $9.2 million during 2020 associated with our acquisitions of 8 Limited and Galileo, which largely consisted of legal, accounting and financial advisory services;
share-based payments to non-employees of $0.9 million during 2020 for financial advisory services related to our acquisitions;
an increase in non-transaction related professional services of $5.7 million, which included accounting and legal services; and
an increase in the fair value of our warrant liabilities of $23.4 million related to an increase in the fair value of our Series H preferred stock.
Net Loss
Our net loss for the year ended December 31, 2020 improved by $15.6 million, or 7%, compared to the year ended December 31, 2019, primarily due to the factors discussed above, as well as the change in income taxes. The primary driver of the $104.6 million year-over-year decrease in income taxes was associated with the remeasurement of our valuation allowance during 2020, which was primarily a result of the deferred tax liabilities recognized in connection with our acquisition of Galileo, which decreased the valuation allowance by $99.8 million. The deferred tax liabilities recognized in the acquisition were substantially all related to acquired intangibles, which had a fair value of $388.0 million and a tax basis of zero.
Year Ended December 31, 2019 Compared to Year Ended December 31, 2018
Interest Income
The following table presents the components of our total interest income for the years indicated:
($ in thousands)
Year Ended December 31,
$ Variance
% Change
2019 2018
Loans
$ 570,466  $ 568,209  $ 2,257  —  %
Securitizations
23,179  19,300  3,879  20  %
Related party notes
3,338  —  3,338 
n/m
Other
11,210  2,109  9,101  432  %
Total interest income
$ 608,193  $ 589,618  $ 18,575  %
Total interest income increased by $18.6 million, or 3%, for the year ended December 31, 2019 compared to the year ended December 31, 2018 due to the following:
Loan interest income increased by $2.3 million, or less than 1%, primarily driven by an increase in personal loan interest income of $50.4 million, offset by declines in student loan interest income of $45.2 million and home loan interest income of $2.9 million. Interest income varies from period to period based on prevailing weighted average coupon rates that we charge on our loans, origination volume during the period and the amount of time our loans remain on our Consolidated Balance Sheets. The increase in personal loan interest income was driven by an increase in monthly average personal loan balances year over year in addition to an increase in the monthly weighted average coupon rate. The decline in student loan interest income was primarily driven by a decrease in monthly average student loan balances, while the decline in home loans interest income was primarily driven by a decrease in
165

TABLE OF CONTENTS
monthly average home loan balances outstanding during 2019, in addition to a decrease in the weighted average coupon rates that we charge on our loans.
Securitizations interest income from our securitization investments and interest earned on member loan payments made prior to our remittance to securitization investors increased year over year by $3.9 million driven by the additive effect of our 2019 securitization transactions.
Related party notes interest income of $3.3 million for the year ended December 31, 2019 was attributable to a stockholder loan and an Apex note receivable. In March 2019, we entered into a $58.0 million note receivable agreement with a stockholder, which accrued interest at 7.0% per annum. In October 2019, the stockholder settled $15.2 million of the note receivable and accrued interest owed to us. The remaining balance was outstanding as of December 31, 2019. In November 2019, we lent $9.1 million to Apex at an interest rate of 12.5% per annum. The Apex note receivable was outstanding as of December 31, 2019, with no payment activity during 2019. See Note 14 to the Notes to Consolidated Financial Statements included elsewhere in this prospectus for additional information on these arrangements.
Other interest income increased by $9.1 million, or 432%, due to growth in Member Bank deposit interest income of $5.7 million, which was reflective of our official launch of the SoFi Money product in early 2019 and nearly a full year of deposit interest income in 2019 compared to limited product testing for a partial period in 2018. The remaining portion of the increase was tied to bank interest income, which was largely attributable to higher cash balances in 2019.
Interest Expense
The following table presents the components of our total interest expense for the years indicated:
Year Ended December 31,
($ in thousands)
2019 2018
$ Variance
% Change
Securitizations and warehouses
$ 268,063  $ 330,186  $ (62,123) (19) %
Other
10,296  368  9,928 
n/m
Total interest expense
$ 278,359  $ 330,554  $ (52,195) (16) %
Total interest expense decreased by $52.2 million, or 16%, for the year ended December 31, 2019 compared to the year ended December 31, 2018 due to the following:
Interest expense related to securitizations and warehouses decreased by $62.1 million, or 19%, primarily due to:
a decrease in securitization residual debt interest expense of $51.9 million, which was correlated with a lower balance of securitization residual debt in addition to a lower effective yield on the residual debt, which lowered the interest expense recognized and was related to tightening market yields on the underlying residual interest positions;
a decrease of $24.1 million in warehouse-related interest expense (exclusive of amortized debt issuance costs) as result of a 25% lower average monthly warehouse balance during 2019 compared to 2018, which was in part a result of us utilizing financing cash inflows from our Series H preferred stock issuance during 2019 to fund warehouse financeable loans; and
an increase of $14.3 million in our consolidated securitization debt interest expense (exclusive of amortized debt issuance costs and discounts), which was largely attributable to interest rate changes.
166

TABLE OF CONTENTS
The following tables present the components of securitizations and warehouses interest expense, as well as other pertinent information:
Year ended December 31,
($ in thousands) 2019 2018 $ Variance % Change
Securitization debt interest expense $ 132,811  $ 118,511  $ 14,300  12  %
Warehouse debt interest expense 80,895  105,022  (24,127) (23) %
Residual interests classified as debt interest expense 30,562  82,505  (51,943) (63) %
Debt issuance cost interest expense 23,795  24,148  (353) (1) %
Total securitizations and warehouses interest expense
$ 268,063  $ 330,186  $ (62,123) (19) %
Year ended December 31,
($ in thousands) 2019 2018 % Change
Average debt balances

Securitization debt $ 3,888,058  $ 3,919,131  (1) %
Warehouse facilities 1,800,902  2,411,202  (25) %
Residual interests classified as debt 379,030  514,054  (26) %
Weighted average interest rates

Securitization debt(1)
3.4  % 3.0  % n/m
Warehouse facilities(1)
4.5  % 4.4  % n/m
Residual interests classified as debt(2)
8.1  % 16.0  % n/m
__________________
(1)Weighted average interest rates exclude the effect of debt issuance cost interest expense for securitization debt and warehouse facilities.
(2)In 2018, declines in expected collateral performance resulted in us raising the required yield used to calculate interest expense. Concerns of decreased cash flows to residual interest owners were mollified in 2019, as securitization collateral performance improved and expected future cash flows increased, which, in turn, resulted in a lower required yield in 2019.
Other interest expense increased by $9.9 million due to increases of $5.2 million associated with our SoFi Money product and $4.7 million related to our revolving credit facility. The increase in SoFi Money interest expense represents the interest income we pay to our members’ SoFi Money accounts. The year-over-year increase is due to an increase in the number and average balances of SoFi Money accounts, largely due to a nearly full year of activity in 2019, as we had the official launch of the SoFi Money product in early 2019 compared to limited product testing for a partial period in 2018. Additionally, we drew $58.0 million on our revolving credit facility during 2019 to fund the aforementioned $58.0 million stockholder note receivable, and also had a full year of interest expense in 2019, as we entered into our revolving credit facility in September 2018.
Noninterest Income and Net Revenue
The following table presents the components of our total noninterest income and total net revenue for the years indicated:
Year Ended December 31,
($ in thousands)
2019 2018
$ Variance
% Change
Loan origination and sales
$ 299,265  $ 123,046  $ 176,219  143  %
Securitizations
(199,125) (114,705) (84,420) 74  %
Servicing
8,486  1,197  7,289  609  %
Other
4,199  797  3,402  427  %
Total noninterest income
$ 112,825  $ 10,335  $ 102,490  992  %
Total net revenue
$ 442,659  $ 269,399  $ 173,260  64  %
167

TABLE OF CONTENTS
Total noninterest income increased by $102.5 million, or 992%, for the year ended December 31, 2019 compared to the year ended December 31, 2018 primarily due to the following:
Loan origination and sales income increased by $176.2 million, or 143%, primarily due to receiving higher prices for loans we sold through our securitization channel in 2019. During 2019, we received $4.8 billion of consideration from student loan securitization transfers for loans with a carrying value of $4.7 billion, which resulted in a gain during the year of $147.5 million, or 103.2% of carrying value. In contrast, during 2018, we received consideration of $5.0 billion for student loan securitization transfers with a carrying value of $4.9 billion, which resulted in a gain of $92.9 million, or 101.9% of carrying value. We achieved a directionally similar outcome with personal loan securitization transfers year over year. In addition, our whole loan sales channel experienced similar improved execution in 2019 versus 2018. For instance, our personal loan whole sales during 2019 resulted in a gain of $87.7 million compared to a loss in 2018 of $(37.7) million, or a difference in carrying value as a percentage of proceeds of 103.9% in 2019 versus 98.3% in 2018. Our fair value adjustments as of December 31, 2019 reflected this improved sales execution compared to 2018.
Securitizations income decreased by $84.4 million, or 74%, primarily due to losses from a $103.8 million reduction in downward fair value adjustments on securitization residual debt, of which $44.6 million was related to non-cash unfavorable fair value changes in residual interests classified as debt valuation assumptions and inputs, which was correlated with improved securitization performance year over year. In 2018, expected securitization loan performance, which directly impacts residual interests classified as debt valuations, was more heavily weighted toward 2016 and 2017 SoFi securitization vintages, which had less strict underwriting criteria than 2018 and 2019 securitization vintages and, therefore, had lower expected future cash flows for residual interest owners during our 2018 valuation process. However, our actual 2019 securitization portfolio performance was better than expected in 2018, which resulted in residual interests classified as debt positions having a more positive future outlook in 2019 and beyond, which in turn increases the fair value. In addition, we incurred a $39.2 million loss related to our transfer of loans held in previously consolidated securitization VIEs. The decrease in income was also attributable to an increase in securitization loan charge-offs, which was mostly driven by carrying a higher balance of consolidated collateral in 2019 related to two consolidated securitizations added in late 2018 in addition to three securitizations consolidated in early 2019 that were deconsolidated in the fourth quarter of 2019. These reductions in income were partially offset by less downward fair value adjustments year over year on our securitization loan collateral of $69.1 million. The remaining variance is attributable to year-over-year aggregate increases in our securitization investment fair market values.
The table below presents additional information related to loan gains and losses and overall performance:
Year Ended December 31,
($ in thousands) 2019 2018 $ Variance % Change
Gains (losses) from non-securitization loan transfers $ 129,989  $ (11,964) $ 141,953  n/m
Gains from loan securitization transfers(1)
226,394  113,918  112,476  99  %
Economic derivative hedges of loan fair values(2)
(24,803) 39,465  (64,268) (163) %
Home loan origination fees(3)
3,639  2,224  1,415  64  %
Loan write-off expense – whole loans(4)
(13,888) (42,300) 28,412  (67) %
Loan write-off expense – securitization loans(5)
(121,102) (101,543) (19,559) 19  %
Loan repurchase expense(6)
(2,337) (10,745) 8,408  (78) %
__________________
(1)Represents the gain recognized on loan securitization transfers qualifying for sale accounting treatment for the years presented.
(2)While not an economic hedge of loan fair values, we also had gains (losses) of $0.9 million and $(1.3) million during the year ended December 31, 2019 and 2018, respectively, related to interest rate lock commitments. The year-over-year change was correlated with an increase in home loan origination volume.
(3)This variance was correlated with an increase in home loan origination volume year over year.
(4)Includes gross write-offs of $22.3 million and $52.6 million for the year ended December 31, 2019 and 2018, respectively. During 2019, $0 of the $8.4 million of recoveries were captured via loan sales to a third-party collection agency. During 2018, $1.1 million of the $10.3 million of recoveries were captured via loan sales to a third-party collection agency.
168

TABLE OF CONTENTS
(5)Includes gross write-offs of $139.2 million and $118.8 million for the year ended December 31, 2019 and 2018, respectively. During 2019, $7.6 million of the $18.1 million of recoveries were captured via loan sales to a third-party collection agency. During 2018, $10.0 million of the $17.3 million of recoveries were captured via loan sales to a third-party collection agency.
(6)Loan repurchase expense in 2018 was correlated with 2018 loan performance, which is discussed elsewhere in this "SoFi’s Management’s Discussion and Analysis of Financial Condition and Results of Operations", and is related to different underwriting standards for loan originations in 2018.
Servicing income increased by $7.3 million, or 609%, primarily due to a $9.9 million increase in servicing fees earned on higher servicing portfolio unpaid principal balances among our home loan, personal loan and student loan products. This increase was partially offset by a decline in our servicing assets year over year of $2.6 million due to servicing portfolio run-off and fair value adjustments.
The table below presents additional information related to our loan servicing activities:
Year ended December 31,
($ in thousands) 2019 2018 $ Variance % Change
Servicing income recognized
Home loans(1)
$ 2,648  $ 2,264  $ 384  17  %
Student loans(2)
47,489  42,625  4,864  11  %
Personal loans(3)
34,290  29,600  4,690  16  %
Servicing rights fair value change
Home loans(4)
4,558  2,970  1,588  53  %
Student loans(5)
16,507  20,588  (4,081) (20) %
Personal loans(6)
14,849  (7,582) 22,431  296  %
__________________
(1)The weighted average bps earned for home loan servicing during the year ended December 31, 2019 and 2018 was 26 bps and 27 bps, respectively.
(2)The weighted average bps earned for student loan servicing during the year ended December 31, 2019 and 2018 was 39 bps and 46 bps, respectively.
(3)The weighted average bps earned for personal loan servicing during the year ended December 31, 2019 and 2018 was 72 bps and 66 bps, respectively.
(4)The impact of the changes in valuation inputs and assumptions on this fair value change was $1.5 million and $2.5 million during the year ended December 31, 2019 and 2018, respectively.
(5)The impact of the changes in valuation inputs and assumptions on this fair value change was $0.2 million and $3.6 million during the year ended December 31, 2019 and 2018, respectively.
(6)The impact of the changes in valuation inputs and assumptions on this fair value change was $6.8 million and $(5.0) million during the year ended December 31, 2019 and 2018, respectively.
Other income increased by $3.4 million, or 427%, primarily due to an increase in affiliate-based referral revenues of $3.0 million and an increase of $0.6 million in payment network revenue, the latter of which was reflective of the continued expansion of our SoFi Money product.
Noninterest Expense
The following table presents the components of our total noninterest expense for the years indicated:
Year Ended December 31,
($ in thousands)
2019 2018
$ Variance
% Change
Technology and product development $ 147,458  $ 99,319  $ 48,139  48  %
Sales and marketing 266,198  212,604  53,594  25  %
Cost of operations 116,327  88,885  27,442  31  %
General and administrative 152,275  121,948  30,327  25  %
Total noninterest expense
$ 682,258  $ 522,756  $ 159,502  31  %
169

TABLE OF CONTENTS
Total noninterest expense increased by $159.5 million, or 31%, for the year ended December 31, 2019 compared to the year ended December 31, 2018 due to the following:
Technology and product development expenses increased by $48.1 million, or 48%, primarily due to a $25.7 million increase in compensation and benefits related costs, inclusive of an increase in share-based compensation expense, primarily related to a 30% increase in average headcount and new hire equity grants as we continued to expand our technology and product teams to support our growth. During 2019 relative to 2018, we spent an additional $7.3 million related to the use of outsourced professional services providers engaged to help support the growth of our Financial Services segment. Additionally, we had a $5.2 million increase in tools and subscription costs related to our continued investment in technology and platform improvements in 2019 and a $5.3 million increase in amortization and software abandonment costs. The remaining increase was related to items such as the allocation of occupancy-related costs.
Sales and marketing expenses increased by $53.6 million, or 25%, primarily due to an increase of $26.9 million in advertising expenditures associated with an increased focus on building brand awareness and support for our burgeoning Financial Services segment, in addition to an incremental $3.5 million in general marketing costs. Additionally, compensation and benefits related costs increased by $8.7 million, inclusive of an increase in share-based compensation expense, primarily related to an 8% increase in average headcount within the sales and marketing department, inclusive of our Chief Marketing Officer, and an increase in discretionary bonuses paid during 2019. This variance includes the effect of a $1.1 million increase in severance costs in 2019. Lastly, we increased member promotional materials expenditures by $7.2 million, affiliate-related marketing by $4.1 million and tools and subscriptions by $2.5 million.
Cost of operations increased by $27.4 million, or 31%, due in part to an overall increase in professional services expenditures of $10.8 million to support the growth of our Financial Services segment. Additionally, account write-offs and member credits increased by $4.7 million and debit card fulfillment and SoFi Money and SoFi Invest account costs increased by $5.1 million, which were also related to the growth in the Financial Services segment. Non-compensation related origination and servicing expenses increased by $3.3 million, in addition to increases in tools and subscriptions expenditures of $2.6 million and occupancy-related costs of $1.8 million. These increases were partially offset by a decrease in compensation and benefit costs of $2.3 million, inclusive of a decrease in share-based compensation costs, primarily related to a 9% decrease in average headcount year over year.
General and administrative expenses increased by $30.3 million, or 25%, primarily due to an $18.7 million increase in compensation and benefits related costs, inclusive of an increase in share-based compensation expense, related to a 24% increase in average headcount, a $3.4 million increase in professional services expenditures, a $6.3 million increase in bank service charges driven by an increase in unused debt warehouse line fees and an increase in bank fees from greater account activity, a $3.1 million increase in tools and subscriptions expenditures, and a $1.4 million increase in occupancy-related costs associated with the headcount increase. These increases were partially offset by a decrease in litigation-related expenses of $1.5 million and recruitment-related expenses of $0.8 million.
Net Loss
Our net loss for the year ended December 31, 2019 improved by $12.7 million, or 5%, compared to the year ended December 31, 2018 primarily due to the factors discussed above. Additionally, during the years ended December 31, 2019 and 2018, we recognized a full valuation allowance against our net deferred tax assets primarily due to net operating losses, which increased our valuation allowance by $70.8 million and $74.2 million, respectively.
170

TABLE OF CONTENTS
Summary Results by Segment
Lending Segment
In the table below, we present certain metrics related to our Lending segment:
December 31,
2020 vs. 2019
% Change
2019 vs. 2018
% Change
Metric
2020 2019 2018
Total products (number) 917,645  798,005  640,350  15  % 25  %
Origination volume ($ in thousands, during period)


Home loans $ 2,183,521  $ 773,684  $ 769,355  182  % %
Personal loans 2,580,757  3,731,981  4,429,366  (31) % (16) %
Student loans 4,928,880  6,695,138  6,532,533  (26) % %
Total $ 9,693,158  $ 11,200,803  $ 11,731,254  (13) % (5) %
Loans with a balance (number) 598,682  623,511  553,276  (4) % 13  %
Average loan balance ($)


Home loans $ 291,382  $ 296,812  $ 305,427  (2) % (3) %
Personal loans 21,789  24,372  26,694  (11) % (9) %
Student loans 54,319  60,127  61,093  (10) % (2) %
In the table below, we present additional information related to our lending products:
Year Ended December 31,
2020 2019 2018
Student Loans
Weighted average origination FICO 773  774  768 
Weighted average interest rate earned 4.97  % 5.48  % 5.38  %
Interest income recognized ($ in thousands) $ 134,917  $ 157,447  $ 202,608 
Sales of loans ($ in thousands)(1)
$ 4,534,286  $ 6,051,418  $ 6,670,778 
Time between loan origination and loan sale (days) 75  58  69 
Home Loans
Weighted average origination FICO 764  761  765 
Weighted average interest rate earned 2.19  % 3.39  % 4.57  %
Interest income recognized ($ in thousands) $ 2,731  $ 2,230  $ 5,219 
Sales of loans ($ in thousands)(1)
$ 2,102,101  $ 726,443  $ 919,094 
Time between loan origination and loan sale (days) 10  13  26 
Personal Loans
Weighted average origination FICO 764  756  750 
Weighted average interest rate earned 10.65  % 10.92  % 9.83  %
Interest income recognized ($ in thousands) $ 192,450  $ 410,789  $ 360,382 
Sales of loans ($ in thousands)(1)
$ 1,531,057  $ 2,604,263  $ 3,453,449 
Time between loan origination and loan sale (days) 88  81  98 
__________________
(1)Excludes the impact of loans transferred into consolidated VIEs.
Total Products
Total products refers to the number of home loans, personal loans and student loans that have been originated through our platform since our inception through the reporting date, whether or not such loans have been paid off. See “— Key Business Metrics” for further discussion of this measure as it relates to our Lending segment.
171

TABLE OF CONTENTS
Origination Volume
We refer to the aggregate dollar amount of loans originated through our platform in a given period as origination volume. Origination volume is an indicator of the size and health of our Lending segment and an indicator (together with the relevant loan characteristics, such as interest rate and prepayment and default expectations) of revenues and profitability. Changes in origination volume are driven by the addition of new members and existing members, the latter of which at times will either refinance into a new SoFi loan or secure an additional, concurrent loan, as well as macroeconomic factors impacting consumer spending and borrowing behavior. Since the profitability of the Lending segment is largely correlated with origination volume, management relies on origination volume trends to assess the need for external financing to support the Financial Services segment and the expense budgets for unallocated expenses.
Home loan origination volume remained stable from 2018 to 2019, as we temporarily paused our home loan operations in late 2018 to redesign our offering. We relaunched our home loan product in the first quarter of 2019. During the year ended December 31, 2020, home loan origination volume significantly increased due to the full period of origination activity relative to 2019, as well as increased demand for home loan products in 2020 following the Federal Reserve’s actions to reduce interest rates to near-zero benchmark levels amid the COVID-19 pandemic.
Personal loan origination volume decreased from 2018 to 2019 due to steps we took to tighten our underwriting and credit policies and to raise the average coupon rate to increase the durability of our loans throughout the economic cycle. During the year ended December 31, 2020, personal loan origination volume decreased relative to 2019 primarily due to the combination of our efforts to further tighten our underwriting and credit policies to mitigate our credit risk exposure during the economic downturn and lower consumer spending behavior during the COVID-19 pandemic. We believe that the diminished consumer spending during the COVID-19 pandemic decreased the overall demand for debt consolidation loans, which is one of the primary stated purposes for our personal loan originations, despite us lowering the average coupon rate during 2020.
Student loan origination volume remained relatively stable from 2018 to 2019, which we believe was largely attributable to new competition entering the student loan refinance market. However, we believe our long-standing reputation in the marketplace has enabled us to maintain strong student loan origination volumes. Additionally, we launched our in-school student loan product in the third quarter of 2019, which allows members to borrow while they attend school and offers flexible repayment options. Although this product had a modest impact on the full year 2019 student loan origination volume, we continued to see growth in this product during 2020. Demand for our student loan refinancing products decreased during the year ended December 31, 2020 relative to 2019, primarily due to the automatic suspension of principal and interest payments on federally-held student loans through September 30, 2020 as part of the CARES Act and subsequent extensions of certain hardship provisions. Suspension of principal and interest payments was further extended by executive action through September 30, 2021. We believe this suspension and subsequent extensions contribute to decreased overall demand for student loan refinancing.
Loans with a Balance and Average Loan Balance
Loans with a balance refers to the number of loans that have a balance greater than zero dollars as of the reporting date. Loans with a balance allows management to better understand the unit economics of acquiring a loan in relation to the lifetime value of that loan. Average loan balance is defined as the total unpaid principal balance of the loans divided by loans with a balance within the respective loan product category as of the reporting date.
The declines in home loan average balances over the years indicated were driven primarily by a change in strategy in which we moved from underwriting both agency and non-agency loans, inclusive of jumbo loans, which carry a larger maximum loan balance, to strictly underwriting agency loans, which have a lower relative balance size compared to non-agency loans.
The declines in personal loan average balances over the years indicated were driven primarily by credit line adjustments we have made to lower our risk of credit losses. In 2020, these declines were also related to the impact
172

TABLE OF CONTENTS
of the COVID-19 pandemic, which caused a decline in consumption demand as well as a reduction in the average size of requested personal loans.
Student loan average balances have remained relatively consistent from 2018 to 2019. The decline in average balance during 2020 was due in part to the growth of in-school student loans, which have a lower average balance.
The following table presents the measure of contribution profit (loss) for the Lending segment for the years indicated. The information is derived from our internal financial reporting used for corporate management purposes. Refer to Note 17 in the Notes to Consolidated Financial Statements included elsewhere in this prospectus for more information regarding Lending segment performance.
Year Ended December 31,
2020 vs. 2019
% Change
2019 vs. 2018
% Change
($ in thousands)
2020 2019 2018
Net revenue
Net interest income $ 199,345  $ 325,589  $ 257,344  (39) % 27  %
Noninterest income 281,521  108,712  9,404  159  %
n/m
Total net revenue 480,866  434,301  266,748  11  % 63  %
Servicing rights – change in valuation inputs or assumptions(1)
17,459  (8,487) (1,197) (306) % 609  %
Residual interests classified as debt – change in valuation inputs or assumptions(2)
38,216  17,157  (27,481) 123  % (162) %
Directly attributable expenses(3)
(294,812) (350,511) (347,348) (16) % %
Contribution Profit (Loss) $ 241,729  $ 92,460  $ (109,278) 161  % (185) %
__________________
(1)Reflects changes in fair value inputs and assumptions, including market servicing costs, conditional prepayment and default rates and discount rates. This non-cash change, which is recorded within noninterest income in the Consolidated Statements of Operations and Comprehensive Income (Loss) is unrealized during the period and, therefore, has no impact on our cash flows from operations. As such, the changes in fair value attributable to assumption changes are adjusted to provide management and financial users with better visibility into the cash flows available to finance our operations.
(2)Reflects changes in fair value inputs and assumptions, including conditional prepayment and default rates and discount rates. When third parties finance our consolidated VIEs through purchasing residual interests, we receive proceeds at the time of the securitization close and, thereafter, pass along contractual cash flows to the residual interest owner. These obligations are measured at fair value on a recurring basis, with fair value changes recorded within noninterest income in the Consolidated Statements of Operations and Comprehensive Income (Loss). The fair value change attributable to assumption changes has no impact on our initial financing proceeds, our future obligations to the residual interest owner (because future residual interest claims are limited to contractual securitization collateral cash flows), or the general operations of our business. As such, this non-cash change in fair value is adjusted to provide management and financial users with better visibility into the cash flows available to finance our operations.
(3)For a disaggregation of the directly attributable expenses allocated to the Lending segment in each of the years presented, refer to the subsections titled “—Directly Attributable Expenses” under the respective year-over-year comparison sections below.
Year Ended December 31, 2020 Compared to Year Ended December 31, 2019
Net interest income
Net interest income in our Lending segment for the year ended December 31, 2020 decreased by $126.2 million, or 39%, compared to the year ended December 31, 2019 due to the following:
Loan interest income decreased by $240.1 million, or 42%, primarily driven by a $218.3 million decrease in personal loan interest income year over year. A significant portion of this decrease was related to a decline in securitization loan interest income of $209.4 million, which was a function of our deconsolidation of three variable interest entities (“VIEs”) during 2020 that were previously consolidated during 2019 (we recognized a loss of $6.1 million during 2020 within noninterest income related to these VIE deconsolidations), and earning interest income from loans in three consolidated VIEs in 2019 that were deconsolidated in the fourth quarter of 2019 (we recognized a loss of $38.7 million within noninterest income related to the fourth quarter 2019 VIE deconsolidations). In all cases, our deconsolidations of previously consolidated VIEs were triggered by a third party purchasing enough residual interest ownership in the VIEs from us such that we owned less than 10% of the VIE residual interest. As we no longer had a significant financial interest in the VIEs, we deconsolidated them, which included the related securitization loans.
173

TABLE OF CONTENTS
Further, we did not consolidate any personal loan VIEs during 2020. In addition, our monthly average non-securitization personal loan balance during 2020 was 5% lower than in 2019, which contributed to an $8.9 million decline in loan interest income year over year. This decline was heavily influenced by the COVID-19 pandemic, which contributed to a year-over-year decline in personal loan origination volume of 31%. Student loan securitization interest income declined by $34.1 million, which was correlated with an increase in prepayments and was also negatively impacted by the COVID-19 pandemic. These declines in interest were offset by an $11.6 million increase in non-securitization student loan interest income, which was consistent with a 33% higher average balance year over year as a result of a longer holding period for loans on the balance sheet and a significant strategic purchase of loans during 2020.
Securitizations interest income increased by $0.9 million, or 4%, which was attributable to an increase in residual investment interest income of $2.9 million and asset-backed bonds of $1.2 million. These increases were offset by a decline in securitization float interest income of $3.2 million, which was largely attributable to declining interest rates during 2020.
Interest expense related to securitizations and warehouses decreased by $112.9 million, or 42%, primarily due to:
a decline in securitization debt interest expense (exclusive of debt issuance and discount amortization) of $66.7  million, which was correlated with the deconsolidation of VIEs discussed above and the absence of new consolidated VIEs, with the exception of one student loan VIE, which was only briefly consolidated before we transferred the significant portion of our financial interest and subsequently deconsolidated it. Moreover, the majority of our student loan securitization debt is tied to one-month LIBOR, which decreased during 2020;
a decline in warehouse debt interest expense (exclusive of debt issuance amortization) of $28.9 million, which was related to a decrease in one- and three-month LIBOR during 2020. Interest rate declines were partially offset by a higher average warehouse debt balance outstanding during 2020;
a decline in residual interests classified as debt interest expense of $17.9 million, which was correlated with a lower balance of residual interests classified as debt during 2020, a significant driver of which was the aforementioned deconsolidation of VIEs during 2020 and 2019; and
an offsetting increase in debt issuance cost interest expense of $0.6 million, which was associated with an initiative to increase our warehouse borrowing capacity to protect against potential future funding constraints attributable to the COVID-19 pandemic, partially offset by a decrease in securitization debt issuance costs in 2020, which was driven by the deconsolidations discussed above.
Noninterest income
Noninterest income in our Lending segment for the year ended December 31, 2020 increased by $172.8 million, or 159%, compared to the year ended December 31, 2019 due to the following:
Loan origination and sales increased by $72.1 million, or 24%. We experienced an $81.1 million year-over-year increase in home loan originations and sales related income, net of hedges, and related interest rate lock commitments, which was driven by a 182% increase in home loans origination volume and a mix shift toward more FNMA loans during 2020, which sell for a greater loan premium compared to non-agency home loans. Home loan origination fees also increased by $7.9 million year over year in conjunction with the increase in origination volume. Additionally, improved loan credit and underwriting performance of personal and student loans resulted in lower combined write-offs and repurchase expense year over year.
Offsetting these increases was a $16.9 million decline in aggregate personal and student loan origination and sales income, which was attributable to lower origination volumes, partially offset by combined lower write-offs and repurchase expense. Student loan origination volume declined 26% year over year, primarily due to lower demand for our student loan refinancing products as a result of the payment deferral period on federal student loans enacted through the CARES Act in 2020. Personal loan origination volume declined 31% year over year, primarily due to
174

TABLE OF CONTENTS
our efforts in 2020 to further tighten our underwriting and credit policies to mitigate our credit risk exposure during the economic downturn combined with lower demand for personal loan financing, which we believe is a result of lower consumer spending behavior during the COVID-19 pandemic.
Securitization income increased by $128.9 million, or 65%, due to a reduction in securitization loan write-offs of $82.5 million, which was related to the deconsolidation of VIEs and stronger securitization loan credit performance during 2020. The decrease in securitization loan write-offs also had the impact of improving our assumed future credit outlook for our securitization loans, which contributed to an aggregate increase of $39.0 million year over year in securitization loan fair market value changes.
These increases were offset by residual debt fair value increases of $16.4 million, which were correlated with underlying securitization performance and residual interest positions representing a greater percentage of securitization claims (which occurs over time as securitization loans are paid off and accordingly securitization debt gets paid off) year over year, of which $21.1 million was related to non-cash unfavorable fair value changes in residual interests classified as debt valuation assumptions and inputs. Further, we experienced an increase in our residual investment earnings of $23.7 million, which was largely due to a $38.7 million loss realized in the fourth quarter of 2019 related to the deconsolidation of three personal loan VIEs compared to losses in 2020 of $8.6 million attributable to a previously consolidated VIE that was both consolidated and deconsolidated in 2020 and $6.1 million attributable to the deconsolidation of three additional VIEs.
Servicing income decreased by $27.9 million, or 329%, and was primarily related to fair value changes in our servicing assets that were largely attributable to an increase in servicing asset prepayment speed assumptions year over year. We experienced an increase in loan prepayments during 2020, which we believe is correlated with the market interest rate declines in 2020 compared to 2019. We expect prepayments to continue to remain at a higher than historical level in the current low interest rate environment that is expected to persist into the next fiscal year.
Directly attributable expenses
The directly attributable expenses allocated to the Lending segment that were used in the determination of the segment's contribution profit (loss) were as follows:
Year Ended December 31,
($ in thousands) 2020 2019 % Change
Direct advertising $ 102,562  $ 124,479  (18) %
Compensation and benefits 82,592  126,710  (35) %
Loan origination costs 41,733  25,505  64  %
Affiliate referrals 24,603  30,255  (19) %
Unused warehouse line fees 14,113  8,073  75  %
Occupancy and travel 11,056  16,593  (33) %
Professional services 7,139  8,080  (12) %
Other(1)
11,014  10,816  %
Directly attributable expenses $ 294,812  $ 350,511  (16) %
__________________
(1)Other expenses primarily include recruiting fees, as well as loan marketing sales and tools and subscriptions costs.
Lending segment directly attributable expenses for the year ended December 31, 2020 decreased by $55.7 million, or 16%, compared to the year ended December 31, 2019 primarily due to:
a decrease of $44.1 million in allocated employee compensation and related benefits and a decrease of $5.5 million in allocated occupancy and travel expenses primarily driven by less direct time allocated to the Lending segment by the technology and product and operations teams related to an increased emphasis on non-lending initiatives in 2020;
175

TABLE OF CONTENTS
a decrease of $21.9 million in direct advertising related to an intentional reduction in advertising spend during the COVID-19 pandemic;
a decrease of $5.7 million in affiliate referral expense related to lower origination volume through our affiliate channels;
a decrease of $0.9 million in professional services costs;
an offsetting increase of $16.2 million in loan origination costs driven primarily by volume increases in our home loan product; and
an offsetting increase of $6.0 million in unused warehouse line fees correlated with an increase in warehouse facility capacity year over year.
Year Ended December 31, 2019 Compared to Year Ended December 31, 2018
Net interest income
Net interest income in our Lending segment for the year ended December 31, 2019 increased by $68.2 million, or 27%, compared to the year ended December 31, 2018 due to the following:
Loan interest income increased by $2.3 million, or less than 1%, primarily driven by an increase in personal loan interest income of $50.4 million, offset by declines in student loan interest income of $45.2 million and home loan interest income of $2.9 million. Interest income varies from period to period based on prevailing weighted average coupon rates that we charge on our loans, origination volume during the period and the amount of time our loans remain on our Consolidated Balance Sheets.
Securitization income from residual investments, bonds and securitization float interest increased year over year by $3.9 million, which was reflective of the additive effect of our 2019 securitization transactions.
Securitization and warehouse related interest expense decreased by $62.1 million, or 19%, primarily due to:
a decrease in securitization residual debt interest expense of $51.9 million, which was correlated with a lower balance of securitization residual debt;
a decrease of $24.1 million in warehouse-related interest expense (exclusive of amortized debt issuance costs) as result of a 26% lower average monthly warehouse balance during 2019 compared to 2018, which was in part a result of us utilizing financing cash inflows from our Series H preferred stock issuance during 2019 to fund warehouse financeable loans; and
an increase of $14.3 million in our consolidated securitization debt interest expense (exclusive of amortized debt issuance costs and discounts), which was largely a function of a 3% higher average monthly balance during 2019 versus 2018.
Noninterest income
Noninterest income in our Lending segment increased by $99.3 million for the year ended December 31, 2019 compared to the year ended December 31, 2018, due to the following:
Loan origination and sales increased by $176.2 million, or 143%, primarily due to higher sales price execution in our securitization and whole loans sales channels year over year.
Securitization income decreased by $84.4 million, or 74%, primarily due to losses from a $103.8 million reduction in downward fair value adjustments on securitization residual debt, net of interest expense adjustments, which was attributable to improved securitization performance year over year, as well as a $39.2 million loss related to our transfer of loans held in previously consolidated securitization VIEs. Our deconsolidations of previously consolidated VIEs were triggered by a third party purchasing enough residual interest ownership in the VIEs from us such that we owned less than 10% of the VIE residual interest. As we no longer had a significant financial interest in
176

TABLE OF CONTENTS
the VIEs, we deconsolidated them, which included the related securitization loans. The decrease in income was also attributable to a $19.6 million increase in securitization loan charge-offs, which was mostly driven by carrying a higher balance of consolidated collateral in 2019 related to two consolidated securitizations added in late 2018 in addition to three securitizations consolidated in early 2019 that were deconsolidated in the fourth quarter of 2019. These reductions in income were partially offset by less downward fair value adjustments year over year on our securitization loan collateral of $69.1 million.
Servicing income increased by $7.3 million, or 609%, primarily due to a $9.9 million increase in servicing fees earned on higher servicing portfolio unpaid principal balances among our home loan, personal loan and student loan products. This increase was partially offset by a decline in our servicing assets year-over-year of $2.6 million due to servicing portfolio run-off and fair value adjustments.
An additional $0.2 million increase in noninterest income was attributable to an increase in earnings related to a residential mortgage origination joint venture.
Directly attributable expenses
The directly attributable expenses allocated to the Lending segment that were used in the determination of the segment's contribution profit (loss) were as follows:
Year Ended December 31,
($ in thousands) 2019 2018 % Change
Direct advertising $ 124,479  $ 123,919  —  %
Compensation and benefits 126,710  141,107  (10) %
Loan origination costs 25,505  22,237  15  %
Affiliate referrals 30,255  31,764  (5) %
Unused warehouse line fees 8,073  3,137  157  %
Occupancy and travel 16,593  16,510  %
Professional services 8,080  2,818  187  %
Other(1)
10,816  5,856  85  %
Directly attributable expenses $ 350,511  $ 347,348  %
__________________
(1)Other expenses primarily include recruiting fees, as well as loan marketing sales and tools and subscriptions costs.
Lending segment directly attributable expenses increased by $3.2 million, or 1%, for the year ended December 31, 2019 compared to the year ended December 31, 2018, primarily due to:
an increase of $5.3 million in professional services costs primarily associated with an increased use of third-party consultants for our operations and technology teams;
an increase of $4.9 million in unused warehouse line fees related to an increase in unused debt warehouse facility capacity;
an increase of $3.3 million in loan origination costs, which was a function of increases in home and personal loan origination costs, partially offset by a decline in student loan origination costs;
an increase of $5.0 million in other expenses primarily related to tools and subscriptions costs; and
an offsetting decrease of $14.4 million in allocated employee compensation and related benefits primarily driven by less direct time allocated to the Lending segment by the technology and product and operations teams in 2019 compared to 2018, as they instead spent a greater proportion of time dedicated to the Financial Services segment to support its growth.
177

TABLE OF CONTENTS
Financial Services Segment
Year Ended December 31,
2020 vs. 2019
% Change
2019 vs. 2018
% Change
($ in thousands)
2020
2019 2018
Net revenue
Net interest income $ 484  $ 614  $ 30  (21) % n/m
Noninterest income 11,386  3,318  844  243  % 293  %
Total net revenue
11,870  3,932  874  202  % 350  %
Directly attributable expenses(1)
(143,280) (122,732) (20,117) 17  % 510  %
Contribution loss
$ (131,410) $ (118,800) $ (19,243)

11  % 517  %
__________________
(1)For a disaggregation of the directly attributable expenses allocated to the Financial Services segment in each of the years presented, refer to the subsections titled "—Directly Attributable Expenses" under the respective year-over-year comparison sections below.
Year Ended December 31, 2020 Compared to Year Ended December 31, 2019
Net interest income
Net interest income in our Financial Services segment for the year ended December 31, 2020 decreased by $0.1 million, or 21%, compared to the year ended December 31, 2019 due to interest rate decreases during 2020, which resulted in lower net interest income earned on our SoFi Money account balances.
Noninterest income
Noninterest income in our Financial Services segment for the year ended December 31, 2020 increased by $8.1 million, or 243%, compared to the year ended December 31, 2019, which was primarily due to a $2.2 million increase in affiliate referral fees, a $3.4 million increase in brokerage-related fees, and a $1.8 million increase in payment network fees. The brokerage fees and payment network fees earned during 2020 were collectively bolstered by our acquisition of 8 Limited and increased member activity in both the SoFi Invest and SoFi Money products. The referral fee increase was primarily attributable to our material affiliate revenue relationships launched during the third quarter of 2019; therefore, 2019 is not fully comparable to 2020.
Directly attributable expenses
The directly attributable expenses allocated to the Financial Services segment that were used in the determination of the segment's contribution profit (loss) were as follows:
Year Ended December 31,
($ in thousands) 2020 2019 % Change
Compensation and benefits $ 81,354  $ 52,977  54  %
Product fulfillment 10,459  11,554  (9) %
Member incentives 9,100  8,894  %
Occupancy and travel 8,441  7,819  %
Direct advertising 8,083  23,038  (65) %
Professional services 5,853  10,290  (43) %
Other(1)
19,990  8,160  145  %
Directly attributable expenses $ 143,280  $ 122,732  17  %
__________________
(1)Other expenses primarily include tools and subscriptions, SoFi Money and SoFi Invest account write offs and marketing expenses.
178

TABLE OF CONTENTS
Financial Services directly attributable expenses for the year ended December 31, 2020 increased by $20.5 million, or 17%, compared to the year ended December 31, 2019 primarily due to the following:
increases in employee compensation and related benefits of $28.4 million and in occupancy and travel of $0.6 million, which dovetailed with the continued infrastructure, technology and support investments we made in our SoFi Money and SoFi Invest products during 2020;
an increase of $11.8 million in other expenses primarily related to write offs of SoFi Money accounts, tools and subscription costs and marketing;
an increase of $0.2 million related to direct member incentives;
an offsetting decrease of $15.0 million in direct advertising costs, such as social media and search engine advertising costs, which was primarily related to a strategic decision to spend less on marketing during the early stages of the COVID-19 pandemic;
an offsetting decrease of $4.4 million in professional services costs as a result of nonrecurring costs incurred in 2019 to support the launch of the SoFi Money and SoFi Invest products; and
an offsetting decrease of $1.1 million in product fulfillment costs related to SoFi Invest and SoFi Money, which included such activities as operating our cash management sweep program, brokerage expenses and debit card fulfillment services. The net decrease in 2020 is primarily attributable to nonrecurring expenses incurred in 2019 due to the launch of the SoFi Money product, which was partially offset by increased fulfillment costs in 2020 driven by the growth of the SoFi Money and SoFi Invest products.
Year Ended December 31, 2019 Compared to Year Ended December 31, 2018
Net interest income
Net interest income in our Financial Services segment increased by $0.6 million for the year ended December 31, 2019 compared to the year ended December 31, 2018, which was entirely attributable to net interest income earned on our SoFi Money account balances. As we officially launched the SoFi Money product in early 2019, we had nearly a full year of net interest income in 2019 compared to limited product testing for a partial period in 2018.
Noninterest income
Noninterest income in our Financial Services segment increased by $2.5 million, or 293%, for the year ended December 31, 2019 compared to the year ended December 31, 2018, which was primarily due to an increase in affiliate referral fees of $3.0 million and to an increase in payment network fees associated with SoFi Money of $0.6 million. These increases in noninterest income were partially offset by a loss of $1.2 million related to derivative contracts utilized to hedge the market risk associated with non-securitization exchange-traded fund investments during the year ended December 31, 2019. There was no gain or loss related to non-securitization hedging activities for the year ended December 31, 2018.
179

TABLE OF CONTENTS
Directly attributable expenses
The directly attributable expenses allocated to the Financial Services segment that were used in the determination of the segment’s contribution profit (loss) were as follows:
Year Ended December 31,
($ in thousands) 2019 2018 % Change
Compensation and benefits $ 52,977  $ 11,001  382  %
Product fulfillment 11,554  895  n/m
Member incentives 8,894  965  822  %
Occupancy and travel 7,819  1,637  378  %
Direct advertising 23,038  1,379  n/m
Professional services 10,290  1,669  517  %
Other(1)
8,160  2,571  217  %
Directly attributable expenses $ 122,732  $ 20,117  510  %
__________________
(1)Other expenses primarily include tools and subscriptions, SoFi Money and SoFi Invest account write offs, recruiting and marketing expenses.
Directly attributable expenses in our Financial Services segment increased by $102.6 million, or 510%, for the year ended December 31, 2019 compared to the year ended December 31, 2018, primarily due to the timing of our official launch of SoFi Money in early 2019 compared to limited product testing for a partial year in 2018. The primary impacts on directly attributable expenses were as follows:
increases of $42.0 million in compensation and benefits related costs and $6.2 million in occupancy and travel expenses resulting from the combination of increased headcount, as we expanded our technology and product team, and increased time spent on the Financial Services segment by the technology and product and operations teams in 2019 compared to 2018;
an increase of $21.7 million in direct advertising costs to increase awareness of our Financial Services segment products, such as social media and search engine marketing costs;
an increase of $10.7 million in product fulfillment costs, related to SoFi Invest and SoFi Money, including but not limited to items such as running our cash management sweep program, brokerage fees and debit card fulfillment;
an increase of $7.9 million related to direct member incentives;
an increase of $8.6 million in professional services, primarily related to third party consulting for our SoFi Money product; and
an increase of $5.6 million in other expenses primarily related to write offs of SoFi Money accounts and recruiting costs.
Technology Platform Segment
In the table below, we present a metric that is exclusive to the Galileo portion of our Technology Platform segment:
December 31,
2020 vs. 2019
% Change
2019 vs. 2018
% Change
2020 2019 2018
Total accounts
59,359,843  —  —  n/m n/m
180

TABLE OF CONTENTS
In our Technology Platform segment, total accounts refers to the number of open accounts at Galileo as of the reporting date, excluding SoFi accounts, as such accounts are eliminated in consolidation. The reporting period reflects the period from May 14, 2020, the date we acquired Galileo, through December 31, 2020. As such, no information is reported prior to our acquisition of Galileo. Total accounts is a primary indicator of the amount of accounts that are dependent upon Galileo’s technology platform to use virtual card products, virtual wallets, make peer-to-peer and bank-to-bank transfers, receive early paychecks, separate savings from spending balances and rely upon real-time authorizations, all of which result in technology platform fees for the Technology Platform segment.
The following table presents the measure of contribution profit for the Technology Platform segment for the years indicated. The information is derived from our internal financial reporting used for corporate management purposes. Refer to Note 17 in the Notes to Consolidated Financial Statements included elsewhere in this prospectus for further details regarding Technology Platform segment performance.
Year Ended December 31,
($ in thousands) 2020 2019 2018
Net revenue
Net interest income (loss) $ (107) $ —  $ — 
Noninterest income 95,737  795  117 
Total net revenue
95,630  795  117 
Directly attributable expenses(1)
(42,427) —  — 
Contribution Profit $ 53,203  $ 795  $ 117 
__________________
(1)For a disaggregation of the directly attributable expenses allocated to the Technology Platform segment in the year ended December 31, 2020, refer to the subsection titled “—Directly Attributable Expenses” below.
Year Ended December 31, 2020 Compared to Year Ended December 31, 2019
Total net revenue of $95.6 million during the year ended December 31, 2020 was primarily related to our acquisition of Galileo in May 2020, which earns revenues from contracts with customers in accordance with ASC 606. The Technology Platform total net revenue primarily consisted of Technology Platform fees at Galileo. During the year ended December 31, 2019, total net revenue was comprised of our investment in Apex, from which we earned income under the equity method of accounting. Total net revenue contributed by Apex equity method income increased by $3.6 million year over year, and represented $4.4 million of the total net revenue balance for 2020. Our Apex equity method income during 2020 included an impairment charge of $4.3 million that resulted from measuring the carrying value of the investment as of December 31, 2020 equal to the payment we received in January 2021 upon the seller of our equity interest exercising its call rights on our investment in Apex.
The directly attributable expenses allocated to the Technology Platform segment that were used in the determination of the segment's contribution profit for the year ended December 31, 2020 were related to the operations of Galileo and consisted of the following. There were no directly attributable expenses allocated to the Technology Platform segment during the year ended December 31, 2019.
$19.2 million in employee compensation and related benefits expenses;
$12.9 million in technology platform fulfillment costs;
$4.2 million in tools and subscription costs;
$1.9 million in occupancy and travel expenses; and
$4.2 million of other expenses, primarily related to professional services and marketing expenses.
181

TABLE OF CONTENTS
Year Ended December 31, 2019 Compared to Year Ended December 31, 2018
Total net revenue increased by $0.7 million for the year ended December 31, 2019 compared to the year ended December 31, 2018. The increase in total net revenue was driven by Apex equity method income of $0.8 million in 2019 compared to $0.1 million in 2018, which is reflected as noninterest income, as a result of our investment in Apex in December 2018. There were no directly attributable expenses to this reportable segment for the years presented.
Reconciliation of Directly Attributable Expenses
The following table reconciles directly attributable expenses allocated to our reportable segments to total noninterest expense in the Consolidated Statements of Operations and Comprehensive Income (Loss) for the years indicated:
Year Ended December 31,
2020 2019 2018
Reportable segments directly attributable expenses $ (480,519) $ (473,243) $ (367,465)
Expenses not allocated to segments:
Share-based compensation expense (99,870) (60,936) (42,936)
Depreciation and amortization expense (69,832) (15,955) (10,912)
Employee-related costs(1)
(114,599) (53,080) (46,724)
Other corporate and unallocated expenses(2)
(129,233) (79,044) (54,719)
Total noninterest expense $ (894,053) $ (682,258) $ (522,756)
__________________
(1)Includes compensation, benefits, recruiting, certain occupancy-related costs and various travel costs of executive management, certain technology groups and general and administrative functions that are not directly attributable to the reportable segments.
(2)Includes corporate overhead costs that are not allocated to reportable segments, such as tools and subscription costs, corporate marketing costs and professional services costs.
Liquidity and Capital Resources
We require substantial liquidity to fund our current operating requirements, which primarily include loan originations and the losses generated by our Financial Services segment. We expect these requirements to increase as we pursue our strategic growth goals. Historically, our Lending cash flow variability has related to loan origination volume, our available funding sources and utilization of our warehouse facilities. Additional sources of variability have related to our acquisitions of Galileo and 8 Limited, and our investment in Apex, which was called by the seller in January 2021 for $107.5 million. Moreover, given our continued growth initiatives, we have seen variability in financing cash flows due to the timing and extent of common stock and redeemable preferred stock raises, redemptions and additional uses of debt. During February 2021, we paid off the seller note issued in 2020 in connection with our acquisition of Galileo, inclusive of all outstanding interest payable, for a total payment of $269.9 million. Remaining operating cash flow variability is largely related to our investments in our business, such as technology and product investments and sales and marketing initiatives, as well as our operating lease facilities. Our capital expenditures have historically been immaterial relative to our operating and financing cash flows, and we expect this trend to continue for the foreseeable future.
To continue to achieve our liquidity objectives, we analyze and monitor liquidity needs and strive to maintain excess liquidity and access to diverse funding sources. We define our liquidity risk as the risk that we will not be able to:
Originate loans at our current pace, or at all;
Sell our loans at favorable prices, or at all;
Meet our contractual obligations as they become due;
182

TABLE OF CONTENTS
Increase or extend the maturity of our revolving credit facility capacity;
Fund continued operating losses in our business, especially if such operating losses continue at the current level for an extended period of time; or
Make future investments in the necessary technological and operating infrastructure to support our business.
During the three months ended March 31, 2021 and 2020, we generated positive cash flows from operations. The primary driver of operating cash flows relates to our Lending segment, particularly origination volume, the holding period of our loans, loan sale execution and, to a lesser extent, the timing of loan repayments. We either fund our loan originations entirely using our own capital, through proceeds from securitization transactions, or receive an advance rate from our various warehouse facilities to finance the majority of the loan amount. Our cash flows from operations were also impacted by material net losses in both the 2021 and 2020 periods. The net losses were primarily driven by our technology and product investments and sales and marketing initiatives, which benefit our Lending and Financial Services segments, the latter of which historically has not generated material net revenues. Our practice of not charging account or trading fees on the majority of our products within the Financial Services segment could result in sustained negative cash flows generated from the Financial Services segment in the short and long term. If our current net losses continue for the foreseeable future, we may need to raise additional capital in the form of equity or debt, which may not be at favorable terms when compared to previous financing transactions.
During the years ended December 31, 2020 and 2019, we generated negative cash flows from operations, while we generated positive cash flows from operations during the year ended December 31, 2018. The primary driver of operating cash flows relates to our Lending segment, particularly origination volume, the holding period of our loans, loan sale execution and, to a lesser extent, the timing of loan repayments. We either fund our loan originations entirely using our own capital, through proceeds from securitization transactions, or receive an advance rate from our various warehouse facilities to finance the majority of the loan amount. Our recent history of negative cash flows from operations is also attributable to material net losses in 2019 and 2020. The net losses were primarily driven by our technology and product investments and sales and marketing initiatives, which benefit our Lending and Financial Services segments, the latter of which historically has not generated material net revenues. When in a negative net cash flow position, we have historically financed our investments in loans primarily through redeemable preferred stock issuances, as well as had a significant common stock issuance in the fourth quarter of 2020.
Historically, we utilized our additional revolving credit facility capacity, term loan financing or additional equity proceeds to fund the portion of our current net loss unrelated to our loan origination activities. Our revolving credit facility had remaining capacity of $74.0 million, $74.0 million and $399.0 million as of March 31, 2021, December 31, 2020 and December 31, 2019, respectively, of which $6.0 million as of each balance sheet date was not available for general borrowing purposes because it was utilized to secure the uncollateralized portion of certain letters of credit issued to secure certain of our operating lease obligations. As of March 31, 2021, December 31, 2020 and December 31, 2019, the remaining $3.3 million, $3.3 million and $3.4 million, respectively, of the $9.3 million, $9.3 million and $9.4 million letters of credit outstanding, respectively, was collateralized by cash deposits with the banking institution, which were presented within restricted cash and cash equivalents in the Consolidated Balance Sheets.
Our warehouse facility and securitization debt is secured by a continuing lien on, and security interest in, the loans financed by the proceeds. The notes assumed in our acquisition of Galileo during the second quarter of 2020 are secured by the value of certain equipment. Our revolving credit facility and seller note, the latter of which we paid back in full in February 2021, are unsecured. We have various affirmative and negative financial covenants, as well as non-financial covenants, related to our warehouse debt and revolving credit facility, as well as our redeemable preferred stock. We were in compliance with all covenants as of March 31, 2021 and December 31, 2020.
183

TABLE OF CONTENTS
Our operating lease obligations consist of our leases of real property from third parties under non-cancellable operating lease agreements, which primarily include the leases of office space, as well as our rights to certain suites and event space within SoFi Stadium, which commenced in the third quarter of 2020 and the latter of which we apply the short-term lease exemption practical expedient and do not capitalize the lease obligation. Our finance lease obligations consist of our rights to certain physical signage within SoFi Stadium, which commenced in the third quarter of 2020. Additionally, our securitization transactions require us to maintain a continuing financial interest in the form of securitization investments when we deconsolidate the special-purpose entity (“SPE”) or in consolidation of the SPE when we have a significant financial interest. In either instance, the continuing financial interest requires us to maintain capital in the SPE that would otherwise be available to us if we had sold loans through a different channel.
We are currently dependent on the success of our Lending segment. Our ability to access whole loan buyers and to sell our loans on favorable terms, maintain adequate warehouse capacity at favorable terms and limit our continuing financial interest in securitization-related transfers is critical to our growth strategy and our ability to have adequate liquidity to fund our balance sheet. As it relates to securitization-related transfers, there is no guarantee that we will be able to find purchasers of securitization residual interests or that we will be able to execute loan transfers at favorable price points. Therefore, we may hold securitization interests for longer than planned or be forced to liquidate at suboptimal prices. Securitization transfers are also negatively impacted during recessionary periods, wherein investors may be more risk averse.
Further, future uncertainties around the demand for our personal loans and around the student loan refinance market in general should be considered when assessing our future liquidity and solvency prospects. Through the CARES Act, which was passed in March 2020 in response to the COVID-19 pandemic and subsequently extended, principal and interest payments on federally-held student loans have been suspended through September 30, 2021, which in turn has lowered and will likely continue to lower the propensity for borrowers to refinance into SoFi student loans during the suspension period. To the extent that further extensions or additional measures, such as student loan forgiveness, are implemented, it may negatively impact our future student loan origination volume. In addition, in the past we have altered our credit strategy to defend against adverse credit consequences during recessionary periods, as we did following the outbreak of COVID-19. In the future, our loan origination volume and our resulting loan balances, and any positive cash flows thereof, could be lower based on strategic decisions to tighten our credit standards. See “— Key Factors Affecting Operating Results — Industry Trends and General Economic Conditions” and “— Business Overview — COVID-19 Pandemic” for discussions of the impact of certain measures taken in response to the COVID-19 pandemic on our loan origination volumes and uncertainties that exist with respect to future operations in light of the pandemic.
Our commitments requiring the use of capital in future periods consist primarily of warehouse facility borrowings, which carry variable interest rates, operating lease obligations and commitments arising out of our agreement for the naming and sponsorship rights to SoFi Stadium, consisting of both lease and non-lease components. The non-lease components of the agreement pertain primarily to sponsorship and advertising opportunities related to the stadium itself, as well as the surrounding performance venue and planned retail district. See Note 8 and Note 14 to the Notes to Unaudited Condensed Consolidated Financial Statements and Note 9 and Note 15 to the Notes to Consolidated Financial Statements included elsewhere in this prospectus for additional information on our warehouse debt and our lease obligations, respectively. Also, see Note 14 to the Notes to Unaudited Condensed Consolidated Financial Statements for additional information on our SoFi Stadium arrangement, including a contingent matter associated with SoFi Stadium payments. As it relates to our securitization debt, the maturity of the notes issued by the various trusts occurs upon either the maturity of the loan collateral or full payment of the loan collateral held in the trusts, the timing of which cannot be reasonably estimated. Our own liquidity resources are not required to make any contractual payments on these borrowings, except in limited instances associated with our guarantee arrangements, as discussed below.
We have a three-year obligation to FNMA on loans that we sell to FNMA, to repurchase any originated loans that do not meet FNMA guidelines, and we are required to pay the full initial purchase price back to FNMA. In addition, we make standard representations and warranties related to other student, personal and non-FNMA home loan transfers, as well as limited credit-related repurchase guarantees on certain such transfers. If realized, any of the repurchases would require the use of cash. See “— Off-Balance Sheet Arrangements”, as well as Note 1 and Note 14
184

TABLE OF CONTENTS
to the Notes to Unaudited Condensed Consolidated Financial Statements and Note 1 and Note 15 to the Notes to Consolidated Financial Statements included elsewhere in this prospectus for further information on our guarantee obligations. We believe we have adequate liquidity to meet these obligations.
Our long-term liquidity strategy includes maintaining adequate revolving credit facility capacity and seeking additional sources of financing. Although our goal is to increase our cash flow from operations, there can be no assurance that our future operating plans will lead to improved operating cash flows.
We had unrestricted cash and cash equivalents of $351.3 million, $872.6 million and $499.5 million as of March 31, 2021, December 31, 2020 and December 31, 2019, respectively. We believe our existing cash and cash equivalents balance, available capacity under our revolving credit facility (and expected extensions or replacements of the facility), together with additional warehouses or other financing we expect to be able to obtain at reasonable terms and cash proceeds received from the Business Combination, will be sufficient to cover net losses, meet our existing working capital and capital expenditure needs, as well as our planned growth for at least the next 12 months. Our non-securitization loans also represent a key source of liquidity for us, and should be considered in assessing our overall liquidity. We also have relationships with whole loan buyers who we believe we will be able to continue to rely on to generate near-term liquidity. Securitization markets can also generate additional liquidity, albeit to a lesser extent, as it involves accessing a much less liquid securitization residual investment market, and in certain cases we are required to maintain a minimum investment due to securitization risk retention rules.
We intend to use a portion of the net cash proceeds from the Business Combination for payment of certain transaction expenses. The remaining funds after the payment of transaction expenses are intended to be used for the repurchase of certain common stock from a shareholder for $150.0 million and a special payment to Series 1 preferred stockholders, which is expected to be $21.2 million in accordance with the Merger Agreement. The remaining net cash proceeds will be retained by the Company to help fund future strategic and capital needs, including repayment of loan warehouse facility debt.
Contractual Obligations
The following table summarizes our contractual obligations as of December 31, 2020:
Payments Due by Period
($ in thousands) Total Less than 1 Year 1 – 3 Years 3 – 5 Years More than 5 Years
Warehouse debt(1)
$ 2,827,399  $ 654,284  $ 1,537,540  $ 251,155  $ 384,420 
Revolving credit facility(2)
501,231  5,559  495,672  —  — 
Seller note(3)
269,864  269,864  —  —  — 
Other financing 4,375  2,421  1,954  —  — 
Operating lease obligations 173,428  19,168  39,230  37,127  77,903 
Finance lease obligations 20,046  1,004  1,923  2,006  15,113 
LA Stadium Complex Naming Rights(4)
562,431  22,086  45,876  49,878  444,591 
Total contractual obligations(5)
$ 4,358,774  $ 974,386  $ 2,122,195  $ 340,166  $ 922,027 
__________________
(1)Our warehouse debt carries variable interest rates, as further outlined in Note 9 to the Notes to Consolidated Financial Statements included elsewhere in this prospectus. As such, only principal commitments are included herein.
(2)Includes principal balance and variable interest on our revolving credit facility. The estimated interest payments assume that our borrowings under the revolving credit facility (i) remain unchanged, (ii) are held to maturity, and (iii) incur interest at the rate for standard withdrawals in effect as of December 31, 2020 through its maturity. See Note 9 to the Notes to Consolidated Financial Statements included elsewhere in this prospectus for additional information on our revolving credit facility.
(3)We issued a seller note in connection with the acquisition of Galileo in 2020 with an aggregate principal amount of $250.0 million and a scheduled balloon maturity of May 14, 2021 that incurred interest at a rate of 10.0%. See Note 2 to the Notes to Consolidated Financial Statements included elsewhere in this prospectus for additional information. In February 2021, we paid off the outstanding principal and accrued interest on the seller note for the amount presented herein.
(4)During the year ended December 31, 2020, we completed our evaluation of the lease and non-lease components of the LA Stadium Complex Naming Rights that commenced during the period. The contractual obligations associated with the operating lease and finance lease components of the arrangement are reported in the corresponding lines and are, therefore, excluded from amounts reported in this line.
185

TABLE OF CONTENTS
As of December 31, 2020, all payments associated with the planned retail district, which is currently expected to commence no earlier than 2022, are attributed to non-lease components. We do not expect the agreement to contain a material lease component, although the evaluation remains ongoing. This had no impact on the estimated contractual obligations in total. See Note 15 to the Notes to Consolidated Financial Statements included elsewhere in this prospectus for additional information on our leases and on a contingent matter associated with SoFi Stadium payments.
(5)Contractual obligations exclude residual interests classified as debt that result from transfers of assets that are accounted for as secured financings. Similarly, contractual obligations exclude securitization debt, as the maturity of the notes issued by the various trusts occurs upon either the maturity of the loan collateral or full payment of the loan collateral held in the trusts, the timing of which cannot be reasonably estimated. Additionally, our own liquidity resources are not required to make any contractual payments on these borrowings, except in limited instances associated with our guarantee arrangements. Our maturity date represents the legal maturity of the last class of maturing notes. See Note 15 to the Notes to Consolidated Financial Statements included elsewhere in this prospectus for further discussion of our guarantees. Finally, contractual obligations exclude the impact of uncertain tax positions, as we are not able to reasonably estimate the timing of such future cash flows. See Note 13 to the Notes to Consolidated Financial Statements included elsewhere in this prospectus for additional information on income taxes and unrecognized tax benefits.
Cash Flow and Liquidity Analysis
The following table provides a summary of cash flow data:
Three Months Ended March 31, Year Ended December 31,
($ in thousands) 2021 2020 2020 2019 2018
Net cash provided by (used in) operating activities $ 340,051  $ 272,799  $ (479,336) $ (54,733) $ 1,023,277 
Net cash provided by (used in) investing activities 180,947  65,339  258,949  114,868  (12,251)
Net cash provided by (used in) financing activities (1,145,779) 81,902  853,754  93,077  (954,793)
Cash Flows from Operating Activities
For the three months ended March 31, 2021, net cash provided by operating activities was $340.1 million, which stemmed from a net loss of $177.6 million that was positively adjusted for non-cash items of $164.8 million, and a favorable change in our operating assets net of operating liabilities of $352.8 million. The change in operating assets net of operating liabilities was primarily a result of our loan origination and sales activities. We originated loans of $2.6 billion during the period and also purchased loans of $1.2 million. These cash uses were offset by principal payments from members of $0.5 billion and proceeds from loan sales of $2.4 billion.
For the three months ended March 31, 2020, net cash provided by operating activities was $272.8 million, which stemmed from a net loss of $106.4 million that was positively adjusted for non-cash items of $58.9 million, and a favorable change in operating assets net of operating liabilities of $320.2 million. The change in operating assets net of operating liabilities was primarily a result of our loan origination and sales activities. We originated loans of $3.4 billion during the period and also purchased certain loans of $35.2 million, the majority of which were related to securitization clean-up calls. These cash uses were offset by principal payments from members of $0.5 billion and proceeds from loan sales of $3.2 billion.
For the year ended December 31, 2020, net cash used in operating activities was $479.3 million, which stemmed from a net loss of $224.1 million that was positively adjusted for non-cash items of $142.0 million, and an unfavorable change in our operating assets net of operating liabilities of $397.3 million. The change in operating assets net of operating liabilities was primarily a result of our loan origination and sales activities. We originated loans of $9.7 billion during the year and also purchased loans of $690.2 million, of which $606.3 million related to strategic loan purchases we made during the year, wherein we believe we can earn net interest income prior to selling the loan for a future gain. These cash uses were offset by principal payments from members of $1.9 billion and proceeds from loan sales of $8.0 billion.
For the year ended December 31, 2019, net cash used in operating activities was $54.7 million, which stemmed from a net loss of $239.7 million that was positively adjusted for non-cash items of $114.9 million, and a favorable change in operating assets net of operating liabilities of $70.0 million. The change in operating assets net of operating liabilities was primarily a result of our loan origination and sales activities. We originated loans of
186

TABLE OF CONTENTS
$11.2 billion during the period and also purchased certain loans of $47.3 million, the majority of which were related to securitization clean-up calls. Furthermore, we also purchased loans of $331.6 million to provide additional loan collateral for securitizations that we sponsored during 2019. These cash uses were offset by principal payments from members of $2.5 billion and proceeds from loan sales of $9.1 billion.
For the year ended December 31, 2018, net cash provided by operating activities was $1.0 billion, which stemmed from a net loss of $252.4 million that was more than offset by combined positive adjustments for non-cash items of $47.5 million and a favorable change in operating assets net of operating liabilities of $1.2 billion. The change in operating assets net of operating liabilities was primarily a result of our loan origination and sales activities. We originated loans of $11.7 billion during the period and also purchased certain loans of $10.3 million. Furthermore, we also purchased loans of $260.4 million to provide additional loan collateral for securitizations that we sponsored during 2018. These cash uses were offset by principal payments from members of $2.4 billion and proceeds from loan sales of $10.7 billion.
Cash Flows from Investing Activities
For the three months ended March 31, 2021, net cash provided by investing activities was $180.9 million, which was primarily attributable to proceeds of $107.5 million from the call on our equity method investment in Apex and proceeds of $64.2 million from our securitization investments. Additionally, Apex repaid its outstanding principal balance of $16.7 million. Lastly, we used $7.4 million for purchases of property, equipment and software.
For the three months ended March 31, 2020, net cash provided by investing activities was $65.3 million, which was primarily attributable to proceeds from our securitization investments of $71.0 million, partially offset by $5.5 million for purchases of property, equipment and software.
For the year ended December 31, 2020, net cash provided by investing activities was $258.9 million, which was primarily attributable to proceeds from our securitization investments of $322.7 million, partially offset by our acquisition activities during the year, which resulted in a net use of cash of $32.4 million. Moreover, we extended additional financing to Apex during the year, which required a use of cash of $7.6 million. Lastly, we used $24.5 million for purchases of property, equipment and software.
For the year ended December 31, 2019, net cash provided by investing activities was $114.9 million, primarily resulting from $165.1 million in proceeds from our securitization investments, partially offset by $37.6 million in purchases of property, equipment and software. In 2019, we made significant leasehold improvement capital expenditures at our corporate headquarters in San Francisco, California. Lastly, we made our first loan to Apex during 2019, which required a use of cash of $9.1 million.
For the year ended December 31, 2018, net cash used in investing activities was $12.3 million, resulting from $100.4 million of cash outflows related to our initial investment in Apex and $13.7 million in purchases of property, equipment and software, partially offset by proceeds of $101.9 million from receipts from securitization investments.
Cash Flows from Financing Activities
For the three months ended March 31, 2021, net cash used in financing activities was $1.1 billion. We received $1.9 billion of proceeds from debt financing activities related to our lending activities. These debt proceeds were more than offset by $2.9 billion of debt repayments, of which $2.5 billion were related to our warehouse facilities. Our payments of debt issuance costs were in the normal course of business and reflective of our recurring debt warehouse facility activity, which involves securing new warehouse facilities and extending existing warehouse facilities. We also paid taxes related to restricted stock unit (“RSU”) vesting of $26.0 million. Finally, we paid $132.9 million to repurchase redeemable preferred stock and $0.5 million to repurchase common stock during the period.
For the three months ended March 31, 2020, net cash provided by financing activities was $81.9 million. We received $3.2 billion of proceeds from debt financing activities, which were primarily attributable to our lending activities. These debt proceeds were partially offset by $3.1 billion of debt repayments, of which $2.8 billion were
187

TABLE OF CONTENTS
related to our warehouse facilities. Our payments of debt issuance costs were in the normal course of business. We also paid taxes related to RSU vesting of $4.6 million.
For the year ended December 31, 2020, net cash provided by financing activities was $853.8 million. We received $10.2 billion of proceeds from debt financing activities, which were primarily attributable to our lending activities and included a $325.0 million draw on our revolving credit facility during the year. These debt proceeds were partially offset by $9.7 billion of debt repayments, $8.6 billion of which were related to our warehouse facilities. Our payments of debt issuance costs were in the normal course of business and reflective of our recurring debt warehouse facility activity, which involves securing new warehouse facilities and extending existing warehouse facilities. We also generated cash of $369.8 million from a common stock issuance in the fourth quarter of 2020. We paid Series 1 redeemable preferred stock dividends of $40.5 million and taxes related to restricted stock unit (“RSU”) vesting of $31.3 million. These uses were offset by principal repayments of $43.5 million related to our stockholder note receivable, which was fully paid off as of December 31, 2020.
For the year ended December 31, 2019, net cash provided by financing activities was $93.1 million. Our financing activities were primarily driven by proceeds from debt issuances of $12.5 billion, partially offset by principal payments on debt of $12.8 billion. In addition, we generated cash from preferred stock issuances of $573.8 million, gross of issuance costs of $2.4 million. The debt issuance and payment activity was related to our revolving credit facility, warehouse financing facilities, residual interests classified as debt and securitization debt. In May 2019, we issued 13,967,169 shares of Series H and 3,234,000 shares of Series 1 redeemable preferred stock for combined net proceeds of $536.6 million. In October 2019, we issued an additional 2,257,365 shares of Series H preferred stock for proceeds of $34.8 million. In 2019, we paid $23.9 million in dividends on the Series 1 redeemable preferred stock. Additionally, we issued a note receivable to a stockholder, which resulted in a net cash outflow of $43.5 million. Finally, taxes paid in connection with RSU vesting of $21.4 million were reflective of our increasing use of RSUs as a compensation mechanism to attract and retain talent.
For the year ended December 31, 2018, net cash used in financing activities was $954.8 million, primarily resulting from principal payments on debt of $14.6 billion, partially offset by proceeds from debt issuances of $13.7 billion. Furthermore, we paid debt issuance costs of $22.7 million during 2018 in conjunction with our borrowing activities.
Borrowings
Our borrowings primarily include our loan and risk retention warehouse facilities, asset-backed securitization debt and revolving credit facility. During the year ended December 31, 2020, our borrowings also consisted of a seller note issued in connection with the acquisition of Galileo, which is further discussed in “Liquidity and Capital Resources — Contractual Obligations”, as well as in Note 2 to the Notes to Consolidated Financial Statements included elsewhere in this prospectus. A detailed description of each of our borrowing arrangements is included in Note 8 to the Notes to Unaudited Condensed Consolidated Financial Statements and Note 9 to the Notes to Consolidated Financial Statements included elsewhere in this prospectus.
The amount of financing actually advanced on each individual loan under our loan warehouse facilities, as determined by agreed-upon advance rates, may be less than the stated advance rate depending, in part, on changes in underlying loan characteristics of the loans securing the financings. Each of our loan warehouse facilities allows the lender providing the funds to evaluate the market value of the loans that are serving as collateral for the borrowings or advances being made. As it relates to home loan warehouse facilities and risk retention warehouse facilities, if the lender determines that the value of the collateral has decreased, the lender can require us to provide additional collateral or reduce the amount outstanding with respect to those loans (e.g., initiate a margin call). Our inability or unwillingness to satisfy the request could result in the termination of the facilities and possible default under our other loan funding facilities. In addition, a large unanticipated margin call could have a material adverse effect on our liquidity.
The amount owed and outstanding on our loan warehouse facilities fluctuates significantly based on our origination volume, sales volume, the amount of time it takes us to sell our loans, and the amount of loans being
188

TABLE OF CONTENTS
self-funded with cash. We may, from time to time, use surplus cash to self-fund a portion of our loan originations and risk retention in the case of securitization transfers.
Our debt warehouse facilities and revolving credit facility also generally require us to comply with certain operating and financial covenants and the availability of funds under these lending arrangements is subject to, among other conditions, our continued compliance with these covenants. These financial covenants include, but are not limited to, maintaining: (i) a certain minimum tangible net worth, (ii) minimum cash and cash equivalents, and (iii) a maximum leverage ratio of total debt to tangible net worth. A breach of these covenants can result in an event of default under these facilities and allows the lenders to pursue certain remedies. Our subsidiaries are restricted in the amount that can be distributed to SoFi only to the extent that such distributions would cause the financial covenants to not be met.
In addition, pursuant to our Series 1 redeemable preferred stock agreement, we are subject to the following financial covenants:
Tangible net worth to total debt ratio, which excludes our warehouse, risk retention and securitization related debt;
Tangible net worth to Series 1 redeemable preferred stock ratio requirement; and
Minimum excess equity requirements, which measure includes redeemable preferred stock, exclusive of Series 1 redeemable preferred stock.
We were in compliance with all covenants as of March 31, 2021 and December 31, 2020.
Financial Condition Summary
March 31, 2021 compared to December 31, 2020
Changes in the composition and balance of our assets and liabilities as of March 31, 2021 compared to December 31, 2020 were principally attributed to the following:
a decrease of $624.9 million in cash and cash equivalents and restricted cash and restricted cash equivalents. See “— Cash Flow and Liquidity Analysis” for further discussion of our cash flow activity;
a decrease of $533.3 million in gross warehouse facility debt and a decrease of $191.9 million in gross securitization debt, which decreased in line with related loan collateral repayments;
a net decrease in loans of $392.5 million, primarily stemming from originations of $2.6 billion, offset by principal payments and sales of $2.9 billion;
a decrease in equity method investments of $107.5 million, as Apex called our investment; and
a decrease in related party notes receivable of $17.9 million, as Apex repaid their outstanding loans.
December 31, 2020 compared to December 31, 2019
Changes in the composition and balance of our assets and liabilities as of December 31, 2020 compared to December 31, 2019 were principally attributed to the following:
an increase of $633.2 million in cash and cash equivalents and restricted cash and restricted cash equivalents. See “— Liquidity and Capital Resources” for further discussion of our cash flow activity;
an increase of $14.4 million in right-of-use assets associated with new finance leases, and an offsetting increase in finance lease liabilities of $14.7 million;
an increase of $820.4 million in gross warehouse facility debt and a decrease of $1.3 billion in gross securitization debt, of which $394.6 million of the securitization debt decrease was related to VIEs that
189

TABLE OF CONTENTS
were consolidated as of December 31, 2019, but deconsolidated during 2020, because we no longer had a significant financial interest in the VIEs;
a net decrease in loans of $508.7 million, which included originations of $9.7 billion, offset by principal payments and sales of $10.1 billion. We also purchased loans of $690.2 million and deconsolidated $902.2 million of loans held in previously consolidated VIEs;
goodwill associated with the Galileo and 8 Limited acquisitions of $883.6 million;
intangible assets acquired associated with the Galileo and 8 Limited acquisitions of $393.0 million;
seller note principal balance associated with the Galileo acquisition of $250.0 million; and
draws on our revolving credit facility of $325.0 million in the aggregate.
December 31, 2019 compared to December 31, 2018
Changes in the composition and balance of our assets and liabilities as of December 31, 2019 compared to December 31, 2018 were principally attributed to the following:
a $153.2 million increase in cash and cash equivalents and restricted cash and restricted cash equivalents. See “— Liquidity and Capital Resources” for further discussion of our cash flow activity;
a $549.2 million increase in temporary equity associated with our Series H and Series 1 preferred stock transactions;
an $11.2 billion increase in loans through origination activity, offset by $13.5 billion of aggregate decreases associated with payments, sales of loans and the deconsolidations of previously consolidated VIEs;
a $101.4 million increase in operating lease right-of-use assets and a $124.7 million increase in operating lease liabilities associated with the adoption of ASC 842, Leases, and subsequent lease activity during 2019; and
a $1.5 billion net decrease in debt driven by a $1.4 billion decrease in gross securitization debt primarily related to the pay down of balances and a $172.6 million decrease in gross warehouse facility debt primarily due to customary loan origination and sales activity. These amounts were partially offset by $58.0 million in incremental borrowings on our revolving credit facility.
Critical Accounting Policies and Estimates
Our consolidated financial statements included elsewhere in this prospectus have been prepared in accordance with GAAP. In preparing our consolidated financial statements, we make judgments, estimates and assumptions that affect reported amounts of assets and liabilities, as well as revenues and expenses. We base our assumptions, judgments and estimates on historical experience and various other factors that we believe to be reasonable under the circumstances. The results involve judgments about the carrying values of assets and liabilities not readily apparent from other sources. Actual results could differ materially from these estimates under different assumptions or conditions. We regularly evaluate our estimates, assumptions and judgments, particularly those that include the most difficult, subjective or complex judgments and are often about matters that are inherently uncertain. See Note 1 to the Notes to Unaudited Condensed Consolidated Financial Statements and to the Notes to Consolidated Financial Statements under “— Summary of Significant Accounting Policies” included elsewhere in this prospectus for a summary of our significant accounting policies and under “— Recently Adopted Accounting Standards” for a discussion of accounting pronouncements recently adopted. The most significant judgments, estimates and assumptions relate to the critical accounting policies, as discussed in more detail below. We evaluate our critical accounting policies and estimates on an ongoing basis and update them as necessary based on changes in market conditions or factors specific to us.
190

TABLE OF CONTENTS
Stock-Based Compensation
Historically, we have offered stock options and RSUs to employees and non-employees. We measure and recognize compensation expense for all stock-based awards made to employees based on estimated fair values on the date of grant. The compensation expense is recognized on a straight-line basis over the requisite service period for time-based awards with only service conditions. Stock-based awards with performance conditions, which we have offered infrequently, are expensed under the accelerated method based on each vesting tranche. We recognize forfeitures as incurred and, therefore, reverse previously recognized stock-based compensation expense at the time of forfeiture. We use the Black-Scholes Option Pricing Model (the “Black-Scholes Model”) to estimate the fair value of stock options. RSUs are measured based on the fair values of our underlying common stock on the dates of grant.
Stock Options
The Black-Scholes Model requires the use of subjective assumptions, including the risk-free interest rate, expected term, expected stock price volatility and dividend yield. The risk-free interest rate assumption is based upon observed interest rates for constant maturity U.S. Treasury securities consistent with the expected term of our stock options. The expected term represents the period of time the stock options are expected to be outstanding and is based on the simplified method. Under the simplified method, the expected term of a stock option is presumed to be the midpoint between the vesting date and the end of the contractual term. Management uses the simplified method due to the lack of sufficient historical exercise data to provide a reasonable basis upon which to otherwise estimate the expected term of the stock options. Expected volatility is based on historical volatility for publicly-traded stock of comparable companies over the estimated expected life of the stock options. In identifying comparable companies, we considered factors such as industry, stage of life cycle and size. We assumed no dividend yield for all periods presented because we do not expect to pay dividends in the near future, which is consistent with our history of not paying dividends. Stock option valuations also depend on the valuation of our common stock on the date of grant, as discussed below.
During the years ended December 31, 2020 and 2018, our board of directors granted a total of 217,275 and 12,479,500 stock options, respectively. No stock options were granted during 2019; therefore, a stock option valuation was not necessary. The inputs used for estimating the fair value of stock options granted during the year ended December 31, 2020 are disclosed in Note 12 to the Notes to Consolidated Financial Statements included elsewhere in this prospectus.
The following table summarizes the inputs used for estimating the fair value of stock options granted during the years indicated:
Year Ended December 31,
Input 2020 2018
Risk-free interest rate
0.3% – 1.4%
2.5% – 3.1%
Expected term (years)
5.5 – 6.0
5.7 – 6.3
Expected volatility
36.5% – 42.5%
35.0%
Fair value of common stock
$11.21 – $12.11
$10.78 – $11.97
Dividend yield —% —%
Restricted Stock Units
During the years ended December 31, 2020, 2019 and 2018, our board of directors granted a total of 20,636,594, 9,136,245 and 11,211,409 RSUs, respectively, at weighted average share prices of $13.57, $11.28 and $11.45, respectively. The RSU share prices were based on the prevailing fair value of our common stock at the time of each stock-based grant.
Prior to making progress toward pursuing a public market transaction, we established the fair value of our common stock through the utilization of option pricing models (Black-Scholes based) via the backsolve method when there were representative transactions available, such as was the case with our Series H redeemable preferred
191

TABLE OF CONTENTS
stock transactions during 2019. Prior to the first Series H redeemable preferred stock transaction, we valued our common stock using a combination of previous redeemable preferred stock transactions, transactions in our common stock and a guideline public company multiples analysis. See below for a discussion of our common stock valuation process during the period wherein we started to pursue a public market transaction.
Common Stock Valuations
Due to the absence of an active market for our common stock, the fair value of our common stock, which is used as an input into the valuation of both our stock options and RSUs granted, is determined by our board of directors based on a third-party valuation and input from our management. The valuation of our common stock is performed by independent valuation specialists when the board of directors believes an event has occurred that may significantly impact the value of our common stock, which is at least on an annual basis, but has been more frequent during the years ended December 31, 2020, 2019 and 2018. The valuation specialists apply valuation techniques and methods that conform to generally accepted valuation practices and standards established by the American Society of Appraisers in accordance with Uniform Standards of Professional Appraisal Practice. The valuation methodologies and techniques utilized are also consistent with guidance issued by the American Institute of Certified Public Accountants in its Accounting and Valuation Guide, Valuation of Privately-Held-Company Equity Securities Issued as Compensation, 2013. They use a number of objective and subjective factors, including:
prices at which our common and preferred stock have been bought and sold in third-party, arms-length, non-employee based transactions;
our capital structure and the prices at which we issued our preferred stock and the relative rights and characteristics of the preferred stock as compared to those of our common stock;
our results of operations, financial position and our future business plans, which include financial forecasts and budgets;
capital market data on interest rates, yields and rates of return for various investments;
the material risks related to our business and the state of the development of our target markets;
the market performance of publicly-traded companies in comparable market sectors;
external market conditions affecting comparable market sectors;
the degree of marketability for our common stock including contractual restrictions on transfer of the units; and
the likelihood of achieving a liquidity event for our preferred and common stockholders, given prevailing market conditions.
The weighted average fair value of our common stock was $13.37, $11.28 and $11.39 during the years ended December 31, 2020, 2019 and 2018, respectively. The grant date exercise and share prices were generally based on the fair value of our common stock as of each valuation date using option pricing model valuation techniques.
During 2018 and 2019, we established the fair value of our common stock through placing weight on previous redeemable preferred stock transactions, for which we used the option pricing model (Black-Scholes Model based) via the backsolve method, transactions in our common stock during the period and a guideline public company multiples analysis.
During the third quarter of 2020, once we made intentional progress toward pursuing a public market transaction, we began applying the probability-weighted expected return method (“PWERM”) to determine the fair value of our common stock. The probability weightings assigned to certain potential exit scenarios were based on management’s expected near-term and long-term funding requirements and assessment of the most attractive liquidation possibilities at the time of the valuation. During this process, we assigned probability weightings to “go public” event scenarios and a “stay private” scenario, wherein the enterprise valuation was based on either estimated
192

TABLE OF CONTENTS
exit valuations determined from conversations held with external parties or was based on public company comparable net book value multiples at the time of our valuation, respectively. In addition, our “stay private” scenario valuation approach continued to rely on a guideline public company multiples analysis with an option pricing model to determine the amount of aggregate equity value allocated to our common stock. The valuations from 2018 through the third quarter of 2020 also applied discounts for lack of marketability ranging from 16% to 25% to reflect the fact that there was no market mechanism to sell our common stock and, as such, the common stock option and RSU holders would need to wait for a liquidity event to facilitate the sale of their equity awards. In addition, there were contractual transfer restrictions placed on common stock in the event that we remained a private company.
During the fourth quarter of 2020, we valued our common stock on a monthly basis. A common stock transaction that closed in December 2020 at a price of $18.43 per common share, which was of substantial size and in close proximity to the Business Combination, served as the key input for the fair value of our common stock for grants made during the fourth quarter of 2020. We decreased the assumed discount for lack of marketability throughout the fourth quarter of 2020, corresponding with our decreased time to liquidity assumption throughout the quarter, as we became more certain about the possibility of entering into the Business Combination over time, and ultimately assumed no discount for lack of marketability for the month of December 2020.
For the period subsequent to executing the Merger Agreement on January 7, 2021, we determined the value of our common stock based on the observable daily closing price of SCH’s stock (ticker symbol “IPOE”) multiplied by the exchange ratio in effect for such transaction date.
Application of these approaches and methodologies involves the use of estimates, judgment and assumptions that are highly complex and subjective, such as those regarding our expected operations, market multiples, the selection of comparable public companies, and the probability of and timing associated with possible future events. Changes in any or all of these estimates and assumptions or the relationships between those assumptions impact our valuations as of each valuation date and may have a material impact on the valuation of our common stock.
See Note 11 to the Notes to Unaudited Condensed Consolidated Financial Statements and Note 12 to the Notes to Consolidated Financial Statements included elsewhere in this prospectus for information about stock-based compensation expense related to stock options and RSUs reflected in our Consolidated Statements of Operations and Comprehensive Income (Loss).
Consolidation of Variable Interest Entities
We enter into arrangements in which we originate loans, establish a special purpose entity (“SPE”), and transfer the loans to the SPE. We retain the servicing rights of those loans and hold additional interests in the SPE. We evaluate each such arrangement to determine whether we have a variable interest. If we determine that we have a variable interest in an SPE, we then determine whether the SPE is a VIE. If the SPE is a VIE, we assesses whether we are the primary beneficiary of the VIE. To determine if we are the primary beneficiary, we identify the most significant activities and determine who has the power over those activities, and who absorbs the variability in the economics of the VIE.
We periodically reassess our involvement with each VIE in which we have a variable interest. We monitor matters related to our ability to control economic performance, such as management of the SPE and its underlying loans, contractual changes in the services provided, the extent of our ownership, and the rights of third parties to terminate us as the VIE servicer. In addition, we monitor the financial performance of each VIE for indications that we may or may not have the right to absorb benefits or the obligation to absorb losses associated with variability in the financial performance of the VIE that could potentially be significant to that VIE, which we define as a variable interest of greater than 10%.
A significant change to our or other parties’ pertinent rights, or a significant change to the ranges of possible financial performance outcomes used in our assessment of the variability of cash flows due to us, could impact the determination of whether or not a VIE should be consolidated in future periods. VIE consolidation and deconsolidation may lead to increased volatility in our financial results and impact period-over-period comparability. Our maximum exposure to loss as a result of our involvement with consolidated VIEs is limited to
193

TABLE OF CONTENTS
our investment, which is eliminated in consolidation. There are no liquidity arrangements, guarantees or other commitments by third parties that may affect the fair value or risk of our variable interests in consolidated VIEs.
Fair Value
Our involvement with VIEs and origination of student, personal and home loans, which we fair value on a recurring basis, results in Level 2 and Level 3 assumptions having a material impact on our Consolidated Balance Sheets and Consolidated Statements of Operations and Comprehensive Income (Loss).
Loans do not trade in an active market with readily observable prices. We determine the fair value of our loans using a discounted cash flow methodology, while also considering market data as it becomes available. We classify loans as Level 3 because the valuations utilize significant unobservable inputs.
When we consolidate VIEs, the loans remain on our Consolidated Balance Sheets and are measured at fair value using Level 3 inputs. Moreover, third-party residual claims on these loans are measured at fair value on a recurring basis and are presented as residual interests classified as debt in our Consolidated Balance Sheets. We record subsequent fair value measurement changes in the period in which the change occurs within noninterest income — securitizations in our Consolidated Statements of Operations and Comprehensive Income (Loss). We determine the fair value of our residual interests classified as debt using a discounted cash flow methodology, while also considering market data as it becomes available.
Consistent with ASC 325-40, Investments — Other — Beneficial Interests in Securitized Financial Assets, we recognize interest expense related to the residual interests classified as debt over the expected life using the effective yield method, which is effectively a reclassification between noninterest income and interest income for the portion of the overall fair value change attributable to interest expense. On a quarterly basis, we reevaluate the cash flow estimates to determine if a change to the accretable yield is required on a prospective basis. We classify the residual interests classified as debt as Level 3 due to the reliance on significant unobservable valuation inputs.
When we do not consolidate VIEs, we generally hold risk retention interests, which we refer to as securitization investments. In Company-sponsored securitization transactions that meet the applicable criteria to be accounted for as a sale, we retain certain asset-backed bonds, which are measured at fair value on a recurring basis using Level 2 inputs, and residual investments, which are measured at fair value on a recurring basis using Level 3 inputs. Gains and losses related to our securitization investments are reported within noninterest income — securitizations in our Consolidated Statements of Operations and Comprehensive Income (Loss). We determine the fair value of our securitization investments using a discounted cash flow methodology, while also considering market data as it becomes available.
For our loans, residual interests classified as debt and securitization investments, the fair value estimates are impacted by assumptions regarding credit performance, prepayments and discount rates. See “—Quantitative and Qualitative Disclosures about Market Risk” for discussion of the sensitivity of our financial instruments measured at fair value to changes in various market risks.
Business Combinations
We account for acquisitions of entities or asset groups that qualify as businesses using the acquisition method of accounting in accordance with ASC 805, Business Combinations. Purchase consideration is allocated to the tangible and intangible assets acquired and liabilities assumed based on the estimated fair values as of the acquisition date, which are measured in accordance with the principles outlined in ASC 820, Fair Value Measurement, and which are typically determined in consultation with an independent appraiser.
The determination of fair value requires management to make estimates about discount rates, future expected cash flows, market conditions and other future events that are highly subjective in nature. The judgments made in the determination of the estimated fair value assigned to the assets acquired and liabilities assumed, as well as the estimated useful life of each asset and the duration of each liability, could significantly impact the consolidated financial statements in periods after the acquisition, such as through depreciation and amortization expense. Assumptions for the developed technology generally include expected earnings attributable to the asset (including an
194

TABLE OF CONTENTS
assumed technology migration curve and contributory asset charges) and an assumed discount rate. Assumptions for the customer-related intangibles generally include estimated annual revenues and net cash flows (including revenue ramp-up periods and customer attrition rates) and an assumed discount rate. Assumptions for the trade names, trademark and domain names generally include expected earnings attributable to the asset, the probability of use of the asset, the royalty rate and an assumed discount rate.
The excess of the total purchase consideration over the fair value of the identified net assets acquired is recognized as goodwill. Acquisition-related costs are expensed as incurred. The results of operations for each acquisition are included in the Company’s consolidated financial results beginning on the respective acquisition date.
During the measurement period, which may be up to one year from the acquisition date, the Company may record adjustments to the allocation of purchase consideration and to the fair values of assets acquired and liabilities assumed to the extent that additional information becomes available. After this period, any subsequent adjustments are recorded in the Consolidated Statements of Operations and Comprehensive Income (Loss).
Recent Accounting Standards Issued, But Not Yet Adopted
See Note 1 to the Notes to Unaudited Condensed Consolidated Financial Statements and to the Notes to Consolidated Financial Statements included elsewhere in this prospectus.
Off-Balance Sheet Arrangements
We enter into arrangements in which we originate loans, establish an SPE and transfer loans to the SPE, which has historically served as an important source of liquidity. We also retain the servicing rights of the underlying loans and hold additional interests in the SPE. When an SPE is determined not to be a VIE or when an SPE is determined to be a VIE but we are not the primary beneficiary, the SPE is not consolidated. In addition, a significant change to the pertinent rights of other parties or our pertinent rights, or a significant change to the ranges of possible financial performance outcomes used in our assessment of the variability of cash flows due to us, could impact the determination of whether or not a VIE is consolidated. VIE consolidation and deconsolidation may lead to increased volatility in our financial results and impact period-over-period comparability. See Note 1 to the Notes to Unaudited Condensed Consolidated Financial Statements and to the Notes to Consolidated Financial Statements included elsewhere in this prospectus in “— Consolidation of Variable Interest Entities” for our VIE consolidation policy.
We established personal loan trusts and student loan trusts that were created and designed to transfer credit and interest rate risk associated with the underlying loans through the issuance of collateralized notes and residual certificates. We hold a variable interest in the trusts through our ownership of collateralized notes in the form of asset-backed bonds and residual certificates in the trusts. The residual certificates absorb variability and represent the equity ownership interest in the equity portion of the personal loan trusts and student loan trusts.
We are also the servicer for all trusts in which we hold a financial interest. Although we have the power as servicer to perform the activities that most impact the economic performance of the VIE, we do not hold a significant financial interest in the trusts and, therefore, we are not the primary beneficiary. Further, we do not provide financial support beyond our initial equity investment, and our maximum exposure to loss as a result of our involvement with nonconsolidated VIEs is limited to our investment. For a more detailed discussion of nonconsolidated VIEs, including activity in relation to the establishment of trusts, the aggregate outstanding values of variable interests and the deconsolidation of VIEs, see Note 4 to the Notes to Unaudited Condensed Consolidated Financial Statements and Note 5 to the Notes to Consolidated Financial Statements included elsewhere in this prospectus.
As a component of our loan sale agreements, we make certain representations to third parties that purchased our previously held loans, which includes FNMA repurchase requirements, general representations and warranties and credit-related repurchase requirements, all of which are standard in nature and, therefore, do not constrain our ability to recognize a sale for accounting purposes. Pursuant to ASC 460, Guarantees, we establish a loan repurchase liability, which is based on historical experience and any current developments which would make it probable that we would buy back loans previously sold to third parties at the historical sales price. Our credit-related repurchase
195

TABLE OF CONTENTS
requirements are assessed for loss under ASC 326, Financial Instruments—Credit Losses. During the three months ended March 31, 2021 and year ended December 31, 2020, we made repurchases of $1.3 million and $9.0 million, respectively, associated with these arrangements. As of March 31, 2021 and December 31, 2020, we accrued liabilities of $6.4 million and $5.2 million, respectively, related to our estimated repurchase obligation.
We do not engage in any other off-balance sheet financing arrangements, as defined in Item 303(a)(4)(ii) of Regulation S-K.
Quantitative and Qualitative Disclosures about Market Risk
In the normal course of business, we are subject to a variety of risks which can affect our operations and profitability. We broadly define these areas of risk as interest rate risk, market risk, credit risk and counterparty risk. Historically, substantially all of our revenue and operating expenses were denominated in U.S. dollars. As a result of our acquisitions in the second quarter of 2020, which are further discussed in Note 2 to the Notes to Unaudited Condensed Consolidated Financial Statements and to the Notes to Consolidated Financial Statements included elsewhere in this prospectus, we may in the future be subject to increasing foreign currency exchange rate risk. Foreign currency exchange rate risk is the risk that our financial position or results of operations could be positively or negatively impacted by fluctuations in exchange rates. For the periods presented in this prospectus, there would have been an immaterial impact on earnings if exchange rates were to have increased or decreased.
Interest Rate Risk
We are subject to interest rate risk associated with our consolidated loans, securitization investments (including residual investments and asset-backed bonds), servicing rights and variable-rate debt. Our loan portfolio consists of personal loans, student loans and home loans, which are carried at fair value on a recurring basis, and credit cards and a commercial loan, which are measured at amortized cost. The loans with variable interest rates are exposed to interest rate volatility, which impacts the amount of interest income we recognize on our Consolidated Statements of Operations and Comprehensive Income (Loss). Our securitization residual investments are carried at fair value, which is subject to changes in market value by virtue of the impact of interest rates on the market yield of the residual investments. The value and earnings of our asset-backed bonds, which are associated with our personal loans and student loans, have a converse relationship to the movement of interest rates. That is, as interest rates rise, bond values and earnings fall and vice versa. Lastly, we are subject to interest rate risk on our variable-rate warehouse facilities and our revolving credit facility. Future funding activities may increase our exposure to interest rate risk, as the interest rates payable on such funding are tied to the one-month or three-month LIBOR. These arrangements will also be subject to the reference rate reform guidance, which is further discussed in Note 1 to the Notes to Unaudited Condensed Consolidated Financial Statements and to the Notes to Consolidated Financial Statements included elsewhere in this prospectus in “— Recent Accounting Standards Issued, But Not Yet Adopted”.
Interest rate risk also occurs in periods where changes in short-term interest rates result in loans being originated with terms that provide a smaller interest rate spread above the financing terms of our warehouse facilities, which can negatively impact our realized net interest income.
Interest Rate Sensitivity Analysis
The following table summarizes the potential effect on earnings over the next 12 months and the potential effect on the fair values of assets and liabilities recorded on our Consolidated Balance Sheets as of December 31, 2020, as applicable, based upon a sensitivity analysis performed by management assuming an immediate hypothetical increase and decrease in market interest rates of 100 basis points. The fair value and earnings sensitivities are applied only to financial assets and liabilities that existed at the indicated balance sheet date. A hypothetical 100
196

TABLE OF CONTENTS
basis points increase in interest rates would have had an immaterial impact on our interest income as it relates to our nascent credit card product and was, therefore, excluded from the below.
As of
December 31, 2020
Impact if Interest Rates:
($ in thousands)
Increase
100 Basis Points
Decrease
100 Basis Points
Loans at fair value
Fair value $ 4,859,068  $ 4,753,825  $ 4,970,723 
Income (loss) before income taxes – fair value change (105,243) 111,655 
Income (loss) before income taxes – interest income(1)
3,125  (3,125)
Securitization investments
Fair value $ 496,935  $ 485,868  $ 508,550 
Income (loss) before income taxes (11,067) 11,615 
Servicing rights
Fair value $ 149,597  $ 146,611  $ 152,742 
Income (loss) before income taxes (2,986) 3,145 
Debt(2)
Carrying value $ 3,983,665  n/a n/a
Income (loss) before income taxes (39,837) 39,837 
Total
Income (loss) before income taxes $ (156,008) $ 163,127 
__________________
(1)Sensitivity analysis was performed only on our variable-rate loans held on the Consolidated Balance Sheets and reflects the impact on interest income from changes in interest rates, while holding all other factors constant.
(2)Sensitivity analysis was performed only on our variable-rate debt, which is not measured at fair value on a recurring basis and, therefore, only reflects the hypothetical impact on interest expense. Additionally, these amounts are gross of debt issuance costs and discounts.
Credit Risk
We are subject to credit risk, which is the risk of default that results from a borrower’s inability or unwillingness to make contractually required loan payments, or declines in home loan collateral values. Generally, all loans sold into the secondary market are sold without recourse. For such loans, our credit risk is limited to repurchase obligations due to fraud or origination defects. For loans that were repurchased or not sold in the secondary market, we are subject to credit risk to the extent a borrower defaults and we are not able to fully recover the principal balance. We believe that this risk is mitigated through the implementation of stringent underwriting standards, strong fraud detection tools and technology designed to comply with applicable laws and our standards. In addition, we believe that this risk is mitigated through the quality of our loan portfolio. The weighted average origination FICO during the three months ended March 31, 2021 and year ended December 31, 2020 was 767 and 768, respectively.
The following table summarizes the potential effect on earnings over the next 12 months and the potential effect on the fair values of our loans for which we elected the fair value option and residual investments recorded on our Consolidated Balance Sheets as of December 31, 2020 based on upon a sensitivity analysis performed by management assuming an immediate hypothetical change in credit loss rates by a rate of 10%. The fair value and earnings sensitivities are applied only to loans that existed at the indicated balance sheet date. A hypothetical 10%
197

TABLE OF CONTENTS
increase in credit losses would have had an immaterial impact on our provision for credit losses as it relates to our nascent credit card product and was, therefore, excluded from the below.
As of
December 31, 2020
Impact if Credit Loss Rates:
($ in thousands) Increase 10 Percent Decrease 10 Percent
Loans at fair value
Fair value $ 4,859,068  $ 4,845,739  $ 4,872,397 
Income (loss) before income taxes (13,329) 13,329 
Residual investments(1)
Fair value $ 139,524  $ 138,711  $ 140,337 
Income (loss) before income taxes (813) 813 
Total
Income (loss) before income taxes $ (14,142) $ 14,142 
__________________
(1)Only residual investments are included herein, as they are subject to credit exposure, and by design this is the portion of the SPE that is expected to absorb the losses of the VIE. Alternatively, asset-backed bonds are not expected to absorb the losses of the VIE based on the extent of overcollateralization and expected credit losses of the VIE.
Market Risk
We are exposed to the risk of loss to future earnings, values or future cash flows that may result from changes in market discount rates. We are exposed to such market risk directly through loans, servicing rights and securitization investments held on our balance sheet, all of which are measured at fair value on a recurring basis using a discounted cash flow methodology in which the discount rate represents an estimate of the required rate of return by market participants. The discount rates for our loans and securitization investments may change due to expected loan performance or changes in the expected returns of similar financial instruments available in the market. For our servicing rights, the discount rate is commensurate with the risk of the servicing asset cash flow, which varies based on the characteristics of the serviced loan portfolio.
As of
December 31, 2020
Impact if Discount Rates:
($ in thousands) Increase
100 Basis Points
Decrease
100 Basis Points
Loans at fair value
Fair value $ 4,859,068  $ 4,753,825  $ 4,970,723 
Income (loss) before income taxes (105,243) 111,655 
Securitization investments
Carrying value $ 496,935  $ 485,868  $ 508,550 
Income (loss) before income taxes (11,067) 11,615 
Servicing rights
Fair value $ 149,597  $ 146,611  $ 152,742 
Income (loss) before income taxes (2,986) 3,145 
Total
Income (loss) before income taxes $ (119,296) $ 126,415 
Counterparty Risk
We are subject to risk that arises from our debt warehouse facilities and interest rate risk hedging activities. These activities generally involve an exchange of obligations with unaffiliated lenders or other companies, referred to in such transactions as “counterparties”. If a counterparty were to default, we could potentially be exposed to financial loss if such counterparty were unable to meet its obligations to us. We manage this risk by selecting only counterparties that we believe to be financially strong, spreading the risk among many such counterparties, placing
198

TABLE OF CONTENTS
contractual limits on the amount of dependence on any single counterparty, and entering into netting agreements with the counterparties as appropriate.
In accordance with Treasury Market Practices Group’s recommendation, we execute Securities Industry and Financial Markets Association trading agreements with all material trading partners. Each such agreement provides for an exchange of margin money should either party’s exposure exceed a predetermined contractual limit. Such margin requirements limit our overall counterparty exposure. The master netting agreements contain a legal right to offset amounts due to and from the same counterparty. Derivative assets in the Consolidated Balance Sheets represent derivative contracts in a gain position net of loss positions with the same counterparty and, therefore, also represent our maximum counterparty credit risk. We incurred no losses due to nonperformance by any of our counterparties during the three months ended March 31, 2021 and year ended December 31, 2020. We did not have any derivative liability positions subject to master netting arrangements as of March 31, 2021. Our derivative asset position was $7.5 million as of March 31, 2021. We did not have any derivative asset positions subject to master netting arrangements as of December 31, 2020. Our derivative liability position was $3.0 million as of December 31, 2020.
Also, in the case of our debt warehouse facilities, we are subject to risk if the counterparty chooses not to renew a borrowing agreement and we are unable to obtain financing to originate loans. With our debt warehouse facilities, we seek to mitigate this risk by ensuring that we have sufficient borrowing capacity with a variety of well-established counterparties to meet our funding needs. As of March 31, 2021, we had total borrowing capacity under debt warehouse facilities of $5.9 billion, of which $1.9 billion was utilized. Refer to Note 8 to the Notes to Unaudited Condensed Consolidated Financial Statements included elsewhere in this prospectus for a listing of our debt warehouse facilities as of March 31, 2021. As of December 31, 2020, we had total borrowing capacity under debt warehouse facilities of $6.4 billion, of which $2.4 billion was utilized. Refer to Note 9 to the Notes to Consolidated Financial Statements included elsewhere in this prospectus for a listing of our debt warehouse facilities as of December 31, 2020.
199

TABLE OF CONTENTS
MANAGEMENT
Executive Officers and Directors
The following table sets forth certain information concerning our executive officers and directors:
Name Age Position
Anthony Noto 53 Chief Executive Officer and Director
Christopher Lapointe 37 Chief Financial Officer
Michelle Gill 48 Executive Vice President and Group Business Unit Leader – Lending & Capital Markets
Micah Heavener 46 Head of Operations
Robert Lavet 66 General Counsel and Secretary
Jennifer Nuckles 46 Executive Vice President and Group Business Unit Leader – Relay, Protect, Lantern, Content, At Work & Partnerships
Maria Renz 53 Executive Vice President and Group Business Unit Leader – SoFi Money, SoFi Invest & Credit Card
Assaf Ronen 47 Chief Product Officer
Lauren Stafford Webb 36 Chief Marketing Officer
Aaron J. Webster 41 Chief Risk Officer
Clay Wilkes 60 Vice Chairman – Galileo and Director
Derek White 47 Chief Executive Officer – Galileo
Tom Hutton 66 Chairman of the Board of Directors
Steven Freiberg 64 Vice Chairman of the Board of Directors
Ahmed Al-Hammadi 40 Director
Ruzwana Bashir 37 Director
Michael Bingle 49 Director
Michel Combes 59 Director
Richard Costolo 57 Director
Clara Liang 41 Director
Carlos Medeiros 39 Director
Harvey Schwartz 57 Director
Magdalena Yeşil 62 Director
Executive Officers
Anthony Noto has served as our Chief Executive Officer and as a member of our board of directors since May 2021. Mr. Noto served in the same capacities at SoFi from February 2018 until May 2021. Before joining SoFi, Mr. Noto served as Twitter’s Chief Operations Officer, a digital/mobile information network, from 2016 to 2017 and as Twitter’s Chief Financial Officer from 2014 to 2017. Previously, Mr. Noto served for almost four years as co-head of Global Technology, Media and Telecom Investment Banking at Goldman Sachs, a multinational investment bank, from 2010 to 2014. Mr. Noto spent nearly three years as the Chief Financial Officer of the National Football League from 2008 to 2010. Mr. Noto holds a bachelor of science from the U.S. Military Academy, and a master of business administration from the University of Pennsylvania’s Wharton School. We believe Mr. Noto is qualified to serve in the capacity of Chief Executive Officer and as a member of our board of directors because of his extensive experience in the technology and financial services sectors in both operating and financial leadership capacities.
Christopher Lapointe has served as our Chief Financial Officer since May 2021. Mr. Lapointe served in the same capacity at SoFi from September 2020 until May 2021. Mr. Lapointe served in multiple leadership roles at SoFi including interim Chief Financial Officer beginning in April 2020 and Head of Business Operations beginning in June 2018. Prior to joining SoFi, Mr. Lapointe served as the Global Head of FP&A, Corporate Finance and
200

TABLE OF CONTENTS
FinTech at Uber Technologies, Inc., a company providing ridesharing services, from November 2015 to June 2018. Previously, Mr. Lapointe served as the Vice President of Technology, Media & Telecommunications Investment Banking at Goldman Sachs from July 2012 to November 2015. Mr. Lapointe holds a bachelor of arts from Dartmouth College as well as a master of business administration from the Tuck School of Business at Dartmouth College.
Michelle Gill has served as our Executive Vice President and Group Business Unit Leader for Lending & Capital Markets since May 2021. Michelle Gill served in the same capacity at SoFi from April 2020 until May 2021. She previously served as SoFi’s Chief Financial Officer from May 2018 to April 2020. Prior to joining SoFi, Ms. Gill served as a Managing Director working on Americas Asset Investing Business at TPG Sixth Street Partners, a global investment firm, from July 2017 to April 2018. Prior to TPG Sixth Street Partners, Ms. Gill spent 14 years at Goldman Sachs where, most recently, she was a Partner co-heading the Structured Finance business. Ms. Gill holds a bachelor of arts from the University of California, Los Angeles and a juris doctor from Cornell Law School.
Micah Heavener has served as our Head of Operations since May 2021. Mr. Heavener served in the same capacity at SoFi from May 2020 until May 2021. In this role, Mr. Heavener oversees our operational staff. Mr. Heavener previously served as the Head of Lending Operations from July 2018 to May 2020. Prior to joining SoFi, Mr. Heavener served as Managing Director, Head of Cardmember Services at Citibank, NA (“Citi”) from October 2016 to July 2018, where he led Cardmember Services for Citi’s U.S. credit card business. Prior to that role, Mr. Heavener held a number of leadership roles within Citi’s Global Consumer Business since joining Citi in 2005. Prior to joining Citi, Mr. Heavener was an infantry officer in the United States Army and served the United States abroad in support of Operation Enduring Freedom. Mr. Heavener holds a bachelor of arts degree from The Citadel, and earned his master of business administration from the University of Florida.
Robert Lavet has served as our General Counsel and Secretary since May 2021, in which role Mr. Lavet is responsible for managing all legal affairs for us and our affiliate entities. Mr. Lavet served in the same capacity at SoFi from 2012 until May 2021. Prior to joining SoFi, Mr. Lavet served as a Principal in the Education and Litigation practice groups of the Washington, D.C. law firm of Powers, Pyles, Sutter & Verville PC (“PPSV”), where he represented financial institutions and post-secondary institutions on a wide variety of regulatory, litigation and transactional matters. Prior to PPSV, Mr. Lavet served as General Counsel to SLM Corporation (known as Sallie Mae), a Fortune 300 company and the largest provider of education finance. Before his 16-year career with Sallie Mae, Mr. Lavet was a trial attorney for the United States Department of Justice for three years and ultimately served as a Partner in the Washington D.C. law firm of Cole, Corette & Abrutyn, specializing in corporate and securities litigation. He was named a top Washington D.C. corporate counsel in 2015 and 2019. Mr. Lavet holds a bachelor of arts from the University of Pennsylvania and a juris doctor from Georgetown University Law Center.
Jennifer Nuckles has served as Executive Vice President and Group Business Unit Leader for Relay, Protect, Lantern, Content, At Work & Partnerships since May 2021. Ms. Nuckles served in the same capacity at SoFi from 2019 until May 2021. Prior to joining SoFi, Ms. Nuckles served as an officer at various consumer technology companies, including telemedicine leader Doctor On Demand, Inc. She previously served as the Chief Marketing Officer of Zynga Inc., a social game development company, from 2014 to 2016. Ms. Nuckles also spent almost a decade in leadership positions at The Clorox Company, a multinational manufacturer and marketer of consumer and professional products, running well-known, household-name brands. Ms. Nuckles began her career in consulting covering consumer and media at Arthur Andersen, a firm which provided auditing, tax and consulting services. Ms. Nuckles holds a bachelor of arts from the University of California, Berkeley and a master of business administration from Harvard Business School.
Maria Renz has served as the Executive Vice President and Group Business Unit Leader for SoFi Money, SoFi Invest and Credit Card since May 2021. Ms. Renz served in the same capacity at SoFi from March 2020 until May 2021. Prior to joining SoFi, Ms. Renz was the Vice President of Customer Service and Delivery Experience at Amazon.com, Inc. (“Amazon”), from 2017 to 2020. Ms. Renz also held a variety of additional leadership positions at Amazon, including Vice President and Technical Advisor to the CEO. Prior to joining Amazon, Ms. Renz worked in brand management at Kraft Foods, Inc., as well as Hallmark Cards, Inc. Ms. Renz currently serves as a Board
201

TABLE OF CONTENTS
member for DoorDash Inc., a food delivery company (NYSE: DASH). Ms. Renz holds a bachelor of science from Drexel University and a master of business administration from Vanderbilt University.
Assaf Ronen has served as our Chief Product Officer since May 2021. Mr. Ronen served in the same capacity at SoFi from June 2020 until May 2021. Prior to such role, Mr. Ronen served as the Head of Product & Design of SoFi from June 2018 to June 2020. In this role, Mr. Ronen oversees the strategy and direction of SoFi’s suite of product offerings. Prior to joining SoFi, Mr. Ronen founded and served as Vice President of Amazon’s Alexa shopping group from 2014 to 2017, creating a new market category in the burgeoning world of voice assistants. Mr. Ronen previously served as a Vice President responsible for Amazon’s physical payments business. Prior to joining Amazon, Mr. Ronen spent nearly seven years at Microsoft Corporation, where he served as general manager of Skype after its acquisition, and as the general manager of identity, access, and security products. Mr. Ronen completed his computer science education while serving in the Israeli Army’s Center of Computing and Information Systems.
Lauren Stafford Webb has served as our Chief Marketing Officer since May 2021, in which role Ms. Stafford Webb oversees the SoFi brand and all aspects of marketing. Ms. Stafford Webb served in the same capacity at SoFi from June 2019 until May 2021. Prior to joining SoFi, Ms. Stafford Webb served at Intuit Inc., a business and financial software company, from February 2017 to May 2019, where she most recently was Vice President of Intuit Marketing, spearheading the delivery of the company’s first corporate brand strategy and campaign. Prior to Intuit, Ms. Stafford Webb held marketing leadership positions at The Procter & Gamble Company, a multinational consumer goods company, from June 2007 to October 2015, where she led well-known household name brands. Ms. Stafford Webb holds a bachelor of science in business administration from The Ohio State University Fisher College of Business.
Aaron J. Webster has served as our Chief Risk Officer since May 2021. Mr. Webster served in the same role at SoFi from 2019 until May 2021. Prior to joining SoFi, Mr. Webster served as Chief Risk Officer — U.S. Retail Bank and Mortgage and Head of Global Regulatory Analytics for Citi, the consumer division of the multinational financial services firm, from 2018 to 2019. Previously, Mr. Webster held several leadership roles at Toyota Financial Services, a leading automotive lender, beginning in 2008, with his most recent position as Managing Director, Americas Risk Management from 2008 to 2018. Previously, Mr. Webster served in various roles at GE Capital, Washington Mutual Bank FSB, and Wachovia Bank, NA (now Wells Fargo & Company). Mr. Webster holds a bachelor of arts from the University of North Carolina at Chapel Hill.
Derek White has served as CEO of Galileo since June 2021. Prior to joining Galileo, Mr. White was Vice President of Global Financial Services at Google, a technology company, from 2020 to 2021 where he was responsible for setting the strategy for Google’s financial services cloud efforts. Mr. White previously served as Vice Chair and Chief Digital Officer at U.S. Bank, a banking institution, from 2019 to 2020 where he oversaw digital expansion across various enterprises. Mr. White also served as Global Head of Client Solutions at BBVA, a banking institution, from 2016 to 2019 where he was responsible for oversight and development of customer and client solutions and growth. Mr. White previously worked at Barclays Bank, a banking institution, from 2005 to 2015, most recently serving as Chief Design and Digital Officer, where he oversaw design and digital innovation for the company. Mr. White also held various roles with other banking institutions. Mr. White holds a bachelor of arts from Utah State University and a master of business administration from the University of Pennsylvania’s Wharton School.
Directors
Tom Hutton has served as the Chairman of our board of directors since May 2021. Mr. Hutton was previously the Chairman of the SoFi board of directors from September 2017 and a director of SoFi from June 2012 until May 2021. Mr. Hutton previously served as interim Chief Executive Officer of SoFi from September 2017 to March 2018. Mr. Hutton has served as the Managing Partner of Thompson Hutton, LLC (“Thompson Hutton”), an investment management firm since 2000. He also founded and has served as Managing Partner of XL Innovate fund, a venture capital fund, since 2000. He has also served as a Board member of Lemonade Inc. (NYSE: LMND) since 2015 and previously served as a Board member of Safeco Insurance, Montpelier Re Holdings and XL Group. Mr. Hutton holds a bachelor of arts and master of science from Stanford University and a master of business
202

TABLE OF CONTENTS
administration from Harvard Business School. We believe that Mr. Hutton is qualified to serve as a member of our board of directors because of his experience as a director and Audit Committee Chairman of public companies and his knowledge of the fintech industry.
Steven Freiberg has served as the Vice Chairman of our board of directors since May 2021. Mr. Freiberg was previously the Vice Chairman of the SoFi board of directors from September 2017 and a director of SoFi from March 2017 until May 2021. Mr. Freiberg served as a senior advisor to SoFi from July 2018 to June 2019 and also served as SoFi’s interim Chief Financial Officer from May 2017 to June 2018. Mr. Freiberg is a long-term veteran of the financial services sector, having served as the Chief Executive Officer of E*TRADE Financial Corporation, an electronic trading platform, and having held multiple positions at Citigroup over a 30 year period, including serving as the Co-Chairman and Chief Executive Officer of Citigroup’s Global Consumer Group. He has also served as a Board member of MasterCard (NYSE: MA) since September 2006, Regional Management (NYSE: RM) since July 2014, Rewards Network since 2017, Purchasing Power, LLC since 2017, Fair Square Financial, LLC since 2016 and as a Founder of Grand Vista Partners, and a senior advisor to several companies including The Boston Consulting Group, Towerbook Capital Partners PE and Verisk Analytics (NASDAQ: VRSK). Mr. Freiberg holds a bachelor of business administration and a master of business administration from Hofstra University. We believe that Mr. Freiberg is qualified to serve as a member of our board of directors because of his experience as a director of public companies and his knowledge of the financial services industry.
Ahmed Al-Hammadi has served as a member of our board of directors since May 2021 and as a director on the SoFi board of directors from May 2019 until May 2021. Mr. Al-Hammadi serves as the Chief Investment Officer, Europe, Russia and Turkey for Qatar Investment Authority (“QIA”), the sovereign wealth fund of the State of Qatar, a position he has held since April 2020. He previously served as Head of Active Investments of QIA, from May 2015 to April 2020. Prior to joining QIA, Mr. Al-Hammadi worked at EFG-Hermes, a regional asset manager, and before that at the consulting firm Booz & Co. where he advised financial services clients on strategy, private equity investment opportunities, and organization structures. He is also a Board member of Heathrow Airport Holding Limited. Mr. Al-Hammadi holds a bachelor of science from the University of Pennsylvania’s Wharton School and a master of business administration from Harvard Business School. We believe that Mr. Al-Hammadi is qualified to serve as a member of our board of directors because of his experience advising companies with respect to business strategy.
Ruzwana Bashir has served as a member of our board of directors since June 2021. Ms. Ruzwana is the co-founder and Chief Executive Officer of Peek.com, an experiences booking software and marketplace, since 2012. Ms. Bashir was previously the Director of Marketing and Business Development at Artsy, an online art brokerage, from 2010 to 2011. Ms. Bashir also worked in Strategy and Business Development at Gilt Groupe, an online shopping company, in 2010. She was also an analyst in the real estate private equity group of The Blackstone Group, an investment firm, from 2006 to 2009, and worked in investment banking at Goldman Sachs in 2005. Ms. Bashir holds a bachelor of arts from University of Oxford and a master of business administration from Harvard Business School. We believe that Ms. Bashir is qualified to serve as a member of the SoFi Technologies’ board of directors because of her experience advising companies with respect to business strategy and leading a technology company.
Michael Bingle has served as a member of our board of directors since May 2021 and as a director on the SoFi board of directors from March 2017 until May 2021. Mr. Bingle is Vice Chairman at Silver Lake, a global investment firm with a focus on investing in technology companies, and has been with Silver Lake since 2000. Mr. Bingle has been a private equity investor for over 20 years, and he has invested in numerous fintech companies. Prior to joining Silver Lake, Mr. Bingle was a principal at Apollo Management and worked in the Investment Banking Division of Goldman Sachs & Co. He has also served as a Board member of SolarWinds Corporation (NYSE: SWI) since February 2016, Achievers Holdings, Inc., Blackhawk Network Holdings, Inc. and Fanatics, Inc. and previously served as a Board member of TD Ameritrade Holding Corporation (NYSE: AMTD), Gartner, Inc. (NYSE: IT), Virtu Financial (NASDAQ: VIRT), Ancestry.com LLC, Credit Karma, Inc., Datek Online Holdings, Inc., Interactive Data Corporation, IPC Systems, Inc., Instinet, Inc., and Mercury Payment Systems. Mr. Bingle holds a bachelor of science in engineering from Duke University. We believe that Mr. Bingle is qualified to serve as a member of our board of directors because of his experience as a director of public companies, his experience advising companies with respect to business strategy, his knowledge of the financial services industry, and his experience with financial technology companies.
203

TABLE OF CONTENTS
Michel Combes has served as a member of our board of directors since May 2021 and as a director on the SoFi board of directors from May 2020 until May 2021. Mr. Combes is President of SoftBank Group International, an affiliate of SoftBank Corp., a Japanese telecommunications company providing mobile communications services. Prior to joining SoftBank, Mr. Combes was President and Chief Executive Officer of Sprint Corporation, an American telecommunications company (“Sprint”), Chief Executive Officer of Altice, a communications and media company, and Chief Executive Officer of SFR Group, a French mobile communications company. He has also served as a Board member of Philip Morris International Inc. (NYSE: PM) since December 2020, F5 Networks (NASDAQ: FFIV) since July 2018 and as a member of the Business Advisory Group of McLaren Technology Group since July 2018. He has previously served on the board of directors of Sprint. Mr. Combes holds a master’s degree from École Polytechnique, Télécom ParisTech and a Ph.D. from Paris Dauphine University. We believe that Mr. Combes is qualified to serve as a member of our board of directors because of his experience advising companies with respect to business strategy and his knowledge of the financial services industry.
Richard Costolo has served as a member of our board of directors since May 2021. Mr. Costolo has also served as the Co-Managing Partner and General Partner at 01 Advisors, a venture and advisory firm, since January 2018. Mr. Costolo was previously a Venture Partner at Index Ventures, a venture capital firm, from January 2016 to December 2016 and served as the CEO of Twitter, Inc., the online social networking and microblogging service, from October 2010 to July 2015. Mr. Costolo has been the founder and CEO of multiple startups, including FeedBurner, which was acquired by Google in 2007. Mr. Costolo holds a bachelor of science in computer science from the University of Michigan. We believe that Mr. Costolo is qualified to serve as a member of our board of directors because of his experience advising companies with respect to business strategy and leading a technology company.
Clara Liang has served as a member of our board of directors since May 2021 and as a director on the SoFi board of directors from October 2019 until May 2021. Ms. Liang is Vice President and head of geos at Airbnb, Inc. (“Airbnb”) (NASDAQ: ABNB), a community of millions of hosts who offer travel experiences in 220 countries and regions around the world. Prior to joining Airbnb, Ms. Liang served as Chief Product Officer at Jive Software, a provider of communication and collaboration products, and spent 11 years at International Business Machines Corporation (“IBM”) in a number of technology and professional services roles. Ms. Liang holds a bachelor of science in Symbolic Systems from Stanford University and a master of science in technology commercialization from the University of Texas at Austin. We believe that Ms. Liang is qualified to serve as a member of our board of directors because of her experience leading and scaling global technology companies.
Carlos Medeiros has served as a member of our board of directors since May 2021 and as a director on the SoFi board of directors from September 2020 until May 2021. Mr. Medeiros is a Partner at SoftBank and has been with SoftBank since 2019. Prior to joining SoftBank, Mr. Medeiros led the direct investment practice at VR Investments, a New York-based investment firm focused on long-term investment horizon, for seven years. Mr. Medeiros’ previous experience also includes investment banking at UBS. He is also a Board member of Bancar Technologies Limited, UK. Mr. Medeiros graduated from Fundação Getulio Vargas in Brazil with a focus on government and financial analysis, and he holds a master in business administration from Columbia Business School. We believe that Mr. Medeiros is qualified to serve as a member of our board of directors because of his experience advising companies with respect to business strategy and his knowledge of the financial services industry.
Harvey Schwartz has served as a member of our board of directors since May 2021. Mr. Schwartz is an investor, philanthropist and consultant and has served as an advisor to Super Set, a venture tech fund, since September 2018. Mr. Schwartz previously served as President and Co-Chief Operating Officer of Goldman Sachs from 2017 to April 2018 and also served as Chief Financial Officer of Goldman Sachs from 2016 to 2017. After joining Goldman Sachs in 1997, Mr. Schwartz served in various senior leadership roles, including Global Co-Head of the Securities Division, Head of Securities Division Sales, Head of North American Sales and Co-Head of the Americas Financing Group. He also served as a member of Goldman Sachs’ Management Committee and co-headed its Risk Committee, Steering Committee on Regulatory Reform and Finance Committee and established Goldman Sachs’ Investment Policy Committee, on which he also served as a member. Prior to Goldman Sachs, Mr. Schwartz spent a decade working at several other financial firms including at Citicorp from 1990 through 1997. Mr. Schwartz holds a bachelor of arts from Rutgers University and a master of business administration from Columbia University.
204

TABLE OF CONTENTS
We believe that Mr. Schwartz is qualified to serve as a member of our board of directors because of his extensive experience in and knowledge of the financial services industry.
Clay Wilkes has served as a member of our board of directors since May 2021 and as a director on the SoFi board of directors from May 2020 until May 2021. Mr. Wilkes founded Galileo in 2000 and served as its Chief Executive Officer since its founding until June 2021. In June 2021, he transitioned to serve as the Vice Chairman of Galileo. Mr. Wilkes launched his professional career developing communications and operating systems for Sperry, IBM, and Novell, Inc. In 1994, Mr. Wilkes also founded I-Link, which developed Voice Over IP and the first switchless voice network. As Chief Executive Officer, Mr. Wilkes took I-Link public and authored patents for VOIP. Mr. Wilkes studied at the University of Oregon and Brigham Young University. We believe Mr. Wilkes is qualified to serve as a member of our board of directors because of his experience operating a financial technology company and as his engineering and technology background.
Magdalena Yeşil has served as a member of our board of directors since May 2021 and as a director on the SoFi board of directors from July 2018 until May 2021. Ms. Yeşil is a founder, entrepreneur, and venture capitalist of many technology companies. Ms. Yeşil is currently the co-founder and executive chair of Informed.IQ, an AI company that turns documents and data into decisions for the consumer finance industry. She is a former general partner at U.S. Venture Partners, a leading Silicon Valley venture capital firm, where she oversaw investments in more than 30 early-stage companies. Ms. Yeşil founded UUnet, CyberCash, Inc., and MarketPay Associates, LLC, some of the first companies dedicated to commercializing Internet access, e-commerce infrastructure, and electronic payments, which earned her the Entrepreneur of the Year title from Red Herring in 1997. She is also a founder of Broadway Angels, a group of female venture capitalists and angel investors. She is also a Board member of Smartsheet and Zuora and has previously served on the board of directors of salesforce.com, inc. (NYSE: CRM). Ms. Yeşil holds a bachelor of science and a master of science in electrical engineering from Stanford University. We believe that Ms. Yeşil is qualified to serve as a member of our board of directors because of her extensive experience leading and advising technology companies.
Board Composition
The board of directors will establish the authorized number of directors from time to time by resolution. The size of the board of directors is currently set at thirteen members. Pursuant to our Certificate of Incorporation and the Shareholders’ Agreement, the composition of the board of directors will consist of the following:
One board seat initially filled by Anthony Noto, the Chief Executive Officer of SoFi Technologies, which will thereafter be designated, nominated and elected as contemplated by the Certificate of Incorporation and Bylaws;
Three board seats that will be designated by certain existing investors for so long as the relevant existing investor holds in the aggregate an amount of shares of SoFi Technologies equal to (i) at least 50% of its percentage ownership of SoFi Technologies immediately following the Closing minus any of such existing investor’s shares of SoFi Technologies repurchased by SoFi Technologies pursuant to the Shareholders’ Agreement, or (ii) at least 5% of the then issued and outstanding shares of SoFi Technologies, including:
a.one board seat that will be designated by Red Crow and that is initially filled by Clay Wilkes,
b.one board seat that will be designated by QIA FIG Holding LLC and that is initially filled by Ahmed Al-Hammadi, and
c.one board seat that will be designated by Silver Lake Partners and that is initially filled by Michael Bingle;
and which will thereafter be designated, nominated and elected as contemplated by the Certificate of Incorporation and Bylaws;
(A) Two board seats that will be designated by SoftBank Group Capital Limited for so long as SoftBank holds in the aggregate an amount of shares of SoFi Technologies equal to at least 50% of its percentage ownership of SoFi Technologies immediately following the Closing minus SoftBank’s shares of SoFi
205

TABLE OF CONTENTS
Technologies repurchased by SoFi Technologies pursuant to the Shareholders’ Agreement or the Share Repurchase Agreement, or (B) in the event the threshold in sub-clause (A) is not met, one board seat that will be designated by SoftBank for so long as SoftBank holds in the aggregate an amount of shares of SoFi Technologies (i) greater than or equal to 25% but less than 50% of its percentage ownership of SoFi Technologies immediately following Closing minus SoftBank’s shares of SoFi Technologies repurchased by SoFi pursuant to the Shareholders’ Agreement or the Share Repurchase Agreement, or (ii) at least 5% of the then issued and outstanding shares of SoFi Technologies, which are initially filled by Michel Combes and Carlos Medeiros, and which will thereafter be designated, nominated and elected as contemplated by the Certificate of Incorporation and Bylaws.
(i) Two board seats that will be designated by SCH for so long as SCH holds in the aggregate an amount of shares of SoFi Technologies equal to at least 50% of its percentage ownership of SoFi Technologies immediately following the Closing and mutually agreed upon between us and SCH and which are initially filled by Richard Costolo and Ruzwana Bashir, or (ii) in the event the threshold set forth in sub-clause (a)(i) is not met, one of which will be designated by SCH for so long as SCH holds in the aggregate an amount of shares of SoFi Technologies equal to (x) at least 25% of its percentage ownership of SoFi Technologies immediately following the Closing or (y) at least 5% of the then issued and outstanding shares of SoFi Technologies;
One board seat that will be filled by an independent director designated by Red Crow for so long as Red Crow holds in the aggregate an amount of shares of SoFi Technologies equal to at least 50% of its percentage ownership of SoFi Technologies immediately following the Closing, which is initially filled by Harvey Schwartz;
One board seat that will be filled by an independent director designated by SoftBank for so long as SoftBank holds in the aggregate an amount of shares of SoFi Technologies equal to at least 50% of its percentage ownership of SoFi Technologies immediately following the Closing minus any of such existing investor’s shares of SoFi Technologies repurchased by SoFi Technologies pursuant to the Shareholders’ Agreement or the Share Repurchase Agreement and which is initially filled by Tom Hutton; and
Three board seats that will be filled by individuals who were members of SoFi’s Board of Directors and which are initially filled by Steven Freiberg, Clara Liang and Magdalena Yeşil, in each case, which will thereafter be designated, nominated and elected as contemplated by the Certificate of Incorporation and Bylaws.
Each director will continue to serve as a director until the election and qualification of their successor, or until their earlier death, resignation, or removal.
When considering whether directors and director nominees have the experience, qualifications, attributes and skills, taken as a whole, to enable the board of directors to satisfy its oversight responsibilities effectively in light of its business and structure, the board of directors expects to focus primarily on each person’s background and experience as reflected in the information discussed in each of the directors’ individual biographies set forth above in order to provide an appropriate mix of experience and skills relevant to the size and nature of its business.
Corporate Governance
Director Independence
As a result of our common stock being listed on Nasdaq, we must comply with the applicable rules of such exchange in determining whether a director is independent. We undertook a review of the independence of the individuals named above and have determined that each of Tom Hutton, Ahmed Al-Hammadi, Ruzwana Bashir, Mike Bingle, Michel Combes, Richard Costolo, Carlos Medeiros, Clara Liang and Magdalena Yeşil qualifies as “independent” as defined under applicable SEC rules and Nasdaq listing standards.
206

TABLE OF CONTENTS
Committees of the Board of Directors
Our board of directors directs the management of our business and affairs, as provided by Delaware law, and conducts its business through meetings of the board of directors and standing committees. We have a standing audit and risk committee, compensation committee and nominating and corporate governance committee, each of which operates under a written charter.
Pursuant to the Shareholders’ Agreement, for so long as the each of the SoftBank Investors, Red Crow Investors and Silver Lake Investors (each as defined in our Certificate of Incorporation) is entitled to nominate a director nominee to serve on the board of directors, each of the SoftBank Investors, Red Crow Investors and Silver Lake Investors is entitled to designate a member to a standing committee of the board of directors of its choice (and in the case of SoftBank, for so long as it may designate two nominees to the board of directors it may designate one member to two such standing committees), subject in each case to applicable law and the qualification of the applicable designees as independent under Nasdaq rules. The Shareholders’ Agreement also provides that for so long as a nominee designated by the SoftBank investors is serving on the audit committee, compensation committee or nominating and corporate governance committee, such committee will have no fewer than four members.
In addition, from time to time, special committees may be established under the direction of the board of directors when the board deems it necessary or advisable to address specific issues. Our current copies of committee charters are posted on our website, www.sofi.com/investors, as required under applicable SEC rules and Nasdaq rules. The information on or available through such website is not deemed incorporated in this prospectus and does not form part of this prospectus.
Audit and Risk Committee
Our audit and risk committee consists of Tom Hutton, Clara Liang and Magdalena Yeşil, with Tom Hutton serving as the chair of the committee. Our board of directors has determined that each of these individuals meet the independence requirements of the Sarbanes-Oxley Act of 2002, as amended, or the Sarbanes-Oxley Act, Rule 10A-3 under the Exchange Act and applicable Nasdaq listing rules. We have determined that each member of our audit and risk committee meets the requirements for financial literacy under the applicable rules and regulations of the SEC and Nasdaq listing rules. In arriving at this determination, the board of directors has examined each audit committee member’s scope of experience and the nature of their prior and/or current employment.
The parties have determined that Tom Hutton qualifies as an audit committee financial expert within the meaning of SEC regulations and meets the financial sophistication requirements of Nasdaq listing rules. In making this determination, the board of directors considered Tom Hutton’s formal education and previous and current experience in financial and accounting roles. The independent registered public accounting firm and management periodically will meet privately with the audit and risk committee.
The audit and risk committee’s responsibilities include, among other things:
appointing, compensating, retaining, evaluating, terminating and overseeing the independent registered public accounting firm;
discussing with the independent registered public accounting firm their independence from management;
reviewing with the independent registered public accounting firm the scope and results of their audit;
pre-approving all audit and permissible non-audit services to be performed by the independent registered public accounting firm;
overseeing the financial reporting process and discussing with management and the independent registered public accounting firm the interim and annual financial statements that SoFi Technologies files with the SEC;
reviewing and monitoring accounting principles, accounting policies, financial and accounting controls and compliance with legal and regulatory requirements; and
207

TABLE OF CONTENTS
establishing procedures for the confidential anonymous submission of concerns regarding questionable accounting, internal controls or auditing matters.
We believe that the composition and functioning of the audit and risk committee meets the requirements for independence under applicable Nasdaq listing standards.
Compensation Committee
Our compensation committee consists of Michael Bingle, Richard Costolo, Clara Liang and Carlos Medeiros, with Mike Bingle serving as the chair of the committee. The board of directors determined that each of these individuals is a non-employee director, as defined in Rule 16b-3 promulgated under the Exchange Act. The board of directors determined that Clara Liang, Richard Costolo, Carlos Medeiros and Mike Bingle are “independent” as defined under applicable Nasdaq listing standards, including the standards specific to members of a compensation committee.
The compensation committee’s responsibilities include, among other things:
reviewing and approving corporate goals and objectives relevant to the compensation of the Chief Executive Officer, evaluating the performance of the Chief Executive Officer in light of these goals and objectives and setting or making recommendations to the board of directors regarding the compensation of the Chief Executive Officer;
reviewing and setting, or making recommendations to the board of directors regarding, the compensation of other executive officers;
making recommendations to the board of directors regarding the compensation of directors;
reviewing and approving, or making recommendations to the board of directors regarding, incentive compensation and equity-based plans and arrangements; and
appointing and overseeing any compensation consultants.
We believe that the composition and functioning of the compensation committee meets the requirements for independence under applicable Nasdaq listing standards.
Nominating and Corporate Governance Committee
The nominating and corporate governance committee consists of Tom Hutton and Magdalena Yeşil, with Magdalena Yeşil serving as the chair of the committee. The board of directors has determined that each of these individuals is “independent” as defined under applicable SEC rules and Nasdaq listing standards.
The nominating and corporate governance committee’s responsibilities include, among other things:
identifying individuals qualified to become members of the board of directors, consistent with criteria approved by the board of directors;
recommending to the board of directors the nominees for election to the board of directors at annual meetings of stockholders;
overseeing an evaluation of the board of directors and its committees; and
developing and recommending to the board of directors a set of corporate governance guidelines.
We believe that the composition and functioning of the nominating and corporate governance committee meets the requirements for independence under current Nasdaq listing standards.
The board of directors may from time to time establish other committees.
208

TABLE OF CONTENTS
Code of Ethics
We have a code of ethics that applies to all of our executive officers, directors and employees, including our principal executive officer, principal financial officer, principal accounting officer or controller or persons performing similar functions. The code of ethics is available on our website, http://sofi.com/investors. We intend to make any legally required disclosures regarding amendments to, or waivers of, provisions of our code of ethics on our website rather than by filing a Current Report on Form 8-K.
Compensation Committee Interlocks and Insider Participation
None of the members of the compensation committee is currently or has been at any time one of our officers or employees. No executive officer currently serves, or has served during the last year, as a member of the board of directors or compensation committee of any entity, other than SoFi Technologies, that has one or more executive officers serving as a member of our board of directors.
209

TABLE OF CONTENTS
COMPENSATION DISCUSSION AND ANALYSIS
This section discusses the material components of the executive compensation program that are paid, awarded to, or earned by our named executive officers (the “NEOs”), which consist of the following persons:
Anthony Noto, Chief Executive Officer;
Christopher Lapointe, Chief Financial Officer;
Maria Renz, EVP & Group Business Unit Leader — Money, Invest & Credit Card;
Michelle Gill, EVP & Group Business Unit Leader — Lending & Capital Markets; and
Jennifer Nuckles, EVP & Group Business Unit Leader — Relay, Protect, Lantern, Content, At Work & Partnerships
Historical Compensation Decisions
Compensation Philosophy and Objectives
Our compensation program is designed to attract, retain and motivate talented, deeply qualified and committed individuals who believe in SoFi’s mission, while rewarding employees for long-term value creation. In furtherance of this objective, our compensation programs focus on paying for performance where executive compensation is aligned to SoFi’s performance, in addition to individual contribution and impact. In addition, our equity program aligns executive compensation to the long-term interests of our shareholders by aligning executive compensation to the performance of SoFi.
Our executive compensation philosophy seeks to promote a long-term commitment to the Company by our executives. We believe that there is great value to the Company in having a team of long-tenured, seasoned managers. Our team-focused culture and management processes are designed to foster this commitment. In addition, we rely on 100% service-based vesting to reinforce this long-term orientation.
While we are still evolving our programs and practices, we strive for a fair, competitive, transparent and equitable approach in recognizing and rewarding our executives. We take a principled approach in providing fair, relevant and competitive compensation and benefits to a dynamic workforce with diverse needs. For our executives, we aim to balance short-term versus long-term compensation and fixed amounts of cash with variable incentive compensation. In furtherance of this goal, we provide the following forms of compensation to our executives:
Base Pay:   We provide a competitive fixed amount of cash compensation based on the executive’s role, prior experience and expected contributions to SoFi.
Cash Incentive Compensation:   We additionally provide cash-based incentives that are tied to specific company metrics and are aligned to our annual company priorities, with the payout opportunity based on company and individual performance.
Long-Term Equity Compensation:   The most significant portion of compensation for our executives is provided in the form of stock options and restricted stock units. This long-term incentive aligns executive compensation to our shareholders’ interests while helping attract and retain talented leaders by paying for performance.
Change of Control and Severance Benefits:   We believe it is important to offer severance and change of control benefits to certain key executives that are in line with our view of market practice such that we may maintain a competitive advantage in hiring and retaining top talent.
Employee Benefit and Wellness Programs:   We offer our executives the same health and wellness programs as all other employees. In addition, executives are eligible to enroll in the same program as all other employees. We think this benefit and retirement package assists us in retaining top executive talent.
210

TABLE OF CONTENTS
When designing our compensation program, we considered the competitive market for corresponding positions within comparable geographic areas and companies of similar size and stage of development operating in our industry. This informal consideration was based on the general knowledge of our Chief Executive Officer regarding the compensation given to some of the executive officers of other companies in our industry through informal discussions with recruiting firms, research and informal benchmarking against their personal knowledge of the competitive market. Our Chief Executive Officer, in consultation with the compensation committee, approved compensation decisions for each executive officer on an individual basis after a thorough discussion of various factors, including any informal knowledge or data in his possession.
As we gain experience as a public company, we expect that the specific direction, emphasis and components of our executive compensation program will continue to evolve. Over time, we intend to transition to a more empirically-based approach that involves benchmarking against peer companies. Accordingly, the compensation paid to our NEOs for fiscal year 2020 is not necessarily indicative of how we will compensate our NEOs after the Business Combination.
Compensation Committee Procedures
The compensation committee and the board of directors meet outside the presence of all of our executive officers (other than Clay Wilkes, chief executive officer of Galileo, as he is also a member of our board of directors and reports directly to the Chief Executive Officer), including our NEOs, to consider appropriate compensation for our Chief Executive Officer. Following the Business Combination, the compensation committee intends to adopt a policy that would, among other things, prohibit members of such committee from voting on compensation matters of individuals to whom such members report. This policy is intended to align with the Company’s policy of ensuring objective and fair decisions on matters of compensation.
The compensation committee meets outside the presence of all NEOs except our Chief Executive Officer to consider appropriate compensation for all other NEOs. Our Chief Executive Officer reviews annually each NEO’s performance and approves appropriate base salary, cash performance awards and grants of long-term equity incentive awards for all other NEOs. The compensation committee is required to approve new grants of long-term equity incentive awards exceeding 200,000 shares in any twelve-month period for a single NEO. The compensation committee also annually analyzes our Chief Executive Officer’s performance and determines his base salary, cash performance awards and grants of long-term equity incentive awards based on its assessment of his performance, such assessment is performed with input from compensation consultants as engaged by the compensation committee. The compensation committee’s determinations with respect to our Chief Executive Officer’s performance are subject to approval from our board of directors. In order to ensure that we continue to remunerate our executives appropriately, the compensation committee has retained Compensia, Inc. (“Compensia”) as its independent compensation consultant to review its policies and procedures with respect to executive compensation. Compensia assists the Chief Executive Officer, our People Team and the compensation committee by providing comparative market data on compensation practices and programs based on an analysis of peer competitors and by providing guidance on industry best practices; however, the Company has not yet undergone a formal peer group study to compare our current compensation practices. The compensation committee retains the right to modify or terminate its relationship with Compensia or select other outside advisors to assist the compensation committee in carrying out its responsibilities. No other services have yet been provided by Compensia to the Company.
Annual Say-on-Pay Vote on Executive Compensation
The board of directors has not yet been required to solicit a non-binding stockholder advisory vote on the compensation of our NEOs (the “Say-on-Pay Vote”). However, SoFi Technologies will solicit a Say-on-Pay Vote in accordance with applicable law at its first Annual Meeting. Our board of directors will consider the outcome of the Say-on-Pay Vote when making compensation decisions for our NEOs in the future.
The Company has determined that any risks arising from its compensation programs and policies are not reasonably likely to have a material adverse effect on the Company. The Company’s compensation programs and policies mitigate risk by combining performance-based, long-term compensation elements with payouts that are highly correlated to the value delivered to stockholders. The combination of performance measures for annual
211

TABLE OF CONTENTS
bonuses and the equity compensation programs, as well as the multiyear vesting schedules for equity awards, encourage executives to maintain both a short and a long-term view with respect to Company performance.
Elements of Compensation
Our current executive compensation program, which was set by our compensation committee, consists of the following:
Base Pay
The principle form of compensation of our executive officers is in the form of equity grants, principally stock options and restricted stock units. Nevertheless, base salary forms a critical component of compensation of our executive officers. The base pay for each NEO is intended to provide a fixed amount of cash compensation that is based on the executive’s individual role, experience and expected contributions. Base salary is also designed to provide our executive officers with steady cash flow during the course of the fiscal year that is not contingent on short-term variations in our corporate performance. Our Chief Executive Officer and compensation committee determine market-level compensation for base salaries based on benchmark data provided by external market data firm Radford in addition to our executives’ experience in the industry with reference to the base salaries of similarly-situated executives in other companies of similar size and stage of development operating in our industry.
With these principles in mind, base salaries are reviewed during the fourth quarter of the fiscal year by our Chief Executive Officer, in collaboration with our People Team and compensation committee. In past years, our Chief Executive Officer, and the board of directors with respect to the Chief Executive Officer, approved certain changes to base salary. The Chief Executive Officer reviewed the performance of the other NEOs using relevant Radford market data made available to him during the past year to set the executive compensation package for each executive officer for the coming year based on such data and in light of our compensation objectives.
The base salaries paid to our NEOs in fiscal year 2020 are set forth in the “Executive Compensation — 2020 Summary Compensation Table” below.
Cash Incentive Compensation
We offer annual cash incentives to our executives, which are tied to specific Company metrics that are aligned to our annual Company priorities. The payout opportunity for each executive officer is based on both Company and individual performance as determined by the Chief Executive Officer, except in the case of the Chief Executive Officer, in which case our compensation committee makes a recommendation to the board of directors for such determination. Our Chief Executive Officer, in his discretion, approves awards of cash bonuses to our executive officers, other than himself. In the case of cash awards to our Chief Executive Officer, the board of directors has the authority and discretion to award an annual cash bonus.
At the commencement of an executive officer’s employment with us, a target level of bonus compensation is determined that is structured as a percentage of such executive officer’s annual base salary. This target level of bonus can be adjusted based on a change in scope or as part of a compensation target adjustment. Depending upon company and individual performance, an executive officer may ultimately receive more or less than his or her target bonus amount.
Key company performance objectives, or “Company Priorities”, set by the company on an annual basis are weighted to determine company-wide bonus funding, including the funding for the annual incentives for our executive officers. In determining the appropriate weight to apply with respect to each Company Priority, our Chief Executive Officer and compensation committee consider the performance metrics that he or they believe are most impactful to our overall corporate performance. These “Company Priorities” are weighted by our Chief Executive Officer to guide the funding of the bonus pool from which we pay our bonuses to our executive officers. For purposes of funding the bonus pool, we determine the actual performance for each Company Priority to be at least 50% and we determine each Company Priority’s target as fully satisfied to the extent 80% of such Company Priority’s Target Performance is deemed actually achieved. When actual performance is less than 80% of the Target Performance or in excess of 100% of the Target Performance, the Chief Executive Officer and our compensation
212

TABLE OF CONTENTS
committee, in their discretion, determine the amount by which the performance condition for such Company Priority is satisfied and, ultimately, the amount of our bonus pool that is funded.
The table below sets forth for 2020 for each Company Priority: the weight distribution and target performance objectives set by us, the actual performance achieved, and the payout determination made by the Chief Executive Officer and compensation committee in their discretion.
Company Priority
Weighting
Target Performance
Actual Performance
Achievement
Payout
Weighted Payout
Adjusted Net Revenue ($ in millions)
30  % $ 593  $ 621  105  % 118  % 35  %
Adjusted EBITDA ($ in millions) 30  % $ (90) $ (45) 150  % 150  % 45  %
Change in NPS(1)
13.33  % 35  (4) (11) % 50  % %
Net New Total Members
13.33  % 750,000  874,412  117  % 122  % 16  %
Net New Total Multi-Product Members 13.33  % 175,000  313,983  179  % 163  % 22  %
Total
100.00  % 125  %
_____________________
(1)“NPS” is defined as “Net Promoter Score” and is a metric commonly used to measure the loyalty or satisfaction of customers to a company or a particular product. NPS scores are measured with a single question survey and are reported with a number ranging from -100 to +100, with a higher score being desirable. Our NPS question is aimed at discerning our general brand perception and whether or not the survey participants, who are self-stated SoFi members, would recommend us to a friend or colleague. Our NPS is used by us as an indicator of the satisfaction of our members relative to the satisfaction of our competitors' customers with our competitors.
Our Chief Executive Officer has the discretion to determine each of our executive officers’ bonus payment amount, other than for himself, which determination is made by the board of directors in its discretion, based upon his subjective evaluation of the impact of his or her performance on the overall Company Priorities. In addition, our Chief Executive Officer may adjust bonuses upwards or downwards due to extraordinary or nonrecurring events, such as significant financings, equity offerings or acquisitions, or for any other reason in his discretion. Because of this, our Chief Executive Officer retains discretion over the ultimate annual bonus payments to each executive officer, other than himself, in which case our board of directors retains such discretion. We believe that establishing cash bonus opportunities helps us attract and retain qualified and highly skilled executives. These annual bonuses are intended to reward executive officers who have a positive impact on corporate results.
During 2020, our Chief Executive Officer established the target percentage amounts for the cash bonuses for each of our NEOs other than himself. For all of fiscal year 2020, Mr. Noto and Ms. Gill were eligible to receive an annual cash bonus target of 100% of their respective base salaries. Mr. Lapointe was eligible to receive an annual cash bonus target of 80% of his base salary from the beginning of 2020 through his appointment as Chief Financial Officer on September 14, 2020, after which he was eligible to receive an annual cash bonus target of 100% of his adjusted base salary as Chief Financial Officer. Additionally, Mr. Lapointe received a discretionary bonus of $25,000 per month while in his role as interim Chief Financial Officer, which resulted in six monthly payments between April 1, 2020 and September 14, 2020. Ms. Renz, who began employment on March 11, 2020, was eligible to receive quarterly cash bonuses of a minimum of 100% of her base salary for her first year. Beginning in fiscal year 2021, Ms. Renz will be eligible to receive an annual cash bonus target of 100% of her base salary. Ms. Nuckles was eligible to receive an annual cash bonus target of 80% of her fiscal year 2020 base salary from the beginning of the year through her appointment to Executive Vice President on March 11, 2020, after which she was eligible to receive an annual cash bonus target of 100% of her adjusted base salary as Executive Vice President. The bonuses received by each NEO are reflective of the Company-wide bonus multiple, which reflects the funded status of our bonus pool, as applied to their respective eligible bonus targets.
For additional information, including the amounts paid for each named executive officer, please see the 2020 Summary Compensation Table below under “— Executive Compensation.”
213

TABLE OF CONTENTS
Long-Term Equity-Based Compensation
The most significant portion of compensation for executives is delivered in the form of stock options and restricted stock units, or RSUs. This long-term equity incentive aligns our executives’ compensation to our shareholders’ interests while helping attract and retain talented leaders and furthers our compensation objective of paying for performance.
Generally, each executive officer is provided with an equity grant in the form of RSUs when they join our Company based upon his or her position with us and his or her relevant prior experience. These inducement grants generally vest over the course of four years with 25% of the shares vesting on the first anniversary of the vesting commencement date and the remainder of the shares vesting quarterly in equal installments over the next 12 quarters. While the vesting schedule noted is typical, RSUs have been issued to executives with alternative schedules. These alternative schedules include, but are not limited to, vesting at a rate of 20% after one year from vesting commencement date then monthly over an additional four years, and vesting at a rate of 25% after one year from the vesting commencement date then monthly over an additional three years. Prior to 2019, we also awarded non-qualified stock options to certain executive officers, which vest either at a rate of 20% after one year from the vesting commencement date then monthly over an additional four years, or 25% after one year from the vesting commencement date then monthly over an additional three years. Our decision to transition from granting stock options to RSUs was made at the determination of the Chief Executive Officer. In making such determination, the Chief Executive Officer relied on professional insight and personal knowledge of competing companies, ultimately determining that granting stock options was no longer appropriate at the time because of our stage of development. In certain circumstances, the stock options may have been issued at exercise prices above the fair value of our common stock at the time of grant. In all events, these equity incentive awards encourage executive longevity and compensate our executive officers for their contribution to our success over a period of time. In addition to RSUs or non-qualified stock options granted upon commencement of employment with us, our compensation committee may grant additional equity awards to retain our executives and to recognize the achievement of Company Priorities and individual goals and/or strong individual performance.
On May 14, 2020, certain employees, including executive officers, were given the option to exchange certain unvested options to purchase SoFi common stock for unvested RSUs. The purpose of this tender was to offer longer-tenured employees who received options as part of their compensation package an opportunity to receive RSUs. As a result of this tender, Ms. Gill participated in the offer and was granted 418,295 RSUs.
See the “Executive Compensation — 2020 Grants of Plan-Based Awards” table as well as “Executive Compensation — Executive Offer Letters/Agreements” for additional information.
Other Executive Benefits and Perquisites
We provide the following benefits to our executive officers on the same basis as other eligible employees:
health insurance;
vacation, personal holidays and sick days;
life insurance and supplemental life insurance;
short-term and long-term disability; and
a 401(k) plan.
We believe these benefits are generally consistent with those offered by other companies and specifically those companies with which we compete for employees.
Pay Mix
We utilize the particular elements of compensation described above because we believe that collectively these elements provide a well-proportioned mix of secure compensation, retention value and at-risk compensation that
214

TABLE OF CONTENTS
produces short-term and long-term performance incentives and rewards. By following this approach, we provide the executive a measure of security in the minimum expected level of compensation, while motivating the executive to focus on business metrics that will produce a high level of short-term and long-term performance for the Company and long-term wealth creation for the executive, as well as reducing the risk of recruitment of top executive talent by competitors. The mix of metrics used for our annual performance bonus and long-term incentive program likewise provides an appropriate balance between short-term financial performance and long-term financial and stock performance.
For certain executives, the mix of compensation is weighted toward at-risk pay (annual incentives and long-term equity incentives). Our cash consideration pay mix is generally equally weighted for performance versus base pay. Our equity program aligns executive compensation to the long-term interests of our stockholders while encouraging them to think and act like owners. Maintaining this pay mix results fundamentally in a pay-for-performance orientation for our executives, which is aligned with our stated compensation philosophy of providing compensation commensurate with performance.
2021 Stock Option and Incentive Plan
Effective upon the completion of the Business Combination, we implemented the 2021 Stock Option and Incentive Plan for SoFi Technologies, Inc., or “2021 Plan”. Our 2021 Plan allows for the grant of equity incentives, such as grants of stock options, restricted stock, restricted stock units and stock appreciation rights.
Employment Agreements and Severance and Change of Control Benefits
We believe that a strong, experienced management team is in the best interests, and is essential to the success, of the company and our stockholders. The agreements that we entered into with the NEOs at the time of their engagement were designed to minimize employment security concerns arising in the course of negotiating and completing a significant transaction such as the Business Combination. These benefits, which are generally payable only if the executive is terminated by the company without cause or the executive resigns for good reason, both in connection with a change in control and without, are enumerated and quantified in “Executive Compensation — Potential Payments Upon Termination or Change of Control”.
Section 409A Considerations
Section 409A of the Code, affects the manner by which deferred compensation opportunities are offered to our employees because Section 409A requires, among other things, that “non-qualified deferred compensation” be structured in a manner that limits employees’ abilities to accelerate or further defer certain kinds of deferred compensation. We intend to operate our existing compensation arrangements that are covered by Section 409A in accordance with the applicable rules thereunder, and we will continue to review and amend our compensation arrangements where necessary to comply with Section 409A.
Tax Considerations
For income tax purposes, publicly-traded companies may be prohibited from deducting employee enumeration in excess of $1 million to certain “covered employees”, which may include certain named executives, including, but not limited to, the chief executive officer and chief financial officer, under Section 162(m) of the Code. Even if Section 162(m) may limit the compensation deduction, the board of directors and the Company believe our compensation practices should be designed to help the Company meet established goals and objectives. While we will consider the impact of Section 162(m), we intend to continue to compensate our named executives in a manner that is in the best interest of our stockholders and reserve the right to make compensation decisions that may not be deductible under Section 162(m) where the Company determines the compensation to be appropriate.
215

TABLE OF CONTENTS
The Compensation Committee
Our compensation committee is comprised of the following members of our board of directors:
Michael Bingle, Chair
Richard Costolo
Clara Liang
Carlos Medeiros
216

TABLE OF CONTENTS
EXECUTIVE COMPENSATION
2020 Summary Compensation Table
The following table sets forth certain information with respect to compensation for the year ended December 31, 2020 earned by, awarded to or paid to our NEOs.
Name and Principal Position Year
Salary
($)(1)
Bonus
($)(2)
Stock
Awards
($)(3)
Non-Equity
Incentive
Plan
Compensation
($)(4)
Total
($)
Anthony Noto 2020 215,342  —  52,118,397  1,200,000  53,533,739 
Chief Executive Officer
Christopher Lapointe 2020 379,781  150,000  9,376,800  675,000  10,581,581 
Chief Financial Officer
Maria Renz 2020 363,699  450,000  14,528,160  34,375  15,376,234 
EVP & Group Business Leader – Money, Invest & Credit Card
Michelle Gill 2020 500,000  —  12,937,052  675,000  14,112,052 
EVP & Group Business Leader – Lending & Capital Markets
Jennifer Nuckles 2020 390,437  —  3,229,120  485,000  4,104,557 
EVP & Group Business Leader – Relay, Protect, Lantern, Content, At Work & Partnerships
___________________
(1)In May 2020, Mr. Noto voluntarily forfeited his salary for the remainder of the fiscal year in response to the global COVID-19 pandemic and macroeconomic uncertainty. In September 2020, Mr. Lapointe was appointed as Chief Financial Officer, his annual salary increased to $450,000. In March 2020, Ms. Nuckles was promoted to Executive Vice President & Group Business Leader — Relay, Protect, Lantern, Content, At Work & Partnerships, for which her annual salary increased to $400,000.
(2)Includes the amount of discretionary bonuses paid in 2020. Mr. Lapointe served as interim Chief Financial Officer from April 1, 2020 through September 13, 2020, for which he received a discretionary bonus of $25,000 per month. Ms. Renz, who began employment on March 11, 2020, participated in the company’s quarterly bonus plan for the first fiscal year of service and was eligible to receive quarterly cash bonuses of a minimum of 100% of her base salary for her first year of employment, which is not prorated for the portion of the year she was employed.
(3)Represents the aggregate grant date fair value of RSUs granted to the NEOs for fiscal year 2020, as calculated in accordance with ASC 718, Compensation — Stock Compensation, and disregarding any estimate of forfeitures related to service-based vesting conditions. For Ms. Gill, a portion of the stock awards granted during 2020 were associated with a tender offer for certain employees to exchange stock options for RSUs. The canceled stock options were granted to Ms. Gill in prior years. There was no incremental fair value obtained by Ms. Gill based on the modification. See “— Equity Compensation — 2011 Stock Plan” for additional information on the modification.
(4)Includes annual cash incentive bonuses earned by the NEOs for fiscal year 2020 and paid in March 2021. Annual cash bonuses are awarded based on achievement of Company Priorities and individual performance goals in 2020. The 2020 annual cash incentive bonus determinations are described in more detail below under “— Annual Cash Bonuses”. The amount that Ms. Renz is receiving above 100% of her base salary is reflected as non-equity incentive plan compensation.
217

TABLE OF CONTENTS
2020 Grants of Plan-Based Awards
The following table sets forth certain information with respect to grants of 2011 Stock Plan-based awards for the year ended December 31, 2020 with respect to our NEOs.
Estimated Future Payouts Under Non-Equity Incentive Plan Awards
Non-Incentive Stock Awards: Number of Shares of Stock
Grant Date
Fair Value
of Stock
Awards
($)(4)
Name and Principal Position Type of Award
Grant Date(1)
Target
($)(2)
Maximum
($)(3)
Anthony Noto
Time-Vesting RSU
3/11/2020
—  —  1,088,514  12,202,242 
Chief Executive Officer
Time-Vesting RSU
12/16/2020
(5)
—  —  2,165,825  39,916,155 
Annual Bonus —  600,000  1,200,000  —  — 
Christopher Lapointe
Time-Vesting RSU
2/3/2020
—  —  80,000  896,800 
Chief Financial Officer
Time-Vesting RSU
11/2/2020
(5)
—  —  500,000  8,480,000 
Annual Bonus —  330,628  —  —  — 
Maria Renz
Time-Vesting RSU
3/11/2020
—  —  1,296,000  14,528,160 
EVP & Group Business Leader – Money, Invest & Credit Card
Quarterly Bonus —  450,000  —  —  — 
Michelle Gill
Time-Vesting RSU
4/1/2020
(6)
—  —  418,295  5,065,552 
EVP & Group Business Leader – Lending & Capital Markets
Time-Vesting RSU
6/23/2020
—  —  450,000  5,449,500 
Time-Vesting RSU
6/23/2020
—  —  200,000  2,422,000 
Annual Bonus —  500,000  —  —  — 
Jennifer Nuckles
Time-Vesting RSU
2/3/2020
—  —  72,000  807,120 
EVP & Group Business Leader – Relay, Protect, Lantern, Content, At Work & Partnerships
Time-Vesting RSU
4/17/2020
(7)
—  —  200,000  2,422,000 
Annual Bonus —  377,049  —  —  — 
___________________
(1)For additional information on the awards granted during fiscal year 2020, including vesting commencement date and vesting conditions, see “— Outstanding Equity Awards at 2020 Fiscal Year-End”.
(2)Estimated future payouts under non-equity incentive plan awards reflect the NEO’s target for their full year of service in fiscal year 2020 determined on the NEO’s base salary and bonus target in effect throughout the fiscal year. The base salary and bonus target for Mr. Lapointe and Ms. Nuckles changed during fiscal year 2020. Mr. Lapointe’s target is prorated with a base salary of $350,000 and annual target bonus of 80% from January 1, 2020 through September 13, 2020 and with a base salary of $450,000 and annual target bonus of 100% from September 14, 2020 through December 31, 2020. Ms. Nuckles’ target is prorated with a base salary of $350,000 and annual target bonus of 80% from January 1, 2020 through March 10, 2020 and with a base salary of $400,000 and annual target of 100% from March 11, 2020 through December 31, 2020.
(3)Generally, our non-equity incentive plan awards do not establish a threshold or maximum. Mr. Noto is subject to a maximum payout under non-equity incentive plan awards of 200% of base pay.
(4)Represents the grant date fair value of RSUs granted to the NEOs, as calculated in accordance with ASC 718, Compensation — Stock Compensation, the assumptions of which are set forth in Note 12 to the Notes to Consolidated Financial Statements included elsewhere in this prospectus for awards granted prior to September 30, 2020 and which are set forth separately herein for awards granted during the fourth quarter of 2020.
(5)On November 2, 2020, Mr. Lapointe was granted 500,000 RSUs in conjunction with his appointment to Chief Financial Officer, which had a vesting commencement date beginning with his appointment on September 14, 2020. The board of directors approved a grant of 2,165,825 RSUs in December 2020 to Mr. Noto. During the fourth quarter of 2020, we valued our common stock on a monthly basis. A common stock transaction that closed in December 2020, which was in close proximity to the Business Combination, served as the key input for the fair value of our common stock for RSU grants made during the fourth quarter of 2020. Additionally, we decreased the assumed discount for lack of marketability throughout the fourth quarter of 2020, corresponding with our decreased time to liquidity assumption throughout the quarter, as we became more certain about the possibility of entering into the Business Combination over time. The grant date fair value of our common stock at the grant date of Mr. Lapointe’s award was $16.96 and the grant date fair value of our common stock at the grant date of Mr. Noto’s award was $18.43.
218

TABLE OF CONTENTS
(6)In April 2020, the RSUs granted to Ms. Gill were associated with a tender offer for certain employees to exchange stock options for RSUs. The canceled stock options were granted to Ms. Gill in prior years. There was no incremental fair value obtained by Ms. Gill based on the modification. See “— Equity Compensation — 2011 Stock Plan” for additional information on the modification.
(7)Ms. Nuckles was granted 200,000 RSUs upon her promotion to Executive Vice President.
Executive Offer Letters/Agreements
Anthony Noto
On January 23, 2018, SoFi and Anthony Noto entered into an employment agreement, which was subsequently amended effective February 26, 2018 (the “Noto Agreement”), to serve as SoFi’s Chief Executive Officer, providing for an initial base salary of $600,000 and an annual target bonus opportunity equal to 100% of Mr. Noto’s base salary with a maximum bonus opportunity of 200% of base salary, subject to the achievement of individual and company performance metrics. For Mr. Noto’s first year of service, the incentive bonus was guaranteed to be no less than 100% of achievement levels. In connection with the execution of the Noto Agreement, SoFi granted Mr. Noto the following: (i) an option to purchase 3,000,000 shares of SoFi common stock with an exercise price of $10.78, which option is immediately exercisable and vests 20% on the first anniversary of the vesting commencement date and 1/60th monthly thereafter; (ii) an option to purchase 3,700,000 shares of SoFi common stock with an exercise price of $17.18, which option is immediately exercisable and vests 20% on the first anniversary of the vesting commencement date and 1/60th monthly thereafter; and (iii) RSUs to vest 3,500,000 shares of SoFi common stock, which vest 20% on the first anniversary of the vesting commencement date and 1/60th monthly thereafter. In addition, as a condition to entering into the Noto Agreement, Mr. Noto is subject to SoFi’s standard confidential information and invention assignment agreement.
On March 11, 2020, the board of directors approved for Mr. Noto an RSU grant to vest 1,088,514 shares of SoFi common stock, subject to quarterly time-based vesting that vest 1/20th on each quarterly anniversary following the vesting commencement date.
On December 16, 2020, the board of directors approved for Mr. Noto an RSU grant to vest 2,165,825 shares of SoFi common stock that vest beginning on March 14, 2023 and are subject to quarterly time-based vesting thereafter according to the following schedule: 975,835 RSUs vest quarterly in four tranches in fiscal 2023 and the remaining RSUs vest quarterly in four tranches in fiscal 2024.
In the event of a financing or offering (including certain public offerings) of the company’s equity, Mr. Noto has the right to purchase, on the same terms as apply to other purchasers, up to that number of shares or securities such that, assuming maximum participation in each transaction, Mr. Noto’s percentage ownership of the Company’s fully diluted capitalization would be no less after the final closing of such transaction than it was immediately prior to such transaction.
The Noto Agreement provides for payments due upon the occurrence of a Qualifying Termination and/or Change of Control. See “— Potential Payments Upon Termination or Change of Control” below for details.
Christopher Lapointe
On May 12, 2018, SoFi and Christopher Lapointe entered into an offer letter, which was subsequently amended on May 29, 2018 (the “Lapointe Offer Letter”), to serve as SoFi’s Vice President, Head of Business Operations, providing for an initial base salary of $300,000 and a quarterly target bonus opportunity of 70% of his base salary, based on company and individual performance. Beginning in 2019, Mr. Lapointe has been eligible to participate in the Company’s annual bonus plan. Mr. Lapointe received an RSU grant to vest 250,000 shares of SoFi common stock, which vested 25% on the first anniversary of the vesting commencement date and in 16 equal quarterly increments thereafter. Mr. Lapointe’s RSU award is subject to Mr. Lapointe’s continued service with SoFi. Mr. Lapointe also received a $173,000 sign-on bonus, subject to a 24-month repayment period. In addition, as a condition to entering into the Lapointe Offer Letter, Mr. Lapointe is subject to SoFi’s standard confidential information and invention assignment agreement.
On June 8, 2019, Mr. Lapointe received an increase in base salary to $350,000 and an annual target bonus opportunity of 80% of his base salary based on a market adjustment.
219

TABLE OF CONTENTS
On April 1, 2020, Mr. Lapointe was appointed interim Chief Financial Officer. In connection with this appointment, Mr. Lapointe received a monthly discretionary bonus of $25,000 through September 2020.
On September 14, 2020, Mr. Lapointe was appointed Chief Financial Officer, which provided for an increase in base salary to $450,000 and an annual target bonus opportunity of 100% of his base salary based on company and individual performance. Mr. Lapointe also received an RSU grant to vest 500,000 shares of SoFi common stock, subject to quarterly time-based vesting that results in combined vesting of: 20,096 during fiscal year 2020; 74,039 during fiscal year 2021; 105,288 during fiscal year 2022; 139,039 during fiscal year 2023; and 161,538 during fiscal year 2024. The RSU award is subject to Mr. Lapointe’s continued service with SoFi.
On January 18, 2021, SoFi’s Board granted Mr. Lapointe 157,857 RSUs, which shall vest as to 1/16th on March 14, 2021 and 1/16th quarterly thereafter, subject to Mr. Lapointe’s continued service with SoFi.
Mr. Lapointe’s grant agreements provide for payments due upon the occurrence of a Qualifying Termination and/or Change of Control. See “— Potential Payments Upon Termination or Change of Control” below for details.
Michelle Gill
On April 12, 2018, SoFi and Michelle Gill entered into an offer letter (the “Gill Offer Letter”) to serve as SoFi’s Chief Financial Officer, providing for an initial base salary of $500,000 and an annual target bonus opportunity of 100% of her base salary based on company and individual performance. In connection with the execution of the Gill Offer Letter, the Company granted Ms. Gill the following: (i) an option to purchase 1,150,000 shares of SoFi common stock with an exercise price of $10.78, which option is immediately exercisable and vests 25% on the first anniversary of the vesting commencement date and 1/48th monthly thereafter; (ii) an option to purchase 1,400,000 shares of SoFi common stock with an exercise price of $17.18, which option is immediately exercisable and vests 25% on the first anniversary of the vesting commencement date and 1/48th monthly thereafter; and (iii) RSUs to vest 1,350,000 shares of SoFi common stock, which vest 25% on the first anniversary of the vesting commencement date and 1/48th monthly thereafter. In addition, as a condition to entering into the Gill Offer Letter, Ms. Gill is subject to SoFi’s standard confidential information and invention assignment agreement.
On April 1, 2020, Ms. Gill was appointed Executive Vice President and Group Business Leader, Lending & Capital Markets. Ms. Gill’s base salary and annual bonus target remained unchanged. On June 23, 2020, Ms. Gill received two RSU grants to vest 200,000 shares and 450,000 shares of SoFi common stock. The grant of RSUs to vest 200,000 shares of SoFi common stock vests as to 50,000 on each of the first two quarterly anniversaries of the vesting commencement date and 25,000 on each of the four quarterly anniversaries thereafter. The grant of RSUs to vest 450,000 shares of SoFi common stock vests as to 1/8th on each quarterly anniversary of the initial vest date. The vesting of the RSU awards is subject to Ms. Gill’s continued service with SoFi.
On January 18, 2021, SoFi’s Board granted Ms. Gill 401,421 RSUs, subject to quarterly time-based vesting that results in combined vesting of: 171,321 during fiscal year 2022; 83,850 during fiscal year 2023; and 146,250 during fiscal year 2024, subject to Ms. Gill’s continued service with SoFi through each applicable vesting date.
The Gill Agreement provides for payments due upon the occurrence of a Qualifying Termination and/or Change of Control. See “— Potential Payments Upon Termination or Change of Control” below for details.
Maria Renz
On February 14, 2020, SoFi and Ms. Renz entered into an offer letter (the “Renz Offer Letter”) to serve as an Executive Vice President, which provides for an initial base salary of $450,000 and an annual target bonus opportunity of 100% of Ms. Renz’s base salary based on company and individual performance. For Ms. Renz’s first fiscal year of employment, Ms. Renz participates in a quarterly bonus plan and is guaranteed to receive a minimum bonus at 100% of her base salary that is not prorated for the portion of the year she is employed. Effective January 1, 2021, Ms. Renz became eligible to instead participate in the annual bonus plan, with a target bonus opportunity of 100% of her base salary and no guaranteed minimum. Ms. Renz received an RSU grant to vest 1,296,000 shares of SoFi common stock, which vest 25% on the first anniversary of the vesting commencement date and 1/16th thereafter, quarterly. The Renz Offer Letter has no specific term and provided for at-will employment. In addition,
220

TABLE OF CONTENTS
as a condition to entering into the Renz Offer Letter, Ms. Renz is subject to SoFi’s standard confidential information and invention assignment agreement.
The Renz Agreement provides for payments due upon the occurrence of a Qualifying Termination and/or Change of Control. See “— Potential Payments Upon Termination or Change of Control” below for details.
Jennifer Nuckles
On May 16, 2019, SoFi and Ms. Nuckles entered into an offer letter (the “Nuckles Offer Letter”) for Ms. Nuckles to serve as SoFi’s Head of Lantern, Partnerships and Content, which provided for an initial base salary of $350,000 and an annual target bonus opportunity of 80% of Ms. Nuckles’ base salary based on company and individual performance. Ms. Nuckles received a RSU grant to vest 180,000 shares of SoFi common stock, which vest as to 25% on the first anniversary of the vesting commencement date and 1/16th thereafter, quarterly. The RSU award is subject to Ms. Nuckles’ continued service with SoFi. The Nuckles Offer Letter has no specific term and provided for at-will employment. In addition, as a condition to entering into the Nuckles Offer Letter, Ms. Nuckles is subject to SoFi’s standard confidential information and invention assignment agreement.
On March 11, 2020, Ms. Nuckles was promoted to Executive Vice President & Group Business Leader — Relay, Protect, Lantern, Content, At Work & Partnerships, for which she received an increase in base salary to $400,000 and an increase in annual target bonus opportunity to 100% of her base salary. Ms. Nuckles also received an RSU grant to vest 200,000 shares of SoFi common stock, which vest as to 1/16th on each quarterly anniversary following the vesting commencement date.
On January 18, 2021, SoFi’s Board granted Ms. Nuckles 278,571 RSUs, which shall vest as to 1/16th on March 14, 2021 and 1/16th quarterly thereafter, subject to Ms. Nuckles’ continued service with SoFi.
Ms. Nuckles’ grant agreement provides for payments due upon the occurrence of a Qualifying Termination and/or Change of Control. See “— Potential Payments Upon Termination or Change of Control” below for details.
Annual Cash Bonuses
Pursuant to their employment agreement or offer letter, as applicable, each NEO is eligible to earn a cash incentive bonus based on company and individual achievement of performance targets established by the board of directors in its discretion. In 2020, the NEOs participated in an annual cash incentive bonus plan, with the exception of Ms. Renz, who participated in a quarterly cash incentive bonus plan during fiscal year 2020, but will participate in the annual cash incentive bonus plan effective January 1, 2021. For fiscal year 2020, each of our NEOs was eligible to earn a target bonus amount, which reflects a percentage of their annual base salaries. Ms. Renz was entitled to receive a minimum bonus at 100% of her base salary in fiscal year 2020, her first year of employment, but will not be entitled to such minimum beginning in fiscal year 2021.
With respect to the fiscal year ended December 31, 2020, the performance metrics used to determine the NEOs’ cash incentive bonuses are set forth above in “Cash Incentive Compensation”. The bonuses paid to each NEO for the fiscal year ended December 31, 2020 are set forth above in the “— 2020 Summary Compensation Table” in the “Non-Equity Incentive Plan Compensation” column, with the exception of Ms. Renz, whose bonus is reflected in the “Bonus” column at 100% of her base salary, as she was entitled to this amount, at a minimum, on a discretionary basis. Any amount that Ms. Renz receives upon final determination of cash incentive bonuses above 100% of her base salary will be reflected as non-equity incentive plan compensation.
The board of directors also has the authority to grant additional discretionary bonuses to our NEOs on a case-by-case basis. Any discretionary bonuses awarded to an NEO for the fiscal year ended December 31, 2020 are set forth above in the “— 2020 Summary Compensation Table” in the “Bonus” column.
Equity Compensation — 2011 Stock Plan
The Company maintains the Social Finance, Inc. 2011 Stock Plan (as Amended and Restated effective as of November 5, 2019) (the “2011 Plan”), which provides for granting stock options, restricted stock and RSUs, pursuant to which the company has authorized 88,426,267 shares of its common stock for issuance to its employees,
221

TABLE OF CONTENTS
non-employee directors and non-employee third-party consultants as of December 31, 2020. The 2011 Plan was originally adopted by our board of directors and approved by our stockholders on June 10, 2011, and the amended and restated 2011 Plan was adopted by the board of directors on November 5, 2019 and approved by our stockholders on February 6, 2020. The number of shares of common stock reserved for issuance is subject to adjustment in the event of a stock split, stock dividend or other change in our capitalization. As of December 31, 2020, options to purchase 17,183,828 shares of common stock and 25,591,913 RSUs subject to service-based vesting conditions were outstanding under the 2011 Plan.
The following shares are added back to the shares of common stock available for issuance under the Plan: shares of common stock (i) underlying any awards that are held back upon exercise or settlement of an award to satisfy the exercise price or tax withholding, (ii) reacquired by us prior to vesting, (iii) satisfied without the issuance of stock, and (iv) that expire or are otherwise terminated (other than by exercise) under the 2011 Plan.
The Chief Executive Officer acts as administrator of the 2011 Plan for executives, except when a grant exceeds 200,000 shares of stock underlying such award, in which case the compensation committee also acts as administrator in coordination with the Chief Executive Officer. The administrator has full power to select, from among the individuals eligible for awards, the individuals to whom awards will be granted, to make any combination of awards to participants, and to determine the specific terms and conditions of each award, subject to the provisions of our 2011 Plan. Persons eligible to participate in our 2011 Plan will be those full or part-time officers, employees and consultants as selected from time to time by the administrator in its discretion.
Our 2011 Plan permits the granting of both options to purchase common stock intended to qualify as incentive stock options under Section 422 of the Code and options that do not so qualify. The option exercise price of each option will be determined by the administrator, but may not be less than 100% of the fair market value of our common stock on the date of grant, or in the case of an incentive stock option granted to an employee who owns stock representing more than 10% of the voting power of all classes of stock of the company, the exercise price shall not be less than 110% of the fair market value of our common stock on the date of grant. The term of each option will be fixed by our administrator and may not exceed ten years from the date of grant. Our administrator will determine at what time or times each option may be exercised. The 2011 Plan allows for the granting of stock options that may be exercised before the options have vested at the discretion and determination of the board of directors.
The administrator may award restricted shares of common stock to participants subject to such conditions and restrictions as it may determine. These conditions and restrictions may include the achievement of certain performance goals and/or continued employment with us through a specified vesting period.
Upon the occurrence of a Change of Control (as defined in the 2011 Plan), each vested outstanding award may be: (i) continued by SoFi (if SoFi is the surviving corporation); (ii) assumed by the surviving corporation or its parent; (iii) substituted by the surviving corporation or its parent; (iv) canceled in exchange for payment to the holder equal to the excess of (a) the fair market value of the underlying shares subject to such award as of the closing date of such Change of Control over (b) the exercise price or purchase price for the shares to be issued pursuant to the exercise of such awards, or (v) canceled for no consideration, if the exercise or purchase price of such awards exceeds the fair market value of SoFi’s shares as of the closing date of the Change of Control. Upon a Change of Control, all outstanding awards shall terminate and cease to be outstanding, except to the extent such awards have been continued or assumed.
The terms of each stock option grant, including the exercise price per share and vesting periods, are determined by our board of directors.
Stock options are typically granted at exercise prices equal to the fair value of SoFi common stock at the date of grant. However, for Mr. Noto’s and Ms. Gill’s option grants, the board of directors determined that issuing options with strike prices in excess of fair value would promote the long-term value growth of the company. Stock options vesting schedules include, but are not limited to: (i) vesting at a rate of 25% after one year from the vesting commencement date and then monthly over an additional three-year period, and (ii) vesting at a rate of 20% after one year from vesting commencement date and then monthly over an additional four years. Our stock options expire
222

TABLE OF CONTENTS
ten years from the grant date or within 90 days of employee termination. We ceased granting stock options to executives in fiscal year 2018.
SoFi began issuing RSUs to executives in 2017. RSUs are equity awards granted to executives that entitle the holder to shares of our common stock when the awards vest. RSUs granted to newly hired executives typically vest 25% on the first vesting date which occurs approximately one year after the date of grant and ratably each quarter of the ensuing 12-quarter period. RSUs have been issued under other vesting schedules, including, but not limited to: (i) vesting at a rate of 20% after one year from vesting commencement date and then monthly over an additional four years, (ii) vesting at a rate of 25% after one year and then monthly over an additional three years, and (iii) other vesting schedules ranging in total duration from one to four years with even or uneven vesting patterns. RSUs are measured based on the fair value of our stock on the date of grant.
On May 14, 2020, certain employees, including executive officers, were given the option to exchange certain unvested options to purchase SoFi common stock for unvested RSUs. The primary purpose of this tender was to offer employees who primarily received options as part of their compensation package an opportunity to receive RSUs. Ms. Gill participated in the tender offer and was granted 418,295 RSUs.
2021 Stock Option and Incentive Plan
In connection with the consummation of the Business Combination, we adopted the 2021 Plan, under which we may grant equity incentive awards to employees, directors and independent contractors in order to attract, motivate and retain the talent for which we compete. In connection with adopting the 2021 Plan, we determined that the aggregate number of shares of our common stock available for issuance under the 2021 Plan is equal to the sum of (i) 63,575,425 shares of our common stock and (ii) an annual increase on the first day of each calendar year beginning January 1, 2022 and ending on and including January 1, 2030 equal to the lesser of (A) a number equal to the excess (if any) of (1) 5% of the aggregate number of shares of our common stock outstanding on the final day of the immediately preceding calendar year over (2) the number of shares of our common stock then reserved for issuance under the 2021 Plan as of such date and (B) such smaller number of shares of our common stock as is determined by our board of directors. The maximum number of shares of our common stock that may be issued pursuant to the exercise of stock awards granted under the 2021 Plan is 63,575,425 shares (equal to approximately 8% of the total number of issued and outstanding shares of our common stock as of immediately following the Closing).
Following the effectiveness of the Form S-8 with respect to the common stock issuable under the 2021 Plan, we intend to grant awards to certain executive officers representing 3% of our outstanding capital stock following the Business Combination on an as converted basis. Specifically, as previously discussed on Form S-4, we shall grant Mr. Noto restricted stock units that will be subject to performance-based vesting conditions. The remaining portion of such 3% pool to be awarded to executive officers, employees and consultants, other than Mr. Noto, cannot be determined at this time, however, they will be subject to the same performance vesting conditions as the Noto PSUs. All other future awards to executive officers, employees and consultants under the 2021 Plan are discretionary and cannot be determined at this time.
The Noto PSUs will represent approximately 0.75% of our outstanding capital stock on an as converted basis. The Noto PSUs shall vest, if at all, during the period commencing on the first anniversary of the Business Combination and ending on the fifth such anniversary, subject to the achievement of specified performance goals including (i) the volume-weighted average closing price of our stock attaining $25, $35 and $45 Target Hurdles, over a 90-trading day period and (ii) if we become a bank holding company, maintaining certain minimum standards applicable to bank holding companies, subject to continued employment on the date of vesting. In the event of a Sale Event (as defined in the 2021 Plan), the Noto PSUs may automatically vest subject to the satisfaction of the Target Hurdles by reference to the sale price, without regard to any other vesting conditions.
More generally, while no additional awards have been determined under the 2021 Plan at this time, any future awards will be subject to the 2021 Plan terms. To the extent any such awards do not provide Sale Event treatment, the 2021 Plan provides that, upon the consummation of any such Sale Event the parties thereto may cause the assumption, continuation, or substitution of such awards. To the extent the parties to such Sale Event do not provide
223

TABLE OF CONTENTS
for the assumption, continuation or substitution of awards, upon the effective time of the Sale Event, the 2021 Plan and all outstanding awards granted thereunder shall terminate.
Employee Benefit Plans
Our NEOs are eligible to participate in our employee benefit plans, including our medical, dental, vision, group life and accidental death and dismemberment insurance plans, in each case, on the same basis as all of our other employees. We also maintain a 401(k) plan for the benefit of its eligible employees, including the NEOs, as discussed in the section “— 401(k) plan”.
401(k) Plan
We maintain a 401(k) retirement savings plan (the “401(k) Plan”) that provides eligible U.S. employees with an opportunity to save for retirement on a tax-advantaged basis. Under the 401(k) Plan, eligible employees may defer eligible compensation subject to applicable annual contribution limits imposed by the Internal Revenue Service. Our employees’ pre-tax contributions are allocated to each participant’s individual account and participants are immediately and fully vested in their contributions. The 401(k) Plan is intended to be qualified under Section 401(a) of the Code with the 401(k) Plan’s related trust intended to be tax exempt under Section 501(a) of the Code. The 401(k) Plan does not permit us to make matching contributions or profit-sharing contributions to eligible participants at this time and would need to be amended to add such benefits.
Pension Benefits
We do not maintain any pension benefit or retirement plans other than the 401(k) Plan, as discussed in “— 401(k) plan”.
Nonqualified Deferred Compensation
We do not maintain any nonqualified deferred compensation plans.
224

TABLE OF CONTENTS
Outstanding Equity Awards at 2020 Fiscal Year-End
The following table summarizes information about the outstanding equity incentive plan awards for each NEO as of December 31, 2020. The market value of the shares in the following table represents the fair value of such shares as of December 31, 2020.
Option Awards(1)
Share Awards
Name
Grant Date
Number of Securities Underlying Unexercised Options Exercisable (#)
Option Exercise Price
($/Share)
Option Expiration Date
Number of Shares or Units That Have Not Vested (#)
Market
Value of
Shares or
Units That
Have Not
Vested ($)(2)
Anthony Noto
3/12/2018
(3)
3,000,000  10.78 
3/11/2028
—  — 
Chief Executive Officer
3/13/2018
(4)
3,700,000  17.18 
3/12/2028
—  — 
3/13/2018
(5)
—  —  —  1,516,667  27,952,173 
3/11/2020
(6)
—  —  —  925,237  17,052,118 
12/16/2020
(7)
—  —  —  2,165,825  39,916,155 
Christopher Lapointe
9/11/2018
(8)
—  —  —  93,750  1,727,813 
Chief Financial Officer
8/6/2019
(9)
—  —  —  12,500  230,375 
2/3/2020
(10)
—  —  —  60,000  1,105,800 
11/2/2020
(11)
—  —  —  479,904  8,844,631 
Maria Renz
3/11/2020
(12)
—  —  —  1,296,000  23,885,280 
EVP & Group Business Leader – Money, Invest & Credit Card
Michelle Gill
5/22/2018
(13)
527,083  10.78 
5/21/2028
—  — 
EVP & Group Business Leader – Lending & Capital Markets
5/22/2018
(14)
641,666  17.18 
5/21/2028
—  — 
5/22/2018
(15)
—  —  —  478,125  8,811,844 
4/1/2020
(16)
—  —  —  273,497  5,040,550 
6/23/2020
(17)
—  —  —  450,000  8,293,500 
6/23/2020
(18)
—  —  —  100,000  1,843,000 
Jennifer Nuckles
8/6/2019
(19)
—  —  —  112,500  2,073,375 
EVP & Group Business Leader – Relay, Protect, Lantern, Content, At Work & Partnerships
2/3/2020
(20)
—  —  —  54,000  995,220 
4/7/2020
(21)
—  —  —  162,500  2,994,875 
___________________
(1)All stock options granted to Mr. Noto and Ms. Gill were immediately exercisable. To the extent Mr. Noto or Ms. Gill exercises his or her stock options prior to vesting, the shares of our common stock that he or she will receive will be unvested and subject to SoFi’s right of first refusal, which will lapse in accordance with the original vesting schedule of the stock options.
(2)Includes the fair value of unvested RSUs calculated as (i) $18.43 (the fair value of SoFi common stock as of December 31, 2020), multiplied by (ii) the number of unvested RSUs.
225

TABLE OF CONTENTS
(3)The options had a vesting commencement date of February 26, 2018 and vest as to 20% of the shares subject to the option on the first anniversary of the vesting commencement date and as to 1/60th of the shares subject to the option on each monthly anniversary thereafter, subject to Mr. Noto’s continued service to us through each such date. The options are exercisable at grant date.
(4)The options had a vesting commencement date of February 26, 2018 and vest as to 20% of the shares subject to the option on the first anniversary of the vesting commencement date and as to 1/60th of the shares subject to the option on each monthly anniversary thereafter, subject to Mr. Noto’s continued service to us through each such date. The options are exercisable at grant date.
(5)The RSUs had a vesting commencement date of February 26, 2018. The service-based vesting condition of the RSUs is satisfied as to 20% of the RSUs on the first anniversary of the vesting commencement date, and as to 1/60th of the RSUs on each monthly anniversary thereafter, subject to Mr. Noto’s continued service to us through each such date.
(6)The RSUs had a vesting commencement date of March 14, 2020. The service-based vesting condition of the RSUs is satisfied as to 1/20th of the RSUs on each quarterly anniversary of the vesting commencement date, subject to Mr. Noto’s continued service to us through each such date.
(7)The RSUs vest beginning on March 14, 2023 and are subject to quarterly time-based vesting thereafter according to the following schedule and subject to Mr. Noto’s continued service to us through each such date: 243,959 RSUs on each of March 14, 2023, June 14, 2023 and September 14, 2023; 243,958 RSUs on December 14, 2023; 297,498 RSUs on each of March 14, 2024 and June 14, 2024; and 297,497 RSUs on each of September 14, 2024 and December 14, 2024.
(8)The RSUs had a vesting commencement date of June 14, 2018. The service-based vesting condition of the RSUs is satisfied as to 25% on the first anniversary of the vesting commencement date and as to 1/16th of the RSUs on each quarterly anniversary thereafter, subject to Mr. Lapointe’s continued service to us through each such date.
(9)The RSUs had a vesting commencement date of June 14, 2019. The grant is subject to quarterly time-based vesting, such that all awards are fully vested after the 16th quarter subsequent to the vesting commencement date, subject to Mr. Lapointe’s continued service to us through each such date.
(10)The RSUs had a vesting commencement date of December 14, 2019. The service-based vesting condition of the RSUs is satisfied as to 1/16th of the RSUs on each quarterly anniversary, subject to Mr. Lapointe’s continued service to us through each such date.
(11)The RSUs had a vesting commencement date of September 14, 2020. The grant is subject to quarterly time-based vesting according to the following schedule and subject to Mr. Lapointe’s continued service to us through each such date: 20,096 RSUs on December 14, 2020; 18,509 RSUs on March 14, 2021; 18,510 RSUs on each of June 14, 2021, September 14, 2021 and December 14, 2021; 26,322 RSUs on each of March 14, 2022, June 14, 2022, September 14, 2022 and December 14, 2022; 34,759 RSUs on March 14, 2023; 34,760 RSUs on each of June 14, 2023, September 14, 2023 and December 14, 2023; 40,384 RSUs on March 14, 2024; 40,385 RSUs on each of June 14, 2024 and September 14, 2024; and 40,384 RSUs on December 14, 2024.
(12)The RSUs had a vesting commencement date of March 14, 2020. The service-based vesting condition of the RSUs is satisfied as to 25% on the first anniversary of the vesting commencement date and as to 1/16th of the RSUs on each quarterly anniversary thereafter, subject to Ms. Renz’s continued service to us through each such date.
(13)The options had a vesting commencement date of May 1, 2018 and vest as to 25% of the shares subject to the option on the first anniversary of the vesting commencement date and as to 1/48th of the shares subject to the option on each monthly anniversary thereafter, subject to Ms. Gill’s continued service to us through each such date. The options are exercisable at grant date. On April 1, 2020, Ms. Gill tendered 622,917 of the then-unvested stock options in exchange for 234,618 RSUs, which did not result in any incremental fair value at the time of the exchange (see footnote 16 below).
(14)The options had a vesting commencement date of May 1, 2018 and vest as to 25% of the shares subject to the option on the first anniversary of the vesting commencement date and as to 1/48th of the shares subject to the option on each monthly anniversary thereafter, subject to Ms. Gill’s continued service to us through each such date. The options are exercisable at grant date. On April 1, 2020, Ms. Gill tendered 758,334 of the then-unvested stock options in exchange for 183,677 RSUs, which did not result in any incremental fair value at the time of the exchange (see footnote 16 below).
(15)The RSUs had a vesting commencement date of May 1, 2018. The service-based vesting condition of the RSUs is satisfied as to 25% of the RSUs on the first anniversary of the vesting commencement date, and as to 1/48th of the RSUs on each monthly anniversary thereafter, subject to Ms. Gill’s continued service to us through each such date.
(16)The RSUs had a vesting commencement date of April 1, 2020 and were received upon exchange of stock options in a tender offer by the Company. The service-based vesting condition of the RSUs is satisfied over the remaining original vesting term of the stock options exchanged, and vests on a quarterly basis according to the following schedule, subject to Ms. Gill’s continued service to us through each such date: 48,270 RSUs on June 14, 2020; 48,264 RSUs on each of September 14, 2020, December 14, 2020, March 14, 2021, June 14, 2021, September 14, 2021, December 14, 2021 and March 14, 2022; and 32,177 on June 14, 2022.
(17)The RSUs vest beginning on March 14, 2022 and are subject to service-based vesting thereafter as to 1/8th of the RSUs on each quarterly anniversary of the initial vest date, subject to Ms. Gill’s continued service to us through each such date.
(18)The RSUs had a vesting commencement date of June 14, 2020. The service-based vesting condition of the RSUs is satisfied according to the following schedule and subject to Ms. Gill’s continued service to us through each such date: 50,000 RSUs on each of September 14, 2020 and December 14, 2020, and 25,000 RSUs on each of March 14, 2021, June 14, 2021, September 14, 2021 and December 14, 2021.
(19)The RSUs had a vesting commencement date of June 14, 2019. The service-based vesting condition of the RSUs is satisfied as to 25% on the first anniversary of the vesting commencement date and as to 1/16th of the RSUs on each quarterly anniversary thereafter, subject to Ms. Nuckles’ continued service to us through each such date.
(20)The RSUs had a vesting commencement date of December 14, 2019. The service-based vesting condition of the RSUs is satisfied as to 1/16th of the RSUs on each quarterly anniversary, subject to Ms. Nuckles’ continued service to us through each such date.
(21)The RSUs had a vesting commencement date of March 14, 2020. The service-based vesting condition of the RSUs is satisfied as to 1/16th of the RSUs on each quarterly anniversary, subject to Ms. Nuckles’ continued service to us through each such date.
226

TABLE OF CONTENTS
Stock Vested During 2020 Fiscal Year-End
There were no equity incentive plan awards stock options exercised by our NEOs during the year ended December 31, 2020. The following table summarizes the equity incentive plan awards stock vested for each NEO to which this table applies as of December 31, 2020:
Stock Vested
Name
Number of Shares Acquired on Vesting (#)
Value Realized on Vesting ($)(1)
Anthony Noto
863,277  11,759,868 
Chief Executive Officer
Christopher Lapointe
107,596  1,582,901 
Chief Financial Officer
Michelle Gill
582,298  8,249,369 
EVP & Group Business Leader – Lending & Capital Markets
Jennifer Nuckles
123,000  1,708,373 
EVP & Group Business Leader – Relay, Protect, Lantern, Content, At Work & Partnerships
___________________
(1)The values reflected in the table are determined by aggregating the values realized on stock vested throughout the fiscal year. The value realized on vesting at each vesting date is calculated as the number of shares acquired on vesting multiplied by the common stock per share value covering such vesting date.
Employee Benefit Plans
Our NEOs are eligible to participate in our employee benefit plans, including our medical, dental, vision, group life and accidental death and dismemberment insurance plans, in each case, on the same basis as all of our other employees. We also maintain a 401(k) plan for the benefit of its eligible employees, including the NEOs, as discussed in the section “— 401(k) plan”.
401(k) Plan
We maintain a 401(k) retirement savings plan (the “401(k) Plan”) that provides eligible U.S. employees with an opportunity to save for retirement on a tax-advantaged basis. Under the 401(k) Plan, eligible employees may defer eligible compensation subject to applicable annual contribution limits imposed by the Internal Revenue Service. Our employees’ pre-tax contributions are allocated to each participant’s individual account and participants are immediately and fully vested in their contributions. The 401(k) Plan is intended to be qualified under Section 401(a) of the Code with the 401(k) Plan’s related trust intended to be tax exempt under Section 501(a) of the Code. The 401(k) Plan does not permit us to make matching contributions or profit-sharing contributions to eligible participants at this time and would need to be amended to add such benefits.
Pension Benefits
We do not maintain any pension benefit or retirement plans other than the 401(k) Plan, as discussed in “— 401(k) plan”.
Nonqualified Deferred Compensation
We do not maintain any nonqualified deferred compensation plans.
227

TABLE OF CONTENTS
Potential Payments Upon Termination or Change of Control
Our NEOs are eligible for certain payments or benefits in connection with certain qualifying terminations or a change of control, as described herein.
Anthony Noto
Pursuant to the Noto Agreement, if Mr. Noto is terminated by SoFi without Cause (as defined in the Noto Agreement) or resigns for Good Reason (as defined in the Noto Agreement) (together, a “Qualifying Termination”), Mr. Noto shall be entitled to: (i) a lump-sum cash payment equal to the sum of (x) twelve months of Mr. Noto’s base salary, and (y) 100% of Mr. Noto’s annual cash bonus at the higher of (a) his target level and (b) his actual level of performance reasonably projected as of the termination of Mr. Noto’s employment, (ii) the continuation of health, dental and vision coverage under SoFi’s group insurance benefits at no cost to Mr. Noto for twelve months, and (iii) vesting acceleration of each of Mr. Noto’s then-outstanding equity incentives as if he had remained in continuous service to SoFi for an additional twelve months and as if all applicable performance-based vesting conditions (if any) were met at the target achievement level or, if higher, the actual level of achievement reasonably projected as of the termination of his employment, with such acceleration effective as of immediately prior to the termination of his employment.
Pursuant to the Noto Agreement, if Mr. Noto experiences a Qualifying Termination three months prior to or any time after a Change of Control (as defined in the Noto Agreement), Mr. Noto shall, in lieu of the above, be entitled to: (i) a lump-sum cash payment equal to the sum of (x) 18 months of Mr. Noto’s base salary, and (y) 150% of Mr. Noto’s annual bonus at the higher of (a) his target level and (b) his actual level of performance reasonably projected as of the termination of Mr. Noto’s employment, (ii) the continuation of health, dental and vision coverage under SoFi’s group insurance benefits at no cost to Mr. Noto for 18 months, and (iii) full vesting acceleration of each of Mr. Noto’s then-outstanding equity incentives (including as to all applicable performance-based vesting conditions (if any), which will be deemed satisfied at maximum achievement), with such acceleration effective as of immediately prior to the later of his Qualifying Termination and SoFi’s Change of Control.
Additionally, all equity grants are subject to automatic accelerated vesting upon a Change of Control (as defined in the 2011 Plan) of SoFi, if such grants are otherwise to be canceled for no consideration upon such Change of Control.
Mr. Noto’s severance payments are subject to the execution of a release of claims in favor of SoFi.
Christopher Lapointe
Effective September 14, 2020, when Mr. Lapointe was appointed Chief Financial Officer, and pursuant to his promotion letter (the “Lapointe Promotion Letter”), if Mr. Lapointe is terminated by SoFi without Cause (as defined in the Lapointe Promotion Letter) or resigns for Good Reason (as defined in the Lapointe Promotion Letter), Mr. Lapointe shall be entitled to: (i) a lump-sum cash payment equal to the sum of (x) 12 months of Mr. Lapointe’s base salary, and (y) 100% of Mr. Lapointe’s annual cash bonus at the higher of (a) Mr. Lapointe’s target level and (b) Mr. Lapointe’s actual level of performance reasonably projected as of the termination of Mr. Lapointe’s employment, (ii) the continuation of health, dental and vision coverage under SoFi’s group insurance benefits at no cost to Mr. Lapointe for 12 months, and (iii) vesting acceleration of each of Mr. Lapointe’s then-outstanding equity incentives as if he had remained in continuous service to SoFi for an additional 12 months.
Additionally, pursuant to the Lapointe Promotion Letter, if Mr. Lapointe is terminated by SoFi without Cause or resigns for Good Reason three months prior to or any time after a Change of Control (as defined in the Lapointe Promotion Letter), Mr. Lapointe shall, in lieu of the above, be entitled to: (i) a lump-sum cash payment equal to the sum of (x) 18 months of Mr. Lapointe’s base salary, and (y) 150% of Mr. Lapointe’s annual bonus at the higher of (a) his target level and (b) his actual level of performance reasonably projected as of the termination of Mr. Lapointe’s employment, (ii) the continuation of health, dental and vision coverage under SoFi’s group insurance benefits at no cost to Mr. Lapointe for 18 months, and (iii) full vesting acceleration of each of Mr. Lapointe’s then-outstanding equity incentives.
228

TABLE OF CONTENTS
Mr. Lapointe’s severance payments are subject to the execution of a release of claims in favor of SoFi.
Michelle Gill
Pursuant to the Gill Offer Letter, if Ms. Gill is terminated by SoFi without Cause (as defined in the Gill Offer Letter) or resigns for Good Reason (as defined in the Gill Offer Letter), Ms. Gill shall be entitled to: (i) a lump-sum cash payment equal to the sum of (x) 12 months of Ms. Gill’s base salary, and (y) 100% of Ms. Gill’s annual cash bonus at the higher of (a) Ms. Gill’s target level and (b) Ms. Gill’s actual level of performance reasonably projected as of the termination of Ms. Gill’s employment, (ii) the continuation of health, dental and vision coverage under SoFi’s group insurance benefits at no cost to Ms. Gill for 12 months, and (iii) vesting acceleration of each of Ms. Gill’s then-outstanding equity incentives as if she had remained in continuous service to SoFi for an additional 12 months and as if all applicable performance-based vesting conditions (if any) were met at the target achievement level or, if higher, the actual level of achievement reasonably projected as of the termination of her employment, with such acceleration effective as of immediately prior to the termination of her employment.
Additionally, pursuant to the Gill Offer Letter, if Ms. Gill is terminated by SoFi without Cause or resigns for Good Reason three months prior to or any time after a Change of Control (as defined in the Gill Offer Letter), Ms. Gill shall, in lieu of the above, be entitled to: (i) a lump-sum cash payment equal to the sum of (x) 18 months of Ms. Gill’s base salary, and (y) 150% of Ms. Gill’s annual bonus at the higher of (a) her target level and (b) her actual level of performance reasonably projected as of the termination of Ms. Gill’s employment, (ii) the continuation of health, dental and vision coverage under SoFi’s group insurance benefits at no cost to Ms. Gill for 18 months, and (iii) full vesting acceleration of each of Ms. Gill’s then-outstanding equity incentives (including as to all applicable performance-based vesting conditions (if any), which will be deemed satisfied at maximum achievement), with such acceleration effective as of immediately prior to the later of such termination of employment and SoFi’s Change of Control.
Additionally, all such grants are subject to automatic accelerated vesting upon a Change of Control (as defined in the 2011 Plan) of SoFi if such grants are otherwise to be canceled for no consideration upon such Change of Control, with any performance vesting conditions deemed satisfied at maximum levels.
Ms. Gill’s severance payments are subject to the execution of a release of claims in favor of SoFi.
Maria Renz
Pursuant to the Renz Offer Letter, if Ms. Renz is terminated by SoFi without Cause (as defined in the Renz Offer Letter) or resigns for Good Reason (as defined in the Renz Offer Letter), Ms. Renz shall be entitled to: (i) a lump-sum cash payment equal to the sum of (x) 12 months of Ms. Renz’s base salary, and (y) 100% of Ms. Renz’s annual cash bonus at the higher of (a) Ms. Renz’s target level and (b) Ms. Renz’s actual level of performance reasonably projected as of the termination of Ms. Renz’s employment, (ii) the continuation of health, dental and vision coverage under SoFi’s group insurance benefits at no cost to Ms. Renz for 12 months, and (iii) vesting acceleration of each of Ms. Renz’s then-outstanding equity incentives as if she had remained in continuous service to SoFi for an additional 12 months and as if all applicable performance-based vesting conditions (if any) were met at the target achievement level or, if higher, the actual level of achievement reasonably projected as of the termination of her employment, with such acceleration effective as of immediately prior to the termination of her employment.
Additionally, pursuant to the Renz Offer Letter, if Ms. Renz is terminated by SoFi without Cause or resigns for Good Reason three months prior to or any time after a Change of Control (as defined in the Renz Offer Letter), Ms. Renz shall, in lieu of the above, be entitled to: (i) a lump-sum cash payment equal to the sum of (x) 18 months of Ms. Renz’s base salary, and (y) 150% of Ms. Renz’s annual bonus at the higher of (a) her target level and (b) her actual level of performance reasonably projected as of the termination of Ms. Renz’s employment, (ii) the continuation of health, dental and vision coverage under SoFi’s group insurance benefits at no cost to Ms. Renz for 18 months, and (iii) full vesting acceleration of each of Ms. Renz’s then-outstanding equity incentives (including as to all applicable performance-based vesting conditions (if any), which will be deemed satisfied at maximum achievement), with such acceleration effective as of immediately prior to the later of such termination of employment and SoFi’s Change of Control.
229

TABLE OF CONTENTS
Ms. Renz’s severance payments are subject to the execution of a release of claims in favor of the Company.
Jennifer Nuckles
Pursuant to the Nuckles Offer Letter in the event of a Change of Control (as defined in the 2011 Plan), Ms. Nuckles shall be entitled to accelerated vesting of 50% of the then-outstanding unvested RSUs received in her initial grant of 180,000 shares.
The following table sets forth quantitative estimates of the benefits that would have accrued to our NEOs pursuant to the employment agreement or offer letters, as applicable, if his or her employment had been terminated under either a “Qualifying Termination” or a “Qualifying Termination with Change of Control”, as well as benefits that would have accrued under solely a “Change of Control” as of December 31, 2020. Refer to the footnotes to the tables for definitions of these scenarios.
Name and Principal Position
Scenario
Cash
Severance
Benefits
($)(1)
Accelerated
Vesting of
Equity
Awards
($)(2)
Continued
Health
Benefits
($)(3)
Total ($)
Anthony Noto
Qualifying Termination(4)
1,800,000  22,428,266  22,823  24,251,089 
Chief Executive Officer
Qualifying Termination with Change of Control(5)
2,700,000  96,869,612  34,235  99,603,847 
Change of Control(6)
—  96,869,612  —  96,869,612 
Christopher Lapointe
Qualifying Termination(4)
1,125,000  2,977,164  —  4,102,164 
Chief Financial Officer
Qualifying Termination with Change of Control(5)
1,687,500  11,908,618  —  13,596,118 
Maria Renz
Qualifying Termination(4)
934,375  10,449,810  22,823  11,407,008 
EVP & Group Business Leader – Money, Invest & Credit Card
Qualifying Termination with Change of Control(5)
1,401,563  23,885,280  34,235  25,321,078 
Michelle Gill
Qualifying Termination(4)
1,175,000  11,621,147  23,716  12,819,863 
EVP & Group Business Leader – Lending & Capital Markets
Qualifying Termination with Change of Control(5)
1,762,500  23,988,893  35,574  25,786,967 
Change of Control(6)
—  23,988,893  —  23,988,893 
Jennifer Nuckles
Qualifying Termination with Change of Control(5)
—  1,036,688  —  1,036,688 
EVP & Group Business Leader – Relay, Protect, Lantern, Content, At Work & Partnerships
__________________
(1)Includes lump-sum base salary payments and non-equity incentive-based compensation payable to the NEO by SoFi as provided under the employment agreement or offer letters, as applicable. Additionally, in a Qualifying Termination, bonuses are determined to be the higher of the target or the actual level of performance reasonably projected at termination.
(2)Includes the fair value of RSUs and/or stock options that would immediately vest pursuant to the specified termination scenario. Award fair values are determined using $18.43 for the fair value of our common stock as of December 31, 2020. The fair value of accelerated RSUs is calculated as (i) $18.43, multiplied by (ii) the number of outstanding and unvested RSUs as of December 31, 2020. The fair value of accelerated stock options is calculated as (i) the number of unexercised stock options, multiplied by (ii) the intrinsic value, if any, of the stock options as measured by the excess of $18.43 over the applicable option exercise price.
230

TABLE OF CONTENTS
(3)Calculated as (i) the cost of health, dental and vision insurance premiums under COBRA applicable to each NEO, multiplied by (ii) the number of months of continued health benefits coverage as provided under the employment agreement or offer letters, as applicable.
(4)A Qualifying Termination is a termination of employment by SoFi without “cause” or a resignation for “good reason”. Cause typically includes certain violations causing material injury to the Company, such as fraud, dishonesty, unauthorized use or disclosure of proprietary information, other willful misconduct, or the like. Good reason typically includes the occurrence of certain conditions without written consent, such as 10% reduction in base salary, a material breach by the Company of any agreement between the Company and employee, and the like.
(5)A Qualifying Termination with Change of Control is a Qualifying Termination, as discussed in footnote (4) above, at any time after, or within three months prior to, a Change of Control. For Mr. Noto, Ms. Gill and Ms. Renz, Change of Control has the same meaning as the term is defined in the 2011 Plan, with modifications that a Change of Control is triggered by consummation of a transaction in which any “person” becomes the “beneficial owner”, directly or indirectly, of a majority of SoFi’s then-outstanding voting securities, rather than all of the then-outstanding voting securities as prescribed in the 2011 Plan. Additionally, the definition of Change of Control in Mr. Noto’s, Ms. Gill’s and Ms. Renz’s employment agreement and offer letter, as applicable, excludes certain transactions by a preferred series investor.
(6)Change of Control has the same meaning as the term is defined in the 2011 Plan. The values reflected herein assume no termination has occurred in connection with such Change of Control.
Director Compensation
The following table sets forth our non-employee directors during fiscal year 2020. During the year ended December 31, 2020, we did not have a formal non-employee director compensation program. The following table provides total compensation paid or awarded in 2020 to certain of our non-employee directors who served during 2020 based on an informal compensation program.
During 2020, the Company and the board of directors agreed to provide Mr. Freiberg a quarterly cash retainer in connection with his being the Audit Committee Chair in an aggregate annual amount of $100,000 (with the second quarter 2020 amount prorated, which was the period wherein Mr. Freiberg commenced his Audit Committee Chair role) to be paid in full as of July 2021.
Further, we reimburse non-employee members of our board of directors for reasonable costs and expenses incurred in attending board meetings. Other than as set forth in this table and described more fully below, we did not pay any compensation or make any equity or non-equity awards to any of the non-employee members of our board of directors in fiscal year 2020. We also did not pay any compensation or make any equity or non-equity awards to Mr. Noto, our Chief Executive Officer, or Clay Wilkes, Chief Executive Officer — Galileo, in their capacities as directors.
Name and Position
Fees Earned or Paid in Cash ($)(1)
Option Awards ($)(2)
Total ($)
Ahmed Al-Hammadi, Director
—  —  — 
Michael Bingle, Director
—  —  — 
Joe Chen, Director
—  —  — 
Michel Combes, Director
—  —  — 
Steven Freiberg, Vice Chairman
54,500  99,758  154,258 
Pete Hartigan, Director
—  —  — 
Tom Hutton, Chairman
—  99,758  99,758 
Robert Joss, Director(3)
—  —  — 
Clara Liang, Director
—  725,791  725,791 
Carlos Medeiros, Director
—  —  — 
Magdalena Yeşil, Director
—  —  — 
__________________
(1)In connection with his role as the Audit Committee Chair, Mr. Freiberg was provided a quarterly cash retainer of $25,000 that was prorated for the second quarter, and earned in full for each of the third and fourth quarters. The remaining quarterly retainer of $25,000 will be paid in each of April 2021 and July 2021 under this arrangement.
(2)Represents the grant date fair value of stock options granted for fiscal year 2020, as calculated in line with ASC 718, Compensation — Stock Compensation, and disregarding any estimate of forfeitures related to service-based vesting conditions. Mr. Freiberg and Mr. Hutton did not have any unexercised stock options outstanding as of December 31, 2020. Ms. Liang had 50,960 unexercised stock options
231

TABLE OF CONTENTS
outstanding as of December 31, 2020. Mr. Freiberg’s and Mr. Hutton’s stock options vest as to 100% in June 2021. Ms. Liang’s unvested stock options vest in equal monthly increments from January 2021 through October 2023.
(3)Mr. Joss resigned from the board of directors in the second quarter of 2020.
On January 29, 2021, we granted to each of Messrs. Freiberg and Hutton 17,858 RSUs, which shall fully vest on June 29, 2022, subject to each director's continued service on the board of directors through such date. In addition, we granted 17,858 RSUs to Ms. Yeşil, which shall fully vest on July 3, 2023, subject to her continued service on the board of directors through such date.
On March 8, 2021, we granted Mr. Hutton 6,696 RSU’s, which shall fully vest on June 29, 2021, subject to Mr. Hutton’s continued service on the board of directors through such date.
In connection with the consummation of the Business Combination, our board of directors approved a compensation program for our non-employee directors who are determined not to be affiliated with SoFi Technologies and SCH (the “NED Compensation Policy”). Pursuant to the terms of the NED Compensation Policy, non-employee directors are eligible to receive annual cash compensation of $40,000 paid in four quarterly installments, subject to continued service (and pro-rated if services are not provided for the full year). In addition, non-employee directors will receive annual grants of restricted stock unit awards with a value of $250,000 for each grant, which awards will generally be made at the time of the annual shareholder meeting and vest on the first to occur between the 12-month anniversary thereof and the next annual shareholder meeting. The first such grants will be made (x) for existing directors, following such time as the initial award granted in connection with the Business Combination becomes 75% vested or (y) for new directors, following initial appointment to the board, provided that new director awards may be prorated if granted off-cycle. In addition to the foregoing, non-employee directors will be entitled to receive additional annual cash compensation in connection with their committee service, including (i) for the Audit Committee, $25,000 per year for the chair and $10,000 for each member; (ii) for the Compensation Committee, $16,000 per year for the chair and $8,000 for each member; and (iii) for the Nominating/Governance Committee, $10,000 for the chair and $5,000 for each member. Compensation for the chair of our board of directors has not yet been determined.
Limitations of Liability and Indemnification Matters
The Certificate of Incorporation contains provisions that limit the liability of our directors for monetary damages for breach of their fiduciary duties, except for liability that cannot be eliminated under the DGCL. Delaware law provides that directors of a corporation will not be personally liable for monetary damages for breach of their fiduciary duties as directors, except liability for any of the following:
any breach of their duty of loyalty to the corporation or its stockholders;
acts or omissions not in good faith or that involve intentional misconduct or a knowing violation of law;
unlawful payments of dividends or unlawful stock repurchases or redemptions as provided in Section 174 of the DGCL; or
any transaction from which the director derived an improper personal benefit.
This limitation of liability does not apply to liabilities arising under the federal securities laws and does not affect the availability of equitable remedies such as injunctive relief or rescission.
The Certificate of Incorporation and the Bylaws also provide that we shall indemnify our directors and executive officers and may indemnify our other officers and employees and other agents to the fullest extent permitted by law. We believe that indemnification under the Bylaws covers at least negligence and gross negligence on the part of indemnified parties. The Bylaws also permit us to secure insurance on behalf of any officer, director, employee or other agent for any liability arising out of his or her actions in this capacity, regardless of whether the Bylaws would permit indemnification.
We have entered into separate indemnification agreements with our directors and executive officers, in addition to indemnification provided for in our charter documents. These agreements, among other things, provide for
232

TABLE OF CONTENTS
indemnification of our directors and executive officers for expenses, judgments, fines and settlement amounts incurred by this person in any action or proceeding arising out of this person’s services as a director or executive officer or at our request. We believe that these provisions and agreements are necessary to attract and retain qualified persons as directors and executive officers.
233

TABLE OF CONTENTS
BENEFICIAL OWNERSHIP OF SECURITIES
The following table sets forth information regarding the beneficial ownership of our voting shares by:
each person who is known to be the beneficial owner of more than 5% of our voting shares;
each of our named executive officers and directors; and
all of our executive officers and directors as a group.
Beneficial ownership is determined according to the rules of the SEC, which generally provide that a person has beneficial ownership of a security if he, she or it possesses sole or shared voting or investment power over that security, including options and warrants that are currently exercisable or exercisable within 60 days of June 11, 2021.
Percentage ownership of our voting securities is based on 795,224,257 shares of our common stock issued and outstanding as of June 11, 2021.
Unless otherwise indicated, we believe that all persons named in the table below have sole voting and investment power with respect to the voting securities beneficially owned by them.
Name and Address of Beneficial Owner(1)
Number of
Shares
% of
Ownership
5% Holders
Entities Affiliated with SoftBank(2)
117,795,933  14.8  %
Red Crow Capital LLC(3)
49,353,832  6.2  %
Directors and Named Executive Officers
Anthony Noto(4)
14,302,137  1.8  %
Christopher Lapointe(5)
310,850  *
Michelle Gill(6)
3,542,591  *
Jennifer Nuckles(7)
227,769  *
Maria Renz(8)
483,637  *
Clay Wilkes(9)
53,921,655  6.8  %
Tom Hutton(10)
1,040,881  *
Steven Freiberg(11)
1,000,410  *
Ahmed Al-Hammadi(12)
35,818,402  4.5  %
Ruzwana Bashir —  —  %
Michael Bingle —  —  %
Michel Combes(13)
117,795,933  14.8  %
Richard Costolo(14)
250,000  *
Carlos Medeiros(15)
117,795,933  14.8  %
Clara Liang(16)
139,563  *
Harvey Schwartz 156,852  *
Magdalena Yeşil(17)
1,053,917  *
All directors and executive officers as a group (23 individuals) 233,094,604  28.7  %
____________
*Less than one percent
(1)Unless otherwise noted, the business address of each of those listed in the table above is 234 1st Street, San Francisco, CA 94105.
(2)Consists of (i) 53,110,699 shares held of record by SoftBank Group Capital Limited and (ii) 64,685,234 shares held of record by SB Sonic Holdco (UK) Limited. Both are subsidiaries of SoftBank Group Corp. Mr. Combes serves as a President of SB Group US, Inc., an affiliate of SoftBank Group Corp., and as a Director of SoftBank Group Capital Limited. Mr. Medeiros serves as a Partner at SoftBank Group International, an affiliate of SoftBank Group Corp. The address of SoftBank Group Capital Limited and SB Sonic Holdco (UK) Limited is 69 Grosvenor Street, London, England, United Kingdom W1K 3JP. The address of SoftBank Group Corp. is 1-7-1, Kaigan, Minato-ku, Tokyo 105-7537 Japan.
234

TABLE OF CONTENTS
(3)Mr. Wilkes serves as the Managing Director of Red Crow Capital, LLC. The address of this entity is c/o Dorsey & Whitney LLP Attention: Nolan S. Taylor 111 South Main, Suite 2100, Salt Lake City, Utah 84111.
(4)Includes 11,676,760 shares of common stock issuable upon the exercise of options exercisable as of or within 60 days of June 11, 2021, 399,844 shares issuable upon vesting of restricted stock units (“RSUs”) within 60 days of June 11, 2021 and 22,581 shares issuable upon exercise of warrants to purchase common stock.
(5)Includes 87,579 shares issuable upon vesting of RSUs within 60 days of June 11, 2021.
(6)Includes 2,085,914 shares of common stock issuable upon the exercise of options exercisable as of or within 60 days of June 11, 2021 and 274,737 shares issuable upon vesting of RSUs within 60 days of June 11, 2021.
(7)Includes 79,577 shares issuable upon vesting of RSUs within 60 days of June 11, 2021.
(8)Includes 141,167 shares issuable upon vesting of RSUs within 60 days of June 11, 2021.
(9)Consists of (i) shares held by Red Crow Capital, LLC, identified in footnote (3) above and (ii) 4,567,823 shares held of record jointly by Clay Wilkes and his wife, who have shared voting and dispositive power with respect to the shares. Mr. Wilkes serves as the Managing Director of Red Crow Capital, LLC.
(10)Includes 559,921 shares of common stock issuable upon the exercise of options exercisable as of or within 60 days of June 11, 2021 and 11,669 shares issuable upon vesting of RSU’s within 60 days of June 11, 2021 and 210,589 shares of common stock held in a living trust directed by Mr. Hutton.
(11)Includes 546,850 shares of common stock issuable upon the exercise of options exercisable as of or within 60 days of June 11, 2021.
(12)Consists of 24,528,058 shares held of record and 11,290,344 shares which may be acquired upon exercise of warrants to purchase common stock held of record by QIA FIG Holding LLC. Mr. Al-Hammadi serves as Chief Investment Officer, Europe, Russia and Turkey for Qatar Investment Authority, the ultimate parent of QIA FIG Holding LLC. Mr. Al-Hammadi disclaims beneficial ownership of these shares except to the extent of any pecuniary interest therein. The address of the entities named above is Qatar Investment Authority, Ooredoo Tower (Building 14), Al Dafna Street (Street 801), Al Dafna (Zone 61), Doha, Qatar.
(13)Consists of shares held by SoftBank Group Capital Limited and SB Sonic Holdco (UK) Limited, identified in footnote (2) above. Mr. Combes serves as a President of SB Group US, Inc., an affiliate of SoftBank Group Capital Limited and SB Sonic Holdco (UK) Limited, and as a Director of SoftBank Group Capital Limited. Mr. Combes disclaims beneficial ownership of these shares except to the extent of any pecuniary interest therein.
(14)Consists of 250,000 shares held of record by 91063 LLC. Mr. Costolo serves as the Manager of 91063 LLC.
(15)Consists of shares held by SoftBank Group Capital Limited and SB Sonic Holdco (UK) Limited, identified in footnote (2) above. Mr. Medeiros serves as a Partner at SoftBank Group International, an affiliate of SoftBank Group Corp. Mr. Medeiros disclaims beneficial ownership of these shares except to the extent of any pecuniary interest therein.
(16)Consists of 139,563 shares of common stock issuable upon the exercise of options exercisable as of or within 60 days of June 11, 2021.
(17)Includes 241,819 shares of common stock issuable upon the exercise of options exercisable as of or within 60 days of June 11, 2021, and 463,538 shares held in trusts directed by Ms. Yeşil.
SoFi Technologies Series 1 Preferred Stock
The following table sets forth information regarding the beneficial ownership of shares of SoFi Technologies Series 1 Preferred Stock as of by the same categories of persons listed in the table above as of June 11, 2021.
Percentage ownership of our voting securities is based on 3,234,000 shares of SoFi Technologies Series 1 Preferred Stock issued and outstanding as of June 11, 2021.
Unless otherwise indicated, we believe that all persons named in the table below have sole voting and investment power with respect to the voting securities beneficially owned by them.
Name and Address of Beneficial Owner(1)
Number of
Shares
% of
Ownership
5% Holders
QIA FIG Holding LLC(2)
3,000,000  92.8  %
Entities Affiliated with Silver Lake(3)
228,000  7.1  %
Directors and Named Executive Officers
Anthony Noto 6,000  *
Ahmed Al-Hammadi(4)
3,000,000  92.8  %
All SoFi Technologies directors and executive officers as a group (23 individuals) 3,006,000  92.9  %
____________
*Less than one percent
(1)Unless otherwise noted, the business address of each of those listed in the table above is 234 1st Street, San Francisco, CA 94105.
(2)The address for this entity is Qatar Investment Authority, Ooredoo Tower (Building 14), Al Dafna Street (Street 801), Al Dafna (Zone 61), Doha, Qatar.
(3)Consists of (i) 224,261 shares held of record by Silver Lake Partners IV, L.P. and (ii) 3,739 shares held of record by Silver Lake Technology Investors IV (Delaware II), L.P. Silver Lake Technology Associates IV, L.P. is the general partner of Silver Lake Partners IV,
235

TABLE OF CONTENTS
L.P. and Silver Lake Technology Investors IV (Delaware II), L.P. The general partner of Silver Lake Technology Associates IV, L.P. is SLTA IV (GP), L.L.C., the managing member of which is Silver Lake Group, L.L.C. The managing members of Silver Lake Group, L.L.C. are Egon Durban, Kenneth Hao, Gregory Mondre and Joseph Osnoss. The address of each of the entities named above is 2775 Sand Hill Road, Suite 100, Menlo Park, CA 94025.
(4)Consists of shares held by QIA FIG Holding LLC. Mr. Al-Hammadi serves as Chief Investment Officer, Europe, Russia and Turkey for Qatar Investment Authority, the ultimate parent of QIA FIG Holding LLC. Mr. Al-Hammadi disclaims beneficial ownership of these shares except to the extent of any pecuniary interest therein. The address of the entities named above is Qatar Investment Authority, Ooredoo Tower (Building 14), Al Dafna Street (Street 801), Al Dafna (Zone 61), Doha, Qatar.
236

TABLE OF CONTENTS
SELLING SECURITYHOLDERS
This prospectus relates to:
the resale of 263,378,239 shares of common stock issued in connection with the Merger by certain of the Selling Securityholders;
the resale of 122,500,000 shares of common stock issued in the PIPE Investment by certain of the Selling Securityholders;
the resale of 3,234,000 shares of Series 1 preferred stock issued in connection with the Merger by certain of the Selling Securityholders;
the resale of 8,000,000 SCH warrants;
the resale of 12,170,990 SoFi warrants;
the issuance by us and resale of up to 40,295,990 shares of common stock upon the exercise of outstanding SCH warrants, SoFi warrants and public warrants;
the issuance by us and resale of 27,089,789 shares of common stock reserved for issuance upon the exercise of options to purchase common stock; and
the issuance by us and resale of 57,713,105 shares of common stock reserved for issuance upon the settlement of restricted stock units.
The Selling Securityholders may from time to time offer and sell any or all of the shares of common stock and warrants set forth below pursuant to this prospectus and any accompanying prospectus supplement. When we refer to the “Selling Securityholders” in this prospectus, we mean the persons listed in the table below, the holders of shares of common stock reserved for issuance upon the exercise of options to purchase common stock and the settlement of restricted stock units covered by this prospectus, and the pledgees, donees, transferees, assignees, successors, designees and others who later come to hold any of the Selling Securityholders’ interest in the common stock, Series 1 preferred stock or warrants, other than through a public sale.
The following table is prepared based on information provided to us by the Selling Securityholders. The following table sets forth, as of the date of this prospectus, the names of the Selling Securityholders, and the aggregate number of shares of common stock, Series 1 preferred stock and warrants that the Selling Securityholders may offer pursuant to this prospectus. The table does not include (i) the issuance by us and resale of 27,089,789 shares of common stock reserved for issuance upon exercise of options to purchase common stock, (ii) the issuance by us and resale of 57,713,105 shares of common stock reserved for issuance upon the settlement of restricted stock units, (iii) the issuance by us and resale of up to 20,125,000 shares of common stock upon the exercise of outstanding public warrants, and (iv) 531,444 shares of common stock issued upon the exercise of options to certain of our employees representing less than 1% of outstanding shares of common stock, each of which is also covered by this prospectus.
237

TABLE OF CONTENTS
Before the Offering After the Offering
Name of Selling Securityholder(1)
Number of Shares of Common Stock Number of Warrants Number of Shares of Series 1 Preferred Stock Number of Shares of Common Stock Being Offered Number of Warrants Being Offered Number of Shares of Series 1 Preferred Stock Being Offered Number of Shares of Common Stock Percentage of Shares of Common Stock Number of Warrants Percentage of Outstanding Warrants Number of Shares of Series 1 Preferred Stock Percentage of Shares of Series 1 Preferred Stock
Anthony Noto(2)
2,225,533  22,581  6,000  2,225,533  22,581  6,000  —  —  —  —  —  *
Christopher Lapointe 223,271  —  —  223,271  —  —  —  —  —  —  —  — 
Michelle Gill 1,181,940  —  —  1,181,940  —  —  —  —  —  —  —  — 
Micah Heavener 99,996  —  —  99,996  —  —  —  —  —  —  —  — 
Robert Lavet 1,248,914  —  —  1,248,914  —  —  —  —  —  —  —  — 
Jennifer Nuckles 148,192  —  —  148,192  —  —  —  —  —  —  —  — 
Maria Renz 342,470  —  —  342,470  —  —  —  —  —  —  —  — 
Assaf Ronen 375,371  —  —  375,371  —  —  —  —  —  —  —  — 
Lauren Stafford Webb 118,545  —  —  118,545  —  —  —  —  —  —  —  — 
Aaron J. Webster 227,154  —  —  227,154  —  —  —  —  —  —  —  — 
Clay Wilkes(3)
4,567,823  —  —  4,567,823  —  —  —  —  —  —  —  — 
Tom Hutton 469,291  —  —  469,291  —  —  —  —  —  —  —  — 
Steven Freiberg 453,560  —  —  453,560  —  —  —  —  —  —  —  — 
Harvey Schwartz 156,852  —  —  156,852  —  —  —  —  —  —  —  — 
Magdalena Yeşil 812,098  —  —  812,098  —  —  —  —  —  —  —  — 
SCH Sponsor V LLC(4)
27,925,000  8,000,000  —  27,925,000  8,000,000  —  —  —  —  —  —  — 
SB Sonic Holdco (UK) Limited(5)
64,685,234  —  —  64,685,234  —  —  —  —  —  —  —  — 
SoftBank Group Capital Limited(5)
53,110,699  —  —  53,110,699  —  —  —  —  —  —  —  — 
Silver Lake Partners IV, L.P.(6)
38,727,889  843,994  224,261  38,727,889  843,994  224,261  —  —  —  —  —  — 
Silver Lake Technology Investors IV (Delaware II), L.P.(6)
645,719  14,071  3,739  645,719  14,071  3,739  —  —  —  —  —  — 
QIA FIG Holding LLC(7)
35,818,402  11,290,344  3,000,000  35,818,402  11,290,344  3,000,000  —  —  —  —  —  — 
Red Crow Capital, LLC(8)
49,353,832  —  —  49,353,832  —  —  —  —  —  —  —  — 
Jay Parikh(9)
100,000  —  —  100,000  —  —  —  —  —  —  —  — 
ChaChaCha SPAC 5, LLC(10)
13,100,000  —  —  13,100,000  —  —  —  —  —  —  —  — 
Entities affiliated with Hedosophia(11)
13,100,000  —  —  13,100,000  —  —  —  —  —  —  —  — 
Entities affiliated with Baron(12)
5,000,000  —  —  5,000,000  —  —  —  —  —  —  —  — 
Atreides Foundation Master Fund LP(13)
2,500,000  —  —  2,500,000  —  —  —  —  —  —  —  — 
Blackrock, Inc.(14)
8,500,000  —  —  8,500,000  —  —  —  —  —  —  —  — 
238

TABLE OF CONTENTS
Before the Offering After the Offering
Name of Selling Securityholder(1)
Number of Shares of Common Stock Number of Warrants Number of Shares of Series 1 Preferred Stock Number of Shares of Common Stock Being Offered Number of Warrants Being Offered Number of Shares of Series 1 Preferred Stock Being Offered Number of Shares of Common Stock Percentage of Shares of Common Stock Number of Warrants Percentage of Outstanding Warrants Number of Shares of Series 1 Preferred Stock Percentage of Shares of Series 1 Preferred Stock
Durable Capital Master Fund LP(15)
15,000,000  —  —  15,000,000  —  —  —  —  —  —  —  — 
Entities affiliated with Fidelity(16)
7,900,000  —  —  7,900,000  —  —  —  —  —  —  —  — 
Entities affiliated with Phoenix Insurance(17)
1,500,000  —  —  1,500,000  —  —  —  —  —  —  —  — 
Entities Managed by Suvretta Capital Management, LLC(18)
2,500,000  —  —  2,500,000  —  —  —  —  —  —  —  — 
Entities affiliated with Luxor Capital Group, LP(19)
1,500,000  —  —  1,500,000  —  —  —  —  —  —  —  — 
The Nineteen77 Entities managed by UBS O’Connor LLC(20)
500,000  —  —  500,000  —  —  —  —  —  —  —  — 
Entities affiliated with Park West(21)
1,300,000  —  —  1,300,000  —  —  —  —  —  —  —  — 
Miller Opportunity Trust, A Series of Trust for Advised Portfolios(22)
1,923,000  —  —  1,923,000  —  —  —  —  —  —  —  — 
Patient Partners, LP(23)
77,000  —  —  77,000  —  —  —  —  —  —  —  — 
Ko Family Trust(24)
20,000  —  —  20,000  —  —  —  —  —  —  —  — 
Ravi Tanuku(25)
20,000  —  —  20,000  —  —  —  —  —  —  —  — 
91063 LLC(26)
250,000  —  —  250,000  —  —  —  —  —  —  —  — 
Institutional Portfolio Investments LP(27)
750,000  —  —  750,000  —  —  —  —  —  —  —  — 
Altimeter Partners Fund, L.P.(28)
2,500,000  —  —  2,500,000  —  —  —  —  —  —  —  — 
Empyrean Capital Overseas(29)
1,500,000  875,000  —  1,500,000  —  —  —  —  875,000  2.17  % —  — 
Linden Capital L.P.(30)
1,000,000  —  —  1,000,000  —  —  —  —  —  —  —  — 
Senator Global Opportunity Master Fund LP(31)
5,000,000  —  —  5,000,000  —  —  —  —  —  —  —  — 
Millais Limited(32)
800,000  —  —  800,000  —  —  —  —  —  —  —  — 
Soroban Opportunities Master Fund LP(33)
9,000,000  —  —  9,000,000  —  —  —  —  —  —  —  — 
Entities affiliated with Millennium Management LLC(34)
5,107,326  326,850  —  5,000,000  —  —  107,326  * 326,850  * —  — 
Aurora Trust(35)
1,500,000  —  —  1,500,000  —  —  —  —  —  —  —  — 
239

TABLE OF CONTENTS
Before the Offering After the Offering
Name of Selling Securityholder(1)
Number of Shares of Common Stock Number of Warrants Number of Shares of Series 1 Preferred Stock Number of Shares of Common Stock Being Offered Number of Warrants Being Offered Number of Shares of Series 1 Preferred Stock Being Offered Number of Shares of Common Stock Percentage of Shares of Common Stock Number of Warrants Percentage of Outstanding Warrants Number of Shares of Series 1 Preferred Stock Percentage of Shares of Series 1 Preferred Stock
Alyeska Master Fund, L.P.(36)
3,500,000  —  —  3,500,000  —  —  —  —  —  —  —  — 
Coatue US 35 LLC(37)
5,000,000  —  —  5,000,000  —  —  —  —  —  —  —  — 
Alfred J. DeCarolis, Trustee of The DeCarolis 2017 Trust dated 12/6/ 2017(38)
100,000  —  —  100,000  —  —  —  —  —  —  —  — 
The David Friedberg Revocable Trust u/a/d 9/19/2013(39)
500,000  —  —  500,000  —  —  —  —  —  —  —  — 
Healthcare of Ontario Pension Plan Trust Fund(40)
5,500,000  —  —  5,500,000  —  —  —  —  —  —  —  — 
Ghisallo Master Fund LP(41)
1,000,000  —  —  1,000,000  —  —  —  —  —  —  —  — 
Schonfeld Strategic 460 Fund LLC(42)
2,000,000  —  —  2,000,000  —  —  —  —  —  —  —  — 
Westlake Services Holding Company(43)
200,000  —  —  200,000  —  —  —  —  —  —  —  — 
Commonwealth Opportunity Platform LLC(44)
200,000  —  —  200,000  —  —  —  —  —  —  —  — 
MMF LT, LLC(45)
2,500,000  —  —  2,500,000  —  —  —  —  —  —  —  — 
The Steven Trieu Living Trust dtd 4.3.12(46)
240,000  —  —  240,000  —  —  —  —  —  —  —  — 
The Tolia-Zaveri Living Trust dated Dec 6 2017(47)
10,000  —  —  10,000  —  —  —  —  —  —  —  — 
Andrew Blake Artz(48)
10,000  —  —  10,000  —  —  —  —  —  —  —  — 
__________________
*       Less than one percent
**     “Percentage of Shares of Common Stock” based on a total of 920,323,141 shares of common stock, which number includes 795,224,257 shares of common stock outstanding as of the date of this prospectus, plus 27,089,789 shares of common stock issuable upon the exercise of outstanding stock options, plus 57,713,105 shares of common stock issuable upon the settlement of outstanding RSUs, plus 40,295,990 shares of common stock issuable upon the exercise of warrants.
“Percentage of Outstanding Warrants” based on a total of 40,295,990 warrants outstanding, which number includes 8,000,000 SCH warrants, 20,125,000 public warrants and 12,170,990 SoFi warrants.
“Percentage of Shares of Series 1 Preferred Stock” based on 3,234,000 shares of Series 1 preferred stock outstanding.
(1)Unless otherwise noted, the business address of each of those listed in the table above is 234 1st Street, San Francisco, CA 94105.
(2)Consists of 2,202,952 shares of common stock held of record and 22,581 shares of common stock which may be acquired upon exercise of warrants.
(3)Consists of 4,567,823 shares of common stock held of record jointly by Clay Wilkes and his wife, who have shared voting and dispositive power with respect to the shares.
(4)Consists of 19,925,000 shares of common stock held of record and 8,000,000 shares of common stock which may be acquired upon exercise of warrants. Chamath Palihapitiya, the former chairman and CEO of SCH, and Ian Osborne, the former President and board member of SCH, may be deemed to beneficially own securities held by SCH Sponsor V LLC by virtue of their shared control over SCH Sponsor V LLC.
240

TABLE OF CONTENTS
(5)SoftBank Group Capital Limited and SB Sonic Holdco (UK) Limited, a subsidiary of SoftBank Group Capital Limited, are both subsidiaries of SoftBank Group Corp. Michel Combes, a member of our board of directors, serves as a President of SB Group US, Inc., an affiliate of SoftBank Group Corp., and as a Director of SoftBank Group Capital Limited. Carlos Medeiros, a member of our board of directors, serves as a Partner at SoftBank Group International, an affiliate of SoftBank Group Corp. Messrs. Combes and Medeiros disclaim beneficial ownership of the shares held by each of the Selling Securityholder entities named above except to the extent of any pecuniary interest therein. The address of each of the Selling Securityholder entities named above is 69 Grosvenor Street, London, England, United Kingdom W1K 3JP. The address of SoftBank Group Corp. is 1-7-1, Kaigan, Minato-ku, Tokyo 105-7537 Japan.
(6)Consists of (i) 37,883,895 shares of common stock held of record and 843,994 shares of common stock which may be acquired upon exercise of warrants by Silver Lake Partners IV, L.P. and (ii) 631,648 shares of common stock held of record and 14,071 shares of common stock which may be acquired upon exercise of warrants by Silver Lake Technology Investors IV (Delaware II), L.P. Silver Lake Technology Associates IV, L.P. is the general partner of Silver Lake Partners IV, L.P. and Silver Lake Technology Investors IV (Delaware II), L.P. The general partner of Silver Lake Technology Associates IV, L.P. is SLTA IV (GP), L.L.C., the managing member of which is Silver Lake Group, L.L.C. The managing members of Silver Lake Group, L.L.C. are Egon Durban, Kenneth Hao, Gregory Mondre and Joseph Osnoss. The address of each of the Selling Securityholder entities named above is 2775 Sand Hill Road, Suite 100, Menlo Park, CA 94025.
(7)Consists of 24,528,058 shares of common stock and 11,290,344 shares of common stock which may be acquired upon exercise of warrants by QIA FIG Holding LLC. Ahmed Al-Hammadi, a member of our board of directors, serves as Chief Investment Officer, Europe, Russia and Turkey for Qatar Investment Authority, the ultimate parent of QIA FIG Holding LLC. Mr. Al-Hammadi disclaims beneficial ownership of these shares except to the extent of any pecuniary interest therein. The address of the entities named above is Qatar Investment Authority, Ooredoo Tower (Building 14), Al Dafna Street (Street 801), Al Dafna (Zone 61), Doha, Qatar.
(8)Clay Wilkes, a member of our board of directors, serves as the Managing Director of Red Crow Capital, LLC and may be deemed to be the beneficial owner the shares held by Red Crow Capital, LLC. The address of Red Crow Capital, LLC is c/o Dorsey & Whitney LLP Attention: Nolan S. Taylor 111 South Main, Suite 2100, Salt Lake City, Utah 84111.
(9)Jay Parikh is a former board member of SCH. Mr. Parikh’s business address is 317 University Ave, Suite 200, Palo Alto, CA 94301.
(10)Chamath Palihapitiya, former chairman and CEO of SCH, is CEO of ChaChaCha SPAC 5, LLC. The address of ChaChaCha SPAC 5, LLC is 317 University Ave Ste 200, Palo Alto, CA 94301.
(11)Consists of (i) 720,000 shares of common stock held by Hedosophia Group Limited, (ii) 380,000 shares of common stock held by Longsutton Limited and (iii) 12,000,000 shares of common stock held by Hedosophia Public Investments Limited. Ian Osborne, the former President and board member of SCH, is the Chief Executive Officer of Hedosophia Group Limited and may be deemed to control such shares. Each of Longsutton Limited and Hedosophia Public Investments Limited are affiliates of Hedosophia Group Limited. The address of Hedosophia Group Limited and Longsutton Limited is Roseneath, The Grange, St. Peter Port, Guernsey GY1 2QJ, and the address of Hedosophia Public Investments Limited is PO Box 255, Trafalgar Court, Les Banques, St. Peter Port, Guernsey GY1 3QL.
(12)Consists of (i) 49,505 shares of common stock held by Baron FinTech Fund, (ii) 3,960,396 shares of common stock held by Baron Global Advantage Fund, and (iii) 990,099 shares of common held by stock Baron Opportunity Fund. Baron FinTech Fund, Baron Global Advantage Fund and Baron Opportunity Fund (the Selling Securityholder entities”) are investment companies registered under the Investment Company Act of 1940. The business address of the Selling Securityholder entities is 767 Fifth Avenue, 49th Floor, New York, NY 10153. Mr. Ronald Baron has voting and/or investment control over the shares held by the Selling Securityholder entities. Mr. Baron disclaims beneficial ownership of the shares held by the Selling Securityholder entities.
(13)Gavin Baker is the Managing Partner & CIO of Atreides Management, LP, the investment manager for Atreides Foundation Master Fund LP. The address of Atreides Foundation Master Fund LP is One International Place, Suite 4410, Boston, MA 02110.
(14)The registered holders of the referenced shares of common stock to be sold are the following funds and accounts under management by subsidiaries of BlackRock, Inc.: BlackRock Capital Allocation Trust; BlackRock Strategic Income Opportunities Portfolio of BlackRock Funds V; Strategic Income Opportunities Bond Fund; BGF ESG Fixed Income Global Opportunities Fund; BGF Fixed Income Global Opportunities Fund; Master Total Return Portfolio of Master Bond LLC; BlackRock Total Return Bond Fund; BlackRock Global Long/Short Credit Fund of BlackRock Funds IV; BlackRock Technology Opportunities Fund, a series of BlackRock Funds; BlackRock Global Funds – World Technology Fund; BlackRock Global Allocation Fund, Inc.; BlackRock Global Funds – Global Allocation Fund; BlackRock Global Allocation V.I. Fund of BlackRock Variable Series Funds, Inc.; BlackRock Global Allocation Portfolio of BlackRock Series Fund, Inc.; BlackRock Global Allocation Collective Fund and BlackRock Global Funds – Global Dynamic Equity Fund. BlackRock, Inc. is the ultimate parent holding company of such subsidiaries. On behalf of such subsidiaries, the applicable portfolio managers, as managing directors (or in other capacities) of such entities, and/or the applicable investment committee members of such funds and accounts, have voting and investment power over the shares held by the funds and accounts which are the registered holders of the referenced shares. Such portfolio managers and/or investment committee members expressly disclaim beneficial ownership of all shares held by such funds and accounts. The addresses of such funds and accounts, such subsidiaries and such portfolio managers and/or investment committee members are 55 East 52nd Street, New York, NY 10055 and 400 Howard Street San Francisco, CA 94105. Shares of common stock shown include only the securities being registered for resale and may not incorporate all shares deemed to be beneficially held by the registered holders or BlackRock, Inc.
(15)Durable Capital Partners LP (“Durable Capital Partners”) is the investment adviser to Durable Capital Master Fund LP (“Durable Master Fund”). Durable Capital Partners GP LLC (“Durable GP”) is the general partner of Durable Capital Partners, and Henry Ellenbogen is the chief investment officer of Durable Capital Partners and the managing member of Durable GP. The principal business address of Durable Master Fund is c/o Durable Capital Partners, 5425 Wisconsin Avenue, Suite 802, Chevy Chase, MD 20815.
(16)Consists of (i) 192,954 shares of common stock held by Fidelity Mt. Vernon Street Trust: Fidelity Series Growth Company Fund, (ii) 1,031,232 shares of common stock held by Fidelity Mt. Vernon Street Trust: Fidelity Growth Company Fund, (iii) 1,094,981 shares of common stock held by Fidelity Growth Company Commingled Pool, (iv) 180,833 shares of common stock held by Fidelity Mt. Vernon Street Trust: Fidelity Growth Company K6 Fund, (v) 2,228,844 shares of common stock held by Fidelity Securities Fund: Fidelity Blue Chip Growth Fund, (vi) 76,379 shares
241

TABLE OF CONTENTS
of common stock held by Fidelity Blue Chip Growth Commingled Pool, (vii) 4,315 shares of common stock held by Fidelity Securities Fund: Fidelity Flex Large Cap Growth Fund, (viii) 242,158 shares of common stock held by Fidelity Securities Fund: Fidelity Blue Chip Growth K6 Fund, (ix) 6,115 shares of common stock held by Fidelity Blue Chip Growth Institutional Trust, (x) 265,216 shares of common stock held by Fidelity Securities Fund: Fidelity Series Blue Chip Growth Fund, (xi) 176,973 shares of common stock held by FIAM Target Date Blue Chip Growth Commingled Pool, (xii) 287,999 shares of common stock held by Variable Insurance Products Fund III: Growth Opportunities Portfolio, (xiii) 1,932,324 shares of common stock held by Fidelity Advisor Series I: Fidelity Advisor Growth Opportunities Fund, (xiv) 70,354 shares of common stock held by Fidelity Advisor Series I: Fidelity Advisor Series Growth Opportunities Fund, (xv) 22,334 shares of common stock held by Fidelity U.S. Growth Opportunities Investment Trust, and (xvi) 86,989 shares of common stock held by Fidelity NorthStar Fund. These accounts are managed by direct or indirect subsidiaries of FMR LLC, of which Abigail P. Johnson is a Director, the Chairman, the Chief Executive Officer. The address of each of (a) Fidelity Mt. Vernon Street Trust: Fidelity Series Growth Company Fund, Fidelity Growth Company Commingled Pool, Fidelity Securities Fund: Fidelity Blue Chip Growth Fund, Fidelity Blue Chip Growth Commingled Pool and Fidelity Advisor Series I: Fidelity Advisor Growth Opportunities Fund is Mag & Co., c/o Brown Brothers Harriman & Co., Attn: Corporate Actions /Vault, 140 Broadway, New York, NY 10005, (b) Fidelity Mt. Vernon Street Trust: Fidelity Growth Company Fund and Fidelity Mt. Vernon Street Trust: Fidelity Growth Company K6 Fund is BNY Mellon, PO Box 392002, Pittsburgh, PA 15230, (c) Fidelity Securities Fund: Fidelity Flex Large Cap Growth Fund, Fidelity Securities Fund: Fidelity Blue Chip Growth K6 Fund and Variable Insurance Products Fund III: Growth Opportunities Portfolio is The Northern Trust Company, Attn: Trade Securities Processing, 333 South Wabash Ave, 32nd Floor, Chicago, IL 60604, (d) Fidelity Blue Chip Growth Institutional Trust, Fidelity U.S. Growth Opportunities Investment Trust, Fidelity NorthStar Fund, Fidelity Securities Fund: Fidelity Series Blue Chip Growth Fund, FIAM Target Date Blue Chip Growth Commingled Pool and Fidelity Advisor Series I: Fidelity Advisor Series Growth is State Street Bank & Trust, PO Box 5756, Boston, MA 02206.
(17)Consists of (i) 1,350,000 shares held by Shotfut Menayot Chool Phoenix Amitim and (ii) 150,000 shares held by Phoenix Insurance Ltd. The address of each of the Selling Securityholders named above is Derech Hashalom 53, Giv’atayim, Israel 5345433.
(18)Consists of (i) 2,482,000 shares of common stock held by Suvretta Master Fund, Ltd. and (ii) 18,000 shares of common stock held by Suvretta Long Master Fund, Ltd. Aaron Cowen is control person of Suvretta Capital Management, LLC, which is the investment manager of Suvretta Master Fund, Ltd. and Suvretta Long Master Fund, Ltd. The address of each of the Selling Securityholders named above is 540 Madison Avenue, 7th Floor, New York, NY 10022.
(19)Consists of (i) 262,215 shares of common stock held by Luxor Wavefront, LP (“Luxor Wavefront”), (ii) 320,467 shares of common stock held by Luxor Capital Partners Offshore Master Fund, LP (“Luxor Offshore”), (iii) 532,060 shares of common stock held by Luxor Capital Partners, LP (“Luxor Capital”), (iv) 369,533 shares of common stock held by Lugard Road Capital Master Fund, LP (“Lugard”), (v) 12,319 shares of common stock held by Luxor Capital Partners Long, LP (“Luxor Long Onshore”), and (vi) 3,406 shares of common stock held by Luxor Capital Partners Long Offshore Master Fund, LP (“Luxor Long Offshore”). Luxor Capital Group, LP, as the investment manager of Luxor Wavefront, Luxor Offshore, Luxor Capital, Lugard, Luxor Long Onshore, and Luxor Long Offshore has sole dispositive and voting power over the securities held by the Selling Securityholders. Christian Leone, in his position as Portfolio Manager at Luxor Capital Group, LP with respect to Luxor Wavefront, Luxor Offshore, Luxor Capital, Luxor Long Onshore, and Luxor Long Offshore may be deemed to have voting and investment power with respect to the securities owned by such Selling Securityholders. Mr. Leone disclaims beneficial ownership of the securities owned by such Selling Securityholders. Jonathan Green, in his position as Portfolio Manager at Luxor Capital Group, LP with respect to Lugard, may be deemed to have voting and investment power with respect to the securities held by Lugard. Mr. Green disclaims beneficial ownership of the securities owned by Lugard. The principal business address of each of the Selling Securityholders named above is 1114 Avenue of the Americas, 28th Floor, New York, NY 10036.
(20)Consists of (i) 230,750 shares of common stock held by Nineteen77 Global Multi-Strategy Alpha Master Limited, (ii) 230,750 shares of common stock held by Nineteen77 Global Merger Arbitrage Master Limited, and (iii) 38,500 shares of common stock held by Nineteen77 Global Merger Arbitrage Opportunity Fund (collectively, the “Nineteen77 Entities”). Kevin Russell, the Chief Investment Officer of UBS O’Connor LLC, is deemed to have power to vote or dispose of the shares held by the Nineteen77 Entities. The address of the Nineteen77 Entities and Mr. Russell is c/o UBS O’Connor LLC, One North Wacker Drive, 31st Floor, Chicago, IL 60606.
(21)Consists of (i) 1,185,000 shares held by Park West Investors Master Fund, Limited and (ii) 115,000 shares held by Park West Partners International, Limited. The business address for each of the Selling Securityholders named above is 900 Larkspur Landing Circle, Suite 165, Larkspur, CA 94939.
(22)Miller Value Partners, LLC (“MVP”) is the Investment Manager of Miller Opportunity Trust, A Series of Trust for Advised Portfolios (“MOT”) and William H. Miller III Living Trust Dated April 17, 2017 (“WHM III Trust”) is the Control Person of MVP. MVP and WHM III Trust may be deemed to be the beneficial owner of the shares held by MOT. The principal business address is c/o Miller Value Partners, One South Street, Suite 2550, Baltimore, MD 21202.
(23)Patient Capital Management, LLC is the Investment Manager of Patient Partners, LP and Samantha M. McLemore is the Control Person of Patient Capital Management, LLC. Patient Capital Management, LLC and Ms. McLemore may be deemed to be the beneficial owners of the shares held by Patient Partners, LP. The principal business address is c/o Miller Value Partners, One South Street, Suite 2550, Baltimore, MD 21202.
(24)Raymond Ko, a partner at The Social+Capital Capital Partnership, LLC, an affiliate of SCH, may be deemed to be the beneficial owner of the shares held by The Ko Family Trust. The address of The Ko Family Trust is 317 University Ave Ste 200, Palo Alto, CA 94301.
(25)Ravi Tanuku is a partner at The Social+Capital Capital Partnership, LLC, an affiliate of SCH. Mr. Tanuku’s address is 317 University Ave Ste 200, Palo Alto, CA 94301.
(26)Richard Costolo, a member of our board of directors, is the Manager of 91063 LLC, and Mr. Costolo may be deemed to be the beneficial owner of the shares held by 91063 LLC. The address of 91063 LLC is 659 Chapman Dr., Corte Madera, CA 94925.
242

TABLE OF CONTENTS
(27)The address of Institutional Portfolio Investments LP is 400 Main Street, Suite 250, Los Altos, CA 94022.
(28)The address of Altimeter Partners Fund, L.P. is One International Place, Suite 4610, Boston, MA 02110.
(29)Consists of (i) 1,500,000 shares of common stock and (ii) 875,000 shares of common stock issuable upon exercise of warrants. Empyrean Capital Partners, LP (“Empyrean”) serves as investment manager to Empyrean Capital Overseas Master Fund, Ltd. (“ECOMF”) with respect to the shares of common stock and warrants directly held by ECOMF. Empyrean Capital, LLC serves as the general partner to Empyrean. Amos Meron is the managing member of Empyrean Capital, LLC, and as such may be deemed to have voting and dispositive control of the shares of common stock and warrants directly held by ECOMF. The address of each of ECOMF, Empyrean, Empyrean Capital, LLC, and Amos Meron is c/o Empyrean Capital Partners, LP, 10250 Constellation Boulevard, Suite 2950, Los Angeles, CA 90067.
(30)The shares of common stock directly held by Linden Capital L.P. are indirectly held by Linden Advisors LP (the investment manager of Linden Capital L.P.), Linden GP LLC (the general partner of Linden Capital L.P.), and Mr. Siu Min (Joe) Wong (the principal owner and the controlling person of Linden Advisors LP and Linden GP LLC). Linden Capital L.P., Linden Advisors LP, Linden GP LLC and Mr. Wong share voting and dispositive power with respect to the securities held by Linden Capital L.P. The address of Linden Capital L.P. is c/o Linden Advisors LP, 590 Madison Avenue, 15th Floor, New York, NY 10022, and Victoria Place, 31 Victoria Street, Hamilton HM10, Bermuda.
(31)Senator Investment Group LP (“Senator”), is investment manager of Senator Global Opportunity Master Fund LP and may be deemed to have voting and dispositive power with respect to the shares. The general partner of Senator is Senator Management LLC (the “Senator GP”). Douglas Silverman controls Senator GP and, accordingly, may be deemed to have voting and dispositive power with respect to the shares held by Senator Global Opportunity Master Fund LP. Mr. Silverman disclaims beneficial ownership of the shares held by this Selling Securityholder. The address of Senator Global Opportunity Master Fund LP is 510 Madison Avenue, 28th Floor, New York, NY 10022.
(32)The address of Millais Limited is c/o Millais USA LLC, 767 5th Avenue, 9th Floor, New York, NY 10153.
(33)The address of Soroban Opportunities Master Fund LP is c/o Soroban Capital Partners LP, 55 West 46th Street, 32nd Floor, New York, NY 10036.
(34)Consists of (i) 4,091,666 shares of common stock and 88,100 shares of common stock issuable upon exercise of warrants held by Integrated Core Strategies (US) LLC, a Delaware limited liability company (“Integrated Core Strategies”), (ii) 500,000 shares of common stock held by Riverview Group LLC, a Delaware limited liability company ("Riverview Group"), (iii) 450,000 shares of common stock and 238,750 shares of common stock issuable upon exercise of warrants held by ICS Opportunities, Ltd., an exempted company organized under the laws of the Cayman Islands ("ICS Opportunities"), (iv) 57,253 shares of common stock held by ICS Opportunities II LLC, a Cayman Islands limited liability company ("ICS Opportunities II") and (v) 8,407 shares of the common stock held by Integrated Assets, Ltd., an exempted company organized under the laws of the Cayman Islands ("Integrated Assets"). Millennium International Management LP, a Delaware limited partnership ("Millennium International Management"), is the investment manager to ICS Opportunities, ICS Opportunities II and Integrated Assets and may be deemed to have shared voting control and investment discretion over securities owned by ICS Opportunities, ICS Opportunities II and Integrated Assets. Millennium Management LLC, a Delaware limited liability company ("Millennium Management"), is the general partner of the managing member of Integrated Core Strategies and Riverview Group and may be deemed to have shared voting control and investment discretion over securities owned by Integrated Core Strategies and Riverview Group. Millennium Management is also the general partner of the 100% owner of ICS Opportunities, ICS Opportunities II and Integrated Assets and may also be deemed to have shared voting control and investment discretion over securities owned by ICS Opportunities, ICS Opportunities II and Integrated Assets. Millennium Group Management LLC, a Delaware limited liability company ("Millennium Group Management"), is the managing member of Millennium Management and may also be deemed to have shared voting control and investment discretion over securities owned by Integrated Core Strategies and Riverview Group. Millennium Group Management is also the general partner of Millennium International Management and may also be deemed to have shared voting control and investment discretion over securities owned by ICS Opportunities, ICS Opportunities II and Integrated Assets. The managing member of Millennium Group Management is a trust of which Israel A. Englander, a United States citizen ("Mr. Englander"), currently serves as the sole voting trustee. Therefore, Mr. Englander may also be deemed to have shared voting control and investment discretion over securities owned by Integrated Core Strategies, Riverview Group, ICS Opportunities, ICS Opportunities II or Integrated Assets. The foregoing should not be construed in and of itself as an admission by Millennium International Management, Millennium Management, Millennium Group Management or Mr. Englander as to beneficial ownership of the securities owned by Integrated Core Strategies, Riverview Group, ICS Opportunities, ICS Opportunities II or Integrated Assets, as the case may be. The address for Integrated Core Strategies and Riverview Group is c/o Millenium Management LLC, 399 Park Avenue, New York, NY 10022. The address for ICS Opportunities, ICS Opportunities II and Integrated Assets is c/o Millenium International Management LP, 399 Park Avenue, New York, NY 10022.
(35)The address of Aurora Trust is 92 Sutherland Drive, Atherton, CA 94027.
(36)Alyeska Investment Group, L.P., the investment manager of Alyeska Master Fund, L.P., has voting and investment control of the shares of common stock held by Alyeska Master Fund, L.P.. Anand Parekh is the Chief Executive Officer of Alyeska Investment Group, L.P. and may be deemed to be the beneficial owner of such shares. Mr. Parekh, however, disclaims any beneficial ownership of the shares held by Alyeska Master Fund, L.P.
(37)The address of Coatue US 35 LLC is 9 West 57th St, 25th FL, New York, NY 10019.
(38)The address of The DeCarolis 2017 Trust dated 12/6/2017 is 801 South Pointe Dr., #401, Miami Beach, FL 33139.
(39)The address of The David Friedberg Revocable Trust u/a/d 9/19/2013 is One Letterman Drive, Suite A3-1, San Francisco, CA 94128.
(40)The address of Healthcare of Ontario Pension Plan Trust Fund is 1 York Street, Suite 1900, Toronto, Ontario, Canada M5J 0B6.
243

TABLE OF CONTENTS
(41)The address of Ghisallo Master Fund LP is 27 Hospital Road, Georgetown, Grand Cayman, CI KY1-9008.
(42)The address of Schonfeld Strategic 460 Fund LLC is 460 Park Ave., Floor 19, New York, NY 10022.
(43)The address of Westlake Services Holding Company is 4751 Wilshire Blvd., Suite 100, Los Angeles, CA 90010.
(44)The address of Commonwealth Opportunity Platform LLC is 200 Crescent Ct Ste 1040, Dallas, TX, 75201.
(45)Moore Capital Management, LP, the investment manager of MMF LT, LLC, has voting and investment control of the shares held by MMF LT, LLC. Mr. Louis M. Bacon controls the general partner of Moore Capital Management, LP and may be deemed the beneficial owner of the shares of common stock held by MMF LT, LLC. Mr. Bacon also is the indirect majority owner of MMF LT, LLC. The address of MMF LT, LLC, Moore Capital Management, LP and Mr. Bacon is 11 Times Square, New York, NY 10036.
(46)Steven Trieu, the former CFO of SCH, is the beneficial owner of the shares of common stock. Mr. Trieu’s business address is 317 University Ave Ste 200, Palo Alto, CA 94301.
(47)Jay Zaveri, a partner at The Social+Capital Capital Partnership, LLC, an affiliate of SCH, may be deemed to be the beneficial owner of the shares of common stock held by The Tolia-Zaveri Living Trust dated Dec 6 2017. The address of Tolia-Zaveri Liviting Trust dated Dec 6, 2017 is 317 University Ave Ste 200, Palo Alto, CA 94301.
(48)Andrew Blake Artz is a partner at Social Capital Holdings Inc, an affiliate of SCH. Mr. Artz’s address is 317 University Ave Ste 200, Palo Alto, CA 94301.
Selling Securityholder information for each additional Selling Securityholder, if any, will be set forth by prospectus supplement to the extent required prior to the time of any offer or sale of Selling Securityholder’s shares pursuant to this prospectus. To the extent permitted by law, a prospectus supplement may add, update, substitute, or change the information contained in this prospectus, including the identity of each Selling Securityholder and the number of shares of common stock or warrants registered on its behalf. A Selling Securityholder may sell or otherwise transfer all, some or none of such shares of common stock or warrants in this offering. See “Plan of Distribution”.
For information regarding transactions between us and the Selling Securityholders, see the section titled “Certain Relationships and Related Person Transactions”.
244

TABLE OF CONTENTS
CERTAIN RELATIONSHIPS AND RELATED PERSON TRANSACTIONS
In addition to the compensation arrangements with directors and executive officers described under “Executive Compensation” and “Management” and the registration rights described elsewhere in this prospectus, the following is a description of each transaction since January 1, 2018 and each currently proposed transaction in which:
we have been or are to be a participant;
the amount involved exceeds or will exceed $120,000; and
any of our directors, executive officers or beneficial holders of more than 5% of our capital stock, or any immediate family member of, or person sharing the household with, any of these individuals (other than tenants or employees), had or will have a direct or indirect material interest.
Shareholders’ Agreement
We, the Sponsor and certain former shareholders of SoFi (the “SoFi Holders”) entered into the Shareholders’ Agreement (the “Shareholders’ Agreement”) on May 28, 2021. The SoFi Holders include entities affiliated with Softbank and Red Crow Capital, which are 5% shareholders, entities affiliated with Michael Bingle, one of our directors, and an entity affiliated with Mr. Al-Hammadi, one of our directors. Pursuant to the Shareholders’ Agreement, we also entered into the Share Repurchase Agreement with SoftBank Group Capital Limited committing us to repurchase, in the aggregate, $150 million of shares of common stock owned by the SoftBank Investors at a price per share equal to $10.00. Following such repurchase, in the event the combined ownership of shares of common stock by the SoftBank Investors and Renren SF Holdings Inc., or their affiliates, exceeds a specified regulatory ownership threshold, the SoftBank Investors will convert a number of shares of common stock into non-voting common stock such that, the combined ownership of the SoftBank Investors, Renren SF Holdings Inc. and their affiliates will not exceed such threshold. The Shareholders’ Agreement further sets forth ongoing board designation rights that entitle (i) the Sponsor to nominate up to two (2) independent directors, (ii) the SoftBank Investors to nominate up to two (2) directors, (iii) the Silver Lake Investors to nominate one (1) director, (iv) the QIA Investors to nominate one (1) director, and (v) the Red Crow Investors to nominate one (1) director, in each case so long as such entity or its affiliates owns a certain percentage of our common stock. Certain of the these entities are also entitled to certain designation rights with respect to committees of our board of directors. Pursuant to the Shareholders’ Agreement, if, as of the Closing, we maintain an amount of available cash that exceeds a certain minimum threshold, and our board of directors approves the repurchase of our common stock, then until the earlier of 180 days following the Closing and such time as the amount of such repurchases equals $250 million, we will offer the SoFi Holders the right to sell to us shares of our common stock owned by the SoFi Holders at a price per share equal to $10.00, subject to certain prioritization between such stockholders, and in each case on the terms, and subject to the conditions, set forth in the Shareholders’ Agreement. As of the date of this prospectus, our board of directors has not approved such a repurchase.
SoftBank Repurchase Agreement
As provided in the Shareholders’ Agreement, following the Closing, we entered into the Share Repurchase Agreement with SoftBank Group Capital Limited, which committed us to repurchase, in the aggregate, $150 million of shares of our common stock owned by the SoftBank Investors at a price per share equal to $10.00. The repurchase was completed on May 28, 2021.
Series 1 Registration Rights Agreement
At the Closing, we and holders of Series 1 Preferred Stock entered into the Series 1 Registration Rights Agreement, pursuant to which we agreed to register for resale, pursuant to Rule 415 under the Securities Act, the Series 1 Preferred Stock and any other of our equity securities or securities of our subsidiaries issued or issuable with respect to shares of Series 1 Preferred Stock. The Series 1 Registration Rights Agreement also provides for certain customary piggyback registration rights. The Series 1 Registration Rights Agreement will terminate on the date that such party no longer holds any Registrable Securities (as defined therein). The holders of Series 1 Preferred include certain parties related to us. See “ — Series H and Series 1 Financing and Series H Warrants” below.
245

TABLE OF CONTENTS
Amended and Restated Registration Rights Agreement
At the Closing, we, the Sponsor, certain affiliates of the Sponsor and certain SoFi stockholders entered into the Amended and Restated Registration Rights Agreement, pursuant to which we agree to register for resale, pursuant to Rule 415 under the Securities Act, certain shares of our common stock and other of our equity securities that are held by the parties thereto from time to time. The Amended and Restated Registration Rights Agreement amends and restates the registration rights agreement that was entered into by SCH, the Sponsor and the other parties thereto in connection with the SCH initial public offering. The Amended and Restated Registration Rights Agreement also provides for certain customary piggyback registration rights. The Amended and Restated Registration Rights Agreement will terminate on the date that such party no longer holds any Registrable Securities (as defined therein). The SoFi stockholders party to the agreement include parties related to us, including entities affiliated with SoftBank and Red Crow Capital, LLC, which are 5% shareholders, entities affiliated with Michael Bingle and Ahmed Al-Hammadi, two of our directors, Jay Parikh and Jennifer Dulski, former directors of SCH, certain entities affiliated with Chamath Palihapitiya, the former Chairman of the board of directors of SCH and certain entities affiliated with Ian Osborne, the former President and a former director of SCH.
Amended and Restated Series H Warrants
On May 28, 2021, we entered into an amended and restated warrant with each holder of Series H Warrants, which warrants superseded the outstanding warrants to purchase shares of SoFi Series H Preferred Stock, and pursuant to which each holder will have the right to purchase a number of shares of our common stock set forth therein. Holders of Series H Warrants include certain persons and entities related to us. See “ — Series H and Series 1 Financing and Series H Warrants” below.
Arrangements with Galileo
Following the acquisition of Galileo, as further described elsewhere in this prospectus, SoFi provided, and we continue to provide, certain ongoing shared operational services to Galileo, including in areas such as legal and compliance, human resources, information technology, corporate development and strategy, and other administrative functions.
Executive Officer and Director Compensation Arrangements
See “Executive Compensation” for information regarding compensation arrangements with the executive officers and directors of SoFi, which include, among other things, employment, termination of employment and change in control arrangements, stock awards and certain other benefits.
Director and Officer Indemnification
Our Certificate of Incorporation and Bylaws provide for indemnification for our directors and officers to the fullest extent permitted by the DGCL. We have entered into indemnification agreements with each of our directors and executive officers. For additional information, see “Executive Compensation  —  Limitations of Liability and Indemnification Matters”.
Pre-Business Combination Related Party Transactions of SoFi
Agreements with Stockholders
Investors’ Rights Agreement
SoFi entered into the Sixth Amended and Restated Investors’ Rights Agreement, dated as of May 29, 2019 (as amended by the Omnibus Amendment to Preferred Stock Financing Agreements, dated May 14, 2020 (the “Omnibus Amendment”) and the Second Omnibus Amendment to Preferred Stock Financing Agreements, dated December 30, 2020, by and among SoFi, certain holders of preferred stock of SoFi and certain holders of common stock of SoFi (together with the Omnibus Amendment, the “Omnibus Amendments”), which grants registration rights and right of first offer rights, among other things, to certain holders of its capital stock, including (i) entities affiliated with Silver Lake, which is affiliated with Michael Bingle, one of our directors, (ii) entities affiliated with
246

TABLE OF CONTENTS
Renren SF Holdings Inc. (“Renren”), which is affiliated with Joe Chen, one of the directors of SoFi prior to the Business Combination, (iii) entities affiliated with QIA, which is affiliated with Ahmed Al-Hammadi, one of our directors, (iv) entities affiliated with SoftBank, which is affiliated with Michel Combes and Carlos Medeiros, two of our directors, (v) Clay Wilkes, Vice Chairman of Galileo and one of our directors, and (vi) Anthony Noto, our Chief Executive Officer and one of our directors. This agreement terminated upon Closing of the Business Combination.
Right of First Refusal and Co-Sale Agreement
SoFi entered into the Sixth Amended and Restated Right of First Refusal and Co-Sale Agreement, dated as of May 29, 2019 (as amended by the Omnibus Amendments), by and among SoFi, certain holders of preferred stock of SoFi and certain holders of common stock of SoFi). Pursuant to the agreement, SoftBank has an initial right of first refusal, and SoFi has a subordinated right of first refusal, in respect of certain sales of securities by certain holders of SoFi capital stock. To the extent SoftBank or SoFi, respectively, do not exercise such rights in full, certain other investor parties to the agreement are granted certain rights of first refusal and co-sale in respect of such sale, including (i) entities affiliated with Silver Lake, which is affiliated with Michael Bingle, one of our directors, (ii) entities affiliated with Renren, which is affiliated with Joe Chen, one of the directors of SoFi prior to the Business Combination, (iii) entities affiliated with QIA, which is affiliated with Ahmed Al-Hammadi, one of our directors, (iv) entities affiliated with SoftBank, which is affiliated with Michel Combes and Carlos Medeiros, two of our directors, (v) Clay Wilkes, Vice Chairman of Galileo and one of our directors, and (vi) Anthony Noto, our Chief Executive Officer and one of our directors. This agreement terminated upon Closing of the Business Combination.
Voting Agreement
SoFi entered into the Eighth Amended and Restated Voting Agreement, dated as of May 29, 2019 (as amended by the Omnibus Amendments), pursuant to which certain holders of its capital stock, including (i) entities affiliated with Silver Lake, which is affiliated with Michael Bingle, one of our directors, (ii) entities affiliated with Renren, which is affiliated with Joe Chen, one of the directors of SoFi prior to the Business Combination, (iii) entities affiliated with QIA, which is affiliated with Ahmed Al-Hammadi, one of our directors, (iv) entities affiliated with SoftBank, which is affiliated with Michel Combes and Carlos Medeiros, two of our directors, (v) Clay Wilkes, Vice Chairman of Galileo and one of our directors, and (vi) Anthony Noto, our Chief Executive Officer and one of our directors, have agreed to vote their shares of capital stock on certain matters as provided under the agreement, including with respect to the election of directors. This agreement terminated upon Closing of the Business Combination.
Series 1 Preferred Stock Investors’ Agreement
SoFi entered into to the Series 1 Preferred Stock Investors’ Agreement (the “Original Series 1 Agreement”), dated as of May 29, 2019, with certain holders of its capital stock, including (i) entities affiliated with Silver Lake, which is affiliated with Michael Bingle, one of our directors, (ii) entities affiliated with QIA, which is affiliated with Ahmed Al-Hammadi, one of our directors, and (iii) Anthony Noto, our Chief Executive Officer and one of our directors (the “Series 1 Holders”). The Series 1 Agreement provides holders of the Series 1 preferred stock who also hold Series H Preferred Stock (the “Series 1 Holders”), upon request by QIA, with certain registration rights, provides for certain shelf registration filing obligations by SoFi and limits the future registration rights that SoFi may grant other parties, contains financial and other covenants, and provides for information rights and special payment rights, among other rights. This agreement will be amended and restated upon Closing. Upon consummation of the Business Combination, the Series 1 Holders became entitled to a cash payment in an aggregate amount of $21.2 million, which was paid from the proceeds of the Business Combination and settled contemporaneously with the Business Combination.
Amended and Restated Series 1 Preferred Stock Investors’ Agreement
In connection with the execution of the Merger Agreement, SCH and the Series 1 Holders, including Anthony Noto, entered into the Series 1 Agreement. The Series 1 Agreement amends and restates in its entirety the Original Series 1 Agreement and assigns all of SoFi’s rights, remedies, obligations and liabilities under the Original Series 1 Agreement to SCH. The Series 1 Agreement contains financial and other covenants, provides for certain information rights and provides for the cash payment of $21.2 million to the Series 1 Holders, immediately upon the Closing, in
247

TABLE OF CONTENTS
full satisfaction of the special payment rights set forth in the Original Series 1 Agreement, which was subject to adjustment in accordance with the Merger Agreement. The Series 1 Agreement further provides that if as the holders of a majority of the outstanding shares of Series 1 Preferred Stock shall be entitled to appoint a director designated by QIA FIG Holding LLC to our board of directors, as provided in our Certificate of Incorporation, then each Series 1 Investor shall vote such number of shares of Series 1 Preferred Stock as is necessary to ensure that the person designated by QIA FIG Holding LLC is so elected.
Note Purchase and Security Agreement
On March 7, 2019, SoFi entered into a $58.0 million note purchase and security agreement (the “Note Purchase Agreement” and the related note, the “Renren Note”) with Renren, which is affiliated with Joe Chen, one of the directors of SoFi prior to the Business Combination. The Renren Note accrued interest at 7.0%, and was collateralized by a portion of Renren’s SoFi common and preferred stock, consisting of 8,000,000 shares of SoFi common stock (the “Pledged Shares”). As consideration for entering into the Note Purchase Agreement and the Renren Note, SoFi, Renren Lianhe Holdings and Renren entered into a Call Option, Right of First Refusal and Voting Agreement (Pledged Shares) on March 7, 2019, pursuant to which SoFi was granted call rights to purchase the Pledged Shares and a Call Option, Right of First Refusal and Voting Agreement on March 7, 2019, pursuant to which SoFi was granted call rights to purchase an additional approximately 9,000,000 shares of SoFi common stock held by Renren (collectively, the “Call Option Shares”) at $8.80 per share (such right, the “Call Option Rights”). The initial scheduled maturity date of the Renren Note was December 7, 2019. Both SoFi and Renren had the option to extend the Renren Note for six months beyond the initial scheduled maturity date, and SoFi exercised the extension in September 2019. Pursuant to the terms of the Note Purchase Agreement, following the initial six-month extension, SoFi had a unilateral extension option for unlimited consecutive three-month terms. On June 3, 2020, SoFi and Renren agreed to amend the Note Purchase Agreement to, among other things, permit extension periods longer than three months and to extend the term of the Renren Note an additional six months through December 31, 2020. The Call Option Rights were effective through the then-current maturity date in the event the Renren Note was prepaid before such date. In October 2019, SoFi assigned a portion of its Call Option Rights to SoftBank Group Capital Limited pursuant to a Side Letter by and among Social Finance, Inc., SoftBank Group Capital Limited, Renren Inc., Renren Lianhe Holdings, Renren and Oak Pacific Investment, which paid approximately $15.2 million to purchase an aggregate 1,722,144 of the Call Option Shares. Renren used the full proceeds from this sale to prepay in part the Renren Note and accrued interest thereon. Renren made additional prepayments during 2020 from dispositions of its assets, and the Renren Note was prepaid in full on November 18, 2020. The Call Option Rights remained outstanding until December 31, 2020 pursuant to the terms of the Note Purchase Agreement. SoFi exercised its Call Option Rights in full on December 30, 2020 and purchased 59,750 shares of SoFi common stock and redeemable preferred stock in the following amounts: 10,558,256 shares of Series B; 1,042,462 shares of Series D; 220,814 shares of Series E and 3,276,055 shares of Series F. The aggregate exercise resulted in total cash payment of $133.4 million, which was paid on January 4, 2021.
Galileo Acquisition and Issuance of Series H-1 Preferred Shares
On May 14, 2020, SoFi and certain of its subsidiaries entered into an Agreement and Plan of Merger and Reorganization (the “Galileo Merger Agreement”) with Galileo Financial Technologies, Inc. and the other parties thereto. Pursuant to the Galileo Merger Agreement, SoFi acquired Galileo and its subsidiaries by acquiring 100% of the outstanding Galileo stock and issuing a seller note in favor of the sellers of Galileo with an aggregate principal amount of $250 million and a scheduled balloon maturity of May 14, 2021. During the first six months of the twelve-month borrowing term, there was no interest due to the seller. Subsequent to the promotional borrowing period, we incurred interest on the note at a rate of 10.0% per annum. In February 2021, we paid off the seller note for a total payment of $269.9 million, consisting of outstanding principal of $250.0 million and accrued interest of $19.9 million. As a result of the acquisition, certain Galileo stockholders, including Clay Wilkes, one of our directors and the founder and former Chief Executive Officer (now Vice Chairman) of Galileo, Mr. Wilkes’ wife, and Mr. Wilkes’ sons, and a daughter-in-law, received shares of Series H-1 Preferred Stock of SoFi, rights to payments due under the seller note and cash consideration. Mr. Wilkes and his wife received 3,101,561 shares of Series H-1 Preferred Stock, Mr. Wilkes’ son received 56 shares of Series H-1 Preferred Stock and Mr. Wilkes’ son and daughter-in-law received 253,293 shares of Series H-1 Preferred Stock.
248

TABLE OF CONTENTS
As a condition to the obligations of Galileo pursuant to the Merger Agreement, SoFi and the parties thereto described above, including certain of our 5% shareholders, entered into the May 20 Omnibus Amendment, which, among other things, provides for the appointment of Mr. Wilkes to the SoFi Board of Directors.
Private Placements of Securities and Related Transactions
Series H and Series 1 Financing and Series H Warrants
On May 29, 2019, SoFi issued and sold an aggregate of 13,967,169 shares of SoFi Series H Preferred Stock at a purchase price of $15.44 per share for aggregate consideration of approximately $215.7 million. On October 28, 2019, SoFi issued and sold 2,257,365 shares of SoFi Series H Preferred Stock at a purchase price of $15.4362 for aggregate consideration of approximately $34.8 million. Additionally, on May 29, 2019, SoFi issued and sold an aggregate of 3,234,000 shares of Series 1 Preferred Stock at a purchase price of $100.00 per share for aggregate consideration of approximately $323.4 million. Each share of SoFi Series H Preferred Stock (excluding Anthony Noto, our Chief Executive Officer, as described below) was canceled and converted into the right to receive a number of our shares of common stock equal to the product of 1.0863 multiplied by the Base Exchange Ratio (except for shares of Series H Preferred Stock held by Anthony Noto, our Chief Executive Officer, which was canceled and converted into the right to receive a number of shares of our common stock equal to the Base Exchange Ratio). Each share of SoFi Series 1 preferred stock was exchanged for one share of our Series 1 Preferred Stock in connection with the Business Combination, and the Series 1 Holders became entitled to a cash payment equal to the product of (i) the amount (if positive, otherwise zero) by which $19.2952 (as may was subject to adjusted pursuant to the Merger Agreement), exceeds the quotient obtained by dividing (x) the aggregate purchase price payable to SoFi and (y) the aggregate number of shares of SoFi common stock issued, in each case pursuant to the Common Stock Purchase Agreement, dated as of December 30, 2020, by and among the Company and the investors party thereto, multiplied by (ii) the number of shares of SoFi Series H Preferred Stock held by such Series H Holder as of immediately prior to the Closing.
The following table summarizes the Series H Preferred Stock purchased by parties related to us:
Stockholder Shares of SoFi Series H Preferred Stock Total Purchase Price
QIA FIG Holding LLC(1)
12,956,557 $ 200,000,005.16 
SoftBank Group Capital Limited(2)
2,257,365 34,845,137.61 
Entities affiliated with Silver Lake(3)
984,698 15,199,995.27 
Anthony Noto(4)
25,914 400,013.69 
____________________
(1)QIA FIG Holding LLC became a beneficial owner of more than 5% of our outstanding capital stock as a result of its participation in this issuance. Ahmed Al-Hammadi, one of our directors, is the Chief Investment Officer, Europe, Russia and Turkey for Qatar Investment Authority.
(2)SoftBank Group Capital Limited beneficially owns more than 5% of the outstanding capital stock of SoFi. Michel Combes, one of our directors, is a President of SoftBank Group International, and Carlos Medeiros, one of our directors, is an Investment Director at SoftBank Group International.
(3)Shares held by Silver Lake Partners IV, L.P. and Silver Lake Technology Investors IV (Delaware II), L.P., both of which are entities affiliated with Silver Lake. These entities beneficially own, in the aggregate, more than 5% of our outstanding capital stock. Michael Bingle, one of our directors, is Vice Chairman of Silver Lake.
(4)Anthony Noto is our Chief Executive Officer and one of our directors.
The following table summarizes the SoFi Series 1 Redeemable Preferred Stock purchased by parties related to us:
Stockholder
Shares of
SoFi Series 1
Preferred Stock
Total Purchase Price
QIA FIG Holding LLC(1)
3,000,000  $ 300,000,000 
Entities affiliated with Silver Lake(2)
228,000  22,800,000 
Anthony Noto(3)
6,000  600,000 
249

TABLE OF CONTENTS
____________________
(1)QIA FIG Holding LLC beneficially owned more than 5% of our outstanding capital stock. Ahmed Al-Hammadi, one of our directors, is the Chief Investment Officer, Europe, Russia and Turkey for Qatar Investment Authority.
(2)Shares held by Silver Lake Partners IV, L.P. and Silver Lake Technology Investors IV (Delaware II), L.P., both of which are entities affiliated with Silver Lake. These entities beneficially own, in the aggregate, more than 5% of our outstanding capital stock. Michael Bingle, one of our directors, is Vice Chairman of Silver Lake.
(3)Anthony Noto is our Chief Executive Officer and one of our directors.
On May 29, 2019, in connection with the SoFi Series H Preferred Stock and SoFi Series 1 Preferred Stock issuances, SoFi also issued 6,983,585 Series H Warrants. Upon issuance, SoFi allocated $22.3 million of the $539.0 million of proceeds received from the Series H Preferred Stock and Series 1 Redeemable Preferred Stock issuances to the Series H Warrants, with such valuation determined using the Black-Scholes Model, in order to establish an initial fair value for the Series H Warrants. See Note 9 to the Notes to Unaudited Condensed Consolidated Financial Statements of SoFi and Note 10 to the Notes to Consolidated Financial Statements of SoFi included elsewhere in this prospectus.
In connection with the Business Combination, the Series H Warrants converted at the Closing into warrants to purchase our common stock.
The following table summarizes the SoFi Series H Warrants issued to parties related to us:
Stockholder Number of Series H Warrants
QIA FIG Holding LLC(1)
6,478,279 
Entities affiliated with Silver Lake(2)
492,349 
Anthony Noto(3)
12,957 
____________________
(1)QIA FIG Holding LLC beneficially owned more than 5% of our outstanding capital stock. Ahmed Al-Hammadi, one of our directors, is the Chief Investment Officer, Europe, Russia and Turkey for Qatar Investment Authority.
(2)Shares held by Silver Lake Partners IV, L.P. and Silver Lake Technology Investors IV (Delaware II), L.P., both of which are entities affiliated with Silver Lake. These entities beneficially own, in the aggregate, more than 5% of our outstanding capital stock. Michael Bingle, one of our directors, is Vice Chairman of Silver Lake.
(3)Anthony Noto is our Chief Executive Officer and one of our directors.
2020 Tender Offer
In May, 2020 SoFi undertook a tender offer pursuant to which SoFi offered to exchange certain unvested options to purchase shares of SoFi common stock for unvested restricted stock units covering shares of SoFi common stock at an exchange ratio equal to the applicable Black-Scholes valuation for the relevant stock option, divided by 13. An aggregate of 2,346,628 stock options were tendered pursuant to the tender offer in exchange for 732,724 restricted stock units representing 732,724 shares of SoFi common stock.
Freiberg Advisor Agreement
On July 1, 2018, SoFi entered into a Consulting Agreement with Steven Freiberg, one of our directors. Mr. Freiberg also served as SoFi’s interim Chief Financial Officer from May 2017 to May 2018. Pursuant to the Consulting Agreement, Mr. Freiberg provided certain consulting services to SoFi during the period from July 1, 2018 to June 30, 2019. In consideration for his services, Mr. Freiberg received $83,333 per month, 92,764 restricted stock units of SoFi, which have fully vested as well as reimbursement of certain expenses.
Schwartz Advisor Agreement
On March 10, 2020, SoFi entered into an Advisor Agreement (the “Schwartz Advisor Agreement”) with Olivehms LLC, a Delaware limited liability company, of which Harvey Schwartz, one of our directors, is the sole member. Pursuant to the Schwartz Advisor Agreement, Mr. Schwartz provided certain advisory services to SoFi during the period from January 1, 2020 through May 1, 2020. In consideration for his services, Mr. Schwartz received 90,000 restricted stock units of SoFi, which have fully vested, as well as reimbursement of certain customary expenses.
250

TABLE OF CONTENTS
Policies and Procedures for Related Person Transactions
Our audit and risk committee has the primary responsibility for reviewing and approving or disapproving “related party transactions”, which are transactions between us and related persons in which the aggregate amount involved exceeds or may be expected to exceed $120,000 and in which a related person has or will have a direct or indirect material interest. The charter of the audit and risk committee provides that the audit committee will review and approve in advance any related party transaction.
Review and Approval of Review and Approval of Related Person Transactions
We have adopted a policy for the review and approval of related party transaction, which requires, among other things, that:
The audit and risk committee review the material facts of all related person transactions.
In reviewing any related person transaction, the audit and risk committee takes into account, among other factors that it deems appropriate, whether the related person transaction is on terms no less favorable to us than terms generally available in a transaction with an unaffiliated third-party under the same or similar circumstances and the extent of the related person’s interest in the transaction.
In connection with its review of any related person transaction, we will provide the audit and risk committee with all material information regarding such related person transaction, the interest of the related person and any potential disclosure obligations of we have in connection with such related person transaction.
If a related person transaction will be ongoing, the audit and risk committee may establish guidelines for our management to follow in its ongoing dealings with the related person.
Pre-Business Combination Related Party Transactions of SCH
Founder Shares
In July 2020, the Sponsor purchased 2,875,000 SCH Class B ordinary shares for an aggregate purchase price of $25,000, or approximately $0.01 per share (the “founder shares”). In September 2020, SCH effected a share capitalization resulting in Sponsor holding an aggregate of 18,687,500 founder shares. Subsequent to the share capitalization, in September 2020, the Sponsor transferred 100,000 founder shares to Jay Parikh (an independent director of SCH). In October 2020, SCH effected a share capitalization resulting in SCH’s initial shareholders holding an aggregate of 20,125,000 founder shares, resulting in an effective purchase price per founder share of approximately $0.001.
These founder shares are identical to the SCH Class A ordinary shares included in the units sold in the SCH initial public offering, except that (i) only the holders of the founder shares have the right to vote on the election of directors prior to the initial business combination (as defined in the Cayman Constitutional Documents), (ii) the founder shares are subject to certain transfer restrictions, (iii) the holders of the founder shares have agreed pursuant to a letter agreement to waive (x) their redemption rights with respect to the Founder Shares and public shares held by them in connection with the completion of a business combination, (y) their redemption rights with respect to any founder shares and public shares held by them in connection with a shareholder vote to amend the Cayman Constitutional Documents (A) to modify the substance or timing of our obligation to allow redemption in connection with our initial business combination or to redeem 100% of our public shares if we do not complete our initial business combination by October 14, 2022 or (B) with respect to any other provision relating to shareholders’ rights or pre-initial business combination activity and (z) their rights to liquidating distributions from the trust account with respect to the founder shares if SCH fails to complete a business combination by October 14, 2022, (iv) the founder shares are automatically convertible into SCH Class A ordinary shares at the time of the initial business combination and (v) the founder shares are entitled to registration rights.
In connection with the Business Combination, upon the Domestication, 20,125,000 founder shares converted automatically into 20,025,000 shares of our common stock.
251

TABLE OF CONTENTS
Private Placement Warrants
Simultaneously with the consummation of the SCH initial public offering, the Sponsor purchased 8,000,000 warrants to purchase one SCH Class A ordinary share at an exercise price of $11.50 (the “private placement warrants”) at a price of $2.00 per warrant, or $16.0 million in the aggregate, in a private placement. Each private placement warrant entitles the holder to purchase one SCH Class A ordinary share for $11.50 per share. A portion of the proceeds from the sale of the private placement warrants was placed in the trust account of SCH. In connection with the Business Combination, upon the Domestication, each of the 8,000,000 private placement warrants automatically converted into a warrant to acquire one share of our common stock.
The private placement warrants are identical to the warrants included in the units sold in the SCH initial public offering except that the private placement warrants: (i) are not redeemable by SCH, (ii) may be exercised for cash or on a cashless basis so long as they are held by the Sponsor or any of its permitted transferees and (iii) are entitled to registration rights (including the ordinary shares issuable upon exercise of the private placement warrants). Additionally, the purchasers have agreed not to transfer, assign or sell any of the private placement warrants, including the shares issuable upon exercise of the private placement warrants (except to certain permitted transferees), until 30 days after the Closing.
Registration Rights
The holders of the founder shares, private placement warrants, and warrants that may be issued upon conversion of working capital loans, if any (and any SCH Class A ordinary shares issuable upon the exercise of the private placement warrants or warrants issued upon conversion of the working capital loans and upon conversion of the founder shares) are entitled to registration rights pursuant to a registration rights agreement signed October 8, 2020 requiring SCH to register such securities for resale (in the case of the founder shares, only after conversion to SCH Class A ordinary shares). The holders of these securities are entitled to make up to three demands, excluding short form demands, that SCH register such securities. In addition, the holders have certain “piggy-back” registration rights with respect to registration statements filed subsequent to the completion of SCH’s initial business combination and rights to require SCH to register for resale such securities pursuant to Rule 415 under the Securities Act. SCH will bear the expenses incurred in connection with the filing of any such registration statements.
In connection with the Business Combination, the registration rights agreement was amended and restated. For additional information, see the section above titled “—Amended and Restated Registration Rights Agreement.”
Subscription Agreements
Concurrently with the execution of the Merger Agreement, we entered into Subscription Agreements with the Sponsor Related PIPE Investors, pursuant to which the Sponsor Related PIPE Investors have subscribed for shares of SoFi Technologies common stock in connection with the PIPE Investment. The Sponsor Related PIPE Investors are expected to fund $275,000,000 of the PIPE Investment, for which they will receive 27,500,000 shares of SoFi Technologies common stock. Specifically, (i) ChaChaCha SPAC 5, LLC, an entity affiliated with SCH’s Chairman and Chief Executive Officer Chamath Palihapitiya, subscribed for 13,100,000 shares of our common stock, (ii) Hedosophia Group Limited, Longsutton Limited and Hedosophia Public Investment Group Limited, each of which are entities affiliated with SCH’s President and director Ian Osborne, subscribed for an aggregate of 13,100,000 shares of our common stock, of which certain shares were subsequently assigned to affiliates of Hedosophia Group Limited, (iii) The Steven Trieu Living Trust dtd 4.3.12, an entity affiliated with SCH’s Chief Financial Officer Steven Trieu, subscribed for 240,000 shares of our common stock, and (iv) individuals affiliated with the Sponsor subscribed for the remaining 1,060,000 shares of our common stock.
The PIPE Investment was consummated concurrently with the Closing.
Related Party Note and Advances
During the three months ended March 31, 2021, the Sponsor paid for certain costs on behalf of the Company. The advances are non-interest bearing and due on demand. As of March 31, 2021, advances amounting to $40,705 were outstanding.
252

TABLE OF CONTENTS
On July 16, 2020, SCH issued an unsecured promissory note to the Sponsor, pursuant to which SCH borrowed an aggregate principal amount of $300,000. The note was non-interest bearing and payable on the earlier of (i) June 30, 2020 and (ii) the completion of the initial public offering. This note was amended and restated on September 17, 2020 solely to increase the amount that could be borrowed to an aggregate principal amount of $400,000. The borrowings outstanding under the note in the amount of $400,000 were repaid upon the consummation of the initial public offering on October 14, 2020.
On January 11, 2021, SCH issued a promissory note to Sponsor (the "Promissory Note"), pursuant to which SCH may borrow up to an aggregate principal amount of $2,500,000. The Promissory Note is non-interest bearing and payable on the earlier of (i) October 14, 2022 and (ii) the completion of the Business Combination. As of March 31, 2021, SCH had drawn $1,415,000 under the Promissory Note.
Administrative Services Agreement
SCH entered into an agreement whereby, commencing on October 9, 2020 through the earlier of the consummation of a business combination or SCH’s liquidation, SCH will pay an affiliate of the Sponsor a monthly fee of $10,000 for office space, administrative and support services. For the period from July 10, 2020 (inception) through December 31, 2020, SCH incurred $25,000 in fees for these services, of which such amount is included in accrued expenses in the accompanying balance sheet.
Financial Advisor Fees Related to Public Offering
In connection with the SCH initial public offering, the underwriters of SCH initial public offering agreed to reimburse SCH for financial advisory services payable to Connaught (UK) Limited (“Connaught”) for amounts equal to (1) 10% of the non-deferred underwriting commission payable to the underwriter, of which $1,400,000 was paid to Connaught upon the closing of the SCH initial public offering, and (2) 20% of the deferred underwriting commission payable to the underwriter, of which $5,635,000 was paid to Connaught upon the closing of SCH’s initial business combination. Connaught is an affiliate of SCH, the Sponsor, and certain of SCH’s directors and officers.
253

TABLE OF CONTENTS
DESCRIPTION OF OUR SECURITIES
Authorized Capitalization
General
The total amount of authorized capital stock of SoFi Technologies consists of 3,000,000,000 shares of voting common stock, par value $0.0001 per share, 100,000,000 shares of non-voting common stock, par value of $0.0001 per share, 100,000,000 shares of preferred stock, par value $0.0001 per share and 100,000,000 shares of redeemable preferred stock, par value $0.0000025 per share. We have 795,224,257 shares of SoFi Technologies voting common stock outstanding and approximately 3,234,000 shares of SoFi Technologies Series 1 Preferred Stock.
The following summary of certain provisions of SoFi Technologies securities does not purport to be complete, and we urge you to read the Certificate of Incorporation, Bylaws, the Warrant Agreement and the form of Amended and Restated Series H Preferred Stock Warrant Agreement.
Preferred Stock
Our board of directors has authority to issue shares of SoFi Technologies’ preferred stock in one or more series, to fix for each such series such voting powers, designations, preferences, qualifications, limitations or restrictions thereof, including dividend rights, conversion rights, redemption privileges and liquidation preferences for the issue of such series all to the fullest extent permitted by the DGCL. The issuance of SoFi Technologies preferred stock could have the effect of decreasing the trading price of SoFi Technologies common stock, restricting dividends on SoFi Technologies capital stock, diluting the voting power of SoFi Technologies common stock, impairing the liquidation rights of SoFi Technologies capital stock, or delaying or preventing a change in control of SoFi Technologies.
Redeemable Preferred Stock
The board of directors has authority to issue shares of SoFi Technologies’ redeemable preferred stock in one or more series, to fix for each such series such voting powers, designations, preferences, qualifications, limitations or restrictions thereof, including dividend rights, conversion rights, redemption privileges and liquidation preferences for the issue of such series all to the fullest extent permitted by the DGCL. The issuance of SoFi Technologies preferred stock could have the effect of decreasing the trading price of SoFi Technologies common stock, restricting dividends on SoFi Technologies capital stock, diluting the voting power of SoFi Technologies common stock, impairing the liquidation rights of SoFi Technologies capital stock, or delaying or preventing a change in control of SoFi Technologies.
Pursuant to the Certificate of Incorporation, the shares of SoFi Technologies Series 1 Preferred Stock rank senior to all classes of SoFi Technologies common stock and existing and future series or classes of capital stock the terms of which do not expressly provide that it ranks senior to or pari passu with the SoFi Technologies Series 1 Preferred Stock, on parity with future series or classes of capital stock, the terms of which expressly provide that it ranks pari passu with the SoFi Technologies Series 1 Preferred Stock, and junior to all existing and future indebtedness of SoFi Technologies and any future series or class of capital stock the terms of which expressly provide that it ranks senior to the SoFi Technologies Series 1 Preferred Stock. The shares of SoFi Technologies Series 1 Preferred Stock are not convertible into any other securities of SoFi Technologies.
The SoFi Technologies Series 1 Preferred Stock has no stated maturity and will not be subject to any sinking fund or, except upon exercise of any put right as further described below, mandatory redemption. The SoFi Technologies Series 1 Preferred Stock is redeemable at SoFi Technologies’ option as follows: SoFi Technologies may at any time, but no more than three times, at its option, redeem the SoFi Technologies Series 1 Preferred Stock, in whole or in part (subject to a minimum redemption amount as more fully described in the Certificate of Incorporation), including, in some cases, subject to the payment of a redemption premium.
Holders of the SoFi Technologies Series 1 Preferred Stock have put rights pursuant to which they may require SoFi Technologies to purchase for cash some or all of the shares of the SoFi Technologies Series 1 Preferred Stock
254

TABLE OF CONTENTS
under certain circumstances, including in connection with a change of control, if a dividend default occurs and if a covenant default occurs and is not cured within the allowed time.
Common Stock
SoFi Technologies common stock is not entitled to preemptive or other similar subscription rights to purchase any of SoFi Technologies securities. SoFi Technologies common stock is neither convertible nor redeemable.
Voting Rights
Each holder of SoFi Technologies voting common stock is entitled to one vote per share on each matter submitted to a vote of stockholders, as provided by the Certificate of Incorporation. The Bylaws provide that the holders of a majority of the capital stock issued and outstanding and entitled to vote thereat, present in person or represented by proxy, will constitute a quorum at all meetings of the stockholders for the transaction of business. When a quorum is present, the affirmative vote of a majority of the votes cast is required to take action, unless otherwise specified by law, the Bylaws or the Certificate of Incorporation, and except for the election of directors, which is determined by a plurality vote. There are no cumulative voting rights.
Each holder of the SoFi Technologies Series 1 Preferred Stock is entitled to vote on each matter submitted to a vote of holders of SoFi Technologies common stock and is entitled to one vote for each share of SoFi Technologies Series 1 Preferred Stock. The holders of voting common stock and SoFi Technologies Series 1 Preferred Stock vote together as a single class on all matters submitted to a vote of stockholders.
So long as any shares of SoFi Technologies Series 1 Preferred Stock remain outstanding, the affirmative vote or consent of the holders of at least a majority of the outstanding shares of SoFi Technologies Series 1 Preferred Stock is required for SoFi Technologies to amend, alter or repeal any provision of the Certificate of Incorporation or the Bylaws in a manner that materially adversely affects the holders of the SoFi Technologies Series 1 Preferred Stock.
Upon the occurrence of a dividend default, subject to certain conditions, the size of the board of directors will be increased by one, and Holders of the SoFi Technologies Series 1 Preferred Stock have the right to appoint a director to fill the vacancy, which director will serve until certain conditions relating to payment of the cumulative dividends are met.
Dividend Rights
Each holder of shares of SoFi Technologies capital stock is entitled to the payment of dividends and other distributions as may be declared by the board of directors from time to time out of the assets of SoFi Technologies or funds legally available for dividends or other distributions. These rights are subject to the preferential rights of the holders of SoFi Technologies preferred stock, if any, and any contractual limitations on the ability of SoFi Technologies to declare and pay dividends.
The holders of SoFi Technologies Series 1 Preferred Stock are entitled to receive cumulative cash dividends at a fixed rate equal to 12.5% per annum prior to declaration or payment of any dividend (other than dividends payable in shares of capital stock junior to the SoFi Technologies Series 1 Preferred Stock) on any such more junior shares of capital stock. Such dividends will accumulate and compound (if applicable) regardless of whether SoFi Technologies has earnings, whether or not there are funds legally available for the payment of those dividends and whether or not those dividends are declared by the board of directors. On the fifth anniversary of May 29, 2019 and annually thereafter, the dividend rate will reset to a new fixed rate equal to six-month London Inter-Bank Offered Rate as in effect on the second London banking day prior to such date plus a spread of 9.9399% per annum.
Other Rights
Each holder of SoFi Technologies common stock is subject to, and may be adversely affected by, the rights of the holders of the SoFi Technologies Series 1 Preferred Stock and any series of SoFi Technologies preferred stock that SoFi Technologies may designate and issue in the future.
255

TABLE OF CONTENTS
Restrictions on Ownership and Transfer
The Certificate of Incorporation contains certain restrictions on the transfer and ownership of common stock that are intended to assist SoFi Technologies in complying with applicable regulatory requirements under the Bank Holding Company Act. The relevant sections of the Certificate of Incorporation provide that, in the event SoFi Technologies becomes a bank holding company (within the meaning of the Bank Holding Company Act), then the minimum number of shares of common stock collectively held by SoftBank Group Capital Limited and SB Sonic Holdco (UK) Limited (each, a “SoftBank Holder” and collectively, the “SoftBank Holders”) will automatically be converted into an equal number of shares of non-voting common stock so that the SoftBank Holders, together with their affiliates, would not own or control, or be deemed to own or control, collectively, greater than 24.9% of the voting power of any class of voting securities of SoFi Technologies. Shares of common stock held by the SoftBank Holders will also automatically convert to shares of non-voting common stock upon written notice from the SoftBank Holders to SoFi Technologies. Shares of non-voting common stock will not be convertible into shares of common stock in the hands of any SoftBank Holder or its transferees, except that (i) each share of non-voting common stock will automatically be converted into one share of common stock in certain permitted transfers, and (ii) in connection with any issuances of common stock by SoFi Technologies, at the election of any SoftBank Holder, shares of non-voting common stock held by such SoftBank Holder may be converted into the same number of shares of common stock so long as the SoftBank Holder does not acquire a higher percentage of outstanding common stock than such SoftBank Holder controlled immediately prior to such issuance.
The Bylaws contain provisions that, subject to certain exceptions as further set forth in the bylaws, restrict for a period of 30 days following the closing of the Business Combination the sale or transfer of shares of SoFi Technologies common stock (a) issued to holders of SoFi capital stock in the Merger or (b) underlying equity awards of SoFi Technologies issued in respect of equity awards of SoFi outstanding at closing of the Business Combination.
Liquidation Rights
If SoFi Technologies is involved in voluntary or involuntary liquidation, dissolution or winding up of the affairs of SoFi Technologies, or a similar event, each holder of SoFi Technologies common stock will participate pro rata in all assets remaining after payment of liabilities, subject to prior distribution rights of SoFi Technologies preferred stock and redeemable preferred stock, if any, then outstanding.
Redeemable Warrants
Public Shareholders’ Warrants
Each whole warrant will entitle the registered holder to purchase one share of SoFi Technologies common stock at a price of $11.50 per share, subject to adjustment as discussed below, at any time commencing on the later of 30 days after May 28, 2021 and 12 months from October 14, 2020, except as described below. Pursuant to the Warrant Agreement, a warrant holder may exercise its warrants only for a whole number of SoFi Technologies common stock. This means only a whole warrant may be exercised at a given time by a warrant holder. No fractional public warrants will be issued upon separation of the units and only whole public warrants will trade. The public warrants will expire five years after the completion of the Business Combination, at 5:00 p.m., New York City time, or earlier upon redemption or liquidation.
We will not be obligated to deliver any shares of SoFi Technologies common stock pursuant to the exercise of a public warrant and will have no obligation to settle such public warrant exercise unless a registration statement under the Securities Act covering the issuance of the SoFi Technologies common stock issuable upon exercise of the public warrants is then effective and a current prospectus relating thereto is current, subject to our satisfying our obligations described below with respect to registration, or a valid exemption from registration is available, including in connection with a cashless exercise permitted as a result of a notice of redemption described below under "Redemption of warrants when the price per SoFi Technologies common stock equals or exceeds $10.00." No public warrant will be exercisable for cash or on a cashless basis, and we will not be obligated to issue any shares to holders seeking to exercise their public warrants, unless the issuance of the shares upon such exercise is registered or qualified under the securities laws of the state of the exercising holder, or an exemption is available. In the event that
256

TABLE OF CONTENTS
the conditions in the two immediately preceding sentences are not satisfied with respect to a public warrant, the holder of such public warrant will not be entitled to exercise such warrant and such warrant may have no value and expire worthless.
Redemption of warrants when the price per share of SoFi Technologies common stock equals or exceeds $18.00. Once the warrants become exercisable, we may redeem the outstanding warrants (except as described herein with respect to the private placement warrants):
in whole and not in part;
at a price of $0.01 per warrant;
upon not less than 30 days’ prior written notice of redemption to each warrant holder; and
if, and only if, the last reported sale price of the SoFi Technologies common stock for any 20 trading days within a 30-trading day period ending on the third trading day prior to the date on which we send the notice of redemption to the warrant holders (which we refer to as the “Reference Value”) equals or exceeds $18.00 per share (as adjusted for adjustments to the number of shares issuable upon exercise or the exercise price of a warrant as described under the heading ”— Anti-dilution Adjustments”).
If and when the public warrants become redeemable by us, we may exercise our redemption right even if we are unable to register or qualify the underlying securities for sale under all applicable state securities laws.
We have established the last of the redemption criterion discussed above to prevent a redemption call unless there is at the time of the call a significant premium to the public warrant exercise price. If the foregoing conditions are satisfied and we issue a notice of redemption of the public warrants, each public warrant holder will be entitled to exercise his, her or its public warrant prior to the scheduled redemption date. However, the price of the SoFi Technologies common stock may fall below the $18.00 redemption trigger price (as adjusted for adjustments to the number of shares issuable upon exercise or the exercise price of a warrant as described under the heading “— Anti-dilution Adjustments”) as well as the $11.50 (for whole shares) warrant exercise price after the redemption notice is issued.
Redemption of warrants when the price per share of SoFi Technologies common stock equals or exceeds $10.00. Once the warrants become exercisable, we may redeem the outstanding warrants:
in whole and not in part;
at $0.10 per warrant upon a minimum of 30 days’ prior written notice of redemption provided that holders will be able to exercise their warrants on a cashless basis prior to redemption and receive that number of shares determined by reference to the table below, based on the redemption date and the “fair market value” of SoFi Technologies common stock (as defined below) except as otherwise described below;
if, and only if, the Reference Value (as defined above under “— Redemption of warrants when the price per share of SoFi Technologies common stock equals or exceeds $18.00”) equals or exceeds $10.00 per share (as adjusted for adjustments to the number of shares issuable upon exercise or the exercise price of a warrant as described under the heading “— Anti-dilution Adjustments”); and
if the Reference Value is less than $18.00 per share (as adjusted for adjustments to the number of shares issuable upon exercise or the exercise price of a warrant as described under the heading “— Anti-dilution Adjustments”), the private placement warrants must also be concurrently called for redemption on the same terms as the outstanding public warrants, as described above.
During the period beginning on the date the notice of redemption is given, holders may elect to exercise their warrants on a cashless basis. The numbers in the table below represent the number of shares of SoFi Technologies common stock that a warrant holder will receive upon such cashless exercise in connection with a redemption by us pursuant to this redemption feature, based on the “fair market value” of SoFi Technologies common stock on the corresponding redemption date (assuming holders elect to exercise their warrants and such warrants are not
257

TABLE OF CONTENTS
redeemed for $0.10 per warrant), determined for these purposes based on volume weighted average price of SoFi Technologies common stock during the 10 trading days immediately following the date on which the notice of redemption is sent to the holders of warrants, and the number of months that the corresponding redemption date precedes the expiration date of the warrants, each as set forth in the table below. We will provide our warrant holders with the final fair market value no later than one business day after the 10-trading day period described above ends.
The share prices set forth in the column headings of the table below will be adjusted as of any date on which the number of shares issuable upon exercise of a warrant or the exercise price of a warrant is adjusted as set forth under the heading “— Anti-dilution Adjustments” below. If the number of shares issuable upon exercise of a warrant is adjusted, the adjusted share prices in the column headings will equal the share prices immediately prior to such adjustment, multiplied by a fraction, the numerator of which is the number of shares deliverable upon exercise of a warrant immediately prior to such adjustment and the denominator of which is the number of shares deliverable upon exercise of a warrant as so adjusted. The number of shares in the table below shall be adjusted in the same manner and at the same time as the number of shares issuable upon exercise of a warrant. If the exercise price of a warrant is adjusted, (a) in the case of an adjustment pursuant to the fifth paragraph under the heading “— Anti-dilution Adjustments” below, the adjusted share prices in the column headings will equal the unadjusted share price multiplied by a fraction, the numerator of which is the higher of the Market Value and the Newly Issued Price as set forth under the heading “— Anti-dilution Adjustments” and the denominator of which is $10.00 and (b) in the case of an adjustment pursuant to the second paragraph under the heading “— Anti-dilution Adjustments” below, the adjusted share prices in the column headings will equal the unadjusted share price less the decrease in the exercise price of a warrant pursuant to such exercise price adjustment.
Fair Market Value of SoFi Technologies common stock
Redemption Date (period to expiration of warrants) ≤$10.00 $11.00 $12.00 $13.00 $14.00 $15.00 $16.00 $17.00 ≥$18.00
60 months 0.261 0.281 0.297 0.311 0.324 0.337 0.348 0.358 0.361
57 months 0.257 0.277 0.294 0.31 0.324 0.337 0.348 0.358 0.361
54 months 0.252 0.272 0.291 0.307 0.322 0.335 0.347 0.357 0.361
51 months 0.246 0.268 0.287 0.304 0.32 0.333 0.346 0.357 0.361
48 months 0.241 0.263 0.283 0.301 0.317 0.332 0.344 0.356 0.361
45 months 0.235 0.258 0.279 0.298 0.315 0.33 0.343 0.356 0.361
42 months 0.228 0.252 0.274 0.294 0.312 0.328 0.342 0.355 0.361
39 months 0.221 0.246 0.269 0.29 0.309 0.325 0.34 0.354 0.361
36 months 0.213 0.239 0.263 0.285 0.305 0.323 0.339 0.353 0.361
33 months 0.205 0.232 0.257 0.28 0.301 0.32 0.337 0.352 0.361
30 months 0.196 0.224 0.25 0.274 0.297 0.316 0.335 0.351 0.361
27 months 0.185 0.214 0.242 0.268 0.291 0.313 0.332 0.35 0.361
24 months 0.173 0.204 0.233 0.26 0.285 0.308 0.329 0.348 0.361
21 months 0.161 0.193 0.223 0.252 0.279 0.304 0.326 0.347 0.361
18 months 0.146 0.179 0.211 0.242 0.271 0.298 0.322 0.345 0.361
15 months 0.13 0.164 0.197 0.23 0.262 0.291 0.317 0.342 0.361
12 months 0.111 0.146 0.181 0.216 0.25 0.282 0.312 0.339 0.361
9 months 0.09 0.125 0.162 0.199 0.237 0.272 0.305 0.336 0.361
6 months 0.065 0.099 0.137 0.178 0.219 0.259 0.296 0.331 0.361
3 months 0.034 0.065 0.104 0.15 0.197 0.243 0.286 0.326 0.361
0 months 0 0 0.042 0.115 0.179 0.233 0.281 0.323 0.361
This redemption feature differs from the typical warrant redemption features used in many other blank check offerings, which typically only provide for a redemption of warrants for cash (other than the private placement warrants) when the trading price for the SoFi Technologies common stock exceeds $18.00 per share for a specified period of time. This redemption feature is structured to allow for all of the outstanding warrants to be redeemed when the SoFi Technologies common stock is trading at or above $10.00 per share, which may be at a time when the trading price of SoFi Technologies common stock is below the exercise price of the warrants. We have established
258

TABLE OF CONTENTS
this redemption feature to provide us with the flexibility to redeem the warrants without the warrants having to reach the $18.00 per share threshold set forth above under — Redemption of warrants when the price per share of SoFi Technologies common stock equals or exceeds $18.00”. Holders choosing to exercise their warrants in connection with a redemption pursuant to this feature will, in effect, receive a number of shares for their warrants based on an option pricing model with a fixed volatility input as of the date of this prospectus. This redemption right provides us with an additional mechanism by which to redeem all of the outstanding warrants, and therefore have certainty as to our capital structure as the warrants would no longer be outstanding and would have been exercised or redeemed. We will be required to pay the applicable redemption price to warrant holders if we choose to exercise this redemption right and it will allow us to quickly proceed with a redemption of the warrants if we determine it is in our best interest to do so. As such, we would redeem the warrants in this manner when we believe it is in our best interest to update our capital structure to remove the warrants and pay the redemption price to the warrant holders.
As stated above, we can redeem the warrants when the shares of SoFi Technologies common stock are trading at a price starting at $10.00, which is below the exercise price of $11.50, because it will provide certainty with respect to our capital structure and cash position while providing warrant holders with the opportunity to exercise their warrants on a cashless basis for the applicable number of shares. If we choose to redeem the warrants when the SoFi Technologies common stock is trading at a price below the exercise price of the warrants, this could result in the warrant holders receiving fewer SoFi Technologies common stock than they would have received if they had chosen to wait to exercise their warrants for SoFi Technologies common stock if and when such SoFi Technologies common stock was trading at a price higher than the exercise price of $11.50.
No fractional shares of SoFi Technologies common stock will be issued upon exercise. If, upon exercise, a holder would be entitled to receive a fractional interest in a share, we will round down to the nearest whole number of the number of SoFi Technologies common stock to be issued to the holder. If, at the time of redemption, the warrants are exercisable for a security other than the SoFi Technologies common stock pursuant to the Warrant Agreement, the warrants may be exercised for such security. At such time as the warrants become exercisable for a security other than the SoFi Technologies common stock, the Company (or surviving company) will use its commercially reasonable efforts to register under the Securities Act the security issuable upon the exercise of the warrants.
Redemption procedures. A holder of a warrant may notify us in writing in the event it elects to be subject to a requirement that such holder will not have the right to exercise such warrant, to the extent that after giving effect to such exercise, such person (together with such person’s affiliates), to Continental Stock Transfer & Trust Company’s, as warrant agent (the “Warrant Agent”), actual knowledge, would beneficially own in excess of 9.8% (or such other amount as a holder may specify) of the SoFi Technologies common stock issued and outstanding immediately after giving effect to such exercise.
Anti-dilution Adjustments. If the number of issued and outstanding SoFi Technologies common stock is increased by a capitalization or share dividend payable in SoFi Technologies common stock, or by a split-up of SoFi Technologies common stock or other similar event, then, on the effective date of such capitalization or share dividend, split-up or similar event, the number of shares of SoFi Technologies common stock issuable on exercise of each warrant will be increased in proportion to such increase in the issued and outstanding SoFi Technologies common stock. A rights offering to holders of SoFi Technologies common stock entitling holders to purchase SoFi Technologies common stock at a price less than the “historical fair market value” (as defined below) will be deemed a share dividend of a number of SoFi Technologies common stock equal to the product of (1) the number of shares of SoFi Technologies common stock actually sold in such rights offering (or issuable under any other equity securities sold in such rights offering that are convertible into or exercisable for SoFi Technologies common stock) and (2) one minus the quotient of (x) the price per share of SoFi Technologies common stock paid in such rights offering and (y) the historical fair market value. For these purposes, (1) if the rights offering is for securities convertible into or exercisable for SoFi Technologies common stock, in determining the price payable for SoFi Technologies common stock, there will be taken into account any consideration received for such rights, as well as any additional amount payable upon exercise or conversion and (2) “historical fair market value” means the volume weighted average price of SoFi Technologies common stock during the 10 trading day period ending on the trading day prior to the first date on which the SoFi Technologies common stock trades on the applicable exchange or in the applicable market, regular way, without the right to receive such rights.
259

TABLE OF CONTENTS
In addition, if we, at any time while the warrants are outstanding and unexpired, pay to all or substantially all of the holders of SoFi Technologies common stock a dividend or make a distribution in cash, securities or other assets to the holders of SoFi Technologies common stock on account of such SoFi Technologies common stock (or other securities into which the warrants are convertible), other than (a) as described above or (b) any cash dividends or cash distributions which, when combined on a per share basis with all other cash dividends and cash distributions paid on the SoFi Technologies common stock during the 365-day period ending on the date of declaration of such dividend or distribution does not exceed $0.50 (as adjusted for share sub-divisions, share dividends, rights issuances, consolidations, reorganizations, recapitalizations and other similar transactions) but only with respect to the amount of the aggregate cash dividends or cash distributions equal to or less than $0.50 per share, then the warrant exercise price will be decreased, effective immediately after the effective date of such event, by the amount of cash and/or the fair market value of any securities or other assets paid on each SoFi Technologies common stock in respect of such event.
If the number of issued and outstanding shares of SoFi Technologies common stock is decreased by a consolidation, combination, reverse share sub-division or reclassification of SoFi Technologies common stock or other similar event, then, on the effective date of such consolidation, combination, reverse share sub-division, reclassification or similar event, the number of shares of SoFi Technologies common stock issuable on exercise of each warrant will be decreased in proportion to such decrease in issued and outstanding SoFi Technologies common stock.
Whenever the number of shares of SoFi Technologies common stock purchasable upon the exercise of the warrants is adjusted, as described above, the warrant exercise price will be adjusted by multiplying the warrant exercise price immediately prior to such adjustment by a fraction (x) the numerator of which will be the number of shares of SoFi Technologies common stock purchasable upon the exercise of the warrants immediately prior to such adjustment and (y) the denominator of which will be the number of shares of SoFi Technologies common stock so purchasable immediately thereafter.
In case of any reclassification or reorganization of the issued and outstanding SoFi Technologies common stock (other than those described above or that solely affects the par value of such SoFi Technologies common stock), or in the case of a merger or consolidation of us with or into another corporation (other than a merger or consolidation in which we are the continuing corporation and that does not result in any reclassification or reorganization of our issued and outstanding SoFi Technologies common stock), or in the case of any sale or conveyance to another corporation or entity of the assets or other property of us as an entirety or substantially as an entirety in connection with which we are dissolved, the holders of the warrants will thereafter have the right to purchase and receive, upon the basis and upon the terms and conditions specified in the warrants and in lieu of SoFi Technologies common stock immediately theretofore purchasable and receivable upon the exercise of the rights represented thereby, the kind and amount of shares, stock or other equity securities or property (including cash) receivable upon such reclassification, reorganization, merger or consolidation, or upon a dissolution following any such sale or transfer, that the holder of the warrants would have received if such holder had exercised their warrants immediately prior to such event. However, if such holders were entitled to exercise a right of election as to the kind or amount of securities, cash or other assets receivable upon such merger or consolidation, then the kind and amount of securities, cash or other assets for which each warrant will become exercisable will be deemed to be the weighted average of the kind and amount received per share by such holders in such merger or consolidation that affirmatively make such election, and if a tender, exchange or redemption offer has been made to and accepted by such holders under circumstances in which, upon completion of such tender or exchange offer, the maker thereof, together with members of any group (within the meaning of Rule 13d-5(b)(1) under the Exchange Act) of which such maker is a part, and together with any affiliate or associate of such maker (within the meaning of Rule 12b-2 under the Exchange Act) and any members of any such group of which any such affiliate or associate is a part, own beneficially (within the meaning of Rule 13d-3 under the Exchange Act) more than 50% of the issued and outstanding SoFi Technologies common stock, the holder of a warrant will be entitled to receive the highest amount of cash, securities or other property to which such holder would actually have been entitled as a shareholder if such warrant holder had exercised the warrant prior to the expiration of such tender or exchange offer, accepted such offer and all of the SoFi Technologies common stock held by such holder had been purchased pursuant to such tender or exchange offer, subject to adjustment (from and after the consummation of such tender or exchange offer)
260

TABLE OF CONTENTS
as nearly equivalent as possible to the adjustments provided for in the Warrant Agreement. Additionally, if less than 70% of the consideration receivable by the holders of SoFi Technologies common stock in such a transaction is payable in the form of ordinary shares in the successor entity that is listed for trading on a national securities exchange or is quoted in an established over-the-counter market, or is to be so listed for trading or quoted immediately following such event, and if the registered holder of the warrant properly exercises the warrant within 30 days following public disclosure of such transaction, the warrant exercise price will be reduced as specified in the Warrant Agreement based on the per share consideration minus Black-Scholes Warrant Value (as defined in the Warrant Agreement) of the warrant.
The warrants will be issued in registered form under a Warrant Agreement between the Warrant Agent, and us. You should review a copy of the Warrant Agreement, which will be filed as an exhibit to the registration statement of which this prospectus is a part, for a complete description of the terms and conditions applicable to the warrants. The Warrant Agreement provides that (a) the terms of the warrants may be amended without the consent of any holder for the purpose of (i) curing any ambiguity or correct any mistake, including to conform the provisions of the Warrant Agreement to the description of the terms of the warrants and the Warrant Agreement set forth in this prospectus, or defective provision or (ii) adding or changing any provisions with respect to matters or questions arising under the Warrant Agreement as the parties to the Warrant Agreement may deem necessary or desirable and that the parties deem to not adversely affect the rights of the registered holders of the warrants under the Warrant Agreement and (b) all other modifications or amendments require the vote or written consent of at least 65% of the then outstanding public warrants; provided that any amendment that solely affects the terms of the private placement warrants or any provision of the Warrant Agreement solely with respect to the private placement warrants will also require at least 65% of the then outstanding private placement warrants.
The warrant holders do not have the rights or privileges of holders of ordinary shares and any voting rights until they exercise their warrants and receive SoFi Technologies common stock. After the issuance of SoFi Technologies common stock upon exercise of the warrants, each holder will be entitled to one vote for each share held of record on all matters to be voted on by shareholders.
We have agreed that, subject to applicable law, any action, proceeding or claim against us arising out of or relating in any way to the Warrant Agreement will be brought and enforced in the courts of the State of New York or the United States District Court for the Southern District of New York, and we irrevocably submit to such jurisdiction, which jurisdiction will be the exclusive forum for any such action, proceeding or claim. See ”Risk Factors — Our Warrant Agreement will designate the courts of the State of New York or the United States District Court for the Southern District of New York as the sole and exclusive forum for certain types of actions and proceedings that may be initiated by holders of our warrants, which could limit the ability of warrant holders to obtain a favorable judicial forum for disputes with our company.” This provision applies to claims under the Securities Act but does not apply to claims under the Exchange Act or any claim for which the United States Federal District Courts are the sole and exclusive forum.
Private Placement Warrants
The private placement warrants (including the SoFi Technologies common stock issuable upon exercise of the private placement warrants) will not be transferable, assignable or salable until 30 days after the completion of the Business Combination (except, among other limited exceptions as described under ”Principal Shareholders — Transfers of Founder Shares and Private Placement Warrants”, to our directors and officers and other persons or entities affiliated with our Sponsor) and they will not be redeemable by us (except as described above under ”— Public Shareholders’ Warrants — Redemption of warrants when the price per share of SoFi Technologies common stock equals or exceeds $10.00”) so long as they are held by our Sponsor or its permitted transferees. Our Sponsor, or its permitted transferees, has the option to exercise the private placement warrants on a cashless basis and have certain registration rights described herein. Otherwise, the private placement warrants have terms and provisions that are identical to those of the warrants being sold as part of the units in the SCH initial public offering on October 14, 2020. If the private placement warrants are held by holders other than our Sponsor or its permitted transferees, the private placement warrants will be redeemable by us in all redemption scenarios and exercisable by the holders on the same basis as the warrants included in the units being sold in the SCH initial public offering on October 14, 2020.
261

TABLE OF CONTENTS
Except as described under ”— Public Shareholders’ Warrants — Redemption of warrants when the price per share of SoFi Technologies common stock equals or exceeds $10.00”, if holders of the private placement warrants elect to exercise them on a cashless basis, they would pay the exercise price by surrendering his, her or its warrants for that number of shares of SoFi Technologies common stock equal to the quotient obtained by dividing (x) the product of the number of shares of SoFi Technologies common stock underlying the warrants, multiplied by the excess of the “historical fair market value” (defined below) less the exercise price of the warrants by (y) the historical fair market value. For these purposes, the “historical fair market value” shall mean the average last reported sale price of the SoFi Technologies common stock for the 10 trading days ending on the third trading day prior to the date on which the notice of warrant exercise is sent to the Warrant Agent.
SoFi Warrants
Each SoFi warrant entitles the holder thereof to purchase one share of SoFi Technologies common stock at a price of $8.86 per share (subject to certain adjustments) at any time prior to the expiration of the warrant. The SoFi warrants expire at 5:00 p.m., New York time on May 19, 2024, the five-year anniversary of the original issue date of the warrants to acquire SoFi Series H preferred stock. SoFi Technologies is required to provide the holders of SoFi warrants at least 30 days’ notice and the opportunity to exercise such warrants prior to the expiration of the warrants.
Holders may elect to exercise the warrants on a cashless basis. Upon such a cashless exercise, SoFi Technologies would issue a number of shares of SoFi Technologies common stock equal to the quotient obtained by dividing (x) (i) the number of shares of SoFi Technologies common stock underlying the warrants being exercised multiplied by (ii) the difference between the fair market value of one share of SoFi Technologies common stock and the exercise price of the warrants, by (y) the fair market value of one share of SoFi Technologies common stock. For these purposes, fair market value means the fair market value as determined by the SoFi Technologies board of directors or, if SoFi Technologies common stock is traded on a national securities exchange or other trading market, the closing price or last sale price of a share of SoFi Technologies common stock reported for the business day immediately prior to the date on which applicable exercise notice is delivered.
The exercise price and amount and kind of property into which the SoFi warrants are exercisable are subject to adjustment upon the occurrence of a stock split, reverse stock split, dividend of common stock or common stock equivalent or recapitalizations or similar transaction with respect to SoFi Technologies common stock. If SoFi Technologies declares a distribution on SoFi Technologies common stock payable in cash, indebtedness, securities, assets or options or rights for which no other adjustment is provided by the terms of the SoFi warrants, holders of SoFi warrants are entitled to receive, upon exercise of the SoFi warrant, the number and kind of securities and assets (including cash dividends) that such holders would have received had such holders been record holders of the SoFi Technologies common stock issuable pursuant to the SoFi warrants as of the record date for such distribution.
No fractional shares of SoFi Technologies common stock will be issued upon the exercise of a SoFi warrant. In lieu of a fractional share, the number of shares of SoFi Technologies common stock will be rounded down to the nearest whole share, and SoFi Technologies will pay the exercising holder an amount in cash equal to the fair market value of such fractional share on the date of exercise, as determined in good faith by the SoFi Technologies board of directors.
Anti-Takeover Effects of the Certificate of Incorporation and the Bylaws
The Certificate of Incorporation and the Bylaws contain provisions that may delay, defer or discourage another party from acquiring control of SoFi Technologies. SoFi Technologies expects that these provisions, which are summarized below, will discourage coercive takeover practices or inadequate takeover bids. These provisions are also designed to encourage persons seeking to acquire control of SoFi Technologies to first negotiate with the board of directors, which SoFi Technologies believes may result in an improvement of the terms of any such acquisition in favor of SoFi Stockholders. However, they also give the board of directors the power to discourage mergers that some stockholders may favor.
262

TABLE OF CONTENTS
Board Composition and Filling Vacancies
The Certificate of Incorporation provides that directors may be removed with or without cause by the affirmative vote of a majority of the holders of the shares then entitled to vote at an election of directors. Any vacancy on the board of directors, however occurring, including a vacancy resulting from an increase in the size of the board of directors, may only be filled by the affirmative vote of a majority of our directors then in office even if less than a quorum, subject to the rights granted to certain stockholders under the Shareholders’ Rights Agreement. The treatment of vacancies has the effect of making it more difficult for stockholders to change the composition of our board of directors.
Special Meetings of Stockholders
The Certificate of Incorporation provides that a special meeting of stockholders may be called by the (a) the Chairperson of the board of directors, (b) the board of directors or (c) the Chief Executive Officer of SoFi Technologies, provided that such special meeting may be postponed, rescheduled or canceled by the board of directors or other person calling the meeting. The Bylaws limit the business that may be conducted at an annual or special meeting of stockholders to those matters properly brought before the meeting.
Action by Written Consent
The Certificate of Incorporation provides that any action required or permitted to be taken by the stockholders must be effected at an annual or special meeting of the stockholders, and may not be taken by written consent in lieu of a meeting. This limit may lengthen the amount of time required to take stockholder actions and would prevent the amendment of our bylaws or removal of directors by our stockholders without holding a meeting of stockholders.
Advance Notice Requirements
The Bylaws establish advance notice procedures with regard to stockholder proposals relating to the nomination of candidates for election as directors or new business to be brought before meetings of SoFi Technologies’ stockholders. These procedures provide that notice of stockholder proposals must be timely given in writing to the corporate secretary of SoFi Technologies prior to the meeting at which the action is to be taken. Generally, to be timely, notice must be received at the principal executive offices of SoFi Technologies not less than 90 days nor more than 120 days prior to the first anniversary date of the annual meeting for the preceding year. The Bylaws specify the requirements as to form and content of all stockholders’ notices. These requirements may preclude stockholders from bringing matters before the stockholders at an annual or special meeting.
Amendment to Certificate of Incorporation and Bylaws
Any amendment of the Certificate of Incorporation must first be approved by a majority of the board of directors, and if required by law or the Certificate of Incorporation, must thereafter be approved by a majority of the outstanding shares entitled to vote on the amendment and a majority of the outstanding shares of each class entitled to vote thereon as a class, except that the amendment of the provisions relating to stockholder action, board composition, limitation of liability and certificate of incorporation must be approved by not less than 66 2/3% of the outstanding shares entitled to vote on the amendment, and not less than 66 2/3% of the outstanding shares of each class entitled to vote thereon as a class. The Bylaws may be amended or repealed by the affirmative vote of a majority of the directors then in office, subject to any limitations set forth in the Bylaws; and may also be amended by the affirmative vote of a majority of the outstanding shares entitled to vote on the election of directors, except that the amendment of the provisions relating to special meetings, voting, advance notice, consents in lieu of meetings, powers, number and qualification of directors, advance notice for nomination of directors, indemnification, exclusive forum and amendments must be approved by the affirmative vote of not less than 66 2/3% 66 2/3% of the voting power of all outstanding shares entitled to vote generally in the election of directors.
Delaware Anti-Takeover Statute
Section 203 of the DGCL provides that if a person acquires 15% or more of the voting stock of a Delaware corporation, such person becomes an “interested stockholder” and may not engage in certain “business
263

TABLE OF CONTENTS
combinations” with such corporation for a period of three years from the time such person acquired 15% or more of such corporation’s voting stock, unless: (i) the board of directors of such corporation approves the acquisition of stock or the merger transaction before the time that the person becomes an interested stockholder, (ii) the interested stockholder owns at least 85% of the outstanding voting stock of such corporation at the time the merger transaction commences (excluding voting stock owned by directors who are also officers and certain employee stock plans), or (iii) the merger transaction is approved by the board of directors and at a meeting of stockholders, not by written consent, by the affirmative vote of 2∕3 of the outstanding voting stock which is not owned by the interested stockholder. A Delaware corporation may elect in its certificate of incorporation or bylaws not to be governed by this particular Delaware law.
Limitations on Liability and Indemnification of Officers and Directors
The Certificate of Incorporation provides that SoFi Technologies will indemnify its directors to the fullest extent authorized or permitted by applicable law. SoFi Technologies expects to enter into agreements to indemnify its directors, executive officers and other employees as determined by the board of directors. Under the Bylaws, SoFi Technologies is required to indemnify each of SoFi Technologies’ directors and officers if the basis of the indemnitee’s involvement was by reason of the fact that the indemnitee is or was a director or officer of SoFi Technologies or was serving at the request of SoFi Technologies as a director, officer, employee or agent for another entity. SoFi Technologies must indemnify its officers and directors against all expenses (including attorneys’ fees), judgments, fines and amounts paid in settlement actually and reasonably incurred by the indemnitee in connection with such action, suit or proceeding if the indemnitee acted in good faith and in a manner the indemnitee reasonably believed to be in or not opposed to the best interests of SoFi Technologies, and, with respect to any criminal action or proceeding, had no reasonable cause to believe the indemnitee’s conduct was unlawful. The Bylaws also require SoFi Technologies to advance expenses (including attorneys’ fees) incurred by a director or officer in defending any civil, criminal, administrative or investigative action, suit or proceeding, provided that such person will repay any such advance if it is ultimately determined that such person is not entitled to indemnification by SoFi Technologies. Any claims for indemnification by SoFi Technologies’ directors and officers may reduce SoFi Technologies’ available funds to satisfy successful third-party claims against SoFi Technologies and may reduce the amount of money available to SoFi Technologies.
Corporate Opportunity Waiver
The Certificate of Incorporation provides that SoFi Technologies acknowledges that, among other things, to the fullest extent permitted by applicable law, Sponsor, the SoftBank Investors, the Silver Lake Investors, the QIA Investors and the Red Crow Investors and their affiliates and director nominees (a) may engage in business that compete with SoFi Technologies without any obligation to offer SoFi Technologies or any holder of SoFi Technologies capital stock the opportunity to participate therein and (b) have not duty to communicate or present to SoFi Technologies or any holder of SoFi Technologies capital stock any potential transaction or matter that may be a corporate opportunity for SoFi Technologies and shall have no liability to SoFi Technologies by reason of the fact that such person pursues or acquires the opportunity for itself or directs the opportunity to another person other than SoFi Technologies; provided, that the foregoing do not apply to any potential transaction or matter that may be a corporate or other business opportunity of SoFi Technologies that is presented in writing to a director nominee of SCH, the SoftBank Investors, the Silver Lake Investors, the QIA Investors or the Red Crow Investors expressly in such director nominee’s capacity as a director or employee of SoFi Technologies (and not in any other capacity).
Exclusive Jurisdiction of Certain Actions
The Bylaws provide that, to the fullest extent permitted by law, and unless SoFi Technologies consents in writing to the selection of an alternative forum, the Court of Chancery of the State of Delaware (or, in the event that such court does not have jurisdiction, the federal district court for the District of Delaware or other state courts of the State of Delaware) will be the sole and exclusive forum for any state law claims for (i) any derivative action or proceeding brought on behalf of SoFi Technologies, (ii) any action asserting a claim for or based on a breach of a fiduciary duty owed by any current or former director, officer or other employee of SoFi Technologies to SoFi Technologies or SoFi Technologies stockholders, (iii) any action asserting a claim against SoFi Technologies or any current or former director or officer or other employee of SoFi Technologies arising pursuant to any provision of the
264

TABLE OF CONTENTS
DGCL or the Bylaws or Certificate of Incorporation (as either may be amended from time to time), (iv) any action asserting a claim related to or involving SoFi Technologies that is governed by the internal affairs doctrine, and (v) any action asserting an “internal corporate claim” as that term is defined in Section 115 of the DGCL (the “Delaware Forum Provision”). The Delaware Forum Provision, however, does not apply to actions or claims arising under the Exchange Act. The Bylaws also provide that, unless SoFi Technologies consents in writing to the selection of an alternate forum, the sole and exclusive forum for the resolution of any complaint asserting a cause of action arising under the Securities Act, and the rules and regulations promulgated thereunder, shall be the United States Federal District Courts. Section 27 of the Exchange Act creates exclusive federal jurisdiction over all suits brought to enforce any duty or liability created by the Exchange Act or the rules and regulations thereunder; SoFi Technologies stockholders cannot and will not be deemed to have waived compliance with the U.S. federal securities laws and the rules and regulations thereunder.
These provisions may have the effect of discouraging certain lawsuits, including derivative lawsuits and lawsuits against the directors and officers of SoFi Technologies, by limiting plaintiffs’ ability to bring a claim in a judicial forum that they find favorable. The enforceability of similar choice of forum provisions in other companies’ certificates of incorporation or bylaws has been challenged in legal proceedings, and it is possible that, in connection with any applicable action brought against SoFi Technologies, a court could find the choice of forum provisions contained in the Bylaws to be inapplicable or unenforceable in such action.
Transfer Agent
The transfer agent for SoFi Technologies common stock will be Continental Stock Transfer & Trust Company.
265

TABLE OF CONTENTS
SECURITIES ACT RESTRICTIONS ON RESALE OF OUR SECURITIES
Pursuant to Rule 144 under the Securities Act (“Rule 144”), a person who has beneficially owned restricted our common stock or our warrants for at least six months would be entitled to sell their securities provided that (i) such person is not deemed to have been our affiliate at the time of, or at any time during the three months preceding, a sale and (ii) we are subject to the Exchange Act periodic reporting requirements for at least three months before the sale and have filed all required reports under Section 13 or 15(d) of the Exchange Act during the 12 months (or such shorter period as SoFi Technologies was required to file reports) preceding the sale.
Persons who have beneficially owned restricted our common stock shares or our warrants for at least six months but who are our affiliates at the time of, or at any time during the three months preceding, a sale, would be subject to additional restrictions, by which such person would be entitled to sell within any three-month period only a number of securities that does not exceed the greater of:
1% of the total number of our common stock then outstanding; or
the average weekly reported trading volume of our common stock during the four calendar weeks preceding the filing of a notice on Form 144 with respect to the sale.
Sales by our affiliates under Rule 144 are also limited by manner of sale provisions and notice requirements and to the availability of current public information about us.
Restrictions on the Use of Rule 144 by Shell Companies or Former Shell Companies
Rule 144 is not available for the resale of securities initially issued by shell companies (other than business combination related shell companies) or issuers that have been at any time previously a shell company. However, Rule 144 also includes an important exception to this prohibition if the following conditions are met:
the issuer of the securities that was formerly a shell company has ceased to be a shell company;
the issuer of the securities is subject to the reporting requirements of Section 13 or 15(d) of the Exchange Act;
the issuer of the securities has filed all Exchange Act reports and material required to be filed, as applicable, during the preceding 12 months (or such shorter period that the issuer was required to file such reports and materials), other than Current Reports on Form 8-K; and
at least one year has elapsed from the time that the issuer filed current Form 10 type information with the SEC reflecting its status as an entity that is not a shell company.
As a result, the Sponsor will be able to sell their founder shares and private placement warrants, as applicable, pursuant to Rule 144 without registration one year after SCH has completed SCH’s initial business combination.
Following the recent consummation of the Business Combination, SoFi Technologies is no longer be a shell company, and, once the conditions set forth in the exceptions listed above are satisfied, Rule 144 will become available for the resale of the above noted restricted securities.
Lock-up Agreements
Pursuant to the lock-up restrictions agreed to into in connection with the Merger Agreement and the Bylaws, subject to certain exceptions, the Sponsor, SoFi Stockholders who beneficially own 5% or greater of SoFi and certain executive officers of SoFi will be contractually restricted from selling or transferring any of its or their shares of our common stock (not including the shares of our common stock issued in the PIPE Investment) (the “Lock-up Shares”). Such restrictions began upon the closing of the Business Combination and end (I) in the case of the lock-up restrictions agreed to in connection with the Merger Agreement, with respect to the Sponsor and certain of the SoFi Stockholders on the earlier of (i) the date that is 180 days after the closing of the Business Combination and (ii)(a) for 33.33% of the Lock-up Shares, the date on which the last reported sale price of our common stock equals
266

TABLE OF CONTENTS
or exceeds $12.50 per share for any 20 trading days within any 30-trading day period commencing at least 30 days after Closing and (b) for an additional 50% of the Lock-up Shares, the date on which the last reported sale price of our common stock equals or exceeds $15.00 per share for any 20 trading days within any 30-trading day period commencing at least 30 days after the closing of the Business Combination and (II) in the case of the restrictions contained in the Bylaws with respect to the SoFi Stockholders on the date that is 30 days after the closing of the Business Combination.
267

TABLE OF CONTENTS
PLAN OF DISTRIBUTION
The Selling Securityholders, which as used herein includes donees, pledgees, transferees, distributees or other successors-in-interest selling shares of common stock, shares of Series 1 preferred stock or warrants, which we refer to collectively as the securities, or interests in the securities received after the date of this prospectus from the Selling Securityholders as a gift, pledge, partnership distribution or other transfer, may, from time to time, sell, transfer, distribute or otherwise dispose of certain of their securities or interests in the securities on any stock exchange, market or trading facility on which the securities are traded, or in private transactions. These dispositions may be at fixed prices, at prevailing market prices at the time of sale, at prices related to the prevailing market price, at varying prices determined at the time of sale, or at negotiated prices.
The Selling Securityholders may use any one or more of the following methods when disposing of the securities or their interests therein:
ordinary brokerage transactions and transactions in which the broker-dealer solicits purchasers;
one or more underwritten offerings on a firm commitment or best efforts basis;
block trades in which the broker-dealer will attempt to sell the securities as agent, but may position and resell a portion of the block as principal to facilitate the transaction;
purchases by a broker-dealer as principal and resale by the broker-dealer for its accounts;
an exchange distribution in accordance with the rules of the applicable exchange;
privately negotiated transactions;
distributions or transfers to their members, partners or shareholders;
short sales effected after the date of the registration statement of which this prospectus is a part is declared effective by the SEC;
through the writing or settlement of options or other hedging transactions, whether through an options exchange or otherwise;
in market transactions, including transactions on a national securities exchange or quotations service or over-the-counter market;
through trading plans entered into by a Selling Securityholder pursuant to Rule 10b5-1 under the Exchange Act that are in place at the time of an offering pursuant to this prospectus and any applicable prospectus supplement hereto that provide for periodic sales of their securities on the basis of parameters described in such trading plans;
directly to one or more purchasers, including through a specific bidding, auction or other process or in privately negotiated transactions;
in “at the market” offerings, as defined in Rule 415 under the Securities Act, at negotiated prices, at prices prevailing at the time of sale or at prices related to such prevailing market prices, including sales made directly on a national securities exchange or sales made through a market maker other than on an exchange or other similar offerings through sales agents;
through agents;
through broker-dealers who may agree with the Selling Securityholders to sell a specified number of such securities at a stipulated price per share or warrant;
268

TABLE OF CONTENTS
by entering into transactions with third parties who may (or may cause others to) issue securities convertible or exchangeable into, or the return of which is derived in whole or in part from the value of, our ordinary shares and
a combination of any such methods of sale or any other method permitted pursuant to applicable law.
The Selling Securityholders may, from time to time, pledge or grant a security interest in some portion or all of the securities owned by them and, if a Selling Securityholder defaults in the performance of its secured obligations, the pledgees or secured parties may offer and sell such securities, as applicable, from time to time, under this prospectus, or under an amendment or supplement to this prospectus amending the list of the Selling Securityholders to include the pledgee, transferee or other successors in interest as the Selling Securityholders under this prospectus. The Selling Securityholders also may transfer the securities in other circumstances, in which case the transferees, pledgees or other successors in interest will be the selling beneficial owners for purposes of this prospectus.
In connection with the sale of the securities or interests in the securities, the Selling Securityholders may enter into hedging transactions with broker-dealers or other financial institutions, which may in turn engage in short sales of the securities in the course of hedging the positions they assume. The Selling Securityholders may also sell the securities short and deliver the securities to close out their short positions, or loan or pledge the securities to broker-dealers that in turn may sell the securities. The Selling Securityholders may also enter into option or other transactions with broker-dealers or other financial institutions or the creation of one or more derivative securities that require the delivery to such broker-dealer or other financial institution of the securities, which securities such broker-dealer or other financial institution may resell pursuant to this prospectus (as supplemented or amended to reflect such transaction).
The aggregate proceeds to the Selling Securityholders from the sale of the securities offered by them will be the purchase price of such securities less discounts or commissions, if any. The Selling Securityholders reserve the right to accept and, together with their agents from time to time, to reject, in whole or in part, any proposed purchase of the securities to be made directly or through agents. We will not receive any of the proceeds from any offering by the Selling Securityholders.
There can be no assurance that the Selling Securityholders will sell all or any of the securities offered by this prospectus. The Selling Securityholders also may in the future resell securities in open market transactions in reliance upon Rule 144 under the Securities Act, provided that they meet the criteria and conform to the requirements of that rule, or pursuant to other available exemptions from the registration requirements of the Securities Act.
The Selling Securityholders and any underwriters, broker-dealers or agents that participate in the sale of the securities or interests in the securities may be “underwriters” within the meaning of Section 2(11) of the Securities Act. Any discounts, commissions, concessions or profit they earn on any resale of the securities may be underwriting discounts and commissions under the Securities Act. If any Selling Securityholders is an “underwriter” within the meaning of Section 2(11) of the Securities Act, then the Selling Securityholders will be subject to the prospectus delivery requirements of the Securities Act. Underwriters and their controlling persons, dealers and agents may be entitled, under agreements entered into with us and the Selling Securityholders, to indemnification against and contribution toward specific civil liabilities, including liabilities under the Securities Act.
To the extent required, the securities to be sold, the respective purchase prices and public offering prices, the names of any agent, dealer or underwriter, and any applicable discounts, commissions, concessions or other compensation with respect to a particular offer will be set forth in an accompanying prospectus supplement or, if appropriate, a post-effective amendment to the registration statement that includes this prospectus.
To facilitate the offering of shares of the securities, certain persons participating in the offering may engage in transactions that stabilize, maintain or otherwise affect the price of the securities. This may include over-allotments or short sales, which involve the sale by persons participating in the offering of more securities than were sold to them. In these circumstances, these persons would cover such over-allotments or short positions by making purchases in the open market or by exercising their over-allotment option, if any. In addition, these persons may stabilize or maintain the price of the securities by bidding for or purchasing securities in the open market or by
269

TABLE OF CONTENTS
imposing penalty bids, whereby selling concessions allowed to dealers participating in the offering may be reclaimed if the securities sold by them are repurchased in connection with stabilization transactions. The effect of these transactions may be to stabilize or maintain the market price of our securities at a level above that which might otherwise prevail in the open market. These transactions may be discontinued at any time.
The Selling Securityholders may solicit offers to purchase the securities directly from, and it may sell such securities directly to, institutional investors or others. In this case, no underwriters or agents would be involved. The terms of any of those sales, including the terms of any bidding or auction process, if utilized, will be described in the applicable prospectus supplement.
It is possible that one or more underwriters may make a market in our securities, but such underwriters will not be obligated to do so and may discontinue any market making at any time without notice. We cannot give any assurance as to the liquidity of the trading market for our securities.
Our common stock and warrants are listed on Nasdaq under the symbols “SOFI” and “SOFIW”, respectively.
The Selling Securityholders may authorize underwriters, broker-dealers or agents to solicit offers by certain purchasers to purchase the securities at the public offering price set forth in the prospectus supplement pursuant to delayed delivery contracts providing for payment and delivery on a specified date in the future. The contracts will be subject only to those conditions set forth in the prospectus supplement, and the prospectus supplement will set forth any commissions we or the Selling Securityholders pay for solicitation of these contracts. The underwriters, broker-dealers and agents may engage in transactions with us or the Selling Securityholders, or perform services for us or the Selling Securityholders, in the ordinary course of business.
Under the Registration Rights Agreement and the Series 1 Registration Rights Agreement, we have agreed to indemnify the Selling Securityholders party thereto against certain liabilities that they may incur in connection with the sale of the securities registered hereunder, including liabilities under the Securities Act, and to contribute to payments that the Selling Securityholders may be required to make with respect thereto. In addition, we and the Selling Securityholders may agree to indemnify any underwriter, broker-dealer or agent against certain liabilities related to the selling of the securities, including liabilities arising under the Securities Act.
We have agreed to maintain the effectiveness of this registration statement until all such securities have been sold under this registration statement or Rule 144 under the Securities Act or are no longer outstanding. We have agreed to pay all expenses in connection with this offering, other than underwriting fees, discounts, selling commissions, stock transfer taxes and certain legal expenses. The Selling Securityholders will pay, on a pro rata basis, any underwriting fees, discounts, selling commissions, stock transfer taxes and certain legal expenses relating to the offering. We will make copies of this prospectus available to the Selling Securityholders for the purpose of satisfying the prospectus delivery requirements of the Securities Act.
Selling Securityholders may use this prospectus in connection with resales of the securities. This prospectus and any accompanying prospectus supplement will identify the Selling Securityholders, the terms of the securities and any material relationships between us and the Selling Securityholders. Selling Securityholders may be deemed to be underwriters under the Securities Act in connection with the securities they resell and any profits on the sales may be deemed to be underwriting discounts and commissions under the Securities Act. Unless otherwise set forth in a prospectus supplement, the Selling Securityholders will receive all the net proceeds from the resale of the securities.
A Selling Securityholder that is an entity may elect to make an in-kind distribution of the securities to its members, partners or shareholders pursuant to the registration statement of which this prospectus is a part by delivering a prospectus. To the extent that such members, partners or shareholders are not affiliates of ours, such members, partners or shareholders would thereby receive freely tradable securities pursuant to the distribution through a registration statement.
If at the time of any offering made under this prospectus a member of FINRA participating in the offering has a “conflict of interest” as defined in FINRA Rule 5121 (“Rule 5121”), that offering will be conducted in accordance with the relevant provisions of Rule 5121.
270

TABLE OF CONTENTS
To our knowledge, there are currently no plans, arrangements or understandings between the Selling Securityholders and any broker-dealer or agent regarding the sale of the securities by the Selling Securityholders. Upon our notification by a Selling Securityholder that any material arrangement has been entered into with an underwriter or broker-dealer for the sale of securities through a block trade, special offering, exchange distribution, secondary distribution or a purchase by an underwriter or broker-dealer, we will file, if required by applicable law or regulation, a supplement to this prospectus pursuant to Rule 424(b) under the Securities Act disclosing certain material information relating to such underwriter or broker-dealer and such offering.
In order to comply with the securities laws of certain states, if applicable, the securities must be sold in such jurisdictions only through registered or licensed brokers or dealers. In addition, in certain states the securities may not be sold unless they have been registered or qualified for sale in the applicable state or an exemption from the registration or qualification requirement is available and is complied with.
The Selling Securityholders and any other persons participating in the sale or distribution of the securities will be subject to applicable provisions of the Securities Act and the Exchange Act, and the rules and regulations thereunder, including, without limitation, Regulation M. These provisions may restrict certain activities of, and limit the timing of purchases and sales of any of the securities by, the Selling Securityholders or any other person, which limitations may affect the marketability of the shares of the securities.
We are required to pay all fees and expenses incident to the registration of the securities to be offered and sold pursuant to this prospectus, which we expect to be approximately $1.4 million.
271

TABLE OF CONTENTS
LEGAL MATTERS
Goodwin Procter LLP, New York, New York has passed upon the validity of the securities of SoFi Technologies offered by this prospectus and certain other legal matters related to this prospectus.
EXPERTS
The financial statements of SCH as of December 31, 2020, and for the period from July 10, 2020 (inception) through December 31, 2020, included in this prospectus have been audited by Marcum LLP, an independent registered public accounting firm, as stated in their report appearing herein (which contains an explanatory paragraph relating to substantial doubt about the ability of SCH to continue as a going concern as described in Note 1 to the financial statements). Such financial statements are included in reliance upon the report of such firm given upon their authority as experts in accounting and auditing.
The financial statements of Social Finance, Inc. as of December 31, 2020 and 2019, and for each of the three years in the period ended December 31, 2020 included in this prospectus and the related financial statement schedules included elsewhere in the Registration Statement, have been audited by Deloitte & Touche LLP, an independent registered public accounting firm, as stated in their report appearing herein. Such financial statements and financial statement schedules have been so included in reliance upon the report of such firm given upon their authority as experts in accounting and auditing.
WHERE YOU CAN FIND MORE INFORMATION
We file annual, quarterly and current reports, proxy statements and other information with the SEC. We have also filed a registration statement on Form S-1, including exhibits, under the Securities Act with respect to the securities offered by this prospectus. This prospectus is part of the registration statement, but does not contain all of the information included in the registration statement or the exhibits. Our SEC filings are available to the public on the Internet at a website maintained by the SEC located at http://www.sec.gov. Those filings are also available to the public on, or accessible through, our website under the heading “Investor Information” at www.sofi.com. The information contained on, or otherwise accessible through, our website, however, is not, and should not be deemed to be, a part of this prospectus.
272

TABLE OF CONTENTS
SOCIAL CAPITAL HEDOSOPHIA HOLDINGS CORP. V
INDEX TO FINANCIAL STATEMENTS
Page
Condensed Consolidated Financial Statements for the Quarter Ended March 31, 2021
F-2
F-3
F-4
F-5
F-6
Audited Financial Statements as of December 31, 2020 and for the Period from July 10, 2020 (inception) to December 31, 2020

F-1

TABLE OF CONTENTS
SOCIAL CAPITAL HEDOSOPHIA HOLDINGS CORP. V
CONDENSED CONSOLIDATED BALANCE SHEETS

March 31,
2021
December 31,
2020
(unaudited)
ASSETS
Current assets
Cash $ 39,940  $ 259,714 
Prepaid expenses 740,375  801,063 
Total Current Assets 780,315  1,060,777 
Marketable securities held in Trust Account 805,037,070  805,017,218 
TOTAL ASSETS
$ 805,817,385  $ 806,077,995 
LIABILITIES, TEMPORARY EQUITY AND PERMANENT EQUITY
Current liabilities
Accrued expenses $ 3,736,794  $ 178,450 
Advance from related party 40,705  5,000 
Promissory note – related party 1,415,000  — 
Total Current Liabilities 5,192,499  183,450 
Warrant liabilities 154,406,250  99,281,250 
Deferred underwriting fee payable 28,175,000  28,175,000 
TOTAL LIABILITIES
187,773,749  127,639,700 
Commitments
Temporary Equity
Class A ordinary shares subject to possible redemption, 61,301,540 and 67,342,389 shares at redemption value at March 31, 2021 and December 31, 2020, respectively
613,043,629  673,438,294 
Permanent Equity
Preferred shares, $0.0001 par value; 5,000,000 shares authorized; none issued and outstanding
—  — 
Class A ordinary shares, $0.0001 par value; 500,000,000 shares authorized; 19,198,460 and 13,157,611 shares issued and outstanding (excluding 61,301,540 and 67,342,389 shares subject to possible redemption) at March 31, 2021 and December 31, 2020, respectively
1,920  1,316 
Class B ordinary shares, $0.0001 par value; 50,000,000 shares authorized; 20,125,000 shares issued and outstanding at March 31, 2021 and December 31, 2020
2,013  2,013 
Additional paid-in capital 121,162,126  60,768,065 
Accumulated deficit (116,166,052) (55,771,393)
Total Permanent Equity
5,000,007  5,000,001 
TOTAL LIABILITIES, TEMPORARY EQUITY AND PERMANENT EQUITY
$ 805,817,385  $ 806,077,995 
The accompanying notes are an integral part of the unaudited condensed financial statements.
F-2

TABLE OF CONTENTS
SOCIAL CAPITAL HEDOSOPHIA HOLDINGS CORP. V
CONDENSED CONSOLIDATED STATEMENT OF OPERATIONS
THREE MONTHS ENDED MARCH 31, 2021
(Unaudited)
Formation and operational costs $ 5,289,511 
Loss from operations (5,289,511)
Other income (expense):
Interest earned on marketable securities held in Trust Account 19,852 
Change in fair value of warrant liabilities (55,125,000)
Other expense, net (55,105,148)
Net loss
$ (60,394,659)
Basic and diluted weighted average shares outstanding, Class A ordinary shares subject to possible redemption 67,342,389 
Basic and diluted net income per share, Class A ordinary shares subject to possible redemption
$  
Basic and diluted weighted average shares outstanding, Non-redeemable ordinary shares 33,282,611 
Basic and diluted net loss per share, Non-redeemable ordinary shares
$ (1.82)
The accompanying notes are an integral part of the unaudited condensed financial statements.
F-3

TABLE OF CONTENTS
SOCIAL CAPITAL HEDOSOPHIA HOLDINGS CORP. V 
CONDENSED CONSOLIDATED STATEMENT OF CHANGES IN TEMPORARY EQUITY AND PERMANENT EQUITY 
THREE MONTHS ENDED MARCH 31, 2021
(Unaudited)
  Class A Ordinary Shares Class B Ordinary Shares Additional
Paid-in Capital
Accumulated Deficit Total Permanent Equity Temporary Equity
  Shares Amount Shares Amount Shares Amount
Balance – January 1, 2021 13,157,611  $ 1,316  20,125,000  $ 2,013  $ 60,768,065  $ (55,771,393) $ 5,000,001    67,342,389  $ 673,438,294 
Change in value of Class A Ordinary shares subject to possible redemption 6,040,849  604  —  —  60,394,061  —    60,394,665  (6,040,849) (60,394,665)
Net loss —  —  —  —  —  (60,394,659) (60,394,659) —  — 
Balance – March 31, 2021 19,198,460  $ 1,920  20,125,000  $ 2,013  $ 121,162,126  $ (116,166,052) $ 5,000,007  61,301,540  $ 613,043,629 
The accompanying notes are an integral part of the unaudited condensed financial statements.
F-4

TABLE OF CONTENTS
SOCIAL CAPITAL HEDOSOPHIA HOLDINGS CORP. V 
CONDENSED CONSOLIDATED STATEMENT OF CASH FLOWS 
THREE MONTHS ENDED MARCH 31, 2021 
(Unaudited)
Cash Flows from Operating Activities:
Net loss $ (60,394,659)
Adjustments to reconcile net loss to net cash used in operating activities:
Interest earned on marketable securities held in Trust Account (19,852)
Change in fair value of warrant liabilities 55,125,000 
Changes in operating assets and liabilities:
Prepaid expenses 60,688 
Accrued expenses 3,558,344 
Net cash used in operating activities
(1,670,479)
Cash Flows from Financing Activities:
Advances from related party 40,705 
Repayment of advances from related party (5,000)
Proceeds from promissory note – related party 1,415,000 
Net cash provided by financing activities
1,450,705 
Net Change in Cash
(219,774)
Cash – Beginning 259,714 
Cash – Ending
$ 39,940 
The accompanying notes are an integral part of the unaudited condensed financial statements.
F-5

TABLE OF CONTENTS
SOCIAL CAPITAL HEDOSOPHIA HOLDINGS CORP. V 
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS 
MARCH 31, 2021 
(Unaudited)
NOTE 1. DESCRIPTION OF ORGANIZATION AND BUSINESS OPERATIONS
Social Capital Hedosophia Holdings Corp. V (the “Company”) is blank check company incorporated as a Cayman Islands exempted company on July 10, 2020. The Company was formed for the purpose of effecting a merger, share exchange, asset acquisition, share purchase, reorganization or similar business combination with one or more businesses (a “Business Combination”).
The Company has one subsidiary, Plutus Merger Sub Inc., a wholly-owned subsidiary of the Company incorporated in Delaware on December 30, 2020 (“Merger Sub”).
As of March 31, 2021, the Company had not commenced any operations. All activity through March 31, 2021 relates to the Company’s formation and the initial public offering (“Initial Public Offering”), which is described below, identifying a target company for a Business Combination, and activities in connection with the proposed acquisition of Social Finance, Inc., a Delaware corporation ("SoFi") (see Note 6). The Company will not generate any operating revenues until after the completion of a Business Combination, at the earliest. The Company generates non-operating income in the form of interest income from the proceeds derived from the Initial Public Offering and recognizes changes in the fair value of warrant liabilities as other income (expense).
The registration statements for the Company’s Initial Public Offering became effective on October 8, 2020. On October 14, 2020, the Company consummated the Initial Public Offering of 80,500,000 units (the “Units” and, with respect to the Class A ordinary shares included in the Units sold, the “Public Shares”), which includes the full exercise by the underwriters of the over-allotment option to purchase an additional 10,500,000 Units, at $10.00 per Unit, generating gross proceeds of $805,000,000 which is described in Note 3.
Simultaneously with the closing of the Initial Public Offering, the Company consummated the sale of 8,000,000 warrants (the “Private Placement Warrants”) at a price of $2.00 per Private Placement Warrant in a private placement to the Company’s sponsor, SCH Sponsor V LLC, a Cayman Islands limited liability company (the “Sponsor”), generating gross proceeds of $16,000,000, which is described in Note 4.
Transaction costs amounted to $42,659,062, consisting of $14,000,000 of underwriting fees, $28,175,000 of deferred underwriting fees and $484,062 of other offering costs.
In connection with the closing of the Initial Public Offering on October 14, 2020, an amount of $805,000,000 ($10.00 per Unit) from the net proceeds of the sale of the Units in the Initial Public Offering and the sale of the Private Placement Warrants was placed in a trust account (the “Trust Account”) located in the United States and invested in U.S. government securities, within the meaning set forth in Section 2(a)(16) of the Investment Company Act of 1940, as amended (the “Investment Company Act”), with a maturity of 185 days or less, or in any open-ended investment company that holds itself out as a money market fund meeting certain conditions of Rule 2a-7 of the Investment Company Act, as determined by the Company, until the earlier of: (i) the completion of a Business Combination and (ii) the distribution of the funds in the Trust Account to the Company’s shareholders, as described below.
The Company’s management has broad discretion with respect to the specific application of the net proceeds of the Initial Public Offering and the sale of the Private Placement Warrants, although substantially all of the net proceeds are intended to be applied generally toward consummating a Business Combination. The New York Stock Exchange rules require that the Business Combination must be with one or more operating businesses or assets with a fair market value equal to at least 80% of the net assets held in the Trust Account (net of amounts disbursed to management for working capital purposes, if permitted, and excluding the amount of any deferred underwriting discount). The Company will only complete a Business Combination if the post-Business Combination company owns or acquires 50% or more of the issued and outstanding voting securities of the target or otherwise acquires a controlling interest in the target business sufficient for it not to be required to register as an investment company
F-6

TABLE OF CONTENTS
under the Investment Company Act. There is no assurance that the Company will be able to successfully effect a Business Combination.
The Company will provide the holders of the Public Shares (the “Public Shareholders”) with the opportunity to redeem all or a portion of their Public Shares upon the completion of the Business Combination, either (i) in connection with a shareholder meeting called to approve the Business Combination or (ii) by means of a tender offer. The decision as to whether the Company will seek shareholder approval of a Business Combination or conduct a tender offer will be made by the Company. The Public Shareholders will be entitled to redeem their shares for a pro rata portion of the amount held in the Trust Account, calculated as of two business days prior to the completion of a Business Combination, including any pro rata interest earned on the funds held in the Trust Account and not previously released to the Company to pay its tax obligations. The per-share amount to be distributed to the Public Shareholders who redeem their shares will not be reduced by the deferred underwriting commissions the Company will pay to the underwriter (as discussed in Note 6). There will be no redemption rights upon the completion of a Business Combination with respect to the Company’s warrants.
The Company will proceed with a Business Combination only if the Company has net tangible assets, after payment of the deferred underwriting commission, of at least $5,000,001 following any related share redemptions and, if the Company seeks shareholder approval, it receives an ordinary resolution under Cayman Islands law approving a Business Combination, which requires the affirmative vote of a majority of the shareholders who attend and vote at a general meeting of the Company. If a shareholder vote is not required and the Company does not decide to hold a shareholder vote for business or other legal reasons, the Company will, pursuant to its Amended and Restated Memorandum and Articles of Association, conduct the redemptions pursuant to the tender offer rules of the Securities and Exchange Commission (“SEC”), and file tender offer documents containing substantially the same information as would be included in a proxy statement with the SEC prior to completing a Business Combination. If the Company seeks shareholder approval in connection with a Business Combination, the Company’s Sponsor has agreed to vote its Founder Shares (as defined in Note 5) and any Public Shares purchased during or after the Initial Public Offering in favor of approving a Business Combination and to waive its redemption rights with respect to any such shares in connection with a shareholder vote to approve a Business Combination or seek to sell any shares to the Company in a tender offer in connection with a Business Combination. Additionally, subject to the immediately succeeding paragraph, each Public Shareholder may elect to redeem their Public Shares, without voting, and if they do vote, irrespective of whether they vote for or against a proposed Business Combination.
Notwithstanding the foregoing, if the Company seeks shareholder approval of the Business Combination and the Company does not conduct redemptions pursuant to the tender offer rules, a Public Shareholder, together with any affiliate of such shareholder or any other person with whom such shareholder is acting in concert or as a “group” (as defined under Section 13 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”)), will be restricted from redeeming its shares with respect to more than 15% of the Public Shares without the Company’s prior written consent.
The Sponsor has agreed (a) to waive its redemption rights with respect to any Founder Shares and Public Shares held by it in connection with the completion of a Business Combination (and not seek to sell its shares to the Company in any tender offer the Company undertakes in connection with its initial Business Combination) and (b) not to propose an amendment to the Amended and Restated Memorandum and Articles of Association (i) to modify the substance or timing of the Company’s obligation to allow redemption in connection with the Company’s initial Business Combination or to redeem 100% of the Public Shares if the Company does not complete a Business Combination within Combination Period (as defined below) or (ii) with respect to any other provision relating to shareholders’ rights or pre-initial business combination activity, unless the Company provides the Public Shareholders with the opportunity to redeem their Public Shares in conjunction with any such amendment.
The Company will have until October 14, 2022 to consummate a Business Combination. However, if the Company has not completed a Business Combination by October 14, 2022 (as such period may be extended pursuant to the Company’s Amended and Restated Memorandum and Articles of Association, the “Combination Period”), the Company will (i) cease all operations except for the purpose of winding up, (ii) as promptly as reasonably possible but not more than ten business days thereafter, redeem the Public Shares, at a per-share price, payable in cash, equal to the aggregate amount then on deposit in the Trust Account, including interest (which
F-7

TABLE OF CONTENTS
interest shall be net of taxes payable, and less up to $100,000 of interest to pay dissolution expenses) divided by the number of then outstanding Public Shares, which redemption will completely extinguish the rights of the Public Shareholders as shareholders (including the right to receive further liquidation distributions, if any), and (iii) as promptly as reasonably possible following such redemption, subject to the approval of the Company’s remaining Public Shareholders and its Board of Directors, liquidate and dissolve, subject in each case to the Company’s obligations under Cayman Islands law to provide for claims of creditors and the requirements of other applicable law. In the event of a liquidation, the Public Shareholders will be entitled to receive a full pro rata interest in the Trust Account. There will be no redemption rights or liquidating distributions with respect to the Company’s warrants, which will expire worthless if the Company fails to complete a Business Combination within the Combination Period.
In order to protect the amounts held in the Trust Account, the Sponsor has agreed that it will be liable to the Company, if and to the extent any claims by a third party (other than the Company’s independent auditors) for services rendered or products sold to the Company, or a prospective target business with which the Company has discussed entering into a transaction agreement, reduce the amount of funds in the Trust Account to below (1) $10.00 per Public Share or (2) such lesser amount per Public Share held in the Trust Account as of the date of the liquidation of the Trust Account due to reductions in the value of trust assets, in each case net of the interest which may be withdrawn to pay taxes, except as to any claims by a third party who executed a waiver of any and all rights to seek access to the Trust Account and except as to any claims under the Company’s indemnity of the underwriter of the Initial Public Offering against certain liabilities, including liabilities under the Securities Act of 1933, as amended (the “Securities Act”). In the event that an executed waiver is deemed to be unenforceable against a third party, the Sponsor will not be responsible to the extent of any liability for such third-party claims. The Company will seek to reduce the possibility that the Sponsor will have to indemnify the Trust Account due to claims of creditors by endeavoring to have all vendors, service providers (other than the Company’s independent auditors), prospective target businesses or other entities with which the Company does business, execute agreements with the Company waiving any right, title, interest or claim of any kind in or to monies held in the Trust Account.
Risks and Uncertainties
Management continues to evaluate the impact of the COVID-19 pandemic and has concluded that while it is reasonably possible that the virus could have a negative effect on the Company’s financial position, results of its operations and/or search for a target company, the specific impact is not readily determinable as of the date of these consolidated financial statements. The consolidated financial statements do not include any adjustments that might result from the outcome of this uncertainty.
Liquidity and Going Concern
As of March 31, 2021, the Company had $39,940 in its operating bank accounts, $805,037,070 in securities held in the Trust Account to be used for a Business Combination or to repurchase or redeem its ordinary shares in connection therewith and a working capital deficit of $4,412,184. As of March 31, 2021, approximately $37,000 of the amount on deposit in the Trust Account represented interest income.
Until the consummation of a Business Combination, the Company will be using the funds not held in the Trust Account for identifying and evaluating prospective acquisition candidates, performing due diligence on prospective target businesses, paying for travel expenditures, selecting the target business to acquire, and structuring, negotiating and consummating the Business Combination.
The Company will need to raise additional capital through loans or additional investments from its Sponsor, shareholders, officers, directors, or third parties. The Company’s officers, directors and Sponsor may, but are not obligated to, loan the Company funds, from time to time or at any time, in whatever amount they deem reasonable in their sole discretion, to meet the Company’s working capital needs. Accordingly, the Company may not be able to obtain additional financing. If the Company is unable to raise additional capital, it may be required to take additional measures to conserve liquidity, which could include, but not necessarily be limited to, curtailing operations, suspending the pursuit of a potential transaction, and reducing overhead expenses. The Company cannot provide any assurance that new financing will be available to it on commercially acceptable terms, if at all. These conditions
F-8

TABLE OF CONTENTS
raise substantial doubt about the Company’s ability to continue as a going concern for a reasonable period of time, which is considered to be one year from the issuance date of the financial statements. These consolidated financial statements do not include any adjustments relating to the recovery of the recorded assets or the classification of the liabilities that might be necessary should the Company be unable to continue as a going concern.
NOTE 2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
Basis of Presentation
The accompanying unaudited condensed consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America (“GAAP”) for interim financial information and in accordance with the instructions to Form 10-Q and Article 8 of Regulation S-X of the Securities and Exchange Commission (the “SEC”). Certain information or footnote disclosures normally included in financial statements prepared in accordance with GAAP have been condensed or omitted, pursuant to the rules and regulations of the SEC for interim financial reporting. Accordingly, they do not include all the information and footnotes necessary for a complete presentation of financial position, results of operations, or cash flows. In the opinion of management, the accompanying unaudited condensed consolidated financial statements include all adjustments, consisting of a normal recurring nature, which are necessary for a fair presentation of the financial position, operating results and cash flows for the periods presented.
The accompanying unaudited condensed consolidated financial statements should be read in conjunction with the Company’s Annual Report as amended on Form 10-K/A for the period ended December 31, 2020 as filed with the SEC on April 22, 2021, which contains the audited financial statements and notes thereto. The financial information as of December 31, 2020 is derived from the audited financial statements presented in the Company’s Annual Report as amended on Form 10-K/A for the period ended December 31, 2020 as filed with the SEC on April 22, 2021. The interim results for the three months ended March 31, 2021 are not necessarily indicative of the results to be expected for the year ending December 31, 2021 or for any future interim periods.
Principles of Consolidation
The accompanying consolidated financial statements include the accounts of the Company and its wholly owned subsidiary. All significant intercompany balances and transactions have been eliminated in consolidation.
Emerging Growth Company
The Company is an “emerging growth company,” as defined in Section 2(a) of the Securities Act, as modified by the Jumpstart Our Business Startups Act of 2012 (the “JOBS Act”), and it may take advantage of certain exemptions from various reporting requirements that are applicable to other public companies that are not emerging growth companies including, but not limited to, not being required to comply with the independent registered public accounting firm attestation requirements of Section 404 of the Sarbanes-Oxley Act, reduced disclosure obligations regarding executive compensation in its periodic reports and proxy statements, and exemptions from the requirements of holding a nonbinding advisory vote on executive compensation and shareholder approval of any golden parachute payments not previously approved.
Further, Section 102(b)(1) of the JOBS Act exempts emerging growth companies from being required to comply with new or revised financial accounting standards until private companies (that is, those that have not had a Securities Act registration statement declared effective or do not have a class of securities registered under the Exchange Act) are required to comply with the new or revised financial accounting standards. The JOBS Act provides that a company can elect to opt out of the extended transition period and comply with the requirements that apply to non-emerging growth companies but any such election to opt out is irrevocable. The Company has elected not to opt out of such extended transition period which means that when a standard is issued or revised and it has different application dates for public or private companies, the Company, as an emerging growth company, can adopt the new or revised standard at the time private companies adopt the new or revised standard. This may make comparison of the Company’s consolidated financial statements with another public company which is neither an emerging growth company nor an emerging growth company which has opted out of using the extended transition period difficult or impossible because of the potential differences in accounting standards used.
F-9

TABLE OF CONTENTS
Use of Estimates
The preparation of the consolidated financial statements in conformity with GAAP requires the Company’s management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period.
Making estimates requires management to exercise significant judgment. It is at least reasonably possible that the estimate of the effect of a condition, situation or set of circumstances that existed at the date of the financial statements, which management considered in formulating its estimate, could change in the near term due to one or more future confirming events. Accordingly, the actual results could differ significantly from those estimates.
Cash and Cash Equivalents
The Company considers all short-term investments with an original maturity of three months or less when purchased to be cash equivalents. The Company did not have any cash equivalents as of March 31, 2021 and December 31, 2020.
Marketable Securities Held in Trust Account
At March 31, 2021 and December 31, 2020, substantially all of the assets held in the Trust Account were held in money market funds which are invested primarily in U.S. Treasury Securities.
Warrant Liabilities
The Company evaluated the Public Warrants and Private Placement Warrants (collectively, “Warrants”) in accordance with ASC 815-40, “Derivatives and Hedging — Contracts in Entity’s Own Equity,” and concluded that a provision in the Warrant Agreement related to certain tender or exchange offers precludes the Warrants from being accounted for as components of equity. As the Warrants meet the definition of a derivative as contemplated in ASC 815, the Warrants are recorded as derivative liabilities in the condensed consolidated balance sheets and measured at fair value on the date of the Initial Public Offering and at each reporting date in accordance with ASC 820, “Fair Value Measurement,” with changes in fair value recognized in the condensed consolidated statement of operations in the period of change.
Class A Ordinary Shares Subject to Possible Redemption
The Company accounts for its Class A ordinary shares subject to possible redemption in accordance with the guidance in ASC 480, “Distinguishing Liabilities from Equity”. Class A redeemable ordinary shares are classified as temporary equity. Non-redeemable ordinary shares are classified as permanent equity. The Company’s Class A ordinary shares feature certain redemption rights that are considered to be outside of the Company’s control and subject to occurrence of uncertain future events. Accordingly, Class A ordinary shares subject to possible redemption are presented as temporary equity in the Company’s condensed consolidated balance sheets.
Components of Equity
Upon the Initial Public Offering, the Company issued Class A Ordinary shares and Warrants. The Company allocated the proceeds received from the issuance using the with-and-without method. Under that method, the Company first allocated the proceeds to the Warrants based on their initial fair value measurement of $44,156,250 and then allocated the remaining proceeds, net of underwriting discounts and offering costs of $42,659,062, to the Class A Ordinary shares. A portion of the 80,500,000 Class A Ordinary shares are presented within temporary equity, as certain shares are subject to redemption upon the occurrence of events not solely within the Company’s control.
Income Taxes
The Company accounts for income taxes under ASC 740, “Income Taxes” (“ASC 740”). ASC 740 requires the recognition of deferred tax assets and liabilities for both the expected impact of differences between the financial
F-10

TABLE OF CONTENTS
statement and tax basis of assets and liabilities and for the expected future tax benefit to be derived from tax loss and tax credit carry forwards. ASC 740 additionally requires a valuation allowance to be established when it is more likely than not that all or a portion of deferred tax assets will not be realized.
ASC 740 also clarifies the accounting for uncertainty in income taxes recognized in an enterprise’s financial statements and prescribes a recognition threshold and measurement process for financial statement recognition and measurement of a tax position taken or expected to be taken in a tax return. For those benefits to be recognized, a tax position must be more-likely-than-not to be sustained upon examination by taxing authorities. The Company recognizes accrued interest and penalties related to unrecognized tax benefits as income tax expense. There were no unrecognized tax benefits and no amounts accrued for interest and penalties as of March 31, 2021 and December 31, 2020. The Company is currently not aware of any issues under review that could result in significant payments, accruals or material deviation from its position. The Company is subject to income tax examinations by major taxing authorities since inception.
The Company is considered an exempted Cayman Islands Company and is presently not subject to income taxes or income tax filing requirements in the Cayman Islands or the United States. As such, the Company’s tax provision was zero for the period presented.
Net Income (Loss) per Ordinary Share
Net income (loss) per share is computed by dividing net income by the weighted-average number of ordinary shares outstanding during the period.
The Company’s condensed consolidated statement of operations includes a presentation of income (loss) per share for common shares subject to possible redemption in a manner similar to the two-class method of income (loss) per share. Net income (loss) per ordinary, basic and diluted, for ordinary shares subject to possible redemption is calculated by dividing the proportionate share of income or loss on marketable securities held by the Trust Account by the weighted average number of ordinary shares subject to possible redemption outstanding since the original issuance.
Net income (loss) per ordinary share, basic and diluted, for non-redeemable ordinary shares is calculated by dividing the net income (loss), adjusted for income or loss on marketable securities attributable to ordinary shares subject to possible redemption, by the weighted average number of non-redeemable ordinary shares outstanding for the period.
Non-redeemable ordinary shares includes Founder Shares and non-redeemable Class A ordinary shares as these shares do not have any redemption features. Non-redeemable ordinary shares participate in the income or loss on marketable securities based on non-redeemable shares’ proportionate interest.
F-11

TABLE OF CONTENTS
The following table reflects the calculation of basic and diluted net income (loss) per ordinary share (in dollars, except per share amounts):
 
Three Months Ended March 31, 2021
Ordinary Shares subject to possible redemption  
Numerator: Earnings allocable to Ordinary shares subject to possible redemption  
Interest earned on marketable securities held in Trust Account $ 15,117 
Net income allocable to Class A ordinary shares subject to possible redemption $ 15,117 
Denominator: Weighted Average Class A Ordinary shares subject to possible redemption
Basic and diluted weighted average shares outstanding $ 67,342,389 
Basic and diluted net income per share $ — 
Non-Redeemable Ordinary Shares
Numerator: Earnings allocable to non-redeemable ordinary shares
Net loss (60,394,659)
Less: Net income allocable to Class A ordinary shares subject to possible redemption (15,117)
Non-redeemable net loss (60,409,776)
Denominator: Weighted Average Non-redeemable ordinary shares
Basic and diluted weighted average shares outstanding, Non-redeemable ordinary shares $ 33,282,611 
Basic and diluted net loss per share, Non-redeemable ordinary shares (1.82)
Concentration of Credit Risk
Financial instruments that potentially subject the Company to concentrations of credit risk consist of a cash account in a financial institution which, at times may exceed the Federal Depository Insurance Coverage limit of $250,000. The Company has not experienced losses on this account and management believes the Company is not exposed to significant risks on such account.
Fair Value of Financial Instruments
The Company follows the guidance in ASC Topic 820, “Fair Value Measurement”, for its financial assets and liabilities that are re-measured and reported at fair value at each reporting period, and non-financial assets and liabilities that are re-measured and reported at fair value at least annually.
The fair value of the Company’s financial assets and liabilities reflects management’s estimate of amounts that the Company would have received in connection with the sale of the assets or paid in connection with the transfer of the liabilities in an orderly transaction between market participants at the measurement date. In connection with measuring the fair value of its assets and liabilities, the Company seeks to maximize the use of observable inputs (market data obtained from independent sources) and to minimize the use of unobservable inputs (internal assumptions about how market participants would price assets and liabilities). The following fair value hierarchy is used to classify assets and liabilities based on the observable inputs and unobservable inputs used in order to value the assets and liabilities:
Level 1: Quoted prices in active markets for identical assets or liabilities. An active market for an asset or liability is a market in which transactions for the asset or liability occur with sufficient frequency and volume to provide pricing information on an ongoing basis.
Level 2: Observable inputs other than Level 1 inputs. Examples of Level 2 inputs include quoted prices in active markets for similar assets or liabilities and quoted prices for identical assets or liabilities in markets that are not active.
Level 3: Unobservable inputs based on our assessment of the assumptions that market participants would use in pricing the asset or liability.
F-12

TABLE OF CONTENTS
See Note 9 for additional information on assets and liabilities measured at fair value.
Recent Accounting Standards
In August 2020, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) 2020-06, Debt — Debt with Conversion and Other Options (Subtopic 470-20) and Derivatives and Hedging — Contracts in Entity’s Own Equity (Subtopic 815-40) (“ASU 2020-06”) to simplify accounting for certain financial instruments. ASU 2020-06 eliminates the current models that require separation of beneficial conversion and cash conversion features from convertible instruments and simplifies the derivative scope exception guidance pertaining to equity classification of contracts in an entity’s own equity. The new standard also introduces additional disclosures for convertible debt and freestanding instruments that are indexed to and settled in an entity’s own equity. ASU 2020-06 amends the diluted earnings per share guidance, including the requirement to use the if-converted method for all convertible instruments. ASU 2020-06 is effective January 1, 2022 and should be applied on a full or modified retrospective basis, with early adoption permitted beginning on January 1, 2021. The Company early adopted ASU 2020-06 on January 1, 2021. The adoption of ASU 2020-06 did not have an impact on the Company’s financial statements.
Management does not believe that any other recently issued, but not yet effective, accounting standards, if currently adopted, would have a material effect on the accompanying condensed consolidated financial statements.
NOTE 3. INITIAL PUBLIC OFFERING
Pursuant to the Initial Public Offering, the Company sold 80,500,000 Units, which includes the full exercise by the underwriter of its option to purchase an additional 10,500,000 Units, at a purchase price of $10.00 per Unit. Each Unit consists of one Class A ordinary share and one-fourth of one redeemable warrant (“Public Warrant”). Each whole Public Warrant entitles the holder to purchase one Class A ordinary share at an exercise price of $11.50 per whole share, subject to adjustment (see Note 8).
NOTE 4. PRIVATE PLACEMENT
Simultaneously with the closing of the Initial Public Offering, the Sponsor purchased an aggregate of 8,000,000 Private Placement Warrants at a price of $2.00 per Private Placement Warrant, for an aggregate purchase price of $16,000,000. Each Private Placement Warrant is exercisable for one Class A ordinary share at a price of $11.50 per share, subject to adjustment (see Note 8). A portion of the proceeds from the sale of the Private Placement Warrants was added to the net proceeds from the Initial Public Offering held in the Trust Account. If the Company does not complete a Business Combination within the Combination Period, the proceeds from the sale of the Private Placement Warrants held in the Trust Account will be used to fund the redemption of the Public Shares (subject to the requirements of applicable law) and the Private Placement Warrants will expire worthless.
NOTE 5. RELATED PARTY TRANSACTIONS
Founder Shares
On July 10, 2020, the Company issued one ordinary share to the Sponsor for no consideration. On July 16, 2020, the Company cancelled the one share issued in July 2020 and the Sponsor purchased 2,875,000 Founder Shares for an aggregate purchase price of $25,000. On September 17, 2020, the Company effected a share capitalization resulting in the Sponsor holding an aggregate of 18,687,500 Founder Shares. On October 8, 2020, the Company effected another share capitalization resulting in the Company’s initial shareholders holding an aggregate of 20,125,000 Founder Shares. All share and per-share amounts have been retroactively restated to reflect the share capitalizations. The Founder Shares will automatically convert into Class A ordinary shares on the first business day following the completion of a Business Combination, or earlier at the option of the holder, on a one-for-one basis, subject to certain adjustments, as described in Note 7.
The Founder Shares included an aggregate of up to 2,625,000 shares that were subject to forfeiture by the Sponsor to the extent that the underwriter’s over-allotment option was not exercised in full or in part, so that the number of Founder Shares would collectively represent 20% of the Company’s issued and outstanding shares upon
F-13

TABLE OF CONTENTS
the completion of the Initial Public Offering. As a result of the underwriters’ election to fully exercise their over-allotment option, no Founder Shares are currently subject to forfeiture.
The Sponsor has agreed, subject to limited exceptions, not to transfer, assign or sell any of its Class B ordinary shares or Class A ordinary shares received upon conversion thereof (together, “Founder Shares”) until the earlier of: (A) one year after the completion of a Business Combination and (B) subsequent to a Business Combination, (x) if the last reported sale price of the Class A ordinary shares equals or exceeds $12.00 per share (as adjusted for share subdivisions, share dividends, rights issuances, consolidations, reorganizations, recapitalizations and the like) for any 20 trading days within any 30-trading day period commencing at least 150 days after a Business Combination, or (y) the date on which the Company completes a liquidation, merger, amalgamation, share exchange, reorganization or other similar transaction that results in all of the Company’s shareholders having the right to exchange their Class A ordinary shares for cash, securities or other property.
Administrative Support Agreement
The Company entered into an agreement whereby, commencing on October 14, 2020, the Company will pay an affiliate of the Sponsor up to $10,000 per month for office space, administrative and support services. Upon completion of a Business Combination or its liquidation, the Company will cease paying these monthly fees. For the three months ended March 31, 2021, the Company incurred $30,000 in fees for these services. As of March 31, 2021 and December 31, 2020, there was $55,000 and $25,000 of such fees, respectively, included in accrued expenses in the accompanying condensed consolidated balance sheets.
Advance from Related Party
During the three months ended March 31, 2021, the Sponsor paid for certain costs on behalf of the Company. The advances are non-interest bearing and due on demand. At March 31, 2021, advances amounting to $40,705 were outstanding.
Promissory Note — Related Party
On July 16, 2020, the Company issued an unsecured promissory note to the Sponsor (the “IPO Promissory Note”), pursuant to which the Company borrowed an aggregate principal amount of $300,000. The IPO Promissory Note was non-interest bearing and payable on the earlier of (i) June 30, 2021 and (ii) the completion of the Initial Public Offering. The IPO Promissory Note was amended and restated on September 17, 2020 solely to increase the amount that could be borrowed to an aggregate principal amount of $400,000. The outstanding balance under the IPO Promissory Note of $400,000 was repaid at the closing of the Initial Public Offering on October 14, 2020.
On January 11, 2021, the Company issued a promissory note with the Sponsor for an aggregate amount of up to $2,500,000 (the “Promissory Note”). The Promissory Note is non-interest bearing and is due and payable in full on the earlier of (i) October 14, 2022 and (ii) the effective date of a merger, share exchange, asset acquisition, share purchase, reorganization or similar business combination, involving the maker and one or more businesses. As of March 31, 2021, there was $1,415,000 outstanding under the Promissory Note.
Related Party Loans
In order to finance transaction costs in connection with a Business Combination, the Sponsor or an affiliate of the Sponsor, or certain of the Company’s officers and directors may, but are not obligated to, loan the Company funds as may be required (“Working Capital Loans”). Such Working Capital Loans would be evidenced by promissory notes. The notes may be repaid upon completion of a Business Combination, without interest, or, at the lender’s discretion, up to $2,500,000 of notes may be converted upon completion of a Business Combination into warrants at a price of $2.00 per warrant. Such warrants would be identical to the Private Placement Warrants. In the event that a Business Combination does not close, the Company may use a portion of proceeds held outside the Trust Account to repay the Working Capital Loans but no proceeds held in the Trust Account would be used to repay the Working Capital Loans.
F-14

TABLE OF CONTENTS
Restricted Stock Units
On November 13, 2020, the Company entered into a Director Restricted Stock Unit Award Agreement (the “Director Restricted Stock Unit Award Agreement”), between the Company and Jennifer Dulski, a member of the Company's board of directors, providing for the grant of 100,000 restricted stock units (“RSUs”) to Ms. Dulski, which grant is contingent on both the consummation of a Business Combination with the Company and a shareholder approved equity plan. The RSUs will vest upon the consummation of such Business Combination and represent 100,000 Class A ordinary shares of the Company that will settle on a date selected by the Company in the year following the year in which such consummation occurs.
NOTE 6. COMMITMENTS
Registration Rights
Pursuant to a registration rights agreement entered into on October 8, 2020, the holders of the Founder Shares, Private Placement Warrants and any warrants that may be issued upon conversion of Working Capital Loans (and any Class A ordinary shares issuable upon the exercise of the Private Placement Warrants or warrants issued upon conversion of the Working Capital Loans and upon conversion of the Founder Shares) will be entitled to registration rights requiring the Company to register such securities for resale (in the case of the Founder Shares, only after conversion to the Company’s Class A ordinary shares). The holders of these securities will be entitled to make up to three demands, excluding short form registration demands, that the Company register such securities. In addition, the holders have certain “piggy-back” registration rights with respect to registration statements filed subsequent to the completion of a Business Combination and rights to require the Company to register for resale such securities pursuant to Rule 415 under the Securities Act. However, the registration rights agreement provides that the Company will not be required to effect or permit any registration or cause any registration statement to become effective until termination of the applicable lock-up period. The Company will bear the expenses incurred in connection with the filing of any such registration statements.
Underwriting Agreement
The underwriter is entitled to a deferred fee of $0.35 per Unit, or $28,175,000 in the aggregate. The deferred fee will become payable to the underwriter from the amounts held in the Trust Account solely in the event that the Company completes a Business Combination, subject to the terms of the underwriting agreement.
Financial Advisory Fee
The underwriters agreed to reimburse the Company for an amount equal to (1) 10% of the non-deferred underwriting commission payable to the underwriter, of which $1,400,000 was paid to Connaught (UK) Limited (“Connaught”) upon the closing of the Initial Public Offering, and (2) 20% of the deferred underwriting commission payable to the underwriter, of which $5,635,000 will be paid to Connaught upon the closing of the Business Combination.
SoFi Business Combination
On January 7, 2021, the Company entered into an Agreement and Plan of Merger (as amended on March 16, 2021, the “Merger Agreement”) with Plutus Merger Sub Inc., a Delaware corporation and a direct wholly owned subsidiary of the Company (“Merger Sub”), and Social Finance, Inc., a Delaware corporation (“SoFi”).
The Merger Agreement provides that, among other things and upon the terms and subject to the conditions thereof, the following transactions will occur (together with the other agreements and transactions contemplated by the Merger Agreement, the “SoFi Business Combination”): (i) prior to the closing of the transactions contemplated by the Merger Agreement (the “Closing”), the Company will domesticate as a Delaware corporation in accordance with Section 388 of the General Corporation Law of the State of Delaware, as amended (the “DGCL”), and the Cayman Islands Companies Law (2020 Revision) (the “Domestication”), (ii) at the Closing, upon the terms and subject to the conditions of the Merger Agreement, in accordance with the DGCL, Merger Sub will merge with and into SoFi, with SoFi continuing as the surviving corporation and a wholly owned subsidiary of the Company (the “Merger”),
F-15

TABLE OF CONTENTS
(iii) upon consummation of the Merger, and subject to the adjustments provided in the Merger Agreement, all of the common stock and preferred stock of SoFi, excluding the Company Redeemable Preferred Stock (as defined in the Merger Agreement), which will convert into Acquiror Series 1 Preferred Stock (as defined in the Merger Agreement), will be converted into the right to receive an aggregate number of shares of common stock, par value $0.0001 per share, of the Company (after the Domestication) (“SCH Common Stock”) equal to the quotient obtained by dividing (x) $6,569,840,376 by (y) $10.00 and (iv) upon the consummation of the Merger, the Company will be renamed “SoFi Technologies, Inc.” The Closing is subject to the satisfaction or waiver of certain closing conditions contained in the Merger Agreement, including the approval of the Company’s shareholders.
On January 7, 2021, concurrently with the execution of the Merger Agreement, the Company entered into subscription agreements with certain investors (collectively, the “PIPE Investors”), pursuant to which, on the terms and subject to the conditions therein, the PIPE Investors have collectively subscribed for 122.5 million shares of SCH Common Stock for an aggregate purchase price equal to $1,225.0 million (the “PIPE Investment”), a portion of which is expected to be funded by one or more affiliates of the Sponsor. The PIPE Investment will be consummated substantially concurrently with the Closing, subject to the terms and conditions contemplated by the Subscription Agreements.
On March 16, 2021, (i) the Company, SoFi and Merger Sub entered into the First Amendment to Agreement and Plan of Merger which amends the Merger Agreement and (ii) the Company, the Sponsor and SoFi entered into the First Amendment to Sponsor Support Agreement to reflect that the securities of the combined company are expected to trade on The Nasdaq Stock Market LLC instead of the New York Stock Exchange following the consummation of the SoFi Business Combination. In addition, SoFi, the Company and the applicable shareholders of SoFi have agreed to make conforming changes to the form of shareholders’ agreement contemplated by the Merger Agreement to be entered into at the closing of the Business Combination with SoFi.
The consummation of the proposed SoFi Business Combination is subject to certain conditions as further described in the Merger Agreement.
In connection with the proposed SoFi Business Combination, certain purported shareholders of the Company have filed lawsuits, including those described below, and other shareholders have threatened to file lawsuits alleging breaches of fiduciary duty and violations of the disclosure requirements of the Exchange Act. The Company believes that these allegations are without merit. These cases are in the early stages and the Company is unable to reasonably determine the outcome or estimate any potential losses, and, as such, has not recorded a loss contingency.
Legal Proceedings
On January 28, 2021, Tim Holtom (“Holtom”), a purported shareholder of the Company, filed a lawsuit in the Supreme Court of the State of New York, County of New York, captioned Tim Holtom v. Social Capital Hedosophia Holdings Corp. V, et al., case number 650647/2021, against the Company and the members of its board of directors (the “Holtom Complaint”). The Holtom Complaint asserts a breach of fiduciary duty claim against the individual defendants and an aiding and abetting claim against the Company. The Holtom Complaint alleges, among other things, that (i) the merger consideration is unfair, and (ii) the registration statement on Form S-4 filed with the SEC on January 11, 2021 regarding the proposed transaction involving SoFi (the “Registration Statement”) is materially misleading and incomplete. The Holtom Complaint seeks, among other things, to enjoin the proposed Business Combination, rescind the transaction or award rescissory damages to the extent it is consummated, and an award of attorneys’ fees and expenses.
On January 29, 2021, Ryan Heitt (“Heitt”), a purported shareholder of the Company, filed a lawsuit in the Supreme Court of the State of New York, County of New York, captioned Ryan Heitt v. Social Capital Hedosophia Holdings Corp. V, et al., case number 650685/2021 against the members of its board of directors, Merger Sub and SoFi (the “Heitt Complaint”). The Heitt Complaint asserts a breach of fiduciary duty claim against the individual defendants and an aiding and abetting claim against the Company, Merger Sub and SoFi. The Heitt Complaint alleges, among other things, that the Registration Statement is materially misleading and incomplete. The Heitt
F-16

TABLE OF CONTENTS
Complaint seeks, among other things, to enjoin the proposed Business Combination, rescind the transaction or award rescissory damages to the extent it is consummated, and an award of attorneys’ fees and expenses.
On February 3, 2021, counsel to Holtom and Heitt sent a joint letter to the Company's counsel (the “Joint Demand”), alleging that they “have identified several disclosure deficiencies” in the Registration Statement, and demanding that the Company issue corrective disclosures with regard to certain enumerated items. The Joint Demand asserts that a failure to issue the requested disclosures will expose the Company and its board of directors to liability.
The parties resolved the allegations made by Holtom and Heitt and notices of discontinuance of the lawsuits commenced by Holtom and Heitt have been filed.
On February 15, 2021, Brian Levy, a purported shareholder of the Company, filed a lawsuit in the Supreme Court of the State of New York, County of Nassau, captioned Brian Levy v. Jennifer Dulski, et al., case number 601778/2021, against the members of the Company’s board of directors, SoFi, Citigroup Global Markets Inc., Credit Suisse Securities (USA) LLC and Goldman Sachs & Co. LLC (the “Levy Complaint”). The lawsuit was filed by Levy individually, and derivatively on behalf of nominal defendant the Company. The Levy Complaint alleges, among other things, that (i) the merger consideration is unfair, and (ii) the Registration Statement is materially misleading and incomplete. The Levy Complaint asserts: (i) a derivative claim for breach of fiduciary duty against the individual defendants; (ii) a derivative claim for causing the Company to fail to disclose material information against the individual defendants; (iii) a derivative claim for aiding and abetting the breaches of fiduciary duties against SoFi, Citigroup Global Markets Inc., Credit Suisse Securities (USA) LLC and Goldman Sachs & Co. LLC; (iv) an individual claim for negligent misrepresentation and concealment against all defendants; and (v) an individual claim for fraudulent misrepresentation and concealment against all defendants. The Levy Complaint seeks, among other things, to enjoin the proposed Business Combination, an award of compensatory and/or recessionary damages, and an award of attorneys' fees and expenses.
The parties resolved the allegations made by Levy, and a Stipulation and Order dismissing the lawsuit filed by Levy was signed by the Court on April 19, 2021.
NOTE 7. PERMANENT EQUITY AND TEMPORARY EQUITY
Preferred Shares  —   The Company is authorized to issue 5,000,000 preference shares with a par value of $0.0001. The Company’s board of directors will be authorized to fix the voting rights, if any, designations, powers, preferences, the relative, participating, optional or other special rights and any qualifications, limitations and restrictions thereof, applicable to the shares of each series. The board of directors will be able to, without shareholder approval, issue preference shares with voting and other rights that could adversely affect the voting power and other rights of the holders of the ordinary shares and could have anti-takeover effects. At March 31, 2021 and December 31, 2020, there were no preference shares issued or outstanding.
Class A Ordinary Shares  —   The Company is authorized to issue 500,000,000 Class A ordinary shares, with a par value of $0.0001 per share. Holders of Class A ordinary shares are entitled to one vote for each share. At March 31, 2021, there were 19,198,460 Class A ordinary shares issued and outstanding, excluding 61,301,540 Class A ordinary shares subject to possible redemption. At December 31, 2020, there were 13,157,611 Class A ordinary shares issued and outstanding, excluding 67,342,389 Class A ordinary shares subject to possible redemption.
Class B Ordinary Shares  —  The Company is authorized to issue 50,000,000 Class B ordinary shares, with a par value of $0.0001 per share. Holders of the Class B ordinary shares are entitled to one vote for each share. At March 31, 2021 and December 31, 2020, there was 20,125,000 Class B ordinary shares issued and outstanding.
Only holders of the Class B ordinary shares will have the right to vote on the election of directors prior to the Business Combination. Holders of Class A ordinary shares and holders of Class B ordinary shares will vote together as a single class on all matters submitted to a vote of the Company’s shareholders except as otherwise required by law.
F-17

TABLE OF CONTENTS
The Class B ordinary shares will automatically convert into Class A ordinary shares at the time of the completion of the Business Combination, or earlier at the option of the holder, on a one-for-one basis, subject to adjustment. In the case that additional Class A ordinary shares, or equity-linked securities, are issued or deemed issued in excess of the amounts issued in the Initial Public Offering and related to the closing of a Business Combination, the ratio at which Founder Shares will convert into Class A ordinary shares will be adjusted (subject to waiver by holders of a majority of the Class B ordinary shares) so that the number of Class A ordinary shares issuable upon conversion of all Founder Shares will equal, in the aggregate, on an as-converted basis, 20% of the sum of the ordinary shares issued and outstanding upon completion of the Initial Public Offering plus the number of Class A ordinary shares and equity-linked securities issued or deemed issued in connection with a Business Combination, excluding any Class A ordinary shares or equity-linked securities issued, or to be issued, to any seller in a Business Combination.
Restricted Stock Units — On November 13, 2020, the Company entered into a Director Restricted Stock Unit Award Agreement (the "Director Restricted Stock Unit Award Agreement"), between the Company and a member of the Company's board of directors, providing for the grant of 100,000 restricted stock units ("RSUs"), which grant is contingent on both the consummation of a Business Combination with the Company and a shareholder approved equity plan. The RSUs will vest upon the consummation of such Business Combination and represent 100,000 Class A ordinary shares of the Company that will settle on a date selected by the Company in the year following the year in which such consummation occurs.
NOTE 8. WARRANTS
Public Warrants may only be exercised for a whole number of shares. No fractional shares will be issued upon exercise of the Public Warrants. The Public Warrants will become exercisable on the later of (a) 30 days after the completion of a Business Combination and (b) 12 months from the closing of the Initial Public Offering. The Public Warrants will expire five years from the completion of a Business Combination or earlier upon redemption or liquidation.
The Company will not be obligated to deliver any Class A ordinary shares pursuant to the exercise of a Public Warrant and will have no obligation to settle such Public Warrant exercise unless a registration statement under the Securities Act covering the issuance of the Class A ordinary shares issuable upon exercise of the Public Warrants is then effective and a prospectus relating thereto is current, subject to the Company satisfying its obligations with respect to registration or a valid exemption from registration is available. No Public Warrant will be exercisable for cash or on a cashless basis, and the Company will not be obligated to issue any shares to holders seeking to exercise their Public Warrants, unless the issuance of the shares upon such exercise is registered or qualified under the securities laws of the state of the exercising holder, or an exemption from registration is available.
The Company has agreed that as soon as practicable, but in no event later than 15 business days, after the closing of a Business Combination, it will use its commercially reasonable efforts to file with the SEC a registration statement registering the issuance, under the Securities Act, of the Class A ordinary shares issuable upon exercise of the Public Warrants. The Company will use its commercially reasonable efforts to cause the same to become effective within 60 business days after the closing of the Business Combination and to maintain the effectiveness of such registration statement, and a current prospectus relating thereto, until the expiration of the Public Warrants in accordance with the provisions of the warrant agreement. Notwithstanding the above, if the Class A ordinary shares are, at the time of any exercise of a Public Warrant, not listed on a national securities exchange such that they satisfy the definition of a “covered security” under Section 18(b)(1) of the Securities Act, the Company may, at its option, require holders of Public Warrants who exercise their Public Warrants to do so on a “cashless basis” in accordance with Section 3(a)(9) of the Securities Act and, in the event the Company so elects, the Company will not be required to file or maintain in effect a registration statement, but will use its commercially reasonable efforts to register or qualify the shares under applicable blue sky laws to the extent an exemption is not available.
Redemption of warrants when the price per Class A ordinary share equals or exceeds $18.00. Once the Public Warrants become exercisable, the Company may redeem the Public Warrants:
in whole and not in part;
F-18

TABLE OF CONTENTS
at a price of $0.01 per Public Warrant;
upon not less than 30 days’ prior written notice of redemption to each warrant holder and
if, and only if, the reported last sale price of the Class A ordinary shares for any 20 trading days within a 30-trading day period ending on the third trading day prior to the date on which the Company sends the notice of redemption to the warrant holders (the “Reference Value”) equals or exceeds $18.00 per share (as adjusted).
Redemption of warrants when the price per Class A ordinary share equals or exceeds $10.00. Once the Public Warrants become exercisable, the Company may redeem the Public Warrants:
in whole and not in part;
at $0.10 per warrant upon a minimum of 30 days’ prior written notice of redemption provided that holders will be able to exercise their warrants on a cashless basis prior to redemption and receive that number of shares based on the redemption date and the “fair market value” of the Class A ordinary shares;
if, and only if, the Reference Value equals or exceeds $10.00 per share (as adjusted); and
if the Reference Value is less than $18.00 per share (as adjusted), the Private Placement Warrants must also be concurrently called for redemption on the same terms as the outstanding Public Warrants, as described above.
If and when the Public Warrants become redeemable by the Company, the Company may exercise its redemption right even if it is unable to register or qualify the underlying securities for sale under all applicable state securities laws.
The exercise price and number of ordinary shares issuable upon exercise of the Public Warrants may be adjusted in certain circumstances including in the event of a share dividend, extraordinary dividend or recapitalization, reorganization, merger or consolidation. However, except as described below, the Public Warrants will not be adjusted for issuances of ordinary shares at a price below its exercise price. Additionally, in no event will the Company be required to net cash settle the Public Warrants. If the Company is unable to complete a Business Combination within the Combination Period and the Company liquidates the funds held in the Trust Account, holders of Public Warrants will not receive any of such funds with respect to their Public Warrants, nor will they receive any distribution from the Company’s assets held outside of the Trust Account with respect to such Public Warrants. Accordingly, the Public Warrants may expire worthless.
In addition, if (x) the Company issues additional ordinary shares or equity-linked securities for capital raising purposes in connection with the closing of a Business Combination at an issue price or effective issue price of less than $9.20 per Class A ordinary share (with such issue price or effective issue price to be determined in good faith by the Company’s board of directors, and in the case of any such issuance to the Sponsor or its affiliates, without taking into account any Founder Shares held by the Sponsor or such affiliates, as applicable, prior to such issuance) (the “Newly Issued Price”), (y) the aggregate gross proceeds from such issuances represent more than 60% of the total equity proceeds, and interest thereon, available for the funding of a Business Combination on the date of the completion of a Business Combination (net of redemptions), and (z) the volume weighted average trading price of the Company’s ordinary shares during the 20 trading day period starting on the trading day prior to the day on which the Company consummates a Business Combination (such price, the “Market Value”) is below $9.20 per share, the exercise price of the Public Warrants will be adjusted (to the nearest cent) to be equal to 115% of the higher of the Market Value and the Newly Issued Price, and the $18.00 per share redemption trigger prices described above will be adjusted (to the nearest cent) to be equal to 180% of the higher of the Market Value and the Newly Issued Price and the $10.00 per share redemption trigger prices described will be adjusted (to the nearest cent) to be equal to the higher of the Market Value and the Newly Issued Price.
The Private Placement Warrants are identical to the Public Warrants underlying the Units sold in the Initial Public Offering, except that the Private Placement Warrants and the Class A ordinary shares issuable upon the
F-19

TABLE OF CONTENTS
exercise of the Private Placement Warrants will not be transferable, assignable or salable until 30 days after the completion of a Business Combination, subject to certain limited exceptions. Additionally, the Private Placement Warrants will be exercisable on a cashless basis and be non-redeemable, except as described above, so long as they are held by the initial purchasers or their permitted transferees. If the Private Placement Warrants are held by someone other than the initial purchasers or their permitted transferees, the Private Placement Warrants will be redeemable by the Company and exercisable by such holders on the same basis as the Public Warrants.
NOTE 9. FAIR VALUE MEASUREMENTS
The following table presents information about the Company’s assets and liabilities that are measured at fair value on a recurring basis at March 31, 2021 and December 31, 2020, and indicates the fair value hierarchy of the valuation inputs the Company utilized to determine such fair value:
Description Level March 31,
2021
December 31,
2020
Assets:
Marketable securities held in Trust Account(1)
1 $ 805,037,070  $ 805,017,218 
Liabilities:
Private Placement Warrants(2)
2 $ 43,920,000  $ 28,240,000 
Public Warrants(2)
1 110,486,250  71,041,250 
__________________
(1)The fair value of the marketable securities held in Trust account approximates the carrying amount primarily due to their short-term nature.
(2)Measured at fair value on a recurring basis.
Warrants
The Warrants are accounted for as liabilities in accordance with ASC 815-40 and are presented within warrant liabilities on the condensed consolidated balance sheets. The warrant liabilities are measured at fair value at inception and on a recurring basis, with changes in fair value presented within change in fair value of warrant liabilities in the condensed consolidated statement of operations.
The Warrants are measured at fair value on a recurring basis. The measurement of the Public Warrants is classified as Level 1 due to the use of an observable market quote in an active market under the ticker IPOE.WS. As the transfer of Private Placement Warrants to anyone outside of a small group of individuals who are permitted transferees would result in the Private Placement Warrants having substantially the same terms as the Public Warrants, the Company determined that the fair value of each Private Placement Warrant is equivalent to that of each Public Warrant, with an insignificant adjustment for short-term marketability restrictions. As such, the Private Placement Warrants are classified as Level 2.
NOTE 10. SUBSEQUENT EVENTS
The Company evaluated subsequent events and transactions that occurred after the balance sheet date up to the date that the condensed consolidated financial statements were issued. Based upon this review, the Company did not identify any subsequent events that would have required adjustment or disclosure in the condensed consolidated financial statements.
F-20

TABLE OF CONTENTS
REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
To the Shareholders and Board of Directors of
Social Capital Hedosophia Holdings Corp. V
Opinion on the Financial Statements
We have audited the accompanying consolidated balance sheet of Social Capital Hedosophia Holdings Corp. V (the “Company”) as of December 31, 2020, the related consolidated statements of operations, changes in temporary equity and permanent equity and cash flows for the period from July 10, 2020 (inception) through December 31, 2020, and the related notes (collectively referred to as the “financial statements”). In our opinion, the financial statements present fairly, in all material respects, the financial position of the Company as of December 31, 2020, and the results of its operations and its cash flows for the period from July 10, 2020 (inception) through December 31, 2020, in conformity with accounting principles generally accepted in the United States of America.
Explanatory Paragraph – Going Concern
The accompanying consolidated financial statements have been prepared assuming that the Company will continue as a going concern. As discussed in Note 1 to the consolidated financial statements, the Company’s business plan is dependent on the completion of a business combination and the Company’s cash and working capital as of December 31, 2020 are not sufficient to complete its planned activities. These conditions raise substantial doubt about the Company’s ability to continue as a going concern. Management’s plans in regard to these matters are also described in Note 1. The consolidated financial statements do not include any adjustments that might result from the outcome of this uncertainty.
Restatement of the 2020 Financial Statements
As discussed in Note 2 to the consolidated financial statements, the accompanying consolidated financial statements as of December 31, 2020 and for the period from July 10, 2020 (inception) through December 31, 2020, have been restated.
Basis for Opinion
These financial statements are the responsibility of the Company’s management. Our responsibility is to express an opinion on the Company’s financial statements based on our audit. We are a public accounting firm registered with the Public Company Accounting Oversight Board (United States) (“PCAOB”) and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.
We conducted our audit in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement, whether due to error or fraud. The Company is not required to have, nor were we engaged to perform, an audit of its internal control over financial reporting. As part of our audit, we are required to obtain an understanding of internal control over financial reporting but not for the purpose of expressing an opinion on the effectiveness of the Company’s internal control over financial reporting. Accordingly, we express no such opinion.
Our audit included performing procedures to assess the risks of material misstatement of the financial statements, whether due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the financial statements. Our audit also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the financial statements. We believe that our audit provides a reasonable basis for our opinion.
/s/ Marcum LLP
Marcum LLP
We have served as the Company’s auditor since 2020.
New York, NY
March 17, 2021, except for the effects of the restatement discussed in Notes 2 and 10 as to which the date is April 22, 2021.
F-21

TABLE OF CONTENTS
SOCIAL CAPITAL HEDOSOPHIA HOLDINGS CORP. V
CONSOLIDATED BALANCE SHEET
DECEMBER 31, 2020
(As Restated)
ASSETS
Current assets
Cash
$ 259,714 
Prepaid expenses
801,063 
Total Current Assets
1,060,777 
Marketable securities held in Trust Account
805,017,218 
TOTAL ASSETS
$ 806,077,995 
LIABILITIES, TEMPORARY EQUITY AND PERMANENT EQUITY
Current liabilities
Accrued offering costs
$ 178,450 
Advance from related party
5,000 
Total Current Liabilities
183,450 
Deferred underwriting fee payable
28,175,000 
Warrant liabilities 99,281,250 
TOTAL LIABILITIES
127,639,700 
Commitments

Temporary Equity
Class A ordinary shares subject to possible redemption, 67,342,389 shares at redemption value
673,438,294 
Permanent Equity
Preferred shares, $0.0001 par value; 5,000,000 shares authorized; none issued and outstanding
— 
Class A ordinary shares, $0.0001 par value; 500,000,000 shares authorized; 13,157,611 issued and outstanding (excluding 67,342,389 shares subject to possible redemption)
1,316 
Class B ordinary shares, $0.0001 par value; 50,000,000 shares authorized; 20,125,000 shares issued and outstanding
2,013 
Additional paid-in capital
60,768,065 
Accumulated deficit
(55,771,393)
Total Permanent Equity
5,000,001 
TOTAL LIABILITIES, TEMPORARY EQUITY AND PERMANENT EQUITY
$ 806,077,995 








The accompanying notes are an integral part of the consolidated financial statements.
F-22

TABLE OF CONTENTS
SOCIAL CAPITAL HEDOSOPHIA HOLDINGS CORP. V
CONSOLIDATED STATEMENT OF OPERATIONS
FOR THE PERIOD FROM JULY 10, 2020 (INCEPTION) THROUGH DECEMBER 31, 2020
(As Restated)
Formation and operational costs
$ 663,611 
Loss from operations
(663,611)
Other income (expense):
Interest earned on marketable securities held in Trust Account 17,218 
Change in fair value of warrant liabilities (55,125,000)
Other expense, net (55,107,782)
Net loss
$ (55,771,393)
Basic and diluted weighted average shares outstanding, Class A ordinary shares subject to possible redemption 72,920,468 
Basic and diluted net income per share, Class A ordinary shares subject to possible redemption
$ 0.00 
Basic and diluted weighted average shares outstanding, Non-redeemable ordinary shares 22,074,445 
Basic and diluted net loss per share, Non-redeemable ordinary shares
$ (2.53)
















The accompanying notes are an integral part of the consolidated financial statements.
F-23

TABLE OF CONTENTS
SOCIAL CAPITAL HEDOSOPHIA HOLDINGS CORP. V
CONSOLIDATED STATEMENT OF CHANGES IN TEMPORARY EQUITY AND PERMANENT EQUITY
FOR THE PERIOD FROM JULY 10, 2020 (INCEPTION) THROUGH DECEMBER 31, 2020
(As Restated)

Class A
Ordinary Shares
Class B
Ordinary Shares
Additional Paid-in
Capital
Accumulated
Deficit
Total Permanent
Equity
Temporary Equity
Shares
Amount
Shares
Amount
Shares Amount
Balance – July 10, 2020 (inception)
  $     $   $   $   $     $  
Issuance of Class B ordinary shares to Sponsor —  —  20,125,000  2,013  22,987  —  25,000  —  — 
Issuance of Class A Ordinary shares, net 80,500,000  8,050  —  —  734,176,638  —  734,184,688  —  — 
Class A Ordinary shares subject to possible redemption (67,342,389) (6,734) —  —  (673,431,560) —  (673,438,294) 67,342,389  673,438,294 
Net loss
—  —  —  —  —  (55,771,393) (55,771,393) —  — 
Balance – December 31, 2020 13,157,611  $ 1,316 

20,125,000  $ 2,013 

$ 60,768,065 

$ (55,771,393)

$ 5,000,001  67,342,389  $ 673,438,294 
The accompanying notes are an integral part of the consolidated financial statements.
F-24

TABLE OF CONTENTS
SOCIAL CAPITAL HEDOSOPHIA HOLDINGS CORP. V
CONSOLIDATED STATEMENT OF CASH FLOWS
FOR THE PERIOD FROM JULY 10, 2020 (INCEPTION) THROUGH DECEMBER 31, 2020
(As Restated)
Cash Flows from Operating Activities:
Net loss
$ (55,771,393)
Adjustments to reconcile net loss to net cash used in operating activities:
Interest earned on marketable securities held in Trust Account (17,218)
Change in fair value of warrant liabilities 55,125,000 
Changes in operating assets and liabilities:
Prepaid expenses
(801,063)
Accrued expenses 178,450 
Net cash used in operating activities
(1,286,224)
Cash Flows from Investing Activities:
Investment of cash in Trust Account
(805,000,000)
Net cash used in investing activities
(805,000,000)
Cash Flows from Financing Activities:
Proceeds from issuance of Class B ordinary shares to Sponsor
25,000 
Proceeds from sale of Units, net of underwriting discounts paid
791,000,000 
Proceeds from sale of Private Placement Warrants
16,000,000 
Advances from related party
5,000 
Proceeds from promissory note – related party
400,000 
Repayment of promissory note – related party
(400,000)
Payment of offering costs
(484,062)
Net cash provided by financing activities
806,545,938 
Net Change in Cash
259,714 
Cash – Beginning
— 
Cash – Ending
$ 259,714 
Non-Cash Investing and Financing Activities:
Initial measurement of warrants issued in connection with initial public offering accounted for as liabilities $ 44,156,250 
Deferred underwriting fee payable
28,175,000 








The accompanying notes are an integral part of the consolidated financial statements.
F-25

TABLE OF CONTENTS
SOCIAL CAPITAL HEDOSOPHIA HOLDINGS CORP. V
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
DECEMBER 31, 2020
NOTE 1. DESCRIPTION OF ORGANIZATION AND BUSINESS OPERATIONS
Social Capital Hedosophia Holdings Corp. V (the “Company”) is blank check company incorporated as a Cayman Islands exempted company on July 10, 2020. The Company was formed for the purpose of effecting a merger, share exchange, asset acquisition, share purchase, reorganization or similar business combination with one or more businesses (a “Business Combination”).
The Company has one subsidiary, Plutus Merger Sub Inc., a wholly-owned subsidiary of the Company incorporated in Delaware on December 30, 2020 (“Merger Sub”).
As of December 31, 2020, the Company had not commenced any operations. All activity for the period from July 10, 2020 (inception) through December 31, 2020 relates to the Company’s formation and the initial public offering (“Initial Public Offering”), which is described below, identifying a target company for a Business Combination, activities in connection with the proposed acquisition of Social Finance, Inc., a Delaware corporation (“SoFi”) (see Note 10). The Company will not generate any operating revenues until after the completion of a Business Combination, at the earliest. The Company generates non-operating income in the form of interest income from the proceeds derived from the Initial Public Offering and recognizes changes in the fair value of warrant liabilities as other income (expense).
The registration statements for the Company’s Initial Public Offering became effective on October 8, 2020. On October 14, 2020, the Company consummated the Initial Public Offering of 80,500,000 units (the “Units” and, with respect to the Class A ordinary shares included in the Units sold, the “Public Shares”), which includes the full exercise by the underwriters of the over-allotment option to purchase an additional 10,500,000 Units, at $10.00 per Unit, generating gross proceeds of $805,000,000 which is described in Note 4.
Simultaneously with the closing of the Initial Public Offering, the Company consummated the sale of 8,000,000 warrants (the “Private Placement Warrants”) at a price of $2.00 per Private Placement Warrant in a private placement to the Company’s sponsor, SCH Sponsor V LLC, a Cayman Islands limited liability company (the “Sponsor”), generating gross proceeds of $16,000,000, which is described in Note 5.
Transaction costs amounted to $42,659,062, consisting of $14,000,000 of underwriting fees, $28,175,000 of deferred underwriting fees and $484,062 of other offering costs.
In connection with the closing of the Initial Public Offering on October 14, 2020, an amount of $805,000,000 ($10.00 per Unit) from the net proceeds of the sale of the Units in the Initial Public Offering and the sale of the Private Placement Warrants was placed in a trust account (the “Trust Account”) located in the United States and invested in U.S. government securities, within the meaning set forth in Section 2(a)(16) of the Investment Company Act of 1940, as amended (the “Investment Company Act”), with a maturity of 185 days or less, or in any open-ended investment company that holds itself out as a money market fund meeting certain conditions of Rule 2a-7 of the Investment Company Act, as determined by the Company, until the earlier of: (i) the completion of a Business Combination and (ii) the distribution of the funds in the Trust Account to the Company’s shareholders, as described below.
The Company’s management has broad discretion with respect to the specific application of the net proceeds of the Initial Public Offering and the sale of the Private Placement Warrants, although substantially all of the net proceeds are intended to be applied generally toward consummating a Business Combination. The New York Stock Exchange rules require that the Business Combination must be with one or more operating businesses or assets with a fair market value equal to at least 80% of the net assets held in the Trust Account (net of amounts disbursed to management for working capital purposes, if permitted, and excluding the amount of any deferred underwriting discount). The Company will only complete a Business Combination if the post-Business Combination company owns or acquires 50% or more of the issued and outstanding voting securities of the target or otherwise acquires a controlling interest in the target business sufficient for it not to be required to register as an investment company under the Investment Company Act. There is no assurance that the Company will be able to successfully effect a Business Combination.
F-26

TABLE OF CONTENTS
SOCIAL CAPITAL HEDOSOPHIA HOLDINGS CORP. V
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
DECEMBER 31, 2020
The Company will provide the holders of the Public Shares (the “Public Shareholders”) with the opportunity to redeem all or a portion of their Public Shares upon the completion of the Business Combination, either (i) in connection with a shareholder meeting called to approve the Business Combination or (ii) by means of a tender offer. The decision as to whether the Company will seek shareholder approval of a Business Combination or conduct a tender offer will be made by the Company. The Public Shareholders will be entitled to redeem their shares for a pro rata portion of the amount held in the Trust Account, calculated as of two business days prior to the completion of a Business Combination, including any pro rata interest earned on the funds held in the Trust Account and not previously released to the Company to pay its tax obligations. The per-share amount to be distributed to the Public Shareholders who redeem their shares will not be reduced by the deferred underwriting commissions the Company will pay to the underwriter (as discussed in Note 7). There will be no redemption rights upon the completion of a Business Combination with respect to the Company’s warrants.
The Company will proceed with a Business Combination only if the Company has net tangible assets, after payment of the deferred underwriting commission, of at least $5,000,001 following any related share redemptions and, if the Company seeks shareholder approval, it receives an ordinary resolution under Cayman Islands law approving a Business Combination, which requires the affirmative vote of a majority of the shareholders who attend and vote at a general meeting of the Company. If a shareholder vote is not required and the Company does not decide to hold a shareholder vote for business or other legal reasons, the Company will, pursuant to its Amended and Restated Memorandum and Articles of Association, conduct the redemptions pursuant to the tender offer rules of the Securities and Exchange Commission (“SEC”), and file tender offer documents containing substantially the same information as would be included in a proxy statement with the SEC prior to completing a Business Combination. If the Company seeks shareholder approval in connection with a Business Combination, the Company’s Sponsor has agreed to vote its Founder Shares (as defined in Note 6) and any Public Shares purchased during or after the Initial Public Offering in favor of approving a Business Combination and to waive its redemption rights with respect to any such shares in connection with a shareholder vote to approve a Business Combination or seek to sell any shares to the Company in a tender offer in connection with a Business Combination. Additionally, subject to the immediately succeeding paragraph, each Public Shareholder may elect to redeem their Public Shares, without voting, and if they do vote, irrespective of whether they vote for or against a proposed Business Combination.
Notwithstanding the foregoing, if the Company seeks shareholder approval of the Business Combination and the Company does not conduct redemptions pursuant to the tender offer rules, a Public Shareholder, together with any affiliate of such shareholder or any other person with whom such shareholder is acting in concert or as a “group” (as defined under Section 13 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”)), will be restricted from redeeming its shares with respect to more than 15% of the Public Shares without the Company’s prior written consent.
The Sponsor has agreed (a) to waive its redemption rights with respect to any Founder Shares and Public Shares held by it in connection with the completion of a Business Combination (and not seek to sell its shares to the Company in any tender offer the Company undertakes in connection with its initial Business Combination) and (b) not to propose an amendment to the Amended and Restated Memorandum and Articles of Association (i) to modify the substance or timing of the Company’s obligation to allow redemption in connection with the Company’s initial Business Combination or to redeem 100% of the Public Shares if the Company does not complete a Business Combination within Combination Period (as defined below) or (ii) with respect to any other provision relating to shareholders’ rights or pre-initial business combination activity, unless the Company provides the Public Shareholders with the opportunity to redeem their Public Shares in conjunction with any such amendment.
The Company will have until October 14, 2022 to consummate a Business Combination. However, if the Company has not completed a Business Combination by October 14, 2022 (as such period may be extended pursuant to the Company’s Amended and Restated Memorandum and Articles of Association, the “Combination Period”), the Company will (i) cease all operations except for the purpose of winding up, (ii) as promptly as reasonably possible but not more than ten business days thereafter, redeem the Public Shares, at a per-share price, payable in cash, equal to the aggregate amount then on deposit in the Trust Account, including interest (which interest shall be net of taxes payable, and less up to $100,000 of interest to pay dissolution expenses) divided by the number of then outstanding Public Shares, which redemption will completely extinguish the rights of the Public Shareholders as shareholders (including the right to receive further liquidation distributions, if any), and (iii) as
F-27

TABLE OF CONTENTS
SOCIAL CAPITAL HEDOSOPHIA HOLDINGS CORP. V
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
DECEMBER 31, 2020
promptly as reasonably possible following such redemption, subject to the approval of the Company’s remaining Public Shareholders and its Board of Directors, liquidate and dissolve, subject in each case to the Company’s obligations under Cayman Islands law to provide for claims of creditors and the requirements of other applicable law. In the event of a liquidation, the Public Shareholders will be entitled to receive a full pro rata interest in the Trust Account. There will be no redemption rights or liquidating distributions with respect to the Company’s warrants, which will expire worthless if the Company fails to complete a Business Combination within the Combination Period.
In order to protect the amounts held in the Trust Account, the Sponsor has agreed that it will be liable to the Company, if and to the extent any claims by a third party (other than the Company’s independent auditors) for services rendered or products sold to the Company, or a prospective target business with which the Company has discussed entering into a transaction agreement, reduce the amount of funds in the Trust Account to below (1) $10.00 per Public Share or (2) such lesser amount per Public Share held in the Trust Account as of the date of the liquidation of the Trust Account due to reductions in the value of trust assets, in each case net of the interest which may be withdrawn to pay taxes, except as to any claims by a third party who executed a waiver of any and all rights to seek access to the Trust Account and except as to any claims under the Company’s indemnity of the underwriter of the Initial Public Offering against certain liabilities, including liabilities under the Securities Act of 1933, as amended (the “Securities Act”). In the event that an executed waiver is deemed to be unenforceable against a third party, the Sponsor will not be responsible to the extent of any liability for such third-party claims. The Company will seek to reduce the possibility that the Sponsor will have to indemnify the Trust Account due to claims of creditors by endeavoring to have all vendors, service providers (other than the Company’s independent auditors), prospective target businesses or other entities with which the Company does business, execute agreements with the Company waiving any right, title, interest or claim of any kind in or to monies held in the Trust Account.
Risks and Uncertainties
Management continues to evaluate the impact of the COVID-19 pandemic and has concluded that while it is reasonably possible that the virus could have a negative effect on the Company’s financial position, results of its operations and/or search for a target company, the specific impact is not readily determinable as of the date of these consolidated financial statements. The consolidated financial statements do not include any adjustments that might result from the outcome of this uncertainty.
Liquidity and Going Concern
As of December 31, 2020, the Company had $259,714 in its operating bank accounts, $805,017,218 in securities held in the Trust Account to be used for a Business Combination or to repurchase or redeem its ordinary shares in connection therewith and working capital of $877,327. As of December 31, 2020, approximately $17,000 of the amount on deposit in the Trust Account represented interest income, which is available to pay the Company’s tax obligations.
Until the consummation of a Business Combination, the Company will be using the funds not held in the Trust Account for identifying and evaluating prospective acquisition candidates, performing due diligence on prospective target businesses, paying for travel expenditures, selecting the target business to acquire, and structuring, negotiating and consummating the Business Combination.
The Company will need to raise additional capital through loans or additional investments from its Sponsor, shareholders, officers, directors, or third parties. The Company’s officers, directors and Sponsor may, but are not obligated to, loan the Company funds, from time to time or at any time, in whatever amount they deem reasonable in their sole discretion, to meet the Company’s working capital needs. Accordingly, the Company may not be able to obtain additional financing. If the Company is unable to raise additional capital, it may be required to take additional measures to conserve liquidity, which could include, but not necessarily be limited to, curtailing operations, suspending the pursuit of a potential transaction, and reducing overhead expenses. The Company cannot provide any assurance that new financing will be available to it on commercially acceptable terms, if at all. These conditions raise substantial doubt about the Company’s ability to continue as a going concern for a reasonable period of time, which is considered to be one year from the issuance date of the financial statements. These consolidated financial
F-28

TABLE OF CONTENTS
SOCIAL CAPITAL HEDOSOPHIA HOLDINGS CORP. V
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
DECEMBER 31, 2020
statements do not include any adjustments relating to the recovery of the recorded assets or the classification of the liabilities that might be necessary should the Company be unable to continue as a going concern.
NOTE 2. RESTATEMENT OF PREVIOUSLY ISSUED FINANCIAL STATEMENTS
On April 12, 2021, the Acting Director of the Division of Corporation Finance and Acting Chief Accountant of the Securities and Exchange Commission together issued a statement regarding the accounting and reporting considerations for warrants issued by special purpose acquisition companies entitled “Staff Statement on Accounting and Reporting Considerations for Warrants Issued by Special Purpose Acquisition Companies (“SPACs”)” (the “SEC Statement”). Specifically, the SEC Statement focused on certain settlement terms and provisions related to certain tender offers following a business combination, which terms are similar to those contained in the warrant agreement, dated as of October 8, 2020, between the Company and Continental Stock Transfer & Trust Company, a New York corporation, as warrant agent (the “Warrant Agreement”). As a result of the SEC Statement, the Company reevaluated the accounting treatment of (i) the 20,125,000 redeemable warrants (the “Public Warrants”) that were included in the units issued by the Company in its initial public offering (the “IPO”) and (ii) the 8,000,000 redeemable warrants that were issued to the Company’s sponsor in a private placement that closed concurrently with the closing of the IPO (the “Private Placement Warrants” and, together with the Public Warrants, the “Warrants”, which are discussed in Note 4, Note 5, Note 8 and Note 9). The Company previously accounted for the Warrants as components of equity.
In further consideration of the guidance in Accounting Standards Codification (“ASC”) 815-40, Derivatives and Hedging — Contracts in Entity’s Own Equity, the Company concluded that a provision in the Warrant Agreement related to certain tender or exchange offers precludes the Warrants from being accounted for as components of equity. As the Warrants meet the definition of a derivative as contemplated in ASC 815, the Warrants should be recorded as derivative liabilities on the Consolidated Balance Sheet and measured at fair value at inception (on the date of the IPO) and at each reporting date in accordance with ASC 820, Fair Value Measurement, with changes in fair value recognized in the Consolidated Statement of Operations in the period of change.
After consultation with the Company’s independent registered public accounting firm, the Company’s management and the audit committee of the Company’s Board of Directors concluded that it is appropriate to restate the Company’s previously issued audited financial statements as of December 31, 2020 and for the period from July 10, 2020 (inception) through December 31, 2020, as previously reported in its Form 10-K. The restated classification and reported values of the Warrants as accounted for under ASC 815-40 are included in the financial statements herein.
Additionally, the Company revised the Consolidated Statement of Changes in Stockholders’ Equity to present temporary equity separate from permanent equity, which allows for better alignment to the Consolidated Balance Sheet presentation. Accordingly, the Company revised the financial statement name to Consolidated Statement of Changes in Temporary Equity and Permanent Equity to reflect this presentation change.
The following tables summarize the effect of the restatement on each financial statement line item as of the dates, and for the period, indicated:
As Previously Reported Adjustment As Restated
Consolidated Balance Sheet as of October 14, 2020
Warrant liabilities $ —  $ 44,156,250  $ 44,156,250 
Total liabilities 28,347,861  44,156,250  72,504,111 
Class A ordinary shares subject to possible redemption 773,360,930  (44,156,250) 729,204,680 
Class A ordinary shares 316  442  758 
Additional paid-in capital $ 5,002,679  $ (442) $ 5,002,237 
Consolidated Balance Sheet as of December 31, 2020
Warrant liabilities $ —  $ 99,281,250  $ 99,281,250 
F-29

TABLE OF CONTENTS
SOCIAL CAPITAL HEDOSOPHIA HOLDINGS CORP. V
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
DECEMBER 31, 2020
Total liabilities 28,358,450  99,281,250  127,639,700 
Class A ordinary shares subject to possible redemption 772,719,537  (99,281,243) 673,438,294 
Class A ordinary shares 323  993  1,316 
Additional paid-in capital 5,644,065  55,124,000  60,768,065 
Accumulated deficit (646,393) (55,125,000) (55,771,393)
Total permanent equity $ 5,000,008  $ (7) $ 5,000,001 
Consolidated Statement of Operations for the Period From July 10, 2020 (Inception) through December 31, 2020
Change in fair value of warrant liabilities $ —  $ (55,125,000) $ (55,125,000)
Other income (expense), net 17,218  (55,125,000) (55,107,782)
Net loss (646,393) (55,125,000) (55,771,393)
Basic and diluted weighted average shares outstanding, Class A ordinary shares subject to possible redemption 77,306,600  (4,386,132) 72,920,468 
Basic and diluted weighted average shares outstanding, Non-redeemable ordinary shares 20,095,027  1,979,418  22,074,445 
Basic and diluted net loss per share, Non-redeemable ordinary shares $ (0.03) $ (2.50) $ (2.53)
Consolidated Statement of Cash Flows for the Period From July 10, 2020 (Inception) through December 31, 2020
Cash Flows from Operating Activities:
Net loss $ (646,393) $ (55,125,000) $ (55,771,393)
Adjustments to reconcile net loss to net cash used in operating activities:
Change in fair value of warrant liabilities —  55,125,000  55,125,000 
Non-Cash Investing and Financing Activities:
Initial measurement of warrants issued in connection with the Initial Public Offering accounted for as liabilities $ —  $ 44,156,250  $ 44,156,250 
NOTE 3. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
Basis of Presentation
The accompanying consolidated financial statements are presented in conformity with accounting principles generally accepted in the United States of America (“GAAP”) and pursuant to the rules and regulations of the SEC.
Principles of Consolidation
The accompanying consolidated financial statements include the accounts of the Company and its majority owned subsidiary where the Company has the ability to exercise control. All significant intercompany balances and transactions have been eliminated in consolidation. Activities in relation to the noncontrolling interest are not considered to be significant and are, therefore, not presented in the accompanying consolidated financial statements.
Emerging Growth Company
The Company is an “emerging growth company,” as defined in Section 2(a) of the Securities Act, as modified by the Jumpstart Our Business Startups Act of 2012 (the “JOBS Act”), and it may take advantage of certain exemptions from various reporting requirements that are applicable to other public companies that are not emerging growth companies including, but not limited to, not being required to comply with the independent registered public accounting firm attestation requirements of Section 404 of the Sarbanes-Oxley Act, reduced disclosure obligations regarding executive compensation in its periodic reports and proxy statements, and exemptions from the
F-30

TABLE OF CONTENTS
SOCIAL CAPITAL HEDOSOPHIA HOLDINGS CORP. V
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
DECEMBER 31, 2020
requirements of holding a nonbinding advisory vote on executive compensation and shareholder approval of any golden parachute payments not previously approved.
Further, Section 102(b)(1) of the JOBS Act exempts emerging growth companies from being required to comply with new or revised financial accounting standards until private companies (that is, those that have not had a Securities Act registration statement declared effective or do not have a class of securities registered under the Exchange Act) are required to comply with the new or revised financial accounting standards. The JOBS Act provides that a company can elect to opt out of the extended transition period and comply with the requirements that apply to non-emerging growth companies but any such election to opt out is irrevocable. The Company has elected not to opt out of such extended transition period which means that when a standard is issued or revised and it has different application dates for public or private companies, the Company, as an emerging growth company, can adopt the new or revised standard at the time private companies adopt the new or revised standard. This may make comparison of the Company’s consolidated financial statements with another public company which is neither an emerging growth company nor an emerging growth company which has opted out of using the extended transition period difficult or impossible because of the potential differences in accounting standards used.
Use of Estimates
The preparation of the consolidated financial statements in conformity with GAAP requires the Company’s management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period.
Making estimates requires management to exercise significant judgment. It is at least reasonably possible that the estimate of the effect of a condition, situation or set of circumstances that existed at the date of the financial statements, which management considered in formulating its estimate, could change in the near term due to one or more future confirming events. Accordingly, the actual results could differ significantly from those estimates.
Cash and Cash Equivalents
The Company considers all short-term investments with an original maturity of three months or less when purchased to be cash equivalents. The Company did not have any cash equivalents as of December 31, 2020.
Marketable Securities Held in Trust Account
At December 31, 2020, substantially all of the assets held in the Trust Account were held in money market funds which are invested primarily in U.S. Treasury Securities.
Warrant Liabilities
The Company evaluated the Public Warrants and Private Placement Warrants (collectively, “Warrants”, which are discussed in Note 4, Note 5, Note 8 and Note 9) in accordance with ASC 815-40, “Derivatives and Hedging — Contracts in Entity’s Own Equity”, and concluded that a provision in the Warrant Agreement related to certain tender or exchange offers precludes the Warrants from being accounted for as components of equity. As the Warrants meet the definition of a derivative as contemplated in ASC 815, the Warrants are recorded as derivative liabilities on the Consolidated Balance Sheet and measured at fair value at inception (on the date of the IPO) and at each reporting date in accordance with ASC 820, “Fair Value Measurement”, with changes in fair value recognized in the Consolidated Statement of Operations in the period of change.
Class A Ordinary Shares Subject to Possible Redemption
The Company accounts for its Class A ordinary shares subject to possible redemption in accordance with the guidance in ASC 480, “Distinguishing Liabilities from Equity”. Class A redeemable ordinary shares are classified as temporary equity. Non-redeemable ordinary shares are classified as permanent equity. The Company’s Class A ordinary shares feature certain redemption rights that are considered to be outside of the Company’s control and subject to occurrence of uncertain future events. Accordingly, Class A ordinary shares subject to possible redemption are presented as temporary equity in the Company’s Consolidated Balance Sheet.
F-31

TABLE OF CONTENTS
SOCIAL CAPITAL HEDOSOPHIA HOLDINGS CORP. V
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
DECEMBER 31, 2020
Components of Equity
Upon the IPO, the Company issued Class A Ordinary shares and Warrants. The Company allocated the proceeds received from the issuance using the with-and-without method. Under that method, the Company first allocated the proceeds to the Warrants based on their initial fair value measurement of $44,156,250 and then allocated the remaining proceeds, net of underwriting discounts and offering costs of $42,659,062, to the Class A Ordinary shares. A portion of the 80,500,000 Class A Ordinary shares are presented within temporary equity, as certain shares are subject to redemption upon the occurrence of events not solely within the Company’s control.
Income Taxes
The Company accounts for income taxes under ASC 740, “Income Taxes” (“ASC 740”). ASC 740 requires the recognition of deferred tax assets and liabilities for both the expected impact of differences between the financial statement and tax basis of assets and liabilities and for the expected future tax benefit to be derived from tax loss and tax credit carry forwards. ASC 740 additionally requires a valuation allowance to be established when it is more likely than not that all or a portion of deferred tax assets will not be realized.
ASC 740 also clarifies the accounting for uncertainty in income taxes recognized in an enterprise’s financial statements and prescribes a recognition threshold and measurement process for financial statement recognition and measurement of a tax position taken or expected to be taken in a tax return. For those benefits to be recognized, a tax position must be more-likely-than-not to be sustained upon examination by taxing authorities. The Company recognizes accrued interest and penalties related to unrecognized tax benefits as income tax expense. There were no unrecognized tax benefits and no amounts accrued for interest and penalties as of December 31, 2020. The Company is currently not aware of any issues under review that could result in significant payments, accruals or material deviation from its position. The Company is subject to income tax examinations by major taxing authorities since inception.
The Company is considered an exempted Cayman Islands Company and is presently not subject to income taxes or income tax filing requirements in the Cayman Islands or the United States. As such, the Company’s tax provision was zero for the period presented.
On March 27, 2020, President Trump signed the Coronavirus Aid, Relief, and Economic Security “CARES” Act into law. The CARES Act includes several significant business tax provisions that, among other things, would eliminate the taxable income limit for certain net operating losses (“NOLs”) and allow businesses to carry back NOLs arising in 2018, 2019 and 2020 to the five prior years, suspend the excess business loss rules, accelerate refunds of previously generated corporate alternative minimum tax credits, generally loosen the business interest limitation under IRC section 163(j) from 30 percent to 50 percent among other technical corrections included in the Tax Cuts and Jobs Act tax provisions. The Company does not believe that the CARES Act will have a significant impact on Company's financial position or statement of operations.
Net Income (Loss) per Ordinary Share
Net income (loss) per share is computed by dividing net income by the weighted-average number of ordinary shares outstanding during the period, excluding ordinary shares subject to forfeiture. The Company has not considered the effect of the warrants sold in the Initial Public Offering and private placement to purchase an aggregate of 28,125,000 shares in the calculation of diluted loss per share, since the exercise of the warrants are contingent upon the occurrence of future events and the inclusion of such warrants would be anti-dilutive.
The Company’s Consolidated Statement of Operations includes a presentation of income (loss) per share for common shares subject to possible redemption in a manner similar to the two-class method of income (loss) per share. Net income (loss) per ordinary, basic and diluted, for Ordinary shares subject to possible redemption is calculated by dividing the proportionate share of income or loss on marketable securities held by the Trust Account by the weighted average number of Ordinary shares subject to possible redemption outstanding since the original issuance.
F-32

TABLE OF CONTENTS
SOCIAL CAPITAL HEDOSOPHIA HOLDINGS CORP. V
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
DECEMBER 31, 2020
Net income (loss) per share, basic and diluted, for non-redeemable ordinary shares is calculated by dividing the net income (loss), adjusted for income or loss on marketable securities attributable to Ordinary shares subject to possible redemption, by the weighted average number of non-redeemable ordinary shares outstanding for the period.
Non-redeemable common stock includes Founder Shares and non-redeemable Class A ordinary shares as these shares do not have any redemption features. Non-redeemable ordinary shares participate in the income or loss on marketable securities based on non-redeemable shares’ proportionate interest.
The following table reflects the calculation of basic and diluted net income (loss) per ordinary share (in dollars, except per share amounts):
For the Period from
July 10, 2020 (Inception) Through
December 31, 2020
Ordinary Shares subject to possible redemption
Numerator: Earnings allocable to Ordinary shares subject to possible redemption
Interest earned on marketable securities held in Trust Account $ 14,405 
Net income allocable to Class A ordinary shares subject to possible redemption $ 14,405 
Denominator: Weighted Average Class A Ordinary shares subject to possible redemption
Basic and diluted weighted average shares outstanding 72,920,468 
Basic and diluted net income per share $ 0.00 
Non-Redeemable Common Stock
Numerator: Earnings allocable to non-redeemable ordinary shares
Net loss $ (55,771,393)
Less: Net income allocable to Class A ordinary shares subject to possible redemption (14,405)
Non-redeemable net loss $ (55,785,798)
Denominator: Weighted Average Non-redeemable ordinary shares
Basic and diluted weighted average shares outstanding, Non-redeemable ordinary shares $ 22,074,445 
Basic and diluted net loss per share, Non-redeemable ordinary shares $ (2.53)
Concentration of Credit Risk
Financial instruments that potentially subject the Company to concentrations of credit risk consist of a cash account in a financial institution which, at times may exceed the Federal Depository Insurance Coverage limit of $250,000. The Company has not experienced losses on this account and management believes the Company is not exposed to significant risks on such account.
Fair Value of Financial Instruments
The Company follows the guidance in ASC Topic 820, “Fair Value Measurement”, for its financial assets and liabilities that are re-measured and reported at fair value at each reporting period, and non-financial assets and liabilities that are re-measured and reported at fair value at least annually.
The fair value of the Company’s financial assets and liabilities reflects management’s estimate of amounts that the Company would have received in connection with the sale of the assets or paid in connection with the transfer of the liabilities in an orderly transaction between market participants at the measurement date. In connection with measuring the fair value of its assets and liabilities, the Company seeks to maximize the use of observable inputs (market data obtained from independent sources) and to minimize the use of unobservable inputs (internal assumptions about how market participants would price assets and liabilities). The following fair value hierarchy is used to classify assets and liabilities based on the observable inputs and unobservable inputs used in order to value the assets and liabilities:
F-33

TABLE OF CONTENTS
SOCIAL CAPITAL HEDOSOPHIA HOLDINGS CORP. V
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
DECEMBER 31, 2020
Level 1: Quoted prices in active markets for identical assets or liabilities. An active market for an asset or liability is a market in which transactions for the asset or liability occur with sufficient frequency and volume to provide pricing information on an ongoing basis.
Level 2: Observable inputs other than Level 1 inputs. Examples of Level 2 inputs include quoted prices in active markets for similar assets or liabilities and quoted prices for identical assets or liabilities in markets that are not active.
Level 3: Unobservable inputs based on our assessment of the assumptions that market participants would use in pricing the asset or liability.
See Note 9 for additional information on assets and liabilities measured at fair value.
Recent Accounting Standards
Management does not believe that any recently issued, but not yet effective, accounting standards, if currently adopted, would have a material effect on the accompanying consolidated financial statements.
NOTE 4. INITIAL PUBLIC OFFERING
Pursuant to the Initial Public Offering, the Company sold 80,500,000 Units, which includes the full exercise by the underwriter of its option to purchase an additional 10,500,000 Units, at a purchase price of $10.00 per Unit. Each Unit consists of one Class A ordinary share and one-fourth of one redeemable warrant (“Public Warrant”). Each whole Public Warrant entitles the holder to purchase one Class A ordinary share at an exercise price of $11.50 per whole share, subject to adjustment (see Note 8).


NOTE 5. PRIVATE PLACEMENT
Simultaneously with the closing of the Initial Public Offering, the Sponsor purchased an aggregate of 8,000,000 Private Placement Warrants at a price of $2.00 per Private Placement Warrant, for an aggregate purchase price of $16,000,000. Each Private Placement Warrant is exercisable for one Class A ordinary share at a price of $11.50 per share, subject to adjustment (see Note 8). A portion of the proceeds from the sale of the Private Placement Warrants was added to the net proceeds from the Initial Public Offering held in the Trust Account. If the Company does not complete a Business Combination within the Combination Period, the proceeds from the sale of the Private Placement Warrants held in the Trust Account will be used to fund the redemption of the Public Shares (subject to the requirements of applicable law) and the Private Placement Warrants will expire worthless.
NOTE 6. RELATED PARTY TRANSACTIONS
Founder Shares
On July 10, 2020, the Company issued one ordinary share to the Sponsor for no consideration. On July 16, 2020, the Company cancelled the one share issued in July 2020 and the Sponsor purchased 2,875,000 Founder Shares for an aggregate purchase price of $25,000. On September 17, 2020, the Company effected a share capitalization resulting in the Sponsor holding an aggregate of 18,687,500 Founder Shares. On October 8, 2020, the Company effected another share capitalization resulting in the Company’s initial shareholders holding an aggregate of 20,125,000 Founder Shares. All share and per-share amounts have been retroactively restated to reflect the share capitalizations. The Founder Shares will automatically convert into Class A ordinary shares on the first business day following the completion of a Business Combination, or earlier at the option of the holder, on a one-for-one basis, subject to certain adjustments, as described in Note 8.
The Founder Shares included an aggregate of up to 2,625,000 shares that were subject to forfeiture by the Sponsor to the extent that the underwriter’s over-allotment option was not exercised in full or in part, so that the number of Founder Shares would collectively represent 20% of the Company’s issued and outstanding shares upon the completion of the Initial Public Offering. As a result of the underwriters’ election to fully exercise their over-allotment option, no Founder Shares are currently subject to forfeiture.
F-34

TABLE OF CONTENTS
SOCIAL CAPITAL HEDOSOPHIA HOLDINGS CORP. V
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
DECEMBER 31, 2020
The Sponsor has agreed, subject to limited exceptions, not to transfer, assign or sell any of its Class B ordinary shares or Class A ordinary shares received upon conversion thereof (together, “Founder Shares”) until the earlier of: (A) one year after the completion of a Business Combination and (B) subsequent to a Business Combination, (x) if the last reported sale price of the Class A ordinary shares equals or exceeds $12.00 per share (as adjusted for share subdivisions, share dividends, rights issuances, consolidations, reorganizations, recapitalizations and the like) for any 20 trading days within any 30-trading day period commencing at least 150 days after a Business Combination, or (y) the date on which the Company completes a liquidation, merger, amalgamation, share exchange, reorganization or other similar transaction that results in all of the Company’s shareholders having the right to exchange their Class A ordinary shares for cash, securities or other property.
Administrative Support Agreement
The Company entered into an agreement whereby, commencing on October 14, 2020, the Company will pay an affiliate of the Sponsor up to $10,000 per month for office space, administrative and support services. Upon completion of a Business Combination or its liquidation, the Company will cease paying these monthly fees. For the period from July 10, 2020 (inception) through December 31, 2020, the Company incurred $25,000, in fees for these services, of which is included in accrued expenses in the accompanying Consolidated Balance Sheet.
Advance from Related Party
As of October 14, 2020, the Sponsor paid for certain offering costs on behalf of the Company in connection with the Initial Public Offering. The advances are non-interest bearing and due on demand. At December 31, 2020, advances amounting to $5,000 were outstanding.
Promissory Note — Related Party
On July 16, 2020, the Company issued an unsecured promissory note to the Sponsor (the “Promissory Note”), pursuant to which the Company borrowed an aggregate principal amount of $300,000. The Promissory Note was non-interest bearing and payable on the earlier of (i) June 30, 2021 and (ii) the completion of the Initial Public Offering. The Promissory Note was amended and restated on September 17, 2020 solely to increase the amount that could be borrowed to an aggregate principal amount of $400,000. The outstanding balance under the Promissory Note of $400,000 was repaid at the closing of the Initial Public Offering on October 14, 2020.
Related Party Loans
In order to finance transaction costs in connection with a Business Combination, the Sponsor or an affiliate of the Sponsor, or certain of the Company’s officers and directors may, but are not obligated to, loan the Company funds as may be required (“Working Capital Loans”). Such Working Capital Loans would be evidenced by promissory notes. The notes may be repaid upon completion of a Business Combination, without interest, or, at the lender’s discretion, up to $2,500,000 of notes may be converted upon completion of a Business Combination into warrants at a price of $2.00 per warrant. Such warrants would be identical to the Private Placement Warrants. In the event that a Business Combination does not close, the Company may use a portion of proceeds held outside the Trust Account to repay the Working Capital Loans but no proceeds held in the Trust Account would be used to repay the Working Capital Loans.
Restricted Stock Units
On November 13, 2020, the Company entered into a Director Restricted Stock Unit Award Agreement (the “Director Restricted Stock Unit Award Agreement”), between the Company and Jennifer Dulski, a member of the Company's board of directors, providing for the grant of 100,000 restricted stock units (“RSUs”) to Ms. Dulski, which grant is contingent on both the consummation of a Business Combination with the Company and a shareholder approved equity plan. The RSUs will vest upon the consummation of such Business Combination and represent 100,000 Class A ordinary shares of the Company that will settle on a date selected by the Company in the year following the year in which such consummation occurs.
F-35

TABLE OF CONTENTS
SOCIAL CAPITAL HEDOSOPHIA HOLDINGS CORP. V
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
DECEMBER 31, 2020
NOTE 7. COMMITMENTS
Registration Rights
Pursuant to a registration rights agreement entered into on October 8, 2020, the holders of the Founder Shares, Private Placement Warrants and any warrants that may be issued upon conversion of Working Capital Loans (and any Class A ordinary shares issuable upon the exercise of the Private Placement Warrants or warrants issued upon conversion of the Working Capital Loans and upon conversion of the Founder Shares) will be entitled to registration rights requiring the Company to register such securities for resale (in the case of the Founder Shares, only after conversion to the Company’s Class A ordinary shares). The holders of these securities will be entitled to make up to three demands, excluding short form registration demands, that the Company register such securities. In addition, the holders have certain “piggy-back” registration rights with respect to registration statements filed subsequent to the completion of a Business Combination and rights to require the Company to register for resale such securities pursuant to Rule 415 under the Securities Act. However, the registration rights agreement provides that the Company will not be required to effect or permit any registration or cause any registration statement to become effective until termination of the applicable lock-up period. The Company will bear the expenses incurred in connection with the filing of any such registration statements.
Underwriting Agreement
The underwriter is entitled to a deferred fee of $0.35 per Unit, or $28,175,000 in the aggregate. The deferred fee will become payable to the underwriter from the amounts held in the Trust Account solely in the event that the Company completes a Business Combination, subject to the terms of the underwriting agreement.
Financial Advisory Fee
The underwriters agreed to reimburse the Company for an amount equal to (1) 10% of the non-deferred underwriting commission payable to the underwriter, of which $1,400,000 was paid to Connaught (UK) Limited (“Connaught”) upon the closing of the Initial Public Offering, and (2) 20% of the deferred underwriting commission payable to the underwriter, of which $5,635,000 will be paid to Connaught upon the closing of the Business Combination.
NOTE 8. PERMANENT EQUITY AND TEMPORARY EQUITY
Preferred Shares — The Company is authorized to issue 5,000,000 preference shares with a par value of $0.0001. The Company’s board of directors will be authorized to fix the voting rights, if any, designations, powers, preferences, the relative, participating, optional or other special rights and any qualifications, limitations and restrictions thereof, applicable to the shares of each series. The board of directors will be able to, without shareholder approval, issue preference shares with voting and other rights that could adversely affect the voting power and other rights of the holders of the ordinary shares and could have anti-takeover effects. At December 31, 2020, there were no preference shares issued or outstanding.
Class A Ordinary Shares — The Company is authorized to issue 500,000,000 Class A ordinary shares, with a par value of $0.0001 per share. Holders of Class A ordinary shares are entitled to one vote for each share. At December 31, 2020, there were 13,157,611 Class A ordinary shares issued and outstanding, excluding 67,342,389 Class A ordinary shares subject to possible redemption.
Class B Ordinary Shares — The Company is authorized to issue 50,000,000 Class B ordinary shares, with a par value of $0.0001 per share. Holders of the Class B ordinary shares are entitled to one vote for each share. At December 31, 2020, there was 20,125,000 Class B ordinary shares issued and outstanding.
Only holders of the Class B ordinary shares will have the right to vote on the election of directors prior to the Business Combination. Holders of Class A ordinary shares and holders of Class B ordinary shares will vote together as a single class on all matters submitted to a vote of the Company’s shareholders except as otherwise required by law.
F-36

TABLE OF CONTENTS
SOCIAL CAPITAL HEDOSOPHIA HOLDINGS CORP. V
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
DECEMBER 31, 2020
The Class B ordinary shares will automatically convert into Class A ordinary shares at the time of the completion of the Business Combination, or earlier at the option of the holder, on a one-for-one basis, subject to adjustment. In the case that additional Class A ordinary shares, or equity-linked securities, are issued or deemed issued in excess of the amounts issued in the Initial Public Offering and related to the closing of a Business Combination, the ratio at which Founder Shares will convert into Class A ordinary shares will be adjusted (subject to waiver by holders of a majority of the Class B ordinary shares) so that the number of Class A ordinary shares issuable upon conversion of all Founder Shares will equal, in the aggregate, on an as-converted basis, 20% of the sum of the ordinary shares issued and outstanding upon completion of the Initial Public Offering plus the number of Class A ordinary shares and equity-linked securities issued or deemed issued in connection with a Business Combination, excluding any Class A ordinary shares or equity-linked securities issued, or to be issued, to any seller in a Business Combination.
Warrants — Public Warrants may only be exercised for a whole number of shares. No fractional shares will be issued upon exercise of the Public Warrants. The Public Warrants will become exercisable on the later of (a) 30 days after the completion of a Business Combination and (b) 12 months from the closing of the Initial Public Offering. The Public Warrants will expire five years from the completion of a Business Combination or earlier upon redemption or liquidation.
The Company will not be obligated to deliver any Class A ordinary shares pursuant to the exercise of a Public Warrant and will have no obligation to settle such Public Warrant exercise unless a registration statement under the Securities Act covering the issuance of the Class A ordinary shares issuable upon exercise of the Public Warrants is then effective and a prospectus relating thereto is current, subject to the Company satisfying its obligations with respect to registration or a valid exemption from registration is available. No Public Warrant will be exercisable for cash or on a cashless basis, and the Company will not be obligated to issue any shares to holders seeking to exercise their Public Warrants, unless the issuance of the shares upon such exercise is registered or qualified under the securities laws of the state of the exercising holder, or an exemption from registration is available.
The Company has agreed that as soon as practicable, but in no event later than 15 business days, after the closing of a Business Combination, it will use its commercially reasonable efforts to file with the SEC a registration statement registering the issuance, under the Securities Act, of the Class A ordinary shares issuable upon exercise of the Public Warrants. The Company will use its commercially reasonable efforts to cause the same to become effective within 60 business days after the closing of the Business Combination and to maintain the effectiveness of such registration statement, and a current prospectus relating thereto, until the expiration of the Public Warrants in accordance with the provisions of the warrant agreement. Notwithstanding the above, if the Class A ordinary shares are, at the time of any exercise of a Public Warrant, not listed on a national securities exchange such that they satisfy the definition of a “covered security” under Section 18(b)(1) of the Securities Act, the Company may, at its option, require holders of Public Warrants who exercise their Public Warrants to do so on a “cashless basis” in accordance with Section 3(a)(9) of the Securities Act and, in the event the Company so elects, the Company will not be required to file or maintain in effect a registration statement, but will use its commercially reasonable efforts to register or qualify the shares under applicable blue sky laws to the extent an exemption is not available.
Redemption of warrants when the price per Class A ordinary share equals or exceeds $18.00. Once the Public Warrants become exercisable, the Company may redeem the Public Warrants:
in whole and not in part;
at a price of $0.01 per Public Warrant;
upon not less than 30 days’ prior written notice of redemption to each warrant holder and
if, and only if, the reported last sale price of the Class A ordinary shares for any 20 trading days within a 30-trading day period ending on the third trading day prior to the date on which the Company sends the notice of redemption to the warrant holders (the “Reference Value”) equals or exceeds $18.00 per share (as adjusted).
F-37

TABLE OF CONTENTS
SOCIAL CAPITAL HEDOSOPHIA HOLDINGS CORP. V
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
DECEMBER 31, 2020
Redemption of warrants when the price per Class A ordinary share equals or exceeds $10.00. Once the Public Warrants become exercisable, the Company may redeem the Public Warrants:
in whole and not in part;
at $0.10 per warrant upon a minimum of 30 days’ prior written notice of redemption provided that holders will be able to exercise their warrants on a cashless basis prior to redemption and receive that number of shares based on the redemption date and the “fair market value” of the Class A ordinary shares;
if, and only if, the Reference Value equals or exceeds $10.00 per share (as adjusted); and
if the Reference Value is less than $18.00 per share (as adjusted), the Private Placement Warrants must also be concurrently called for redemption on the same terms as the outstanding Public Warrants, as described above.
If and when the Public Warrants become redeemable by the Company, the Company may exercise its redemption right even if it is unable to register or qualify the underlying securities for sale under all applicable state securities laws.
The exercise price and number of ordinary shares issuable upon exercise of the Public Warrants may be adjusted in certain circumstances including in the event of a share dividend, extraordinary dividend or recapitalization, reorganization, merger or consolidation. However, except as described below, the Public Warrants will not be adjusted for issuances of ordinary shares at a price below its exercise price. Additionally, in no event will the Company be required to net cash settle the Public Warrants. If the Company is unable to complete a Business Combination within the Combination Period and the Company liquidates the funds held in the Trust Account, holders of Public Warrants will not receive any of such funds with respect to their Public Warrants, nor will they receive any distribution from the Company’s assets held outside of the Trust Account with respect to such Public Warrants. Accordingly, the Public Warrants may expire worthless.
In addition, if (x) the Company issues additional ordinary shares or equity-linked securities for capital raising purposes in connection with the closing of a Business Combination at an issue price or effective issue price of less than $9.20 per Class A ordinary share (with such issue price or effective issue price to be determined in good faith by the Company’s board of directors, and in the case of any such issuance to the Sponsor or its affiliates, without taking into account any Founder Shares held by the Sponsor or such affiliates, as applicable, prior to such issuance) (the “Newly Issued Price”), (y) the aggregate gross proceeds from such issuances represent more than 60% of the total equity proceeds, and interest thereon, available for the funding of a Business Combination on the date of the completion of a Business Combination (net of redemptions), and (z) the volume weighted average trading price of the Company’s ordinary shares during the 20 trading day period starting on the trading day prior to the day on which the Company consummates a Business Combination (such price, the “Market Value”) is below $9.20 per share, the exercise price of the Public Warrants will be adjusted (to the nearest cent) to be equal to 115% of the higher of the Market Value and the Newly Issued Price, and the $18.00 per share redemption trigger prices described above will be adjusted (to the nearest cent) to be equal to 180% of the higher of the Market Value and the Newly Issued Price and the $10.00 per share redemption trigger prices described will be adjusted (to the nearest cent) to be equal to the higher of the Market Value and the Newly Issued Price.
The Private Placement Warrants are identical to the Public Warrants underlying the Units sold in the Initial Public Offering, except that the Private Placement Warrants and the Class A ordinary shares issuable upon the exercise of the Private Placement Warrants will not be transferable, assignable or salable until 30 days after the completion of a Business Combination, subject to certain limited exceptions. Additionally, the Private Placement Warrants will be exercisable on a cashless basis and be non-redeemable, except as described above, so long as they are held by the initial purchasers or their permitted transferees. If the Private Placement Warrants are held by someone other than the initial purchasers or their permitted transferees, the Private Placement Warrants will be redeemable by the Company and exercisable by such holders on the same basis as the Public Warrants.
Restricted Stock Units — On November 13, 2020, the Company entered into a Director Restricted Stock Unit Award Agreement (the "Director Restricted Stock Unit Award Agreement"), between the Company and a member
F-38

TABLE OF CONTENTS
SOCIAL CAPITAL HEDOSOPHIA HOLDINGS CORP. V
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
DECEMBER 31, 2020
of the Company's board of directors, providing for the grant of 100,000 restricted stock units ("RSUs") , which grant is contingent on both the consummation of a Business Combination with the Company and a shareholder approved equity plan. The RSUs will vest upon the consummation of such Business Combination and represent 100,000 Class A ordinary shares of the Company that will settle on a date selected by the Company in the year following the year in which such consummation occurs.
NOTE 9. FAIR VALUE MEASUREMENTS
The following table presents information about the Company’s assets and liabilities that are measured at fair value on a recurring basis at December 31, 2020, and indicates the fair value hierarchy of the valuation inputs the Company utilized to determine such fair value:
Description Level December 31, 2020
Assets:
Marketable securities held in Trust Account(1)
1 $ 805,017,218 
Liabilities:
Private Placement Warrants(2)
2 $ 28,240,000 
Public Warrants(2)
1 $ 71,041,250 
__________________
(1)The fair value of the marketable securities held in Trust account approximates the carrying amount primarily due to their short-term nature.
(2)Measured at fair value on a recurring basis.
Warrants
The Warrants are accounted for as liabilities in accordance with ASC 815-40 and are presented within warrant liabilities on the Consolidated Balance Sheet. The warrant liabilities are measured at fair value at inception and on a recurring basis, with changes in fair value presented within change in fair value of warrant liabilities in the Consolidated Statement of Operations.
Initial Measurement
The Company established the initial fair value for the Warrants on October 14, 2020, the date of the Company’s Initial Public Offering, using a Monte Carlo simulation model for the Private Placement Warrants and the Public Warrants. The Company allocated the proceeds received from (i) the sale of Units (which is inclusive of one share of Class A ordinary shares and one-fourth of one Public Warrant), (ii) the sale of Private Placement Warrants, and (iii) the issuance of Class B ordinary shares, first to the Warrants based on their fair values as determined at initial measurement, with the remaining proceeds allocated to Class A ordinary shares subject to possible redemption (temporary equity), Class A ordinary shares (permanent equity) and Class B ordinary shares (permanent equity) based on their relative fair values at the initial measurement date. The Warrants were classified as Level 3 at the initial measurement date due to the use of unobservable inputs.
The key inputs into the Monte Carlo simulation model for the Private Placement Warrants and Public Warrants were as follows at initial measurement:
Input October 14, 2020 (Initial Measurement)
Risk-free interest rate 0.4  %
Expected term (years) 1
Expected volatility 20.0  %
Exercise price $ 11.50 
Fair value of Units $ 10.60 
The Company’s use of a Monte Carlo simulation model required the use of subjective assumptions:
F-39

TABLE OF CONTENTS
SOCIAL CAPITAL HEDOSOPHIA HOLDINGS CORP. V
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
DECEMBER 31, 2020
The risk-free interest rate assumption was based on the five-year U.S. Treasury rate, which was commensurate with the contractual term of the Warrants, which expire on the earlier of (i) five years after the completion of the initial business combination and (ii) upon redemption or liquidation. An increase in the risk-free interest rate, in isolation, would result in an increase in the fair value measurement of the warrant liabilities and vice versa.
The expected term was determined to be one year, as the Warrants become exercisable on the later of (i) 30 days after the completion of a business combination and (ii) 12 months from the Initial Public Offering date. An increase in the expected term, in isolation, would result in an increase in the fair value measurement of the warrant liabilities and vice versa.
The expected volatility assumption was based on the implied volatility from a set of comparable publicly-traded warrants as determined based on the size and proximity of other similar business combinations. An increase in the expected volatility, in isolation, would result in an increase in the fair value measurement of the warrant liabilities and vice versa.
The fair value of the Units, which each consist of one Class A ordinary share and one-fourth of one Public Warrant, represents the closing price on the measurement date as observed from the ticker IPOE.U.
Based on the applied volatility assumption and the expected term to a business combination noted above, the Company determined that the risk-neutral probability of exceeding the $18.00 redemption value by the start of the exercise period for the Warrants resulted in a nominal difference in value between the Public Warrants and Private Placement Warrants across the valuation dates utilized in the Monte Carlo simulation model. Therefore, the resulting valuations for the two classes of Warrants were determined to be equal. On October 14, 2020, the Private Placement Warrants and Public Warrants were determined to be $1.57 per warrant for aggregate values of $12.6 million and $31.6 million, respectively.
Subsequent Measurement
The Warrants are measured at fair value on a recurring basis. The subsequent measurement of the Public Warrants as of December 31, 2020 is classified as Level 1 due to the use of an observable market quote in an active market under the ticker IPOE.WS. As the transfer of Private Placement Warrants to anyone outside of a small group of individuals who are permitted transferees would result in the Private Placement Warrants having substantially the same terms as the Public Warrants, the Company determined that the fair value of each Private Placement Warrant is equivalent to that of each Public Warrant, with an insignificant adjustment for short-term marketability restrictions. As such, the Private Placement Warrants are classified as Level 2.
As of December 31, 2020, the aggregate values of the Private Placement Warrants and Public Warrants were $28.2 million and $71.0 million, respectively, based on the closing price of IPOE.WS on that date of $3.53.
The following table presents the changes in the fair value of warrant liabilities:
Private Placement Public Warrant Liabilities
Fair value as of July 10, 2020 $ —  $ —  $ — 
Initial measurement on October 14, 2020 12,560,000 31,596,250 44,156,250
Change in valuation inputs or other assumptions(1)(2)
15,680,000 39,445,000 55,125,000
Fair value as of December 31, 2020 $ 28,240,000  $ 71,041,250  $ 99,281,250 
__________________
(1)Changes in valuation inputs or other assumptions are recognized in change in fair value of warrant liabilities in the Consolidated Statement of Operations.
(2)Due to the use of quoted prices in an active market (Level 1) and the use of observable inputs for similar assets or liabilities (Level 2) to measure the fair values of the Public Warrants and Private Placement Warrants, respectively, subsequent to initial measurement, the Company had transfers out of Level 3 totaling $55.1 million during the period from October 14, 2020 through December 31, 2020.
F-40

TABLE OF CONTENTS
SOCIAL CAPITAL HEDOSOPHIA HOLDINGS CORP. V
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
DECEMBER 31, 2020
NOTE 10. SUBSEQUENT EVENTS
The Company evaluated subsequent events and transactions that occurred after the balance sheet date up to the date that the consolidated financial statements were issued. Based upon this review, other than as described below, the Company did not identify any subsequent events that would have required adjustment or disclosure in the consolidated financial statements.
On January 7, 2021, the Company entered into an Agreement and Plan of Merger (as amended on March 16, 2021, the “Merger Agreement”) with Plutus Merger Sub Inc., a Delaware corporation and a direct wholly owned subsidiary of the Company (“Merger Sub”), and Social Finance, Inc., a Delaware corporation (“SoFi”).
The Merger Agreement provides that, among other things and upon the terms and subject to the conditions thereof, the following transactions will occur (together with the other agreements and transactions contemplated by the Merger Agreement, the “SoFi Business Combination”): (i) prior to the closing of the transactions contemplated by the Merger Agreement (the “Closing”), the Company will domesticate as a Delaware corporation in accordance with Section 388 of the DGCL, and the Cayman Islands Companies Law (2020 Revision) (the “Domestication”), (ii) at the Closing, upon the terms and subject to the conditions of the Merger Agreement, in accordance with the DGCL, Merger Sub will merge with and into SoFi, with SoFi continuing as the surviving corporation and a wholly owned subsidiary of the Company (the “Merger”), (iii) upon consummation of the Merger, and subject to the adjustments provided in the Merger Agreement, all of the common stock and preferred stock of SoFi, excluding the Company Redeemable Preferred Stock (as defined in the Merger Agreement), which will convert into Acquiror Series 1 Preferred Stock (as defined in the Merger Agreement), will be converted into the right to receive an aggregate number of shares of common stock, par value $0.0001 per share, of the Company (after the Domestication) (“SCH Common Stock”) equal to the quotient obtained by dividing (x) $6,569,840,376 by (y) $10.00 and (iv) upon the consummation of the Merger, the Company will be renamed “SoFi Technologies, Inc.” The Closing is subject to the satisfaction or waiver of certain closing conditions contained in the Merger Agreement, including the approval of the Company’s shareholders.
On January 7, 2021, concurrently with the execution of the Merger Agreement, the Company entered into subscription agreements with certain investors (collectively, the "PIPE Investors"), pursuant to which, on the terms and subject to the conditions therein, the PIPE Investors have collectively subscribed for 122.5 million shares of SCH Common Stock for an aggregate purchase price equal to $1,225.0 million (the “PIPE Investment”), a portion of which is expected to be funded by one or more affiliates of the Sponsor. The PIPE Investment will be consummated substantially concurrently with the Closing, subject to the terms and conditions contemplated by the Subscription Agreements.
On March 16, 2021, (i) the Company, SoFi and Merger Sub entered into the First Amendment to Agreement and Plan of Merger which amends the Merger Agreement and (ii) the Company, the Sponsor and SoFi entered into the First Amendment to Sponsor Support Agreement to reflect that the securities of the combined company are expected to trade on The Nasdaq Stock Market LLC instead of the New York Stock Exchange following the consummation of the SoFi Business Combination. In addition, SoFi, the Company and the applicable shareholders of SoFi have agreed to make conforming changes to the form of shareholders’ agreement contemplated by the Merger Agreement to be entered into at the closing of the Business Combination with SoFi.
The consummation of the proposed SoFi Business Combination is subject to certain conditions as further described in the Merger Agreement.
In connection with the proposed SoFi Business Combination, certain purported shareholders of the Company have filed lawsuits, including those described below, and other shareholders have threatened to file lawsuits alleging breaches of fiduciary duty and violations of the disclosure requirements of the Exchange Act. The Company believes that these allegations are without merit. These cases are in the early stages and the Company is unable to reasonably determine the outcome or estimate any potential losses, and, as such, has not recorded a loss contingency.
On January 28, 2021, Tim Holtom (“Holtom”), a purported shareholder of the Company, filed a lawsuit in the Supreme Court of the State of New York, County of New York, captioned Tim Holtom v. Social Capital
F-41

TABLE OF CONTENTS
SOCIAL CAPITAL HEDOSOPHIA HOLDINGS CORP. V
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
DECEMBER 31, 2020
Hedosophia Holdings Corp. V, et al., case number 650647/2021, against the Company and the members of its board of directors (the “Holtom Complaint”). The Holtom Complaint asserts a breach of fiduciary duty claim against the individual defendants and an aiding and abetting claim against the Company. The Holtom Complaint alleges, among other things, that (i) the merger consideration is unfair, and (ii) the registration statement on Form S-4 filed with the SEC on January 11, 2021 regarding the proposed transaction involving SoFi (the “Registration Statement”) is materially misleading and incomplete. The Holtom Complaint seeks, among other things, to enjoin the proposed Business Combination, rescind the transaction or award rescissory damages to the extent it is consummated, and an award of attorneys’ fees and expenses.
On January 29, 2021, Ryan Heitt (“Heitt”), a purported shareholder of the Company, filed a lawsuit in the Supreme Court of the State of New York, County of New York, captioned Ryan Heitt v. Social Capital Hedosophia Holdings Corp. V, et al., case number 650685/2021 against the members of its board of directors, Merger Sub and SoFi (the “Heitt Complaint”). The Heitt Complaint asserts a breach of fiduciary duty claim against the individual defendants and an aiding and abetting claim against the Company, Merger Sub and SoFi. The Heitt Complaint alleges, among other things, that the Registration Statement is materially misleading and incomplete. The Heitt Complaint seeks, among other things, to enjoin the proposed Business Combination, rescind the transaction or award rescissory damages to the extent it is consummated, and an award of attorneys’ fees and expenses.
On February 3, 2021, counsel to Holtom and Heitt sent a joint letter to the Company's counsel (the “Joint Demand”), alleging that they “have identified several disclosure deficiencies” in the Registration Statement, and demanding that the Company issue corrective disclosures with regard to certain enumerated items. The Joint Demand asserts that a failure to issue the requested disclosures will expose the Company and its board of directors to liability.
The parties resolved the allegations made by Holtom and Heitt and discontinuances of the lawsuits commenced by Holtom and Heitt are expected to be filed shortly.
On February 15, 2021, Brian Levy, a purported shareholder of the Company, filed a lawsuit in the Supreme Court of the State of New York, County of Nassau, captioned Brian Levy v. Jennifer Dulski, et al., case number 601778/2021, against the members of the Company’s board of directors, SoFi, Citigroup Global Markets Inc., Credit Suisse Securities (USA) LLC and Goldman Sachs & Co. LLC (the “Levy Complaint”). The lawsuit was filed by Levy individually, and derivatively on behalf of nominal defendant the Company. The Levy Complaint alleges, among other things, that (i) the merger consideration is unfair, and (ii) the Registration Statement is materially misleading and incomplete. The Levy Complaint asserts: (i) a derivative claim for breach of fiduciary duty against the individual defendants; (ii) a derivative claim for causing the Company to fail to disclose material information against the individual defendants; (iii) a derivative claim for aiding and abetting the breaches of fiduciary duties against SoFi, Citigroup Global Markets Inc., Credit Suisse Securities (USA) LLC and Goldman Sachs & Co. LLC; (iv) an individual claim for negligent misrepresentation and concealment against all defendants; and (v) an individual claim for fraudulent misrepresentation and concealment against all defendants. The Levy Complaint seeks, among other things, to enjoin the proposed Business Combination, an award of compensatory and/or recessionary damages, and an award of attorneys' fees and expenses.
The parties resolved the allegations made by Levy, and a Stipulation and Order dismissing the lawsuit filed by Levy was signed by the Court on April 19, 2021.
On January 11, 2021 the Company issued a promissory note with the Sponsor for an aggregate amount of up to $2,500,000 (the “Promissory Note”). The Promissory Note is non-interest bearing and is due and payable in full on the earlier of (i) October 14, 2022 and (ii) the effective date of a merger, share exchange, asset acquisition, share purchase, reorganization or similar business combination, involving the maker and one or more businesses. As of the date of these financial statements, the Company has drawn $1,415,000 under this Promissory Note.
F-42

TABLE OF CONTENTS
SOCIAL FINANCE, INC.
INDEX TO FINANCIAL STATEMENTS
Page
Unaudited Condensed Consolidated Financial Statements
Consolidated Financial Statements
F-43

TABLE OF CONTENTS
Social Finance, Inc.
Unaudited Condensed Consolidated Balance Sheets
(In Thousands, Except for Share Data)
March 31, 2021 December 31, 2020
Assets
Cash and cash equivalents $ 351,283  $ 872,582 
Restricted cash and restricted cash equivalents(1)
347,284  450,846 
Loans(1)(2)
4,486,828  4,879,303 
Servicing rights 161,240  149,597 
Securitization investments 462,109  496,935 
Equity method investments —  107,534 
Property, equipment and software 82,825  81,489 
Goodwill 899,270  899,270 
Intangible assets 335,719  355,086 
Operating lease right-of-use assets 116,553  116,858 
Related party notes receivable —  17,923 
Other assets(3)
139,126  136,076 
Total assets $ 7,382,237  $ 8,563,499 
Liabilities, temporary equity and permanent deficit
Liabilities:
Accounts payable, accruals and other liabilities(1)
$ 421,061  $ 452,909 
Operating lease liabilities 138,822  139,796 
Debt(1)
3,827,424  4,798,925 
Residual interests classified as debt(1)
114,882  118,298 
Total liabilities 4,502,189  5,509,928 
Commitments, guarantees, concentrations and contingencies (Note 14)
Temporary equity(4):
Redeemable preferred stock: 311,842,666 and 311,842,666 shares authorized; 256,459,941 and 256,459,941 shares issued and outstanding as of March 31, 2021 and December 31, 2020, respectively
3,173,686  3,173,686 
Permanent deficit:
Common stock, $0.00 par value: 452,815,616 and 452,815,616 shares authorized; 68,291,780 and 66,034,174 shares issued and outstanding as of March 31, 2021 and December 31, 2020, respectively(5)
—  — 
Additional paid-in capital 583,349  579,228 
Accumulated other comprehensive loss (246) (166)
Accumulated deficit (876,741) (699,177)
Total permanent deficit (293,638) (120,115)
Total liabilities, temporary equity and permanent deficit $ 7,382,237  $ 8,563,499 
_______________
(1)Financial statement line items include amounts in consolidated variable interest entities (“VIEs”). See Note 4.
(2)As of March 31, 2021 and December 31, 2020, includes loans measured at fair value of $4,472,604 and $4,859,068, respectively, and loans measured at amortized cost of $14,224 and $20,235, respectively. See Note 3 and Note 7.
(3)Other assets includes accounts receivable, net, of $39,857 and $32,374 as of March 31, 2021 and December 31, 2020, respectively, with allowance for credit losses on accounts receivable of $919 and $562, respectively.
(4)Redemption amounts are $3,210,470 and $3,210,470 as of March 31, 2021 and December 31, 2020, respectively.
(5)Includes 5,000,000 non-voting common shares authorized and 1,380,852 non-voting common shares issued and outstanding as of March 31, 2021 and December 31, 2020. See Note 10 for additional information.
The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.
F-44

TABLE OF CONTENTS
Social Finance, Inc.
Unaudited Condensed Consolidated Statements of Operations and Comprehensive Loss
(In Thousands, Except for Share and Per Share Data)
Three Months Ended March 31,
2021 2020
Interest income
Loans
$ 77,221  $ 86,116 
Securitizations
4,467  7,061 
Related party notes
211  1,052 
Other
629  3,053 
Total interest income 82,528  97,282 
Interest expense
Securitizations and warehouses
29,808  47,523 
Corporate borrowings 5,008  1,088 
Other
432  1,522 
Total interest expense 35,248  50,133 
Net interest income 47,280  47,149 
Noninterest income
Loan origination and sales
110,345  104,255 
Securitizations
(2,036) (83,104)
Servicing
(12,109) 7,059 
Technology Platform fees
45,659  — 
Other
6,845  2,943 
Total noninterest income 148,704  31,153 
Total net revenue 195,984  78,302 
Noninterest expense
Technology and product development
65,948  40,171 
Sales and marketing
87,234  62,670 
Cost of operations
57,570  32,657 
General and administrative
161,697  49,114 
Total noninterest expense 372,449  184,612 
Loss before income taxes (176,465) (106,310)
Income tax expense
(1,099) (57)
Net loss $ (177,564) $ (106,367)
Other comprehensive loss
Foreign currency translation adjustments, net (80) (7)
Total other comprehensive loss (80) (7)
Comprehensive loss $ (177,644) $ (106,374)
Loss per share (Note 15)
Loss per share – basic $ (2.81) $ (2.93)
Loss per share – diluted $ (2.81) $ (2.93)
Weighted average common stock outstanding – basic 66,647,192  39,815,023 
Weighted average common stock outstanding – diluted 66,647,192  39,815,023 



The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.
F-45

TABLE OF CONTENTS
Social Finance, Inc.
Unaudited Condensed Consolidated Statements of Changes in Temporary Equity and Permanent Deficit
(In Thousands, Except for Share Data)
Common Stock
Additional Paid-In Capital
Accumulated
Other
Comprehensive
Loss
Accumulated
Deficit
Permanent Deficit
Temporary Equity
Shares
Amount
Shares Amount
Balance at January 1, 2021 66,034,174  $ —  $ 579,228  $ (166) $ (699,177) $ (120,115) 256,459,941  $ 3,173,686 
Stock-based compensation expense —  —  37,454  —  —  37,454  —  — 
Vesting of RSUs 2,096,875  —  —  —  —  —  —  — 
Stock withheld related to taxes on vested RSUs (803,142) —  (25,989) —  —  (25,989) —  — 
Exercise of common stock options 963,873  —  2,624  —  —  2,624  —  — 
Redeemable preferred stock dividends —  —  (9,968) —  —  (9,968) —  — 
Foreign currency translation adjustments, net of tax of $0
—  —  —  (80) —  (80) —  — 
Net loss —  —  —  —  (177,564) (177,564) —  — 
Balance at March 31, 2021 68,291,780  $ —  $ 583,349  $ (246) $ (876,741) $ (293,638) 256,459,941  $ 3,173,686 
Common Stock
Additional Paid-In Capital
Accumulated Other Comprehensive Loss
Accumulated Deficit
Permanent Deficit
Temporary Equity
Shares
Amount
Shares
Amount
Balance at January 1, 2020
39,614,844  $ —  $ 135,517  $ (21) $ (474,558) $ (339,062) 218,814,230  $ 2,439,731 
Stock-based compensation expense
—  —  19,685  —  —  19,685  —  — 
Vesting of RSUs
1,060,794  —  —  —  —  —  —  — 
Stock withheld related to taxes on vested RSUs
(441,891) —  (4,640) —  —  (4,640) —  — 
Exercise of common stock options
50,946  —  235  —  —  235  —  — 
Redeemable preferred stock dividends
—  —  (10,106) —  —  (10,106) —  — 
Note receivable issuance to stockholder, inclusive of interest
—  —  (770) —  —  (770) —  — 
Foreign currency translation adjustments, net of tax of $0
—  —  —  (7) —  (7) —  — 
Net loss —  —  —  —  (106,367) (106,367) —  — 
Balance at March 31, 2020 40,284,693  $ —  $ 139,921  $ (28) $ (580,925) $ (441,032) 218,814,230  $ 2,439,731 










The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.
F-46

TABLE OF CONTENTS
Social Finance, Inc.
Unaudited Condensed Consolidated Statements of Cash Flows
(In Thousands)
Three Months Ended March 31,
2021 2020
Operating activities
Net loss $ (177,564) $ (106,367)
Adjustments to reconcile net loss to net cash provided by operating activities:
Depreciation and amortization
25,977  4,715 
Deferred debt issuance and discount expense
5,998  9,137 
Stock-based compensation expense
37,454  19,685 
Deferred income taxes
623  62 
Equity method investment earnings
—  (1,002)
Fair value changes in residual interests classified as debt
7,951  14,936 
Fair value changes in securitization investments
(2,957) 8,530 
Fair value changes in warrant liabilities
89,920  2,879 
Fair value adjustment to related party notes receivable
(169) — 
Other
30  — 
Changes in operating assets and liabilities:
Originations and purchases of loans
(2,575,932) (3,418,210)
Proceeds from sales and repayments of loans
2,911,540  3,697,718 
Other changes in loans
30,486  36,224 
Servicing assets
(11,643) (8,301)
Related party notes receivable interest income
1,399  (1,052)
Other assets
3,299  (4,595)
Accounts payable, accruals and other liabilities
(6,361) 18,440 
Net cash provided by operating activities
$ 340,051  $ 272,799 
Investing activities
Purchases of property, equipment, software and intangible assets
$ (7,445) $ (5,499)
Proceeds from repayment of related party notes receivable 16,693  — 
Proceeds from non-securitization investments
107,534  — 
Purchases of non-securitization investments
—  (145)
Receipts from securitization investments
64,165  70,983 
Net cash provided by investing activities
$ 180,947  $ 65,339 






The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.
F-47

TABLE OF CONTENTS
Social Finance, Inc.
Unaudited Condensed Consolidated Statements of Cash Flows (Continued)
(In Thousands)
Three Months Ended March 31,
2021 2020
Financing activities
Proceeds from debt issuances
$ 1,925,042  $ 3,203,608 
Repayment of debt (2,912,263) (3,116,680)
Payment of debt issuance costs
(1,645) (621)
Taxes paid related to net share settlement of stock-based awards
(25,989) (4,640)
Purchases of common stock
(526) — 
Redemption of redeemable preferred stock (132,859) — 
Proceeds from stock option exercises
2,624  235 
Finance lease principal payments
(163) — 
Net cash provided by (used in) financing activities
$ (1,145,779) $ 81,902 
Effect of exchange rates on cash and cash equivalents
(80) (7)
Net increase (decrease) in cash, cash equivalents, restricted cash and restricted cash equivalents
$ (624,861) $ 420,033 
Cash, cash equivalents, restricted cash and restricted cash equivalents at beginning of period
1,323,428  690,206 
Cash, cash equivalents, restricted cash and restricted cash equivalents at end of period
$ 698,567  $ 1,110,239 
Reconciliation to amounts on Consolidated Balance Sheets (as of period end)
Cash and cash equivalents
$ 351,283  $ 867,130 
Restricted cash and restricted cash equivalents
347,284  243,109 
Total cash, cash equivalents, restricted cash and restricted cash equivalents
$ 698,567  $ 1,110,239 
Supplemental non-cash investing and financing activities
Securitization investments acquired via loan transfers
$ 26,381  $ 126,343 
Non-cash property, equipment, software and intangible asset additions
888  — 
Accrued but unpaid redeemable preferred stock dividends
9,968  10,106 
Deconsolidation of residual interests classified as debt
—  72,026 
Deconsolidation of securitization debt —  200,654 






The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.
F-48

TABLE OF CONTENTS
Social Finance, Inc.
Notes to Unaudited Condensed Consolidated Financial Statements 
(In Thousands, Unless Otherwise Stated and Except for Share and Per Share Data)
Note 1. Organization, Summary of Significant Accounting Policies and New Accounting Standards
Organization
Social Finance, Inc. (collectively with its subsidiaries, “SoFi”, the “Company”, “we”, “us” or “our”) is a financial services platform. The Company was founded in 2011 to offer an innovative approach to the private student loan market by providing student loan refinancing options. Since its founding, SoFi has expanded its lending strategy to offer home loans, personal loans and credit cards. SoFi predominantly operates in the U.S. via its lending activities. The Company has also developed non-lending financial products, such as money management and investment product offerings, and has also leveraged its financial services platform to empower other businesses. Through strategic acquisitions made during the year ended December 31, 2020, the Company expanded its investment product offerings into Hong Kong, and now also operates as a platform-as-a-service for a variety of financial service providers, providing the infrastructure to facilitate core client-facing and back-end capabilities, such as account setup, account funding, direct deposit, authorizations and processing, payments functionality and check account balance features.
For information on business combinations, see Note 2.
Summary of Significant Accounting Policies
Basis of Presentation
The Unaudited Condensed Consolidated Financial Statements include the accounts of the Company, its wholly-owned and majority-owned subsidiaries and certain consolidated VIEs. All intercompany accounts were eliminated in consolidation. The Unaudited Condensed Consolidated Financial Statements were prepared in conformity with accounting principles generally accepted in the United States (“GAAP”) and in accordance with the rules and regulations of the Securities and Exchange Commission (“SEC”). We condensed or omitted certain notes and other financial information form the interim financial statements presented herein. The financial data and other information disclosed in these Notes to Unaudited Condensed Consolidated Financial Statements related to the three months ended March 31, 2021 and 2020 are unaudited. The unaudited interim financial statements have been prepared on the same basis as the annual consolidated statements and, in the opinion of management, reflect all adjustments, which are of a normal recurring nature, necessary for a fair statement of the Company’s financial condition and results of operations and cash flows for the interim periods presented. The results for the three months ended March 31, 2021 are not necessarily indicative of the results to be expected for the full year ending December 31, 2021.
Use of Judgments, Assumptions and Estimates
The preparation of our Unaudited Condensed Consolidated Financial Statements and related disclosures in conformity with GAAP requires management to make assumptions and estimates that affect the amounts reported in our Unaudited Condensed Consolidated Financial Statements and accompanying notes. Management bases its estimates on historical experience and on various other factors it believes to be reasonable under the circumstances, the results of which form the basis for making judgments about the carrying values of our assets and liabilities. These judgments, assumptions and estimates include, but are not limited to, the following: (i) fair value measurements; (ii) stock-based compensation expense, and (iii) business combinations. These judgments, estimates and assumptions are inherently subjective in nature and, therefore, actual results may differ from our estimates and assumptions.
Business Combinations
We account for acquisitions of entities or asset groups that qualify as businesses using the acquisition method of accounting in accordance with ASC 805, Business Combinations. Purchase consideration is allocated to the tangible and intangible assets acquired and liabilities assumed based on the estimated fair values as of the acquisition date, which are measured in accordance with the principles outlined in Accounting Standards Codification (“ASC”) 820, Fair Value Measurement. The determination of fair value requires management to make estimates about discount rates, future expected cash flows, market conditions and other future events that are highly subjective in nature. The
F-49

TABLE OF CONTENTS
Social Finance, Inc.
Notes to Unaudited Condensed Consolidated Financial Statements 
(In Thousands, Unless Otherwise Stated and Except for Share and Per Share Data)
excess of the total purchase consideration over the fair value of the identified net assets acquired is recognized as goodwill. The results of the acquired businesses are included in our results of operations beginning from the date of acquisition. Acquisition-related costs are expensed as incurred.
During the measurement period, which may be up to one year from the acquisition date, we may record adjustments to the allocation of purchase consideration and to the fair values of assets acquired and liabilities assumed to the extent that additional information becomes available. After this period, any subsequent adjustments are recorded in the Unaudited Condensed Consolidated Statements of Operations and Comprehensive Loss.
Consolidation of Variable Interest Entities
We enter into arrangements in which we originate loans, establish a special purpose entity (“SPE”), and transfer loans to the SPE. We retain the servicing rights of those loans and hold additional interests in the SPE. We evaluate each such arrangement to determine whether we have a variable interest. If we determine that we have a variable interest in an SPE, we then determine whether the SPE is a VIE. If the SPE is a VIE, we assess whether we are the primary beneficiary of the VIE, such that we must consolidate the VIE on our Unaudited Condensed Consolidated Balance Sheets. To determine if we are the primary beneficiary, we identify the most significant activities and determine who has the power over those activities, and who absorbs the variability in the economics of the VIE. As of March 31, 2021 and December 31, 2020, we had 15 and 15 consolidated VIEs, respectively, on our Unaudited Condensed Consolidated Balance Sheets. Refer to Note 4 for more details regarding our consolidated VIEs. As of each of March 31, 2021 and December 31, 2020, there were two and one consolidated VIEs, respectively, which did not have securitization debt.
We periodically reassess our involvement with each VIE in which we have a variable interest. We monitor matters related to our ability to control economic performance, such as management of the SPE and its underlying loans, contractual changes in the services provided, the extent of our ownership, and the rights of third parties to terminate us as the VIE servicer. In addition, we monitor the financial performance of each VIE for indications that we may or may not have the right to absorb benefits or the obligation to absorb losses associated with variability in the financial performance of the VIE that could potentially be significant to that VIE, which we define as a variable interest of greater than 10%.
A significant change to the pertinent rights of us or other parties, or a significant change to the ranges of possible financial performance outcomes used in our assessment of the variability of cash flows due to us, could impact the determination of whether or not a VIE should be consolidated in future periods. VIE consolidation and deconsolidation may lead to increased volatility in our financial results and impact period-over-period comparability. Our maximum exposure to loss as a result of our involvement with consolidated VIEs is limited to our investment, which is eliminated in consolidation. There are no liquidity arrangements, guarantees or other commitments by third parties that may affect the fair value or risk of our variable interests in consolidated VIEs.
Fair Value Measurements
Fair value is defined as the price that would be received for an asset or paid to transfer a liability (an exit price) in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants on the measurement date. We use a three-level fair value hierarchy to classify and disclose all assets and liabilities measured at fair value on a recurring basis in periods subsequent to their initial measurement. The hierarchy requires us to use observable inputs when available and to minimize the use of unobservable inputs when determining fair value. The three levels are defined as follows:
Level 1 — Quoted prices in active markets for identical assets or liabilities, accessible by us at the measurement date.
Level 2 — Quoted prices for similar assets or liabilities in active markets, or quoted prices for identical or similar assets or liabilities in markets that are not active, or observable inputs other than quoted prices.
Level 3 — Unobservable inputs for assets or liabilities for which there is little or no market data, which requires us to develop our own assumptions. These unobservable assumptions reflect estimates of inputs
F-50

TABLE OF CONTENTS
Social Finance, Inc.
Notes to Unaudited Condensed Consolidated Financial Statements 
(In Thousands, Unless Otherwise Stated and Except for Share and Per Share Data)
that market participants would use in pricing the asset or liability. Valuation techniques include the use of option pricing models, discounted cash flow models, or similar techniques, which incorporate management’s own estimates of assumptions that market participants would use in pricing the asset or liability.
A financial instrument’s categorization within the fair value hierarchy is based on the lowest level of input that is significant to the fair value measurement. Instruments are categorized in Level 3 of the fair value hierarchy based on the significance of unobservable factors in the overall fair value measurement. As a result, the related gains and losses for assets and liabilities within the Level 3 category presented in Note 7 may include changes in fair value that are attributable to both observable and unobservable inputs.
Transfers of Financial Assets
The transfer of an entire financial asset and, to a much lesser extent, a participating interest in an entire financial asset in which we surrender control over the asset is accounted for as a sale if all of the following conditions are met:
the financial asset is isolated from the transferor and its consolidated affiliates as well as its creditors, even in bankruptcy or other receivership;
the transferee or beneficial interest holders have the right to pledge or exchange the transferred financial asset; and
the transferor, its consolidated affiliates and its agents do not maintain effective control over the transferred financial asset.
Loan sales are aggregated in the financial statements due to the similarity of both the loans transferred and servicing arrangements. The portion of our income relating to ongoing servicing and the fair value of our servicing rights are dependent upon the performance of the sold loans. We measure the gain or loss on the sale of financial assets as the net assets received from the sale less the carrying amount of the loans sold. The net assets received from the sale represent the fair value of any assets obtained or liabilities incurred as part of the transaction, including but not limited to cash, servicing assets, retained securitization investments and recourse obligations.
When securitizing loans, we employ a two-step transaction that includes the isolation of the underlying loans in a trust and the sale of beneficial interests in the trust to a bankruptcy-remote entity. Transfers of financial assets that do not qualify for sale accounting are reported as secured borrowings. Accordingly, the related assets remain on our Unaudited Condensed Consolidated Balance Sheets and continue to be reported and accounted for as if the transfer had not occurred. Cash proceeds received from these transfers are reported as liabilities, with related interest expense recognized over the life of the related secured borrowing.
As a component of the loan sale agreements, we make certain representations to third parties that purchase our previously-held loans, some of which include Federal National Mortgage Association (“FNMA”) repurchase requirements and all of which are standard in nature and do not constrain our ability to recognize a sale for accounting purposes. Any significant estimated post-sale obligations or contingent obligations to the purchaser of the loans arising from these representations are accrued if probable and estimable. Pursuant to ASC 460, Guarantees, we establish a loan repurchase liability, which is based on historical experience and any current developments which would make it probable that we would buy back loans previously sold to third parties at the historical sales price. The loan repurchase liability is presented within accounts payable, accruals and other liabilities in the Unaudited Condensed Consolidated Balance Sheets, with the corresponding charges recorded within noninterest income — loan origination and sales in the Unaudited Condensed Consolidated Statements of Operations and Comprehensive Loss.
Cash and Cash Equivalents
Cash and cash equivalents include unrestricted deposits with financial institutions in checking, money market and short-term certificate of deposit accounts. We consider all highly liquid investments with original maturity dates of three months or less to be cash equivalents.
F-51

TABLE OF CONTENTS
Social Finance, Inc.
Notes to Unaudited Condensed Consolidated Financial Statements 
(In Thousands, Unless Otherwise Stated and Except for Share and Per Share Data)
Restricted Cash and Restricted Cash Equivalents
Restricted cash and restricted cash equivalents consist primarily of cash deposits, certificate of deposit accounts held on reserve, money market funds held by consolidated VIEs, funds reserved for committed stock purchases, and collection balances. These accounts are earmarked as restricted because these balances are either member balances held in our custody, escrow requirements for certain debt facilities and derivative agreements, deposits required by Member Banks that support one or more of our products, collection balances awaiting disbursement to investors, or represent consolidated VIE cash balances that we cannot use for general operating purposes.
Loans
As of March 31, 2021, our loan portfolio consisted of personal loans, student loans and home loans, which are measured at fair value, and credit card loans, which are measured at amortized cost, and which we began originating in the third quarter of 2020. As of December 31, 2020, we also had a commercial loan, which is further discussed below.
Loans Measured at Fair Value
Our personal loans, student loans and home loans are carried at fair value on a recurring basis and, therefore, all direct fees and costs related to the origination process are recognized in earnings as earned or incurred. We elected the fair value option to measure these loans, as we believe that fair value best reflects the expected economic performance of the loans, as well as our intentions given our gain on sale origination model. We record the initial fair value measurement and subsequent measurement changes in fair value in the period in which the changes occur within noninterest income — loan origination and sales in the Unaudited Condensed Consolidated Statements of Operations and Comprehensive Loss. Our consolidated loans are originated with the intention to sell to third-party investors and are, therefore, considered held for sale. Securitized loans are assets held by consolidated SPEs as collateral for bonds issued, for which fair value changes are recorded within noninterest income — securitizations in the Unaudited Condensed Consolidated Statements of Operations and Comprehensive Loss. Gains or losses recognized upon deconsolidation of a VIE are also recorded within noninterest income — securitizations.
Loans do not trade in an active market with readily observable prices. We determine the fair value of our loans using a discounted cash flow methodology, while also considering market data as it becomes available. We classify loans as Level 3 because the valuations utilize significant unobservable inputs.
We consider a loan to be delinquent when the borrower has not made the scheduled payment amount within one day of the scheduled payment date, provided the borrower is not in school or in deferment, forbearance or within an agreed-upon grace period. Loan deferment is a provision in the student loan contract that permits the borrower to defer payments while enrolled at least half time in school. During the deferment period, interest accrues on the loan balance and is capitalized to the loan when the loan enters repayment status, which begins when the student no longer qualifies for deferment.
Whereas deferment only relates to student loans, forbearance applies to student loans, personal loans and home loans. A borrower in repayment may generally request forbearance for reasons including a FEMA-declared disaster, unemployment, economic hardship or general economic uncertainty. Forbearance typically cannot exceed a total of 12 months over the life of the loan. During the year ended December 31, 2020 and, to a lesser extent, the three months ended March 31, 2021, requests for forbearance have also included impacts related to the COVID-19 pandemic. If forbearance is granted, interest continues to accrue during the forbearance period and is capitalized to the loan when the borrower resumes making payments. At the conclusion of a forbearance period, the contractual monthly payment is recalculated and is generally higher as a result.
Delinquent loans are charged off after 120 days of nonpayment or on the date of confirmed loss, at which time we stop accruing interest and reverse all accrued but unpaid interest as of such date. Additional information about our loans measured at fair value is included in Note 3 through Note 5, as well as Note 7.
F-52

TABLE OF CONTENTS
Social Finance, Inc.
Notes to Unaudited Condensed Consolidated Financial Statements 
(In Thousands, Unless Otherwise Stated and Except for Share and Per Share Data)
Loans Measured at Amortized Cost
As of March 31, 2021 and December 31, 2020, loans measured at amortized cost included credit card loans. During the fourth quarter of 2020, we also issued a commercial loan, which had a principal balance of $16,500 and accumulated unpaid interest of $12 as of December 31, 2020, all of which was repaid during January 2021. For loans measured at amortized cost, we present accrued interest within loans in the Unaudited Condensed Consolidated Balance Sheets.
We launched our credit card product in the third quarter of 2020, which was expanded to a broader market in the fourth quarter of 2020. Credit card loans are reported as delinquent when they become 30 or more days past due. Credit card loans are charged off after 180 days of nonpayment or on the date of the confirmed loss, at which time we stop accruing interest and reverse all accrued but unpaid interest as of such date. When payments are received against charged off credit card loans, we use the cash basis method and resume the accrual of interest. Credit card loans charged off during the three months ended March 31, 2021 were immaterial. There were no credit card loans on nonaccrual status as of March 31, 2021 and December 31, 2020.
The following table presents the aging analysis of our credit card loans as of the dates indicated:
Delinquent Loans
Current 30–59 Days 60–89 Days
≥ 90 Days(1)
Total Delinquent Loans
Total Loans(2)
March 31, 2021
Credit card loans $ 14,136  169  39  210  $ 14,346 
December 31, 2020
Credit card loans $ 3,864  74  —  76  $ 3,940 
_______________
(1)As of March 31, 2021, all of the credit card loans that were 90 days or more past due continued to accrue interest.
(2)Presented before allowance for credit losses and excludes accrued interest of $49 and $2 as of March 31, 2021 and December 31, 2020, respectively.
Allowance for Credit Losses
Effective January 1, 2020, we adopted the provisions of Accounting Standards Update (“ASU”) 2016-13, Measurement of Credit Losses on Financial Instruments, which requires upfront recognition of lifetime expected credit losses using a current expected credit loss model. As of March 31, 2021, the standard was applicable to (i) cash equivalents and restricted cash equivalents, (ii) accounts receivable from contracts with customers, inclusive of servicing related receivables, (iii) margin receivables, which were attributable to our activities at 8 Limited, (iv) certain loan repurchase reserves representing guarantees of credit exposure, and (v) loans measured at amortized cost, including credit card loans. Our approaches to measuring the allowance for credit losses on the applicable financial assets are as follows:
Cash equivalents and restricted cash equivalents: Our cash equivalents and restricted cash equivalents are short-term in nature and of high credit quality; therefore, we determined that our exposure to credit losses over the life of these instruments was immaterial.
Accounts receivable from contracts with customers: Accounts receivable from contracts with customers as of the balance sheet dates are recorded at their original invoice amounts reduced by any allowance for credit losses. In accordance with the standard, we pool our accounts receivable, all of which are short-term in nature and arise from contracts with customers, based on shared risk characteristics to assess their risk of loss, even when that risk is remote. Certain of our historical accounts receivable balances did not have any write-offs. We use the aging method to establish an allowance for expected credit losses on accounts receivable balances and consider whether current conditions or reasonable and supportable forecasts about future conditions warrant an adjustment to our historical loss experience. In applying such adjustments, we primarily evaluate changes in customer creditworthiness, current
F-53

TABLE OF CONTENTS
Social Finance, Inc.
Notes to Unaudited Condensed Consolidated Financial Statements 
(In Thousands, Unless Otherwise Stated and Except for Share and Per Share Data)
economic conditions, expectations of near-term economic trends and changes in customer payment terms and collection trends.
When we determine that a receivable is not collectible, we write off the uncollectible amount as a reduction to both the allowance and the gross asset balance. Recoveries are recorded when received and credited to provision for credit losses. Accrued interest is excluded from the measurement of the allowance for credit losses. Any change in the assumptions used in analyzing a specific account receivable may result in an additional allowance for credit losses being recognized in the period in which the change occurs. See Note 6 for additional information on our accounts receivable.
Margin receivables: Our margin receivables of $1.7 million and $1.6 million as of March 31, 2021 and December 31, 2020, respectively, associated with margin lending services we offer to members through 8 Limited, which we acquired in 2020, are fully collateralized by the borrowers’ securities under collateral maintenance provisions, to which we regularly monitor adherence. Therefore, using the practical expedient in ASC 326-20-35-6, Financial Instruments — Credit Losses, we did not record expected credit losses on this pool of margin receivables, as the fair value of the underlying collateral is expected to exceed the amortized cost of the receivables.
Loan repurchase reserves: We issue financial guarantees related to certain non-agency loan transfers, which are subject to repurchase based on the occurrence of certain credit-related events within a specified amount of time following loan transfer, which does not exceed 90 days from origination. We estimate the contingent guarantee liability based on our historical repurchase activity for similar types of loans and assess whether adjustments to our historical loss experience are required based on current conditions and forecasts of future conditions, as appropriate, as our exposure under the guarantee is short-term in nature. See Note 14 for additional information on our guarantees.
Credit card loans: Our credit card loan portfolio had a carrying value of $14,224 and $3,723 as of March 31, 2021 and December 31, 2020, respectively. Accordingly, our estimates of the allowance for credit losses as of March 31, 2021 and December 31, 2020 of $171 and $219, respectively, were immaterial to the Unaudited Condensed Consolidated Financial Statements. Our credit card loan portfolio consists of small balance, homogenous loans. We pool credit card loans using ten internal risk tier categories. We assign the risk tier of our credit card loans primarily based on credit scores, such as FICO, and utilizing a proprietary risk model that relies on other attributes from the credit bureau data to model account-level charge off probability. These pools will be reassessed periodically to confirm that all loans within each pool continue to share similar risk characteristics. As we do not yet have meaningful historical credit card data, we establish an allowance for the pooled credit card loans within each internal risk tier using a combination of historical industry and bureau data, which are then adjusted for current conditions and reasonable and supportable forecasts of future conditions, including economic conditions. We apply the probability-of-default and loss-given-default methods to the drawn balance of credit card loans within each internal risk tier to estimate the lifetime expected credit losses within each tier, which are then aggregated to determine the allowance for credit losses. We estimate the average life over which expected credit losses may occur for the pools of credit card loans within each risk tier using historical industry data for credit card loans with comparable risk profiles, which primarily reflects expectations of future payments on the credit card account. Similarly, we estimate the expected annual loss rate for the pools of credit card loans within each risk tier using historical credit bureau data for credit card loans with comparable risk profiles. We do not measure credit losses on the undrawn credit exposure, as such undrawn credit exposure is unconditionally cancellable by us. Management further considers an evaluation of overall portfolio credit quality based on indicators such as changes in our credit decisioning process, underwriting and collection management policies; the effects of external factors, such as regulatory requirements; general economic conditions and inherent uncertainties in applying the methodology. The assignment of internal risk tiers and determination of comparable industry and credit bureau data involves subjective management judgment.
When a credit card loan is charged off, we record a reduction to the allowance and the credit card loan balance. Accrued interest associated with a charged off receivable is reversed through interest income. Accrued interest receivables written off during the three months ended March 31, 2021 were immaterial. Recoveries of amounts previously charged off are recorded when received as a direct reduction to the provision for credit losses. We elected to exclude interest on credit card loans from the measurement of our allowance, as our policy allows for accrued
F-54

TABLE OF CONTENTS
Social Finance, Inc.
Notes to Unaudited Condensed Consolidated Financial Statements 
(In Thousands, Unless Otherwise Stated and Except for Share and Per Share Data)
interest to be reversed in a timely manner. Further, we elected the practical expedient to exclude the accrued interest component of our credit card loans from the quantitative disclosures presented in accordance with the guidance.
When necessary, we will apply a separate credit loss methodology to assets that have deteriorated in credit quality and, as such, no longer share similar risk characteristics with other assets in the pool. We will either estimate the allowance for credit losses on such assets with deteriorated credit quality individually based on individual risk characteristics or as part of a separate pool of assets that shares similar risk characteristics.
Servicing Rights
Each time we enter into a servicing agreement, we determine whether we should record a servicing asset, servicing liability, or neither a servicing asset nor liability. We elected the fair value option to measure our servicing rights subsequent to initial recognition. We measure the initial and subsequent fair value of our servicing rights using a discounted cash flow methodology, which includes our contractual servicing fee, ancillary income, prepayment rate assumptions, default rate assumptions, a discount rate commensurate with the risk of the servicing asset or liability being valued, and an assumed market cost of servicing, which is based on active quotes from third-party servicers. For servicing rights retained in connection with loan transfers that do not meet the requirements for sale accounting treatment, there is no recognition of a servicing asset or liability.
Servicing rights are initially measured at fair value and recognized as a component of the gain or loss from sales of loans and the initial capitalization is reported within noninterest income — loan origination and sales in the Unaudited Condensed Consolidated Statements of Operations and Comprehensive Loss. Servicing rights are measured at fair value at each subsequent reporting date and changes in fair value are reported in earnings in the period in which they occur. Subsequent measurement changes, including servicing fee payments and fair value changes, are included within noninterest income — servicing in the Unaudited Condensed Consolidated Statements of Operations and Comprehensive Loss. We elected the fair value option to measure our servicing rights to better align with the valuation of our loans, which are impacted by similar factors, such as conditional prepayment rates. We consider the risk of the assets and the observability of inputs in determining the classes of servicing rights. We have three classes of servicing assets: personal loans, home loans and student loans. No servicing was acquired or assumed from a third party during the three months ended March 31, 2021 and 2020. There is prepayment and delinquency risk inherent in our servicing rights, but we currently do not use any instruments to mitigate such risks.
See Note 7 for the key inputs used in the fair value measurements of our classes of servicing rights.
Securitization Investments
In Company-sponsored securitization transactions that meet the applicable criteria to be accounted for as a sale, we retain certain residual interests and asset-backed bonds. We measure these investments at fair value on a recurring basis. Gains and losses related to our securitization investments are reported within noninterest income — securitizations in the Unaudited Condensed Consolidated Statements of Operations and Comprehensive Loss. We determine the fair value of our securitization investments using a discounted cash flow methodology, while also considering market data as it becomes available. We classify the residual investments as Level 3 due to the reliance on significant unobservable valuation inputs. We classify asset-backed bonds as Level 2 due to the use of quoted prices for similar assets in markets that are not active, as well as certain factors specific to us.
Our residual investments accrete interest income over the expected life using the effective yield method pursuant to ASC 325-40, Investments — Other, which reflects a portion of the overall fair value adjustment recorded each period on our residual investments. On a quarterly basis, we reevaluate the cash flow estimates over the life of the residual investments to determine if a change to the accretable yield is required on a prospective basis. Additionally, we record interest income associated with asset-backed bonds over the term of the underlying bond using the effective interest method on unpaid bond amounts. Interest income on residual investments and asset-backed bonds is presented within interest income — securitizations in the Unaudited Condensed Consolidated Statements of Operations and Comprehensive Loss.
See Note 7 for the key inputs used in the fair value measurements of our residual investments and asset-backed bonds.
F-55

TABLE OF CONTENTS
Social Finance, Inc.
Notes to Unaudited Condensed Consolidated Financial Statements 
(In Thousands, Unless Otherwise Stated and Except for Share and Per Share Data)
Equity Method Investments
We purchased a 16.7% interest in Apex Clearing Holdings, LLC (“Apex”) for $100,000 in December 2018, which represented our only significant equity method investment. We recorded our portion of Apex equity method earnings within noninterest income — other in the Unaudited Condensed Consolidated Statements of Operations and Comprehensive Loss and as an increase to the carrying value of our equity method investment in the Unaudited Condensed Consolidated Balance Sheets. We recognized equity method earnings on our investment in Apex of $997 during the three months ended March 31, 2020, which included basis difference amortization.
The seller of the Apex interest had call rights over our initial equity interest in Apex (“Seller Call Option”) from April 14, 2020 (“Option Start Date”) to December 14, 2023, which rights were exercised in January 2021. Therefore, we ceased recognizing Apex equity investment income subsequent to the call date. As of December 31, 2020, we measured the carrying value of the Apex equity method investment equal to the call payment that we received in January 2021 of $107,534. There was no equity method investment balance as of March 31, 2021.
During the three months ended March 31, 2020, we invested an additional $145 in Apex. We did not receive any distributions during the three months ended March 31, 2021 or 2020.
We also had an equity method investment balance related to a residential mortgage origination joint venture, which was discontinued in the third quarter of 2020. For the three months ended March 31, 2020, the income and loss related to this joint venture was immaterial.
Derivative Financial Instruments
We enter into derivative contracts to manage future loan sale execution risk. We did not elect hedge accounting, as management’s hedging intentions are to economically hedge the risk of unfavorable changes in the fair value of our student loans, personal loans and home loans. Our derivative instruments include interest rate futures, interest rate options, interest rate swaps, interest rate lock commitments (“IRLC”), credit default swaps and mortgage pipeline hedges. The interest rate futures, interest rate options and mortgage pipeline hedges are measured at fair value and categorized as Level 1 fair value assets and liabilities, as all contracts held are traded in active markets for identical assets or liabilities and quoted prices are accessible by us at the measurement date. The interest rate swaps are measured at fair value and categorized as Level 2 fair value assets and liabilities, as all contracts held are traded in active markets for similar assets or liabilities and other observable inputs are available at the measurement date. IRLCs are categorized as Level 3 fair value assets and liabilities, as the fair value is highly dependent on an assumed loan funding probability. Changes in derivative instrument fair values are recognized in earnings as they occur. For the three months ended March 31, 2021 and 2020, we recorded a gain (loss) of $27,569 and $(24,981), respectively, in the Unaudited Condensed Consolidated Statements of Operations and Comprehensive Loss within noninterest income — loan origination and sales related to our derivative assets and liabilities associated with our management of future loan sale execution risk. The loss during the three months ended March 31, 2020 was inclusive of a $22,487 gain on credit default swaps that were opened and settled during the period. Depending on the measurement date position, derivative financial instruments are presented within other assets or accounts payable, accruals and other liabilities in the Unaudited Condensed Consolidated Balance Sheets.
In addition, in the past we have entered into derivative contracts to hedge the market risk associated with some of our non-securitization investments, which are also presented within other assets or accounts payable, accruals and other liabilities in the Unaudited Condensed Consolidated Balance Sheets. Gains and losses are recorded within noninterest income — other in the Unaudited Condensed Consolidated Statements of Operations and Comprehensive Loss. For the three months ended March 31, 2020, we recorded a gain of $996. We did not record a gain or loss for the three months ended March 31, 2021, as we did not have any such derivative contracts to hedge our non-securitization investments during the period.
Certain derivative instruments are subject to enforceable master netting arrangements. Accordingly, we present our net asset or liability position by counterparty within the Unaudited Condensed Consolidated Balance Sheets. Additionally, since our cash collateral balances do not approximate the fair value of the derivative position, we do not offset our right to reclaim cash collateral or obligation to return cash collateral against recognized derivative assets or liabilities. As of March 31, 2021, our derivative instruments were in asset positions totaling $7,505, with no
F-56

TABLE OF CONTENTS
Social Finance, Inc.
Notes to Unaudited Condensed Consolidated Financial Statements 
(In Thousands, Unless Otherwise Stated and Except for Share and Per Share Data)
offsetting liability positions and no cash collateral related to our master netting arrangements. As of December 31, 2020, our derivative instruments were in liability positions totaling $2,955, with no offsetting asset positions and cash collateral included within restricted cash and restricted cash equivalents in the Unaudited Condensed Consolidated Balance Sheets related to our master netting arrangements of $1,746. See Note 7 for additional information on our derivative assets and liabilities. Our derivative instruments are reported within cash from operating activities in the Unaudited Condensed Consolidated Statements of Cash Flows.
Residual Interests Classified as Debt
For residual interests related to consolidated securitizations, the residual interests held by third parties are presented as residual interests classified as debt in the Unaudited Condensed Consolidated Balance Sheets. We measure residual interests classified as debt at fair value on a recurring basis. We record subsequent measurement changes in fair value in the period in which the change occurs within noninterest income — securitizations in the Unaudited Condensed Consolidated Statements of Operations and Comprehensive Loss. We determine the fair value of residual interests classified as debt using a discounted cash flow methodology, while also considering market data as it becomes available. We classify the residual interests classified as debt as Level 3 due to the reliance on significant unobservable valuation inputs.
We recognize interest expense related to residual interests classified as debt over the expected life using the effective yield method, which reflects a portion of the overall fair value adjustment recorded each period on our residual interests classified as debt. Interest expense related to residual interests classified as debt is presented within interest expense — securitizations and warehouses in the Unaudited Condensed Consolidated Statements of Operations and Comprehensive Loss. On a quarterly basis, we reevaluate the cash flow estimates to determine if a change to the accretable yield is required on a prospective basis.
See Note 7 for the key inputs used in the fair value measurements of residual interests classified as debt.
Revenue Recognition
In accordance with ASC 606, Revenue from Contracts with Customers, in each of our revenue arrangements, revenue is recognized when control of the promised goods or services is transferred to the customer in an amount that reflects our expected consideration in exchange for those goods or services.
Disaggregated Revenue
The table below presents revenue from contracts with customers disaggregated by type of service, which best depicts how the revenue and cash flows are affected by economic factors, and by the reportable segment to which each revenue stream relates. Revenues from contracts with customers are presented within noninterest income — Technology Platform fees and noninterest income — other in the Unaudited Condensed Consolidated Statements of Operations and Comprehensive Loss. There are no revenues from contracts with customers attributable to our Lending segment for any of the periods presented.
F-57

TABLE OF CONTENTS
Social Finance, Inc.
Notes to Unaudited Condensed Consolidated Financial Statements 
(In Thousands, Unless Otherwise Stated and Except for Share and Per Share Data)
Three Months Ended March 31,
2021 2020
Financial Services
Referrals
$ 2,254  $ 1,589 
Brokerage
4,612  177 
Payment network
1,202  298 
Enterprise services
58  54 
Total
$ 8,126  $ 2,118 
Technology Platform
Technology Platform fees
$ 45,659  $ — 
Payment network
442  — 
Total
$ 46,101  $ — 
Total Revenue from Contracts with Customers
Technology Platform fees
$ 45,659  $ — 
Referrals
2,254  1,589 
Payment network
1,644  298 
Brokerage
4,612  177 
Enterprise services
58  54 
Total
$ 54,227  $ 2,118 

Technology Platform Fees
Commencing in May 2020 with our acquisition of Galileo, we earn Technology Platform fees for providing an integrated platform as a service for financial and non-financial institutions. Within our technology platform fee arrangements, certain contracts contain a provision for a fixed, upfront implementation fee related to setup activities, which represents an advance payment for future technology platform services. Our implementation fees are recognized ratably over the contract life, as we consider the implementation fee partially earned each month that we meet our performance obligation over the life of the contract. We had deferred revenues of $2,635 and $2,520 as of March 31, 2021 and December 31, 2020, which are presented within accounts payable, accruals and other liabilities in the Unaudited Condensed Consolidated Balance Sheets. During the three months ended March 31, 2021, we recognized revenue of $156 associated with deferred revenues within noninterest income — Technology Platform fees in the Unaudited Condensed Consolidated Statements of Operations and Comprehensive Loss.
Sales commissions: Capitalized sales commissions presented within other assets in the Unaudited Condensed Consolidated Balance Sheets, which are incurred in connection with obtaining a technology platform-as-a-service contract, were $546 and $527 as of March 31, 2021 and December 31, 2020, respectively. Additionally, we incur ongoing monthly commissions, which are expensed as incurred, as the benefit of such sales efforts are realized only in the period in which the commissions are earned. Commissions recorded within noninterest expense — sales and marketing in the Unaudited Condensed Consolidated Statements of Operations and Comprehensive Loss were $809 during the three months ended March 31, 2021, of which $64 represented amortization of capitalized sales commissions.
Loss Contingencies
Loss contingencies, including claims and legal actions arising in the ordinary course of business, are recorded in accounts payable, accruals and other liabilities in the Unaudited Condensed Consolidated Balance Sheets. Such liabilities and associated expenses are recorded when the likelihood of loss is probable and an amount or range of loss can be reasonably estimated. Such estimates are based on the best information available at the time. As additional information becomes available, we reassess the potential liability and record an estimate in the period in which the adjustment is probable and an amount or range can be reasonably estimated. Due to the inherent
F-58

TABLE OF CONTENTS
Social Finance, Inc.
Notes to Unaudited Condensed Consolidated Financial Statements 
(In Thousands, Unless Otherwise Stated and Except for Share and Per Share Data)
uncertainties of loss contingencies, estimates may be different from the actual outcomes. With respect to legal proceedings, we recognize legal fees as they are incurred within noninterest expense — general and administrative in our Unaudited Condensed Consolidated Statements of Operations and Comprehensive Loss. See Note 14 for discussion of contingent matters.
Recently Adopted Accounting Standards
We did not adopt any accounting standards during the three months ended March 31, 2021.
Recent Accounting Standards Issued, But Not Yet Adopted
Facilitation of the Effects of Reference Rate Reform on Financial Reporting
In March 2020, the FASB issued ASU 2020-04, Reference Rate Reform (Topic 848): Facilitation of the Effects of Reference Rate Reform on Financial Reporting. In January 2021, the FASB issued ASU 2021-01, Reference Rate Reform (Topic 848): Scope, which clarifies the scope of ASC 848 for certain derivative instruments that use an interest rate for margining, discounting or contract price alignment. ASU 2020-04 and ASU 2021-01 were both effective upon issuance and may be applied to contract modifications from January 1, 2020 through December 31, 2022. We are in the process of reviewing our borrowings and Series 1 redeemable preferred stock dividends that utilize LIBOR as the reference rate and are evaluating options for modifying such arrangements in accordance with the provisions of the standard and the potential impact that such modifications may have on the condensed consolidated financial statements and related disclosures.
Accounting for Convertible Instruments and Contracts in an Entity’s Own Equity
In August 2020, the FASB issued ASU 2020-06, Debt — Debt with Conversion and Other Options (Subtopic 470-20) and Derivatives and Hedging — Contracts in Entity’s Own Equity (Subtopic 815-40): Accounting for Convertible Instruments and Contracts in an Entity’s Own Equity. This ASU simplifies the accounting for certain convertible instruments, amends the guidance on derivative scope exceptions for contracts in an entity’s own equity, and modifies the guidance on diluted earnings per share calculations as a result of these changes. The standard is effective for fiscal years and interim periods beginning after December 15, 2023. Early adoption is permitted, but no earlier than fiscal years beginning after December 15, 2020, including interim periods within those fiscal years. We are currently evaluating the effect of adopting this standard on our condensed consolidated financial statements and related disclosures.
Note 2. Business Combinations
Merger with Social Capital Hedosophia Holdings Corp. V
During January 2021, Social Finance, Inc. entered into a business combination agreement (the “Agreement”) by and among Social Finance, Inc., Social Capital Hedosophia Holdings Corp. V, a Cayman Islands exempted company limited by shares (“SCH”), and Plutus Merger Sub Inc., a Delaware corporation and a wholly owned subsidiary of SCH (“Merger Sub”). Pursuant to the Agreement, Merger Sub merged with and into Social Finance, Inc (“SoFi”). Subsequent to the balance sheet date, upon the completion of the transactions contemplated by the terms of the Agreement (the “Closing”) on May 28, 2021, the separate corporate existence of Merger Sub ceased and Social Finance, Inc. survived the merger and became a wholly owned subsidiary of SCH. On May 28, 2021, SCH also filed a notice of deregistration with the Cayman Islands Registrar of Companies, together with the necessary accompanying documents, and filed a certificate of incorporation and a certificate of corporate domestication with the Secretary of State of the State of Delaware, under which SCH was domesticated as a Delaware corporation, changing its name from “Social Capital Hedosophia Holdings Corp. V” to “SoFi Technologies, Inc.” (“SoFi Technologies”). These transactions are collectively referred to as the “Business Combination”.
The Business Combination was accounted for as a reverse recapitalization whereby SCH was determined to be the accounting acquiree and SoFi to be the accounting acquirer. This accounting treatment is the equivalent of SoFi issuing stock for the net assets of SCH, accompanied by a recapitalization whereby no goodwill or other intangible
F-59

TABLE OF CONTENTS
Social Finance, Inc.
Notes to Unaudited Condensed Consolidated Financial Statements 
(In Thousands, Unless Otherwise Stated and Except for Share and Per Share Data)
assets are recorded. Operations prior to the Business Combination are those of SoFi. At the Closing, we received gross cash consideration of $764.8 million as a result of the reverse recapitalization, which was then reduced by:
A redemption of redeemable common stock of $150.0 million;
A Special Payment (as defined in Note 9), which was accounted for as an embedded derivative, and made to our Series 1 redeemable preferred stockholders of $21.2 million (which was expensed as incurred); and
Our equity issuance costs.
In connection with the Business Combination, SoFi incurred $26.1 million of equity issuance costs, consisting of advisory, legal and other professional fees, which are recorded to additional paid-in capital as a reduction of proceeds. A portion of the equity issuance costs ($7.8 million) were included within other assets as of March 31, 2021, and we paid a portion of the equity issuance costs during 2020 ($0.6 million) and the first quarter of 2021 ($1.5 million). We expect to pay the balance of the equity issuance costs during the second quarter of 2021.
In connection with the Business Combination, SCH entered into subscription agreements with certain investors, whereby it issued 122,500,000 shares of common stock at $10.00 per share (“PIPE Shares”) for an aggregate purchase price of $1.225 billion (“PIPE Investment”), which closed simultaneously with the consummation of the Business Combination. Upon the Closing, the PIPE Shares were automatically converted into shares of SoFi Technologies common stock on a one-for-one basis.
Upon the Closing, holders of SoFi common stock received shares of SoFi Technologies common stock in an amount determined by application of the exchange ratio of 1.7428 (“Exchange Ratio”), which was based on SoFi’s implied price per share prior to the Business Combination. Additionally, holders of SoFi preferred stock (with the exception of holders of Series 1 Preferred Stockholders) received shares of SoFi Technologies common stock in amounts determined by application of either the Exchange Ratio or a multiplier of the Exchange Ratio, as provided by the Agreement.
Acquisition of Golden Pacific Bancorp, Inc.
During March 2021, the Company and Golden Pacific Bancorp, Inc. (“Golden Pacific”), a California corporation, entered into an Agreement and Plan of Merger (the “Bank Merger”), by and among the Company, a wholly-owned subsidiary of the Company and Golden Pacific, pursuant to which the Company will acquire all of the outstanding equity interests in Golden Pacific and thereby acquire its wholly-owned subsidiary, Golden Pacific Bank, National Association (“Golden Pacific Bank”), for total cash purchase consideration of $22.3 million, of which approximately $0.7 million could be held back by the Company in escrow (“Holdback Amount”) if certain legal proceedings with which Golden Pacific is involved as a plaintiff are not resolved at the time the Bank Merger closes. The Holdback Amount will be used for further financing or costs incurred associated with the litigation and any remaining amount upon resolution of the litigation will be released to the Golden Pacific shareholders. Alternatively, if the legal proceedings are resolved prior to the close of the Bank Merger and a favorable settlement is received, the merger consideration will be increased by the amount of such proceeds, net of all fees and expenses and taxes payable in respect of such proceeds, such that the settlement will be returned to the Golden Pacific shareholders.
Golden Pacific is duly registered as a bank holding company with the Board of Governors of the Federal Reserve System. Golden Pacific Bank is a national banking association duly organized and validly existing and in good standing under the laws of the United States and is regulated by the OCC. Deposit accounts of Golden Pacific Bank are insured by the FDIC through the Deposit Insurance Fund to the fullest extent permitted by law. The closing of the Bank Merger is subject to regulatory approval, including approval from the OCC of a revised business plan for Golden Pacific Bank, and approval from the Federal Reserve to become a bank holding company and for a change of control, and other customary closing conditions, which the Company anticipates can be completed by the end of 2021. The Bank Merger will be accounted for as a business combination. The purchase consideration will be allocated to the tangible and intangible assets acquired and liabilities assumed based on the estimated fair values as of the acquisition date. The acquisition is not expected to be a significant acquisition under ASC 805 or Regulation
F-60

TABLE OF CONTENTS
Social Finance, Inc.
Notes to Unaudited Condensed Consolidated Financial Statements 
(In Thousands, Unless Otherwise Stated and Except for Share and Per Share Data)
S-X, Rule 3-05. In March 2021, we submitted an application to the Federal Reserve to become a bank holding company. The application review process is ongoing.
Acquisition of Galileo Financial Technologies, Inc.
On May 14, 2020, we acquired Galileo Financial Technologies, Inc. and its subsidiaries (“Galileo”) by acquiring 100% of the outstanding Galileo stock as of that date. Galileo primarily provides technology platform services to financial and non-financial institutions. Our acquisition of Galileo enabled us to diversify our business from primarily consumer-based to also serve institutions that rely upon Galileo’s integrated platform as a service to serve their clients.
The following table presents the components of the purchase consideration to acquire Galileo:
Cash paid $ 75,633 
Seller note 243,998 
Fair value of preferred stock issued(1)
814,156 
Fair value of common stock options assumed(2)
32,197 
Total purchase consideration $ 1,165,984 
___________________
(1) The preferred stock issued is subject to adjustment as part of the closing net working capital calculation, which was finalized subsequent to March 31, 2021, as discussed below. As of March 31, 2021, the closing net working capital calculation remained the only open item with regard to the purchase price allocation process for Galileo.
(2) We contemporaneously converted outstanding options to acquire common stock of Galileo into corresponding options to acquire common stock of SoFi (“Replacement Options”) at an exchange ratio of one Galileo option to 3.83 Replacement Options.
Upon the finalization of the closing net working capital calculation in April 2021, the total purchase price consideration was reduced by $743, which was settled through the return to SoFi of an equivalent value of 48,116 previously issued Series H-1 preferred stock, which were retired upon receipt. In April 2021, the adjustment similarly reduced the carrying value of recognized goodwill, and did not impact the estimated fair values of the assets acquired and liabilities assumed in conjunction with the transaction.
None of the goodwill recognized is deductible for tax purposes. Goodwill is primarily attributable to synergies expected from leveraging SoFi’s resources to further build upon Galileo’s product offerings, scaling Galileo’s operations and expanding its market reach. As such, the goodwill is fully allocated to the Technology Platform segment.
Identifiable intangible assets at the date of acquisition included finite-lived intangible assets with a gross carrying amount of $388,000, as follows:
Gross Carrying Amount
Weighted Average Useful Life (Years)
Developed technology
$ 253,000  8.6
Customer-related
125,000  3.6
Trade names, trademarks and domain names
10,000  8.6

F-61

TABLE OF CONTENTS
Social Finance, Inc.
Notes to Unaudited Condensed Consolidated Financial Statements 
(In Thousands, Unless Otherwise Stated and Except for Share and Per Share Data)
The following unaudited supplemental pro forma financial information presents the Company’s consolidated results of operations for the three months ended March 31, 2020 as if the business combination had occurred on January 1, 2020:
Three Months Ended March 31,
2020
Total net revenue $ 99,278 
Net loss (24,560)
The unaudited supplemental pro forma financial information is presented for comparative purposes only and is not necessarily indicative of the actual results of operations that would have been achieved, nor is it indicative of future results of operations.
The unaudited supplemental pro forma financial information reflects pro forma adjustments that give effect to applying the Company’s accounting policies and certain events the Company believes to be directly attributable to the acquisition. The pro forma adjustments primarily include:
incremental straight-line amortization expense associated with acquired intangible assets;
adjustments to depreciation expense resulting from accounting policy alignment between the acquirer and acquiree;
adjustments to reflect accretion of interest on the seller note;
an adjustment to reflect post-combination stock-based compensation expense associated with the Replacement Options as if they had been granted on January 1, 2020;
a reversal of the Company’s previously-established deferred tax asset valuation allowance of $99,793 resulting from deferred tax liabilities acquired in connection with the acquisition;
an adjustment to reflect acquisition-related costs of $9,341; and
the related income tax effects, at the statutory tax rate applicable for the period, of the pro forma adjustments noted above.
The unaudited supplemental pro forma financial information does not give effect to any anticipated cost savings, operating efficiencies or other synergies that may be associated with the acquisition, or any estimated costs that have been or will be incurred by the Company to integrate the assets and operations of Galileo.
Other Acquisitions
On April 28, 2020, the Company acquired 100% of the outstanding stock of 8 Limited, a Hong Kong brokerage services firm, for total consideration of $16,126, consisting of $561 in cash and $15,565 in fair value of common stock issued. Of the 1,285,291 shares of the Company’s common stock issuable in connection with the acquisition, 1,101,306 shares were issued at the date of acquisition and the remaining issuable common stock is subject to certain representations and warranties and is expected to be issued within 18 months of the date of acquisition. The share awards issued in connection with this acquisition have both performance- and service-based requirements. The excess of the total purchase consideration over the fair value of the net assets acquired of $10,239 was allocated to goodwill, none of which is deductible for tax purposes. As the acquisition was not determined to be a significant acquisition as contemplated in ASC 805, the Company did not disclose the pro forma impact of this acquisition to the results of operations for the three months ended March 31, 2020.
Identifiable intangible assets at the date of acquisition included finite-lived intangible assets for developed technology, customer-related contracts and broker-dealer license and trading rights with an aggregate fair value of $5,038. The intangible assets are being amortized over a period of 3.6 to 5.7 years based on the estimated economic benefit derived from each of the underlying assets.
F-62

TABLE OF CONTENTS
Social Finance, Inc.
Notes to Unaudited Condensed Consolidated Financial Statements 
(In Thousands, Unless Otherwise Stated and Except for Share and Per Share Data)
Note 3. Loans
As of March 31, 2021, our loan portfolio consisted of personal loans, student loans and home loans, which are measured at fair value, and credit card loans, which are measured at amortized cost. Below is a disaggregated presentation of our loans, inclusive of fair market value adjustments and accrued interest income, as applicable, as of the dates indicated:
March 31, December 31,
2021 2020
Loans at fair value
Securitized student loans $ 793,366  $ 908,427 
Securitized personal loans 461,394  559,743 
Student loans 1,873,427  1,958,032 
Home loans 231,903  179,689 
Personal loans 1,112,514  1,253,177 
Total loans at fair value 4,472,604  4,859,068 
Loans at amortized cost(1)
Credit card loans(2)
14,224  3,723 
Commercial loan(3)
—  16,512 
Total loans at amortized cost 14,224  20,235 
Total loans $ 4,486,828  $ 4,879,303 
_____________________
(1) See Note 1 for additional information on our loans at amortized cost as it pertains to the allowance for credit losses pursuant to ASC 326.
(2) During the three months ended March 31, 2021, we had originations of credit card loans of $28,763 and gross repayments on credit card loans of $18,357.
(3) During the fourth quarter of 2020, we issued a commercial loan with a principal balance of $16,500 and accumulated interest of $12 as of December 31, 2020, all of which was repaid in January 2021.
Loans Measured at Fair Value
The following table summarizes the aggregate fair value of our loans measured at fair value on a recurring basis as of the dates indicated:
Student Loans
Home Loans
Personal Loans
Total
March 31, 2021
Unpaid principal
$ 2,590,442  $ 228,645  $ 1,536,702  $ 4,355,789 
Accumulated interest
8,222  106  9,371  17,699 
Cumulative fair value adjustments
68,129  3,152  27,835  99,116 
Total fair value of loans
$ 2,666,793  $ 231,903  $ 1,573,908  $ 4,472,604 
December 31, 2020
Unpaid principal
$ 2,774,511  $ 171,967  $ 1,780,246  $ 4,726,724 
Accumulated interest
9,472  141  11,558  21,171 
Cumulative fair value adjustments
82,476  7,581  21,116  111,173 
Total fair value of loans
$ 2,866,459  $ 179,689  $ 1,812,920  $ 4,859,068 
F-63

TABLE OF CONTENTS
Social Finance, Inc.
Notes to Unaudited Condensed Consolidated Financial Statements 
(In Thousands, Unless Otherwise Stated and Except for Share and Per Share Data)
The following table summarizes the aggregate fair value of loans 90 days or more delinquent as of the dates indicated. As delinquent loans are charged off after 120 days of nonpayment, amounts presented below represent the fair value of loans that are 90 to 120 days delinquent.
Student Loans
Home Loans
Personal Loans
Total
March 31, 2021
Unpaid principal $ 775  $ —  $ 4,237  $ 5,012 
Accumulated interest 24  —  237  261 
Cumulative fair value adjustments (285) —  (3,916) (4,201)
Fair value of loans 90 days or more delinquent $ 514  $ —  $ 558  $ 1,072 
December 31, 2020
Unpaid principal $ 1,046  $ —  $ 4,199  $ 5,245 
Accumulated interest 37  —  210  247 
Cumulative fair value adjustments (442) —  (3,872) (4,314)
Fair value of loans 90 days or more delinquent $ 641  $ —  $ 537  $ 1,178 
The following table presents the changes in our loans measured at fair value on a recurring basis:
Student Loans
Home Loans
Personal Loans
Total
Fair value as of January 1, 2021 $ 2,866,459  $ 179,689  $ 1,812,920  $ 4,859,068 
Origination of loans 1,004,685  735,604  805,689  2,545,978 
Principal payments (250,219) (1,479) (258,199) (509,897)
Sales of loans (936,160) (677,566) (779,441) (2,393,167)
Purchases(1)
71  119  1,001  1,191 
Change in accumulated interest (1,249) (35) (2,187) (3,471)
Change in fair value(2)
(16,794) (4,429) (5,875) (27,098)
Fair value as of March 31, 2021 $ 2,666,793  $ 231,903  $ 1,573,908  $ 4,472,604 
Fair value as of January 1, 2020 $ 3,185,233  $ 91,695  $ 2,111,030  $ 5,387,958 
Origination of loans 2,134,506  346,808  901,694  3,383,008 
Principal payments (226,378) (1,400) (261,776) (489,554)
Sales of loans (2,256,059) (313,042) (777,346) (3,346,447)
Deconsolidation of securitizations —  —  (260,740) (260,740)
Purchases(1)
33,367  —  1,835  35,202 
Change in accumulated interest 134  16  (3,397) (3,247)
Change in fair value(2)
(15,060) 1,891  (19,808) (32,977)
Fair value as of March 31, 2020 $ 2,855,743  $ 125,968  $ 1,691,492  $ 4,673,203 
__________________
(1) Purchases reflect unpaid principal balance and relate to previously transferred loans. Purchase activity during the three months ended March 31, 2020 included securitization clean-up calls of $33,012. The remaining purchases during the periods presented related to standard representations and warranties pursuant to our various loan sale agreements.
(2) Changes in fair value of loans are recorded in the Unaudited Condensed Consolidated Statements of Operations and Comprehensive Loss within noninterest income — loan origination and sales for loans held on the balance sheet prior to transfer and within noninterest income — securitizations for loans in a consolidated VIE. Changes in fair value are impacted by valuation assumption changes, as well as sales price execution and amount of time the loans are held prior to sale.
F-64

TABLE OF CONTENTS
Social Finance, Inc.
Notes to Unaudited Condensed Consolidated Financial Statements 
(In Thousands, Unless Otherwise Stated and Except for Share and Per Share Data)
Note 4. Variable Interest Entities
Consolidated VIEs
The Company consolidates certain securitization trusts in which we have a variable interest and are deemed to be the primary beneficiary. Our consolidation policy is further discussed in Note 1.
The VIEs are SPEs with portfolio loans securing debt obligations. The SPEs were created and designed to transfer credit and interest rate risk associated with consumer loans through the issuance of collateralized notes and trust certificates. The Company makes standard representations and warranties to repurchase or replace qualified portfolio loans. Aside from these representations, the holders of the asset-backed debt obligations have no recourse to the Company if the cash flows from the underlying portfolio loans securing such debt obligations are not sufficient to pay all principal and interest on the asset-backed debt obligations. We hold a significant interest in these financing transactions through our ownership of a portion of the residual interest in certain VIEs. In addition, in some cases, we invest in the debt obligations issued by the VIE. Our investments in consolidated VIEs eliminate in consolidation. The residual interest is the first VIE interest to absorb losses should the loans securing the debt obligations not provide adequate cash flows to satisfy more senior claims and is, by design, the interest that we expect to absorb the expected gains and losses of the VIE. The Company’s exposure to credit risk in sponsoring SPEs is limited to our investment in the VIE. VIE creditors have no recourse against our general credit.
The following table presents the assets and liabilities of consolidated VIEs that were included in our Unaudited Condensed Consolidated Balance Sheets. The assets in the below table may only be used to settle obligations of consolidated VIEs and were in excess of those obligations as of the dates presented. Additionally, the assets and liabilities in the table below exclude intercompany balances, which eliminate upon consolidation:
March 31, December 31,
2021 2020
Assets:
Restricted cash and restricted cash equivalents $ 86,815  $ 76,973 
Loans 1,254,760  1,468,170 
Total assets $ 1,341,575  $ 1,545,143 
Liabilities:
Accounts payable, accruals and other liabilities $ 614  $ 759 
Debt(1)
1,059,443  1,248,822 
Residual interests classified as debt 114,882  118,298 
Total liabilities $ 1,174,939  $ 1,367,879 
___________________
(1)Debt is presented net of debt issuance costs and debt discounts.
Nonconsolidated VIEs
We have created and designed personal loan and student loan trusts to transfer associated credit and interest rate risk associated with the loans through the issuance of collateralized notes and residual certificates. We have a variable interest in the nonconsolidated loan trusts, as we own collateralized notes and residual certificates in the loan trusts that absorb variability. We also have continuing, non-controlling involvement with the trusts as the servicer. As servicer, we have the power to perform the activities which most impact the economic performance of the VIE, but since we hold an insignificant financial interest in the trusts, we are not the primary beneficiary. We define an insignificant financial interest as less than 10% of the expected gains and losses of the VIE. This financial interest represents the equity ownership interest in the loan trusts, wherein there is an obligation to absorb losses and the right to receive benefits from residual certificate ownership. The maximum exposure to loss as a result of our involvement with the nonconsolidated VIE is limited to our investment. There are no liquidity arrangements, guarantees or other commitments by third parties that may affect the fair value or risk of our variable interests in nonconsolidated VIEs.
F-65

TABLE OF CONTENTS
Social Finance, Inc.
Notes to Unaudited Condensed Consolidated Financial Statements 
(In Thousands, Unless Otherwise Stated and Except for Share and Per Share Data)
Personal Loans
We did not establish any personal loan trusts during the three months ended March 31, 2021 that were not consolidated as of the corresponding balance sheet date. We established one personal loan trust during the three months ended March 31, 2020 that was not consolidated as of the corresponding balance sheet date. As of both March 31, 2021 and December 31, 2020, we had investments in nine nonconsolidated personal loan VIEs.
We did not provide financial support to any personal loan trusts beyond our initial equity investment during the periods presented. We did not deconsolidate any personal loan VIEs during the three months ended March 31, 2021. We deconsolidated two personal loan VIEs during the three months ended March 31, 2020, which were originally consolidated in 2017.
Student Loans
We established two student loan trusts during each of the three months ended March 31, 2021 and 2020 that were not consolidated as of the corresponding balance sheet dates. As of March 31, 2021 and December 31, 2020, we had investments in 22 and 20 nonconsolidated student loan VIEs.
We did not provide financial support to any student loan trusts beyond our initial equity investment during the periods presented. We did not deconsolidate any student loan VIEs during the three months ended March 31, 2021 and 2020.
The following table presents the aggregate outstanding value of asset-backed bonds and residual interests owned by the Company in nonconsolidated VIEs, which were included in our Unaudited Condensed Consolidated Balance Sheets:
March 31, December 31,
2021 2020
Personal loans
$ 60,412  $ 71,115 
Student loans
401,697  425,820 
Securitization investments
$ 462,109  $ 496,935 

Note 5. Transfers of Financial Assets
We regularly transfer financial assets and account for such transfers as either sales or secured borrowings depending on the facts and circumstances. When a transfer of financial assets qualifies as a sale, in many instances we have continued involvement as the servicer of those financial assets. As we expect the benefits of servicing to be more than just adequate, we recognize a servicing asset. Further, in the case of securitization-related transfers that qualify as sales, we have additional continued involvement as an investor, albeit at insignificant levels relative to the expected gains and losses of the securitization. In instances where a transfer is accounted for as a secured borrowing, we perform servicing (but we do not recognize a servicing asset) and typically maintain a significant investment relative to the expected gains and losses of the securitization. In whole loan sales, we do not have a residual financial interest in the loans, nor do we have any other power over the loans that would constrain us from recognizing a sale. Additionally, we have no repurchase requirements related to transfers of personal loans, student loans and non-FNMA home loans other than standard origination representations and warranties, for which we record a liability based on expected repurchase obligations. For FNMA home loans, we have customary FNMA repurchase requirements, which do not constrain sale treatment but result in a liability for the expected repurchase requirement.
F-66

TABLE OF CONTENTS
Social Finance, Inc.
Notes to Unaudited Condensed Consolidated Financial Statements 
(In Thousands, Unless Otherwise Stated and Except for Share and Per Share Data)
The following table summarizes the loan securitization transfers qualifying for sale accounting treatment for the periods indicated. There were no home loan securitization transfers qualifying for sale accounting treatment during either of the periods presented and no personal loan securitization transfers qualifying for sale accounting treatment during the three months ended March 31, 2021.
Three Months Ended March 31,
2021 2020
Student loans
Fair value of consideration received:
Cash $ 500,041  $ 1,990,657 
Securitization investments 26,381  105,382 
Servicing assets recognized 28,731  15,652 
Total consideration 555,153  2,111,691 
Aggregate unpaid principal balance and accrued interest of loans sold 526,126  2,043,265 
Gain from loan sales $ 29,027  $ 68,426 
Personal loans
Fair value of consideration received:
Cash $ —  $ 307,819 
Securitization investments —  20,961 
Deconsolidation of debt(1)
—  272,680 
Servicing assets recognized —  1,644 
Total consideration —  603,104 
Aggregate unpaid principal balance and accrued interest of loans sold —  561,223 
Gain from loan sales(1)
$ —  $ 41,881 
_____________________
(1)Deconsolidation of debt reflects the impacts of previously consolidated VIEs that became deconsolidated during the period because we no longer held a significant financial interest in the underlying securitization entity. See Note 4 for further discussion of deconsolidations. The gain from loan sales excludes losses from deconsolidations of $5.1 million for the three months ended March 31, 2020, which are presented in noninterest income — securitizations in the Unaudited Condensed Consolidated Statements of Comprehensive Loss.
F-67

TABLE OF CONTENTS
Social Finance, Inc.
Notes to Unaudited Condensed Consolidated Financial Statements 
(In Thousands, Unless Otherwise Stated and Except for Share and Per Share Data)
The following table summarizes the whole loan sales for the periods indicated:
Three Months Ended March 31,
2021 2020
Student loans
Fair value of consideration received:
Cash $ 422,341  $ 225,523 
Servicing assets recognized 4,858  2,233 
Repurchase liabilities recognized (79) (42)
Total consideration 427,120  227,714 
Aggregate unpaid principal balance and accrued interest of loans sold
413,090  218,594 
Gain from loan sales
$ 14,030  $ 9,120 
Home loans
Fair value of consideration received:
Cash $ 696,197  $ 319,202 
Servicing assets recognized 6,539  3,107 
Repurchase liabilities recognized (939) (382)
Total consideration
701,797  321,927 
Aggregate unpaid principal balance and accrued interest of loans sold
677,569  313,013 
Gain from loan sales
$ 24,228  $ 8,914 
Personal loans
Fair value of consideration received:
Cash $ 811,252  $ 499,095 
Servicing assets recognized 6,003  4,096 
Repurchase liabilities recognized (2,084) (1,198)
Total consideration received
815,171  501,993 
Aggregate unpaid principal balance and accrued interest of loans sold
782,529  481,328 
Gain from loan sales
$ 32,642  $ 20,665 
F-68

TABLE OF CONTENTS
Social Finance, Inc.
Notes to Unaudited Condensed Consolidated Financial Statements 
(In Thousands, Unless Otherwise Stated and Except for Share and Per Share Data)
The following table presents information as of the dates indicated about the unpaid principal balances of transferred loans that are not recorded in our Unaudited Condensed Consolidated Balance Sheets, but with which we have a continuing involvement through our servicing agreements:
Student Loans
Home Loans
Personal Loans
Total
March 31, 2021
Loans in repayment
$ 11,428,130  $ 3,075,495  $ 4,751,597  $ 19,255,222 
Loans in-school/grace/deferment
23,375  —  —  23,375 
Loans in forbearance
221,693  32,756  19,138  273,587 
Loans in delinquency
67,532  2,679  90,374  160,585 
Total loans serviced
$ 11,740,730  $ 3,110,930  $ 4,861,109  $ 19,712,769 
Servicing fees collected
$ 9,025  $ 1,613  $ 9,490  $ 20,128 
Charge-offs, net of recoveries
3,053  —  37,817  40,870 
December 31, 2020
Loans in repayment
$ 12,059,702  $ 2,629,015  $ 4,796,404  $ 19,485,121 
Loans in-school/grace/deferment
26,158  —  —  26,158 
Loans in forbearance
275,659  46,357  35,677  357,693 
Loans in delinquency
91,424  8,493  110,640  210,557 
Total loans serviced
$ 12,452,943  $ 2,683,865  $ 4,942,721  $ 20,079,529 
Servicing fees collected
$ 50,794  $ 4,499  $ 45,574  $ 100,867 
Charge-offs, net of recoveries
16,999  —  197,927  214,926 

Note 6. Accounts Receivable
We measure our allowance for credit losses on accounts receivable, which primarily relates to Galileo, under ASC 326. Given our methods of collecting funds on servicing receivables, our historical experience of infrequent write offs, and that we have not observed meaningful changes in our counterparties’ abilities to pay, we determined that the future exposure to credit losses on servicing related receivables was immaterial.
For our accounts receivable, we used an aging method and historical loss rates as a basis for estimating the percentage of current and delinquent accounts receivable balances that will result in credit losses. We considered the conditions at the measurement date and reasonable and supportable forecasts about future conditions to consider if adjustments to the historical loss rate were warranted. Given our methods of collecting funds on our receivables, and that we have not observed meaningful changes in our customers’ payment behavior, we determined that our historical loss rates remain most indicative of our lifetime expected losses. Accounts receivable balances, net of allowance for credit losses, are recorded within other assets in the Unaudited Condensed Consolidated Balance Sheets.
The following table summarizes the activity in the balance of allowance for credit losses on accounts receivable during the period indicated. There was no activity in the balance of allowance for credit losses on accounts receivable during the three months ended March 31, 2020.
Three Months Ended
March 31, 2021
Beginning balance
$ 562 
Provision for expected losses
1,222 
Write-offs charged against the allowance
(778)
Recoveries collected
(87)
Ending balance
$ 919 
F-69

TABLE OF CONTENTS
Social Finance, Inc.
Notes to Unaudited Condensed Consolidated Financial Statements 
(In Thousands, Unless Otherwise Stated and Except for Share and Per Share Data)
Note 7. Fair Value Measurements
The following table summarizes, by level within the fair value hierarchy, the carrying amounts and estimated fair values of our assets and liabilities measured at fair value on a recurring basis, measured at fair value on a nonrecurring basis, or disclosed, but not carried, at fair value in the Unaudited Condensed Consolidated Balance Sheets as of the dates presented.
March 31, 2021 December 31, 2020
Level
Carrying
Value
Fair Value
Carrying
Value
Fair Value
Assets
Cash and cash equivalents(1)
1 $ 351,283  $ 351,283  $ 872,582  $ 872,582 
Restricted cash and restricted cash equivalents(1)
1 347,284  347,284  450,846  450,846 
Student loans(2)
3 2,666,793  2,666,793  2,866,459  2,866,459 
Home loans(2)
3 231,903  231,903  179,689  179,689 
Personal loans(2)
3 1,573,908  1,573,908  1,812,920  1,812,920 
Credit card loans(1)
3 14,224  14,224  3,723  3,723 
Commercial loan(1)
3 —  —  16,512  16,512 
Servicing rights(2)
3 161,240  161,240  149,597  149,597 
Asset-backed bonds(2)(7)
2 311,148  311,148  357,411  357,411 
Residual investments(2)(7)
3 150,961  150,961  139,524  139,524 
Non-securitization investments – ETFs(2)(9)
1 5,194  5,194  6,850  6,850 
Non-securitization investments – other(3)
3 1,147  1,147  1,147  1,147 
Derivative assets(2)(4)
1 2,248  2,248  —  — 
Interest rate lock commitments(2)(5)
3 7,118  7,118  15,620  15,620 
Interest rate swaps(2)(4)(6)
2 5,257  5,257  —  — 
Total assets
$ 5,829,708  $ 5,829,708  $ 6,872,880  $ 6,872,880 
Liabilities
Debt(1)
2 $ 3,827,424  $ 3,874,826  $ 4,798,925  $ 4,851,658 
Residual interests classified as debt(2)
3 114,882  114,882  118,298  118,298 
Warrant liabilities(2)(8)
3 129,879  129,879  39,959  39,959 
Derivative liabilities(2)(4)
1 —  —  2,008  2,008 
Interest rate swaps(2)(4)(6)
2 —  —  947  947 
ETF short positions(2)(9)
1 3,667  3,667  5,241  5,241 
Total liabilities
$ 4,075,852  $ 4,123,254  $ 4,965,378  $ 5,018,111 
_____________________
(1)Disclosed, but not carried, at fair value. The carrying value of our debt is net of unamortized discounts and debt issuance costs. The fair values of our warehouse facility debt, revolving credit facility debt and financing arrangements assumed in the Galileo acquisition were based on market factors and credit factors specific to us. The securitization debt was valued using a discounted cash flow model, with key inputs relating to the underlying contractual coupons, terms, discount rate and expectations for defaults and prepayments. The carrying amounts of our cash and cash equivalents and restricted cash and restricted cash equivalents approximate their fair values due to the short-term maturities and highly liquid nature of these accounts.
(2)Measured at fair value on a recurring basis.
(3)Measured at fair value on a nonrecurring basis.
(4)Derivative assets and derivative liabilities classified as Level 1 are based on broker quotes in active markets and represent economic hedges of loan fair values. Gross derivative assets and liabilities included herein are subject to master netting arrangements. See Note 1 for additional information on our master netting arrangements, including the amounts netted against these gross derivative assets and liabilities.
(5)Interest rate lock commitments are classified as Level 3 because of our reliance on an assumed loan funding probability, which is based on our internal historical experience with home loans similar to those in the pipeline on the measurement date.
(6)Interest rate swaps are classified as Level 2, because these financial instruments do not trade in active markets with observable prices, but rely on observable inputs other than quoted prices. Interest rate swaps are valued using the three-month LIBOR swap yield curve, which is an observable input from an active market.
(7)These assets represent the carrying value of our holdings in VIEs wherein we were not deemed the primary beneficiary. As we do not provide financial support beyond our initial equity investment, our maximum exposure to loss as a result of our involvement with nonconsolidated VIEs is limited to the investment amount. See Note 4 for additional information.
(8)See Note 9 for additional information on our warrant liabilities, including inputs to the valuation.
(9)ETF short positions classified as Level 1 are based on quoted prices in actively traded markets and serve as an economic hedge to our non-securitization investments in exchange-traded funds.
F-70

TABLE OF CONTENTS
Social Finance, Inc.
Notes to Unaudited Condensed Consolidated Financial Statements 
(In Thousands, Unless Otherwise Stated and Except for Share and Per Share Data)
Loans
The following key unobservable assumptions were used in the fair value measurement of our loans as of the dates indicated:
March 31, 2021 December 31, 2020
Range Weighted Average
Range
Weighted Average
Student loans
Conditional prepayment rate
17.3% – 27.8%
19.7%
15.8% – 33.3%
18.4%
Annual default rate
0.2% – 3.5%
0.4%
0.2% – 4.9%
0.4%
Discount rate
1.5% – 7.1%
3.3%
1.1% – 7.1%
3.3%
Home loans
Conditional prepayment rate
3.8% – 11.6%
9.8%
4.4% – 17.6%
14.9%
Annual default rate
0.1% – 4.2%
0.1%
0.1% – 4.9%
0.1%
Discount rate
2.2% – 12.0%
2.4%
1.3% – 10.0%
1.6%
Personal loans
Conditional prepayment rate
15.9% – 31.6%
21.3%
14.5% – 23.2%
18.1%
Annual default rate
3.3% – 36.1%
4.1%
3.3% – 33.8%
4.2%
Discount rate
4.6% – 9.5%
5.5%
5.0% – 10.7%
6.0%
The key assumptions included in the above table are defined as follows:
Conditional prepayment rate — The monthly annualized proportion of the principal of a pool of loans that is assumed to be paid off prematurely in each period. An increase in the conditional prepayment rate, in isolation, would result in a decrease in a fair value measurement. The weighted average assumption was weighted based on relative fair value.
Annual default rate — The annualized rate of borrowers who do not make loan payments on time. An increase in the annual default rate, in isolation, would result in a decrease in a fair value measurement. The weighted average assumption was weighted based on relative fair value.
Discount rate — The weighted average rate at which the expected cash flows are discounted to arrive at the net present value of the loans. An increase in the discount rate, in isolation, would result in a decrease in a fair value measurement. The weighted average assumption was weighted based on relative fair value.
See Note 3 for additional loan fair value disclosures.
Servicing Rights
Servicing rights for student loans and personal loans do not trade in an active market with readily observable prices. Similarly, home loan servicing rights infrequently trade in an active market. At the time of the underlying loan sale, the fair value of servicing rights is determined using a discounted cash flow methodology based on observable and unobservable inputs. Management classifies servicing rights as Level 3 due to the use of significant unobservable inputs in the fair value measurement.
F-71

TABLE OF CONTENTS
Social Finance, Inc.
Notes to Unaudited Condensed Consolidated Financial Statements 
(In Thousands, Unless Otherwise Stated and Except for Share and Per Share Data)
The following key unobservable inputs were used in the fair value measurement of our classes of servicing rights as of the dates presented:
March 31, 2021 December 31, 2020
Range Weighted Average
Range
Weighted Average
Student loans
Market servicing costs
0.1% – 0.2%
0.1%
0.1% – 0.2%
0.1%
Conditional prepayment rate
13.6% – 26.4%
21.0%
13.8% – 24.7%
18.7%
Annual default rate
0.2% – 4.7%
0.4%
0.2% – 4.8%
0.4%
Discount rate
7.3% – 7.3%
7.3%
7.3% – 7.3%
7.3%
Home loans
Market servicing costs
0.1% – 0.1%
0.1%
0.1% – 0.1%
0.1%
Conditional prepayment rate
8.6% – 17.5%
11.1%
13.9% – 20.3%
16.5%
Annual default rate
0.1% – 0.6%
0.1%
0.1% – 0.1%
0.1%
Discount rate
9.5% – 9.5%
9.5%
10.0% – 10.0%
10.0%
Personal loans
Market servicing costs
0.2% – 0.8%
0.3%
0.2% – 0.7%
0.3%
Conditional prepayment rate
20.2% – 34.6%
24.9%
16.2% – 26.1%
19.1%
Annual default rate
3.1% – 7.7%
5.3%
3.1% – 7.5%
5.5%
Discount rate
7.3% – 7.3%
7.3%
7.3% – 7.3%
7.3%
The key assumptions included in the above table are defined as follows:
Market servicing costs — The fee a willing market participant, which we validate through actual third-party bids for our servicing, would require for the servicing of student loans, home loans and personal loans with similar characteristics as those in our serviced portfolio. An increase in the market servicing cost, in isolation, would result in a decrease in a fair value measurement. The weighted average assumption was weighted based on relative fair value.
Conditional prepayment rate — The monthly annualized proportion of the principal of a pool of loans that is assumed to be paid off prematurely in each period. An increase in the conditional prepayment rate, in isolation, would result in a decrease in a fair value measurement. The weighted average assumption was weighted based on relative fair value.
Annual default rate — The annualized rate of default within the total serviced loan balance. An increase in the annual default rate, in isolation, would result in a decrease in a fair value measurement. The weighted average assumption was weighted based on relative fair value.
Discount rate — The weighted average rate at which the expected cash flows are discounted to arrive at the net present value of the servicing rights. An increase in the discount rate, in isolation, would result in a decrease in a fair value measurement. The weighted average assumption was weighted based on relative fair value.
F-72

TABLE OF CONTENTS
Social Finance, Inc.
Notes to Unaudited Condensed Consolidated Financial Statements 
(In Thousands, Unless Otherwise Stated and Except for Share and Per Share Data)
The following table presents the estimated decrease to the fair value of our servicing rights as of the dates indicated if the key assumptions had each of the below adverse changes:
March 31, 2021 December 31, 2020
Market servicing costs
2.5 basis points increase
$ (10,096) $ (10,472)
5.0 basis points increase
(20,192) (20,944)
Conditional prepayment rate
10% increase
$ (6,624) $ (5,430)
20% increase
(13,232) (10,230)
Annual default rate
10% increase
$ (230) $ (336)
20% increase
(452) (681)
Discount rate
100 basis points increase
$ (3,480) $ (2,986)
200 basis points increase
(6,772) (5,820)
The sensitivity calculations above are hypothetical and should not be considered to be predictive of future performance. The effect on fair value of a variation in assumptions generally cannot be determined because the relationship of the change in assumptions to the fair value may not be linear. Additionally, the effect of an adverse variation in a particular assumption on the fair value of our servicing rights is calculated while holding the other assumptions constant. In reality, changes in one factor may lead to changes in other factors, which could impact the above hypothetical effects.
The following table presents the changes in the Company’s servicing rights, which are measured at fair value on a recurring basis. Servicing rights are initially measured at fair value and recognized as a component of the gain or loss from sales of loans and the initial capitalization is reported within noninterest income — loan origination and sales in the Unaudited Condensed Consolidated Statements of Operations and Comprehensive Loss. Subsequent changes in the fair value of servicing rights are reported within noninterest income — servicing in the Unaudited Condensed Consolidated Statements of Operations and Comprehensive Loss.
Student Loans
Home Loans
Personal Loans
Total
Fair value as of January 1, 2021 $ 100,637  $ 23,914  $ 25,046  $ 149,597 
Recognition of servicing from transfers of financial assets 33,589  6,539  6,003  46,131 
Change in valuation inputs or other assumptions (15,728) 3,329  290  (12,109)
Realization of expected cash flows and other changes
(12,160) (1,744) (8,475) (22,379)
Fair value as of March 31, 2021 $ 106,338  $ 32,038  $ 22,864  $ 161,240 
Fair value as of January 1, 2020 $ 138,582  $ 13,181  $ 49,855  $ 201,618 
Recognition of servicing from transfers of financial assets
17,885  3,107  5,740  26,732 
Derecognition of servicing via loan purchases
(221) —  —  (221)
Change in valuation inputs or other assumptions
4,581  (957) 3,435  7,059 
Realization of expected cash flows and other changes
(13,037) (891) (11,341) (25,269)
Fair value as of March 31, 2020 $ 147,790  $ 14,440  $ 47,689  $ 209,919 
F-73

TABLE OF CONTENTS
Social Finance, Inc.
Notes to Unaudited Condensed Consolidated Financial Statements 
(In Thousands, Unless Otherwise Stated and Except for Share and Per Share Data)
Asset-Backed Bonds
The fair value of asset-backed bonds is determined using a discounted cash flow methodology. Management classifies asset-backed bonds as Level 2 due to the use of quoted prices for similar assets in markets that are not active, as well as certain factors specific to us. The following key inputs were used in the fair value measurement of our asset-backed bonds as of the dates indicated:
March 31, 2021 December 31, 2020
Discount rate (range)
0.7% – 3.6%
0.8% – 4.0%
Conditional prepayment rate (range)
18.8% – 28.2%
18.8% – 21.9%
As of the dates indicated, the fair value of our asset-backed bonds was not materially impacted by default assumptions on the underlying securitization loans, as the subordinate residual interests, by design, are expected to absorb all estimated losses based on our default assumptions for the respective periods.
Residual Investments and Residual Interests Classified as Debt
Residual investments and residual interests classified as debt do not trade in active markets with readily observable prices, and there is limited observable market data for reference. The fair values of residual investments and residual interests classified as debt are determined using a discounted cash flow methodology. Management classifies residual investments and residual interests classified as debt as Level 3 due to the use of significant unobservable inputs in the fair value measurements.
The following key unobservable inputs were used in the fair value measurements of our residual investments and residual interests classified as debt as of the dates indicated:
March 31, 2021 December 31, 2020
Range Weighted Average
Range
Weighted Average
Residual investments
Conditional prepayment rate
19.3% – 30.6%
22.9%
18.8% – 22.3%
20.2%
Annual default rate
0.3% – 6.2%
0.6%
0.3% – 6.2%
0.7%
Discount rate
2.6% – 15.0%
4.9%
3.0% – 18.5%
6.2%
Residual interests classified as debt
Conditional prepayment rate
18.7% – 33.7%
26.3%
19.5% – 24.8%
21.4%
Annual default rate
0.4% – 6.3%
3.2%
0.4% – 6.4%
3.1%
Discount rate
7.3% – 15.0%
9.1%
8.5% – 18.0%
10.8%
The key assumptions included in the above table are defined as follows:
Conditional prepayment rate — The monthly annualized proportion of the principal of a pool of loans that is assumed to be paid off prematurely in each period for the pool of loans in the securitization. An increase in the conditional prepayment rate, in isolation, would result in a decrease in a fair value measurement. The weighted average assumption was weighted based on relative fair value.
Annual default rate — The annualized rate of borrowers who fail to remain current on their loans for the pool of loans in the securitization. An increase in the annual default rate, in isolation, would result in a decrease in a fair value measurement. The weighted average assumption was weighted based on relative fair value.
Discount rate — The weighted average rate at which the expected cash flows are discounted to arrive at the net present value of the residual investments and residual interests classified as debt. An increase in the discount rate, in isolation, would result in a decrease in a fair value measurement. The weighted average assumption was weighted based on relative fair value.
F-74

TABLE OF CONTENTS
Social Finance, Inc.
Notes to Unaudited Condensed Consolidated Financial Statements 
(In Thousands, Unless Otherwise Stated and Except for Share and Per Share Data)
The following table presents the changes in the residual investments and residual interests classified as debt, which are both measured at fair value on a recurring basis. We record changes in fair value within noninterest income — securitizations in the Unaudited Condensed Consolidated Statements of Operations and Comprehensive Loss, a portion of which is subsequently reclassified to interest expense — securitizations and warehouses for residual interests classified as debt and to interest income — securitizations for residual investments, but does not impact the liability or asset balance, respectively.
Residual Investments
Residual Interests Classified as Debt
Fair value as of January 1, 2021 $ 139,524  $ 118,298 
Additions 26,381  — 
Change in valuation inputs or other assumptions 3,497  7,951 
Payments (18,441) (11,367)
Fair value as of March 31, 2021 $ 150,961  $ 114,882 
Fair value as of January 1, 2020 $ 262,880  $ 271,778 
Additions 9,408  — 
Change in valuation inputs or other assumptions (1,074) 14,936 
Payments (22,523) (28,579)
Derecognition upon achieving true sale accounting treatment —  (72,026)
Fair value as of March 31, 2020 $ 248,691  $ 186,109 
Instrument-Specific Credit Risk
The change in the fair value of certain financial instruments measured at fair value using the fair value option that resulted from instrument-specific credit risk was as follows during the periods indicated:
Three Months Ended March 31,
2021 2020
Loans
$ 108,105  $ 157,401 
Residual investments
6,160  17,675 
The changes in the fair values attributable to instrument-specific credit risk were estimated by incorporating the Company’s current default and loss severity assumptions for the financial instruments included in the table above. These assumptions are based on historical performance, market trends and performance expectations over the term of the underlying instrument.
Interest Rate Lock Commitments
As part of our home loan origination activities, we commit to interest rate terms prior to completing the home loan origination process. These interest rate commitments are “locked”, despite changes in interest rates between the time of home loan application approval and loan closure. Given that a home loan origination is contingent on a plethora of factors, our IRLCs are inherently uncertain. We account for the probability of honoring an IRLC using an assumed loan funding probability, which is the percentage likelihood that an approved loan application will close based on historical experience. A significant difference between the actual funded rate and the assumed funded rate at the measurement date could result in a significantly higher or lower fair value measurement. Our key valuation input was as follows as of the dates indicated:
March 31, 2021 December 31, 2020
IRLCs
Range Weighted Average
Range
Weighted Average
Loan funding probability
64.1% – 64.1%
64.1%
54.5% – 54.5%
54.5%
F-75

TABLE OF CONTENTS
Social Finance, Inc.
Notes to Unaudited Condensed Consolidated Financial Statements 
(In Thousands, Unless Otherwise Stated and Except for Share and Per Share Data)
The key assumption included in the above table is defined as follows:
Loan funding probability — Our expectation of the percentage of IRLCs which will become funded loans. An increase in the loan funding probability, in isolation, would result in an increase in a fair value measurement. The weighted average assumption was weighted based on relative fair value.
The following table presents the changes in our IRLCs, which are measured at fair value on a recurring basis. Changes in the fair value of IRLCs are recorded within noninterest income — loan origination and sales in the Unaudited Condensed Consolidated Statements of Operations and Comprehensive Loss.
IRLCs
Fair value as of January 1, 2021 $ 15,620 
Revaluation adjustments 7,118 
Funded loans(1)
(10,210)
Unfunded loans(1)
(5,410)
Fair value as of March 31, 2021 $ 7,118 
Fair value as of January 1, 2020 $ 1,090 
Revaluation adjustments 11,831 
Funded loans(1)
(572)
Unfunded loans(1)
(518)
Fair value as of March 31, 2020 $ 11,831 
___________________
(1)Funded and unfunded loan fair value adjustments represent the unpaid principal balance of funded and unfunded loans, respectively, multiplied by the IRLC price in effect at the beginning of each quarter.
Non-Securitization Investments
Non-securitization investments — ETFs include investments in exchange-traded funds and are measured at fair value on a recurring basis using the net asset value expedient in accordance with ASC 820 and are presented within other assets in the Unaudited Condensed Consolidated Balance Sheets.
As of March 31, 2021 and December 31, 2020, we also had a non-securitization investment, which is presented within non-securitization investments — other, related to an investment for which fair value was not readily determinable, which we elected to measure using the measurement alternative method of accounting. Under the measurement alternative method, we measure the investment at cost, less any impairment and adjusted for changes resulting from observable price changes in orderly transactions for identical or similar investments of the same issuer. The carrying value of the investment is presented within other assets in the Unaudited Condensed Consolidated Balance Sheets. Adjustments to the carrying value, such as impairments, are recognized within noninterest income — other in the Unaudited Condensed Consolidated Statements of Operations and Comprehensive Loss. In the second quarter of 2020, we recorded an impairment charge of $803 and adjusted the carrying value of the investment accordingly, which was based on a discounted cash flow analysis, wherein we weighted different valuation scenarios with different assumed internal rates of return and time to liquidity events. In performing a qualitative impairment assessment, we determined that the carrying amount of the investment exceeded its fair value due to a significant decline in investee operating results relative to expectations, primarily as a result of the COVID-19 pandemic. The fair value measurement is classified within Level 3 of the fair value hierarchy due to the use of unobservable inputs in the fair value measurement.
F-76

TABLE OF CONTENTS
Social Finance, Inc.
Notes to Unaudited Condensed Consolidated Financial Statements 
(In Thousands, Unless Otherwise Stated and Except for Share and Per Share Data)
Note 8. Debt
The following table summarizes the Company’s principal outstanding debt, debt discounts and debt issuance costs as of the dates indicated:
Outstanding as of
Borrowing Description
Collateral Balances(1)
Interest Rate(7)
Termination/
Maturity(2)
Total Capacity
March 31, 2021(3)
December 31, 2020
Student Loan Warehouse Facilities
SoFi Funding I
$ 216,858 
1 ML + 125 bps
April 2022 $ 200,000  $ 192,804  $ 374,575 
SoFi Funding III 37,655 
PR – 134 bps(8)
September 2024 75,000  33,489  30,170 
SoFi Funding V
241,614 
1 ML + 135 bps
May 2023 350,000  220,550  — 
SoFi Funding VI
288,394 
3 ML + 150 bps
March 2023 600,000  266,452  432,437 
SoFi Funding VII
272,325 
1 ML + 125 bps
September 2022 500,000  251,409  276,910 
SoFi Funding VIII
189,776 
1 ML + 115 bps
June 2021 300,000  175,112  221,342 
SoFi Funding IX(9)
6,909 
3 ML+ 350 bps and CP + 143 bps
July 2023 500,000  6,344  70,780 
SoFi Funding X(10)
52,043 
CP + 200 bps
August 2023 100,000  45,193  44,136 
SoFi Funding XI(11)
153,042 
CP + 115 bps
November 2023 500,000  138,126  87,404 
Total, before unamortized debt issuance costs
$ 1,458,616  $ 3,125,000  $ 1,329,479  $ 1,537,754 
Unamortized debt issuance costs
$ (6,602) $ (7,940)
Personal Loan Warehouse Facilities
SoFi Funding PL I(12)
$ 108,598 
CP + 137.5 bps
September 2023 $ 250,000  $ 90,954  $ — 
SoFi Funding PL II
2,269 
3 ML + 225 bps
July 2023 400,000  2,199  137,420 
SoFi Funding PL III
64,724 
1 ML + 175 bps
May 2023 250,000  55,684  2,793 
SoFi Funding PL IV(13)
12,464 
CP + 170 bps
November 2023 500,000  11,517  132,416 
SoFi Funding PL VI(14)
16,693 
CP + 170 bps
September 2024 50,000  14,734  107,595 
SoFi Funding PL VII
— 
1 ML + 250 bps
June 2021 250,000  —  15,610 
SoFi Funding PL X
182,003 
1 ML + 142.5 bps
February 2023 200,000  151,856  3,004 
SoFi Funding PL XI
111,966 
1 ML + 170 bps
January 2022 200,000  95,644  112,478 
SoFi Funding PL XII
4,915 
1 ML + (225-315 bps)
March 2029 250,000  4,683  127,724 
SoFi Funding PL XIII
159,057 
1 ML + 175 bps
January 2030 300,000  138,822  219,362 
Total, before unamortized debt issuance costs
$ 662,689  $ 2,650,000  $ 566,093  $ 858,402 
Unamortized debt issuance costs
$ (6,257) $ (6,692)
Home Loan Warehouse Facilities
Mortgage Warehouse V
$ — 
1 ML + 325 bps
June 2021 $ 150,000  $ —  $ — 
Total, before unamortized debt issuance costs
$ —  $ 150,000  $ —  $ — 
Unamortized debt issuance costs
$ —  $ — 
Risk Retention Warehouse Facilities(4)
SoFi RR Funding I
$ — 
1 ML + 200 bps
June 2022 $ 250,000  $ —  $ 54,304 
SoFi RR Repo
115,880 
3 ML + 185 bps
June 2023 192,141  62,335  75,863 
SoFi EU RR Repo
— 
3 ML + 425 bps
June 2021 —  — 
SoFi C RR Repo
40,970 
3 ML + (180-185 bps)
December 2021 35,613  42,757 
SoFi RR Funding II
156,826 
1 ML + 125 bps
November 2024 140,524  160,199 
SoFi RR Funding III 60,316 
1 ML + 375 bps
November 2024 53,781  60,786 
SoFi RR Funding IV 63,472 
3 ML + 250 bps
October 2026 100,000  54,713  37,334 
SoFi RR Funding V 71,002 
298 bps
December 2025 51,547  — 
Total, before unamortized debt issuance costs
$ 508,466  $ 398,513  $ 431,243 
Unamortized debt issuance costs
$ (2,114) $ (2,052)
F-77

TABLE OF CONTENTS
Social Finance, Inc.
Notes to Unaudited Condensed Consolidated Financial Statements 
(In Thousands, Unless Otherwise Stated and Except for Share and Per Share Data)
Outstanding as of
Borrowing Description
Collateral Balances(1)
Interest Rate(7)
Termination/
Maturity(2)
Total Capacity
March 31, 2021(3)
December 31, 2020
Revolving Credit Facility(5)
SoFi Corporate Revolver n/a
1 ML + 100 bps(15)
September 2023 $ 560,000  $ 486,000  $ 486,000 
Total, before unamortized debt issuance costs
$ 560,000  $ 486,000  $ 486,000 
Unamortized debt issuance costs
$ (896) $ (987)
Seller note(6)
n/a
1000 bps
February 2021 $ —  $ 250,000 
Total
$ —  $ 250,000 
Other financing – various notes(6)
n/a
331 – 557 bps
April 2021 –  January 2023 $ 3,765  $ 4,375 
Total
$ 3,765  $ 4,375 
Student Loan Securitizations
SoFi PLP 2016-B LLC
$ 66,970 
1 ML + (120-380 bps)
April 2037 $ 60,670  $ 69,448 
SoFi PLP 2016-C LLC
78,820 
1 ML + (110-335 bps)
May 2037 71,382  81,115 
SoFi PLP 2016-D LLC
94,883 
1 ML + (95-323 bps)
January 2039 86,060  93,942 
SoFi PLP 2016-E LLC
113,104 
1 ML + (85-443 bps)
October 2041 104,315  117,800 
SoFi PLP 2017-A LLC
140,444 
1 ML + (70-443 bps)
March 2040 129,483  146,064 
SoFi PLP 2017-B LLC
122,595 
183 – 444 bps
May 2040 114,124  129,873 
SoFi PLP 2017-C LLC
155,865 
1 ML + (60-421 bps)
July 2040 144,038  161,897 
Total, before unamortized debt issuance costs and discount
$ 772,681  $ 710,072  $ 800,139 
Unamortized debt issuance costs
$ (5,376) $ (5,958)
Unamortized discount
(1,499) (1,654)
Personal Loan Securitizations
SoFi CLP 2016-1 LLC
$ 38,807 
326 bps
August 2025 $ 25,273  $ 36,546 
SoFi CLP 2016-2 LLC
38,052 
309 – 477 bps
October 2025 26,060  37,973 
SoFi CLP 2016-3 LLC
55,606 
305 – 449 bps
December 2025 15,839  30,780 
SoFi CLP 2018-3 LLC
156,036 
320 – 467 bps
August 2027 136,484  163,784 
SoFi CLP 2018-4 LLC
177,428 
354 – 476 bps
November 2027 154,623  184,831 
SoFi CLP 2018-3 Repack LLC
— 
200 bps
March 2021 —  2,457 
SoFi CLP 2018-4 Repack LLC
8,812 
200 bps
December 2027 2,082  5,853 
Total, before unamortized debt issuance costs and discount
$ 474,741  $ 360,361  $ 462,224 
Unamortized debt issuance costs
$ (2,565) $ (3,057)
Unamortized discount
(1,550) (2,872)
Total, before unamortized debt issuance costs and discounts
$ 3,854,283  $ 4,830,137 
Less: unamortized debt issuance costs and discounts
(26,859) (31,212)
Total reported debt
$ 3,827,424  $ 4,798,925 
_________________
(1)As of March 31, 2021, and represents unpaid principal balances, with the exception of the risk retention warehouse facilities, which include securitization-related investments carried at fair value. In addition, certain securitization interests that eliminate in consolidation are pledged to risk retention warehouse facilities.
(2)For securitization debt, the maturity of the notes issued by the various trusts occurs upon either the maturity of the loan collateral or full payment of the loan collateral held in the trusts. Our maturity date represents the legal maturity of the last class of maturing notes. Securitization debt matures as loan collateral payments are made. In instances where the related securitization was deconsolidated during the current period, the termination date is equivalent to our deconsolidation date.
(3)There were no debt discounts issued during the three months ended March 31, 2021.
(4)Financing was obtained for both asset-backed bonds and residual investments in various personal loan and student loan securitizations, and the underlying collateral are the underlying asset-backed bonds and residual investments. We only state capacity amounts in this table for risk retention facilities wherein we can pledge additional asset-backed bonds and residual investments as of March 31, 2021.
(5)As of March 31, 2021, $6.0 million of the revolving credit facility total capacity was not available for general borrowing purposes because it was utilized to secure a letter of credit. Refer to our letter of credit disclosures in Note 14 for more details.
F-78

TABLE OF CONTENTS
Social Finance, Inc.
Notes to Unaudited Condensed Consolidated Financial Statements 
(In Thousands, Unless Otherwise Stated and Except for Share and Per Share Data)
(6)Part of our consideration to acquire Galileo was in the form of a seller note financing arrangement, which we paid off in February 2021. See Note 2 for additional information. We also assumed certain other financing arrangements resulting from our acquisition of Galileo.
(7)Unused commitment fees ranging from 0 to 200 basis points (“bps”) on our various warehouse facilities are recognized as noninterest expense — general and administrative in our Unaudited Condensed Consolidated Statements of Operations and Comprehensive Loss. “ML” stands for “Month LIBOR”. As of March 31, 2021, 1 ML and 3 ML was 0.11% and 0.19%, respectively. As of December 31, 2020, 1 ML and 3 ML was 0.14% and 0.24%, respectively. “PR” stands for “Prime Rate”. As of March 31, 2021 and December 31, 2020, PR was 3.25% and 3.25%, respectively.
(8)This facility has a prime rate floor of 309 bps.
(9)Warehouse facility incurs different interest rates on its two types of asset classes. One such class incurs interest based on a commercial paper rate (“CP”) rate, which is determined by the facility lender. As of March 31, 2021 and December 31, 2020, the CP rate for this facility was 0.22% and 0.25%, respectively.
(10)Warehouse facility incurs interest based on a CP rate, which is determined by the facility lender. As of March 31, 2021 and December 31, 2020, the CP rate for this facility was 0.26% and 0.28%, respectively.
(11)Warehouse facility incurs interest based on a CP rate, which is determined by the facility lender. As of March 31, 2021 and December 31, 2020, the CP rate for this facility was 0.22% and 0.25%, respectively.
(12)Warehouse facility incurs interest based on a CP rate, which is determined by the facility lender. As of March 31, 2021, the CP rate for this facility was 0.12%. As of December 31, 2020, this facility incurred interest based on 1ML.
(13)Warehouse facility incurs interest based on a CP rate, which is determined by the facility lender. As of March 31, 2021 and December 31, 2020, the CP rate for this facility was 0.22% and 0.25%, respectively.
(14)Warehouse facility incurs interest based on a CP rate, which is determined by the facility lender. As of March 31, 2021, the CP rate for this facility was 0.22%. As of December 31, 2020, this facility incurred interest based on 3ML.
(15)Interest rate presented represents the interest rate on standard withdrawals on our revolving credit facility, while same-day withdrawals incur interest based on PR.
Material Changes to Debt Arrangements
During the three months ended March 31, 2021, we paid off the seller note issued in 2020 for a total payment of $269.9 million, consisting of outstanding principal of $250,000 and accrued interest of $19,864, as well as opened one risk retention warehouse facility.
The total accrued interest payable on our debt as of March 31, 2021 and December 31, 2020 was $2,856 and $19,817, respectively, and was included as a component of accounts payable, accruals and other liabilities in the Unaudited Condensed Consolidated Balance Sheets.
Our warehouse and securitization debt is secured by a continuing lien and security interest in the loans financed by the proceeds. Within each of our debt facilities, we must comply with certain operating and financial covenants. These financial covenants include, but are not limited to, maintaining: (i) a certain minimum tangible net worth, (ii) minimum cash and cash equivalents, and (iii) a maximum leverage ratio of total debt to tangible net worth. Our debt covenants can lead to restricted cash classifications in our Unaudited Condensed Consolidated Balance Sheets. Our subsidiaries are restricted in the amount that can be distributed to the parent company only to the extent that such distributions would cause the financial covenants to not be met. We were in compliance with all financial covenants required per each agreement as of each balance sheet date presented.
We act as a guarantor for our wholly-owned subsidiaries in several arrangements in the case of default. As of March 31, 2021, we have not identified any risks of nonpayment by our wholly-owned subsidiaries.
F-79

TABLE OF CONTENTS
Social Finance, Inc.
Notes to Unaudited Condensed Consolidated Financial Statements 
(In Thousands, Unless Otherwise Stated and Except for Share and Per Share Data)
Note 9. Temporary Equity
The following table summarizes the original issuance price per share and authorized and outstanding number of shares of redeemable preferred stock as of the dates indicated:
March 31, 2021 December 31, 2020
Series Name
Original Issuance Price
Number of Shares Authorized Number of Shares Outstanding
Number of Shares Authorized
Number of Shares Outstanding
Series 1
$ 100.00  4,500,000  3,234,000  4,500,000  3,234,000 
Series A
0.20  19,687,500  19,687,500  19,687,500  19,687,500 
Series B
2.20  37,252,051  26,693,795  37,252,051  26,693,795 
Series C
2.20 – 3.05
2,209,991  2,038,643  2,209,991  2,038,643 
Series D
3.45  23,411,503  22,369,041  23,411,503  22,369,041 
Series E
9.46  24,483,290  24,262,476  24,483,290  24,262,476 
Series F
15.78  63,386,220  60,110,165  63,386,220  60,110,165 
Series G
17.18  29,096,495  29,096,489  29,096,495  29,096,489 
Series H
15.44  50,815,616  16,224,534  50,815,616  16,224,534 
Series H-1
15.44  57,000,000  52,743,298  57,000,000  52,743,298 
Total
311,842,666  256,459,941  311,842,666  256,459,941 
The original issuance price excludes any applicable discounts and the cost of issuance. Any shares of redeemable preferred stock that are redeemed, converted, purchased or acquired by the Company may be reissued, except as restricted by law or contract.
Recent Issuances and Redemptions
During December 2020, we exercised a call and redeemed 15,097,587 shares of redeemable preferred stock consisting of: 10,558,256 shares of Series B; 1,042,462 shares of Series D; 220,814 shares of Series E and 3,276,055 shares of Series F. The amount payable resulted in a reduction to redeemable preferred stock of $80,201 for the redeemable preferred stock balance at the time of the exercise. The shares were retired upon receipt. The cash payment for the redeemed preferred shares was made in January 2021. See Note 13 for additional information.
In May 2020, the Company issued 52,743,298 shares of Series H-1 redeemable preferred stock as a component of the purchase consideration for the acquisition of Galileo at a fair value of $814,156. See Note 2 for additional information on the acquisition.
Series 1 Preference and Rights
SoFi is party to the Series 1 Preferred Stock Investors’ Agreement (the “Series 1 Agreement”), dated as of May 29, 2019, with certain holders of its capital stock, including (i) entities affiliated with Silver Lake, which is affiliated with Michael Bingle, one of the directors of SoFi, (ii) entities affiliated with QIA, which is affiliated with Ahmed Al-Hammadi, one of the directors of SoFi, and (iii) Mr. Noto, the Chief Executive Officer and one of the directors of SoFi. The agreement provides holders of the Series 1 preferred stock, who also hold Series H Preferred Stock (the “Series 1 Holders”), upon request by QIA, with certain registration rights, provides for certain shelf registration filing obligations by SoFi and limits the future registration rights that SoFi may grant other parties, contains financial and other covenants, and provides for information rights and special payment rights, among other rights, as discussed further below.
The Series 1 redeemable preferred stock has no stated maturity. However, the Series 1 redeemable preferred shares have limited price protection in the instance that the Company liquidates, finalizes an initial public offering (“IPO”), or sells control of the Company to a third party. In the instance where the Company enters one of the foregoing transaction types during a period commencing on May 29, 2020 and ending one year later, if the Company
F-80

TABLE OF CONTENTS
Social Finance, Inc.
Notes to Unaudited Condensed Consolidated Financial Statements 
(In Thousands, Unless Otherwise Stated and Except for Share and Per Share Data)
does not achieve an IPO or sales price of $19.30 per share, then the Series 1 Holders have a right to a special payment for the difference between $19.30 and $15.44 per share (the “Special Payment”).
We evaluated the Special Payment provision and determined that the special payment feature was an embedded derivative that was not clearly and closely related to the host contract, and therefore should be accounted for as a derivative liability when the special payment becomes payable. In the event that a Special Payment event were to trigger a Special Payment becoming payable, it would be recognized within noninterest expense — general and administrative in the Unaudited Condensed Consolidated Statements of Operations and Comprehensive Loss.
Additionally, subsequent to an IPO or change of control event (collectively, a “Change of Control”), within 120 days after the first date on which such Change of Control has occurred, each Series 1 Holder will have the right to require the Company, at the Series 1 Holder’s election, to purchase for cash some or all of the shares of Series 1 redeemable preferred stock held by such Series 1 Holder on the Change of Control put date at a redemption price in the amount of the initial Series 1 investment of $323.4 million. In conjunction with the Business Combination agreement in January 2021, the redeemable preferred stockholders waived their rights in the event of a liquidation, inclusive of the Series 1 Holders’ right to immediately receive the Series 1 proceeds of $323.4 million. The redeemable preferred stock redemption value will remain at $323.4 million, and all other material rights will remain the same, with the exception of added voting rights and the former liquidation provision triggered by an IPO is no longer of any effect. As such, the Series 1 redeemable preferred stock will remain in temporary equity following the Business Combination because the Series 1 redeemable preferred stock is not fully controlled by SoFi.
Additionally, in conjunction with the Business Combination, the Special Payment provision from our 2019 Series 1 Investor Agreement was amended. In accordance with the Merger Agreement, the amended Series 1 Investor Agreement provided for a special distribution of $21.2 million to Series 1 investors, which was paid from the proceeds of the Business Combination and settled contemporaneously with the Business Combination. The Special Payment will be recognized within noninterest expense — general and administrative in the Unaudited Condensed Consolidated Statements of Operations and Comprehensive Loss, because this feature will be accounted for as an embedded derivative, which is not clearly and closely related to the host contract, and have no subsequent impact on our consolidated financial results.
Dividends
The following summarizes the dividend provisions of each series of redeemable preferred stock (excluding Series 1, which is discussed separately below). The per-share amounts below are applied to the outstanding redeemable preferred shares then held by each Series at the time of the dividend declaration (if any). In the event dividends are declared, the below stated dividends are received in parity with each other, and prior and in preference to any dividends paid to Series C redeemable preferred shares or any class of common shares.
March 31, December 31,
Series Name(1)
2021 2020
Series A $ 0.02  $ 0.02 
Series B 0.18  0.18 
Series D 0.28  0.28 
Series E 0.76  0.76 
Series F 1.26  1.26 
Series G 1.37  1.37 
Series H 1.23  1.23 
Series H-1 1.23  1.23 
____________________
(1)Series C redeemable preferred shares do not have a stated dividend.
With respect to the series of redeemable preferred stock presented in the table above, no dividends were declared or paid during the three months ended March 31, 2021 and 2020. All such dividends per share are non-cumulative and non-mandatory.
F-81

TABLE OF CONTENTS
Social Finance, Inc.
Notes to Unaudited Condensed Consolidated Financial Statements 
(In Thousands, Unless Otherwise Stated and Except for Share and Per Share Data)
Series 1 redeemable preferred stock are entitled to receive cumulative cash dividends from and including the closing date of May 29, 2019 (“Closing Date”) at a fixed rate equal to $12.50 per annum per share, or 12.5% of the Series 1 redeemable preferred share price of $100.00 (“Series 1 Dividend Rate”). The Series 1 Dividend Rate resets to a new fixed rate on the fifth anniversary of the Closing Date and on every one-year anniversary of the Closing Date subsequent to the fifth anniversary of the Closing Date (“dividend reset date”), equal to six-month LIBOR as in effect on the second London banking day prior to such dividend reset date plus a spread of 9.94% per annum. During the three months ended March 31, 2021 and 2020, the Series 1 preferred stockholders were entitled to dividends of $9,968 and $10,106, respectively, which reflected the Series 1 Dividend Rate of $12.50 per annum per share of Series 1 preferred stock. Dividends payable as of March 31, 2021 were $9,968. There were no dividends payable as of December 31, 2020.
Dividends are payable semiannually in arrears on the 30th day of June and 31st day of December of each year, when and as authorized by the board of directors. The Company may defer any scheduled dividend payment for up to three semiannual dividend periods, subject to such deferred dividend accumulating and compounding at the applicable Series 1 Dividend Rate. If the Company defers any single scheduled dividend payment on the Series 1 redeemable preferred stock for four or more semiannual dividend periods, the Series 1 Dividend Rate applicable to (i) the compounding following the date of such default on all then-deferred dividend payments (whether or not deferred for four or more semiannual dividend periods) is applied on a go-forward basis and not retroactively, and (ii) new dividends declared following the date of such default and the compounding on such dividends if such new dividends are deferred shall be equal to the otherwise applicable Series 1 Dividend Rate plus 400 basis points. This default-related increase shall continue to apply until the Company pays all deferred dividends and related compounding. Once the Company is current on all such dividends, it may again commence deferral of any pre-scheduled dividend payment for up to three semiannual dividend periods, following the same procedure as outlined in the foregoing. There were no dividend deferrals during the three months ended March 31, 2021 and year ended December 31, 2020.
Conversion
In respect of every Series, other than Series 1, each redeemable preferred share automatically converts at the conversion rate then in effect into common stock upon a firm-commitment underwritten IPO of the Company’s common stock with an IPO not less than $17.06 per share (as adjusted for stock splits and the like) and aggregate cash proceeds of not less than $100.0 million.
The common stock conversion prices for each series were as follows:
March 31, December 31,
Series Name
2021 2020
Series A
$ 0.20  $ 0.20 
Series B
2.20  2.20 
Series C
1.00  1.00 
Series D
3.45  3.45 
Series E
9.46  9.46 
Series F
15.75  15.75 
Series G
17.06  17.06 
Series H
15.44  15.44 
Series H-1
15.44  15.44 
In respect of Series A, Series B, Series D, Series E, Series H and Series H-1 shares, each share is convertible at the option of the holder into common stock at a one-to-one conversion rate of the price per preferred share to its conversion price but is subject to adjustments for events of dilution. Series F and G conversion rates were lowered in 2019 in conjunction with the Series H preferred stock offering and, therefore, the conversion prices no longer equal their respective prices per preferred share. Automatic conversion into common stock will occur upon written consent of a majority of Series A and Series B holders (voting as a single class), Series D holders (voting as a single class),
F-82

TABLE OF CONTENTS
Social Finance, Inc.
Notes to Unaudited Condensed Consolidated Financial Statements 
(In Thousands, Unless Otherwise Stated and Except for Share and Per Share Data)
Series E holders (voting as a single class), Series F holders (voting as a single class), Series G holders (voting as a single class), Series H (voting as a single class) and Series H-1 (voting as a single class).
In respect of Series C shares, each share is convertible at the option of the holder into non-voting common stock at a one-to-one conversion rate of $1.00 per redeemable preferred share to its conversion price. Automatic conversion into non-voting common stock will occur upon the conversion of all Series A and Series B shares into common stock.
Liquidation
In the event of any liquidation, dissolution, merger or consolidation (resulting in the common and preferred stockholders’ loss of a collective 50% or more ownership in the Company), disposition or transfer of assets, or winding up of the Company, whether voluntary or involuntary (a “Liquidation Event”), the following summarizes the preference of each series of redeemable preferred stock:
In respect to all redeemable preferred stock, the preference is equal to an amount per share equal to the original issue price per share, and Series 1 has priority over all other redeemable preferred stock classes.
If, upon the Liquidation Event, the assets and funds are insufficient to permit payment of all outstanding preferences, the Company’s entire assets and funds will be distributed ratably among the redeemable preferred stockholders following the holders’ liquidation preferences (after the Series 1 liquidation preference is fully satisfied).
The various liquidation preferences (redemption amounts) are itemized below:
March 31, December 31,
Series Name
2021 2020
Series 1
$ 323,400  $ 323,400 
Series A
3,938  3,938 
Series B
58,668  58,668 
Series C
4,837  4,837 
Series D
77,240  77,240 
Series E
229,470  229,470 
Series F
948,316  948,316 
Series G
500,000  500,000 
Series H
250,445  250,445 
Series H-1
814,156  814,156 
Total
$ 3,210,470  $ 3,210,470 
Settlement Rights
The Series 1 redeemable preferred stock is redeemable at SoFi’s option in certain circumstances. SoFi may, at any time but no more than three times, at its option, settle the Series 1 redeemable preferred stock, in whole or in part, but if in part, in an amount no less than one-third of the total amount of Series 1 redeemable preferred stock originally issued or the remainder of Series 1 redeemable preferred stock outstanding (the “Minimum Redemption Amount”). In addition, SoFi may settle the Series 1 redeemable preferred stock in whole or in part (subject to the Minimum Redemption Amount) in the event of a liquidation transaction or a direct sale of control transaction by a majority of SoFi’s stockholders, or within 120 days of (i) an IPO, or (ii) following an IPO, a change of control of SoFi, each of which would result in a payment of the initial purchase price of the Series 1 shares of $323.4 million plus any unpaid dividends on the Series 1 redeemable preferred stock and any special payment due under the Series 1 investor agreement (whether deferred or otherwise) (the “Series 1 Redemption Price”). Such settlement is determined at the discretion of the board of directors.
F-83

TABLE OF CONTENTS
Social Finance, Inc.
Notes to Unaudited Condensed Consolidated Financial Statements 
(In Thousands, Unless Otherwise Stated and Except for Share and Per Share Data)
If the Series 1 redeemable preferred stock is not earlier redeemed by SoFi as described in the preceding paragraph, the holders of Series 1 redeemable preferred stock have the right to force SoFi to settle their Series 1 redeemable preferred stock in the following circumstances: (i) upon a change of control of SoFi following an IPO, or (ii) during the six-month period following (a) a default in payment of any dividend on the Series 1 redeemable preferred stock, or (b) the cure period for any covenant default under the Series 1 investor agreement, in each case at the Series 1 Redemption Price.
All other preferred stock is convertible in the case of an IPO into common stock at defined conversion prices as disclosed above, but there is no stated term for settling the liquidation preference for all other Series of preferred stock.
Voting Rights
Series A and Series B together have the right to elect one member of the board of directors provided the number of shares outstanding is at least 14,000,000. Series D and Series E together have the right to elect one member of the board of directors provided the number of shares outstanding is at least 14,000,000. Series F holders have the right to elect one member of the board of directors provided the number of shares outstanding is at least 7,000,000. Series G holders have the right to elect one member of the board of directors provided the number of shares outstanding is at least 3,000,000. Series H holders have the right to elect one member of the board of directors provided the number of shares outstanding is at least 1,396,717. The Series C, Series 1 and Series H-1 holders do not have explicit Board rights per our current Articles of Incorporation.
Warrants
In connection with the Series 1 and Series H redeemable preferred stock issuances during the year ended December 31, 2019, we also issued 6,983,585 Series H warrants, which were accounted for as liabilities in accordance with ASC 480, Distinguishing Liabilities from Equity, and were included within accounts payable, accruals and other liabilities in the Unaudited Condensed Consolidated Balance Sheets. At inception, we allocated $22.3 million of the $539.0 million of proceeds we received from the Series 1 and Series H preferred stock issuances to the Series H warrants, with such valuation determined using the Black-Scholes Model, in order to establish an initial fair value for the Series H warrants. The remaining proceeds were allocated to the Series 1 and Series H preferred stock balances based on their initial relative fair values.
The Series H warrants are subsequently measured at fair value on a recurring basis and are classified as Level 3 because of our reliance on unobservable assumptions, with fair value changes recognized within noninterest expense — general and administrative in the Unaudited Condensed Consolidated Statements of Operations and Comprehensive Loss. The key inputs into our Black-Scholes Model valuation were as follows at inception and as of the dates indicated:
March 31, December 31, Initial Measurement Assumptions
Input 2021 2020
Risk-free interest rate 0.4  % 0.2  % 2.1  %
Expected term (years) 3.2 3.4 5.0
Expected volatility 36.6  % 32.6  % 25.0  %
Dividend yield —  % —% —%
Exercise price $ 15.44  $ 15.44  $ 15.44 
Fair value of Series H preferred stock $ 33.03  $ 18.43  $ 14.13 
The Company’s use of the Black-Scholes Model requires the use of subjective assumptions:
The risk-free interest rate assumption was initially based on the five-year U.S. Treasury rate, which was commensurate with the expected term of the warrants. The warrants automatically convert into Series H redeemable shares at the later of an IPO or five years from the issuance date of the warrants (May 29, 2019). At inception, we assumed that the term would be five years, given by design the warrants were only
F-84

TABLE OF CONTENTS
Social Finance, Inc.
Notes to Unaudited Condensed Consolidated Financial Statements 
(In Thousands, Unless Otherwise Stated and Except for Share and Per Share Data)
expected to extend for greater than five years if the Company was still not publicly traded by that point in time. The expected term assumption used reflects the five-year term less time elapsed since initial measurement. An increase in the expected term, in isolation, would typically correlate to a higher risk-free interest rate and result in an increase in the fair value measurement of the warrant liabilities and vice versa. See below for a development in connection with the Business Combination.
The expected volatility assumption for the initial measurement was based on the volatility of our common stock and adjusted for the reduced volatility inherent in redeemable preferred stock, given the Series H liquidity preference. As of each subsequent measurement date presented above, we updated our expected volatility assumptions to reflect the expectation that the Series H warrants will convert into common stock upon consummation of the Business Combination, and the Series H preference would be of no further effect, in which case the Series H preference would not have a material impact on the stock volatility measure. As such, the expected volatility assumptions reflect our common stock volatility as of March 31, 2021 and December 31, 2020. An increase in the expected volatility, in isolation, would result in an increase in the fair value measurement of the warrant liabilities and vice versa.
The initial fair value of the Series H redeemable preferred stock was based on the purchase price of the Series H redeemable preferred stock, which was contemporaneous with the issuance of the warrants. The fair value measurement of the Series H redeemable preferred stock as of December 31, 2020 was informed from a common stock transaction during December 2020 at a price of $18.43 per common share. We determined that this common stock transaction was a reasonable proxy for the valuation of the Series H redeemable preferred stock as of December 31, 2020 due to the proximity to an expected Business Combination; therefore, no further adjustments were made for the Series H concluded price per share. As of March 31, 2021, the fair value measurement of the Series H redeemable preferred stock was determined based on the observable closing price of SCH’s stock (ticker symbol “IPOE”) on the measurement date multiplied by the weighted average exchange ratio of the Series H preferred stock.
We assumed no dividend yield because we have historically not paid out dividends to our existing redeemable preferred stockholders, other than to the Series 1 redeemable preferred stockholders, which is considered a special circumstance.
At inception of the warrants, we allocated the remaining net proceeds of $514.3 million from the combined Series H and Series 1 redeemable preferred stock offering to the Series H and Series 1 redeemable preferred stock balances in proportion to their relative fair values. This resulted in an initial allocation of $193.9 million and $320.4 million to the Series H and Series 1 redeemable preferred stock, respectively.
The following table presents the changes in the fair value of warrant liabilities:
Warrant Liabilities
Fair value as of January 1, 2021 $ 39,959 
Change in valuation inputs or other assumptions(1)
89,920 
Fair value as of March 31, 2021 $ 129,879 
Fair value as of January 1, 2020 $ 19,434 
Change in valuation inputs or other assumptions(1)
2,879 
Fair value as of March 31, 2020 $ 22,313 
___________________
(1)Changes in valuation inputs or other assumptions are recognized in noninterest expense — general and administrative in the Unaudited Condensed Consolidated Statements of Operations and Comprehensive Loss.
F-85

TABLE OF CONTENTS
Social Finance, Inc.
Notes to Unaudited Condensed Consolidated Financial Statements 
(In Thousands, Unless Otherwise Stated and Except for Share and Per Share Data)
Note 10. Permanent Equity
The Company is authorized to issue common stock and non-voting common stock. As of each of March 31, 2021 and December 31, 2020, the Company was authorized to issue 447,815,616 shares of common stock and 5,000,000 shares of non-voting common stock.
During December 2020, we issued 20,067,302 shares of common stock for gross proceeds received of $369.8 million, which was offset by direct legal costs of $56 (the “Common Stock Issuance”). The number of shares issued in the Common Stock Issuance was subject to upward adjustment if we consummated the Business Combination described in Note 2, with the amount of the adjustment based on the implied per-share consideration in the Business Combination and the number of shares of our capital stock issued in certain dilutive issuances prior to the closing of the Business Combination. The adjustment resulted in the issuance of an additional 735,100 shares at the time of closing of the Business Combination.
The Company reserved the following common stock for future issuance as of the dates indicated:
March 31, December 31,
2021 2020
Conversion of outstanding redeemable preferred stock
253,525,467  253,525,467 
Unissued redeemable preferred stock reserved for issued warrants
6,983,585  6,983,585 
Unissued redeemable preferred stock
47,133,140  47,133,140 
Outstanding stock options and RSUs
43,006,252  42,775,741 
Possible future issuance under stock plans
16,689,226  19,177,343 
Contingent common stock(1)
919,085  183,985 
Total common stock reserved for future issuance
368,256,755  369,779,261 
___________________
(1)As of each balance sheet date presented, includes 183,985 contingently issuable common stock in connection with our acquisition of 8 Limited, as discussed in Note 2. As of March 31, 2021, also includes 735,100 contingently issuable common stock related to an adjustment to a common stock issuance in December 2020, as discussed in this Note 10.
Dividends
Common stockholders and non-voting common stockholders are entitled to dividends when and if declared by the board of directors, but as stated in Note 9, only after dividends are paid to redeemable preferred stockholders, with the exception of Series C preferred stockholders. All redeemable preferred shares, except for Series 1 preferred stock, participate in dividends with common stock. There were no dividends declared or paid to common stockholders during the three months ended March 31, 2021 and 2020.
Conversion and Redemption
Upon the Company’s sale of its common stock in a firm commitment underwritten IPO, each share of non-voting common stock would automatically be converted into such number of common stock as is determined by dividing $1.00 by the conversion price applicable to such shares. The initial conversion price per share shall be $1.00. Both prices are subject to adjustment for any stock splits and stock dividends. The common stock and non-voting common stock are otherwise non-redeemable.
Liquidation
Upon completion of the distribution to preferred stockholders, as discussed within Note 9, if assets remain in the Company, the holders of common stock and non-voting common stock would receive all of the remaining assets pro rata based on the number of shares of common stock then held by each holder (assuming conversion of all such non-voting common stock into common stock).
F-86

TABLE OF CONTENTS
Social Finance, Inc.
Notes to Unaudited Condensed Consolidated Financial Statements 
(In Thousands, Unless Otherwise Stated and Except for Share and Per Share Data)
Voting Rights
Each holder of common stock has the right to one vote per share of common stock and is entitled to notice of any stockholder meeting. Non-voting common stock does not have any voting rights or other powers. The common stockholders, voting together as a single class, can elect one member to the board of directors.
Note 11. Stock-Based Compensation
The Company maintains the Amended and Restated 2011 Stock Option Plan, which provides for granting stock options and RSUs, pursuant to which the Company has authorized 88,426,267 shares of its common stock for issuance to its employees, non-employee directors and non-employee third parties and also has 35,000 shares authorized under a stock plan assumed in a business combination as of March 31, 2021. Further, during the three months ended March 31, 2021 and 2020, we incurred cash outflows of $25,989 and $4,640, respectively, related to the payment of withholding taxes for vested RSUs. These cash outflows are presented within financing activities in the Unaudited Condensed Consolidated Statements of Cash Flows.
Stock-based compensation expense related to stock options and RSUs is presented within the following line items in the Unaudited Condensed Consolidated Statements of Operations and Comprehensive Loss for the periods indicated:
Three Months Ended March 31,
2021 2020
Technology and product development
$ 11,616  $ 6,061 
Sales and marketing
2,445  1,121 
Cost of operations
1,481  1,671 
General and administrative
21,912  10,832 
Total
$ 37,454  $ 19,685 
Common Stock Valuations
Prior to us contemplating a public market transaction, we established the fair value of our common stock by using the option pricing model (Black-Scholes Model based) via the backsolve method and through placing weight on previously redeemable preferred stock transactions. The valuations also applied discounts for lack of marketability to reflect the fact that there was no market mechanism to sell our common stock and, as such, the common stock option and RSU holders would need to wait for a liquidity event to facilitate the sale of their equity awards. In addition, there were contractual transfer restrictions placed on common stock in the event that we remained a private company.
During the third quarter of 2020, once we made intentional progress toward pursuing a public market transaction, we began applying the probability-weighted expected return method to determine the fair value of our common stock. The probability weightings assigned to certain potential exit scenarios were based on management’s expected near-term and long-term funding requirements and assessment of the most attractive liquidation possibilities at the time of the valuation.
During the fourth quarter of 2020, we valued our common stock on a monthly basis. A common stock transaction that closed in December 2020 at a price of $18.43 per common share, which was of substantial size and in close proximity to the Business Combination, served as the key input for the fair value of our common stock for grants made during the fourth quarter of 2020. We decreased the assumed discount for lack of marketability throughout the fourth quarter of 2020, corresponding with our decreased time to liquidity assumption throughout the quarter, as we became more certain about the possibility of entering into the Business Combination over time. We continued to use a share price of $18.43 to value our common stock for transactions in January until the date on which we executed the Merger Agreement.
F-87

TABLE OF CONTENTS
Social Finance, Inc.
Notes to Unaudited Condensed Consolidated Financial Statements 
(In Thousands, Unless Otherwise Stated and Except for Share and Per Share Data)
Subsequent to executing the Merger Agreement on January 7, 2021, we determined the value of our common stock based on the observable daily closing price of SCH’s stock (ticker symbol “IPOE”) multiplied by the exchange ratio in effect for such transaction date.
Stock Options
The terms of the stock option grants, including the exercise price per share and vesting periods, are determined by our board of directors. At the discretion and determination of our board of directors, the Plan allows for the granting of stock options that may be exercised before the stock options have vested.
The following is a summary of stock option activity for the period indicated:
Number of
Stock Options
Weighted Average
Exercise Price
Weighted Average
Remaining
Contractual Term
(in years)
Outstanding as of December 31, 2020 17,183,828  $ 9.92  6.6
Granted(1)
—  n/a
Exercised(2)
(963,873) 2.75 
Forfeited
(2,523) 10.79 
Expired
(42,912) 10.37 
Outstanding as of March 31, 2021 16,174,520  $ 10.35  6.4
Exercisable as of March 31, 2021 14,113,930  $ 11.53  6.4
____________________
(1)There were no stock options granted during the three months ended March 31, 2021.
(2)The tax benefit from stock options exercised was not material for the period presented.
Total compensation cost related to unvested stock options not yet recognized as of March 31, 2021 was $12.9 million and will be recognized over a weighted average period of approximately 1.7 years.
Restricted Stock Units
RSUs are equity awards granted to employees that entitle the holder to shares of our common stock when the awards vest. RSUs are measured based on the fair value of our common stock on the date of grant. The weighted average fair value of our common stock was $34.86 during the three months ended March 31, 2021.
The following table summarizes RSU activity for the period indicated:
Number of
RSUs
Weighted Average Grant Date Fair Value
Outstanding as of December 31, 2020 25,591,913 $ 13.06 
Granted
3,887,639 35.81 
Vested(1)
(2,096,875) 12.12 
Forfeited
(550,945) 12.61 
Outstanding as of March 31, 2021
26,831,732 $ 16.44 
________________________
(1)The total fair value, based on grant date fair value, of RSUs that vested during the three months ended March 31, 2021 was $25.4 million.
As of March 31, 2021, there was $407.7 million of unrecognized compensation cost related to unvested RSUs, which will be recognized over a weighted average period of approximately 3.4 years.
Note 12. Income Taxes
For interim periods, we follow the general recognition approach whereby tax expense is recognized through the use of an estimated annual effective tax rate, which is applied to the year-to-date operating results. Additionally, we
F-88

TABLE OF CONTENTS
Social Finance, Inc.
Notes to Unaudited Condensed Consolidated Financial Statements 
(In Thousands, Unless Otherwise Stated and Except for Share and Per Share Data)
recognize tax expense or benefit for any discrete items occurring within the interim period that were excluded from the estimated annual effective tax rate. Our effective tax rate may be subject to fluctuations during the year due to impacts from the following items: (i) changes in forecasted pre-tax and taxable income or loss, (ii) changes in statutory law or regulations in jurisdictions where we operate, (iii) audits or settlements with taxing authorities, (iv) the tax impact of expanded product offerings or business acquisitions, and (v) changes in valuation allowance assumptions.
For the three months ended March 31, 2021 and 2020, we recorded income tax expense of $1,099 and $57, respectively. The significant change in the interim 2021 period relative to the interim 2020 period was primarily due to the profitability of SoFi Lending Corp, which incurs income tax expense in some state jurisdictions where separate company filing is required. There were no material changes to our unrecognized tax benefits during the three months ended March 31, 2021 and we do not expect to have any significant changes to unrecognized tax benefits over the next 12 months.
During the three months ended March 31, 2021, we continued to maintain a full valuation allowance against our net deferred tax assets in applicable jurisdictions. In certain state jurisdictions where sufficient deferred tax liabilities exist, no valuation allowance is recognized. Management reviews all available positive and negative evidence in assessing the realizability of deferred tax assets. We will continue to recognize a full valuation allowance until there is sufficient positive evidence to support its release.
Note 13. Related Parties
The Company defines related parties as members of our board of directors, entity affiliates, executive officers and principal owners of the Company’s outstanding stock and members of their immediate families. Related parties also include any other person or entity with significant influence over the Company’s management or operations.
Stockholder Note
In 2019, the Company entered into a $58,000 note receivable agreement with a stockholder (“Note Receivable Stockholder”), which was collateralized by the Note Receivable Stockholder’s common stock and redeemable preferred stock. Related to this collateralization, the Company obtained call rights to purchase the collateral at $8.80 per share (“Call Option Rights”). As of December 31, 2020, there was no remaining receivable associated with this related party note; however, our Call Option Rights remained outstanding post settlement, per the terms of our Note Receivable Stockholder agreement.
During the three months ended March 31, 2020, we recognized related party interest income of $770. In December 2020, we exercised our Call Option Rights to acquire the Note Receivable Stockholder collateral, which included 59,750 shares of common stock and 15,097,587 shares of redeemable preferred stock. The Call Option Rights shares were retired upon receipt. The option exercise payable of $133,385 remained outstanding as of December 31, 2020 and the reserved funds were presented within restricted cash and restricted cash equivalents on the Unaudited Condensed Consolidated Balance Sheets. The full payment was subsequently made in January 2021.
Apex Loan
In November 2019, we lent $9,050 to Apex at an interest rate of 12.5% per annum, which had a scheduled maturity date of August 31, 2020. In August 2020, we extended the maturity date to August 31, 2021 and modified the interest rate to 5.0% per annum, which we determined to be below the market rate of interest. In accordance with ASC 835-30, Interest, in 2020, we recognized a loss representing the discounted fair value of the loan receivable relative to its stated value at the market rate of interest, which is accreted into interest income over the remaining term of the loan. During the year ended December 31, 2020, we lent an additional $7,643 to Apex. We had an interest income receivable of $1,443 as of December 31, 2020. During February 2021, Apex paid us $18,304 in settlement of all of their outstanding obligations to us, which consisted of outstanding principal balances of $16,693 and accrued interest of $1,611. During the three months ended March 31, 2021, we recognized interest income of $211 within interest income — related party notes, and we reversed the remainder of the loss for the discount to fair value that had not yet been accreted of $169 within noninterest income — other in the Unaudited Condensed
F-89

TABLE OF CONTENTS
Social Finance, Inc.
Notes to Unaudited Condensed Consolidated Financial Statements 
(In Thousands, Unless Otherwise Stated and Except for Share and Per Share Data)
Consolidated Statements of Operations and Comprehensive Loss. During the three months ended March 31, 2020, we recognized interest income of $282.
Note 14. Commitments, Guarantees, Concentrations and Contingencies
Leases
We primarily lease our office premises under multi-year, non-cancelable operating leases. During the three months ended March 31, 2021, we commenced new operating leases for office premises with terms expiring from 2024 to 2026. Associated with these leases, we obtained non-cash operating lease ROU assets in exchange for new operating lease liabilities of $3,581 during the three months ended March 31, 2021.
During the year ended December 31, 2020, the lessor for one of our operating leases allowed us to defer payments on the lease beginning in April 2020 as a result of our inability to use the leased premises during the COVID-19 pandemic. We elected to not account for this non-substantial concession as a lease modification. In the absence of this concession, we would have recognized $566 in additional operating lease cost during the three months ended March 31, 2021.
Other Commitments
In September 2019, we entered into a 20-year partnership with LA Stadium and Entertainment District at Hollywood Park in Inglewood, California that granted us the exclusive naming rights to SoFi Stadium and official partnerships with the Los Angeles Chargers and Los Angeles Rams, as well as rights with the performance venue and surrounding entertainment district (“Naming and Sponsorship Agreement”). We made payments totaling $3,267 during the three months ended March 31, 2021. See “Contingencies” below for discussion of an associated contingent matter.
Concentrations
Financial instruments that potentially subject us to significant concentrations of credit risk consist principally of cash and cash equivalents, restricted cash and restricted cash equivalents, residual investments and loans. We hold cash and cash equivalents and restricted cash and restricted cash equivalents in accounts at regulated domestic financial institutions in amounts that may exceed FDIC insured amounts. We believe these institutions are of high credit quality and have not experienced any related losses to date.
We are dependent on third-party funding sources to originate loans. Additionally, we sell loans to various third parties. During the three months ended March 31, 2021, the two largest third-party buyers accounted for a combined 41% of our loan sales volume. No individual third-party buyer accounted for 10% or more of consolidated total net revenues for any of the periods presented.
The Company is exposed to default risk on borrower loans originated and financed by us. There is no single borrower or group of borrowers that comprise a significant concentration of the Company’s loan portfolio. Likewise, the Company is not overly concentrated within a group of channel partners or other customers, with the exception of our distribution of personal loan residual interests in our sponsored personal loan securitizations, which we market to third parties and the aforementioned whole loan buyers. Given we have a limited number of prospective buyers for our personal loan securitization residual interests, this might result in us utilizing a significant amount of our own capital to fund future residual interests in personal loan securitizations, or impact the execution of future securitizations if we are limited in our own ability to invest in the residual interest portion of future securitizations, or find willing buyers for securitization residual interests.
See Note 16 for a discussion of concentrations in revenues from contracts with customers.
F-90

TABLE OF CONTENTS
Social Finance, Inc.
Notes to Unaudited Condensed Consolidated Financial Statements 
(In Thousands, Unless Otherwise Stated and Except for Share and Per Share Data)
Contingencies
Legal Proceedings
In limited instances, the Company may be subject to a variety of claims and lawsuits in the ordinary course of business. Regardless of the final outcome, defending lawsuits, claims, government investigations, and proceedings in which we are involved is costly and can impose a significant burden on management and employees, and there can be no assurances that we will receive favorable final outcomes. As of March 31, 2021, there were no material claims requiring disclosure.
Contingencies
Galileo. Galileo, our wholly owned subsidiary that we acquired in May 2020, was a defendant in a putative class action involving service disruption for customers of Galileo’s largest client stemming from Galileo’s system experiencing technology platform downtime. The parties have entered into a class action settlement agreement to resolve the claims in the action. The window for Plaintiff to submit claims closed in February 2021. As of March 31, 2021, we estimated a contingent liability associated with this litigation of $1,750, which decreased from the amount recorded as of December 31, 2020 due to lower-than-anticipated claims. The contingent liability was presented within accounts payable, accruals and other liabilities in the Unaudited Condensed Consolidated Balance Sheets, and represents Galileo’s maximum exposure to loss on the litigation. Other assets as of March 31, 2021 included $1,750 for the expected insurance recovery on the expected settlement. We expense Galileo legal fees associated with this litigation as they are incurred. Additionally, Galileo’s client sought compensatory payment from Galileo as part of the technology platform outage, which Galileo settled in November 2020 for $3,341.
SoFi Stadium. In September 2020, we discussed certain provisions of the Naming and Sponsorship Agreement for SoFi Stadium entered into by the same parties in September 2019 in light of the COVID-19 pandemic. Based on these discussions, SoFi paid sponsorship fees for the initial contract year (July 1, 2020 to March 31, 2021) of $9.8 million, of which $6.5 million was paid during 2020 and $3.3 million was paid in January 2021.
The parties are revisiting the sponsorship fees to determine the ultimate amount payable for the initial contract year. Therefore, the Company is exposed to additional potential sales and marketing expense of up to $12.7 million, which reflects the difference between the sponsorship payment terms discussed above and the commitment for the initial contract year made under the 2019 agreement. As of March 31, 2021, we are unable to estimate the amount of reasonably possible additional costs we may incur with respect to this contingency. Moreover, we have not determined that the likelihood of additional cost is probable. Therefore, as of March 31, 2021, we have not recorded additional expense related to this contingency.
Guarantees
We have three types of repurchase obligations that we account for as financial guarantees pursuant to ASC 460. First, we issue financial guarantees to FNMA on loans that we sell to FNMA, which manifest as repurchase requirements if it is later discovered that loans sold to FNMA do not meet FNMA guidelines. We have a three-year repurchase obligation from the time of origination to buy back originated loans that do not meet FNMA guidelines, and we are required to pay the full initial purchase price back to FNMA. We recognize a liability for the full amount of expected loan repurchases, which we estimate based on historical experience. The liability we record is equal to what we expect to buy back and, therefore, approximates fair value. Second, we make standard representations and warranties related to other loan transfers, breaches of which would require us to repurchase the transferred loans. Finally, we have limited repurchase obligations for certain loan transfers associated with credit-related events, such as early prepayment or events of default within 90 days after origination. Estimated losses associated with credit-related repurchases are evaluated pursuant to ASC 326. In the event of a repurchase, we are typically required to pay the purchase price of the loans transferred.
As of March 31, 2021 and December 31, 2020, the Company accrued liabilities within accounts payable, accruals and other liabilities in the Unaudited Condensed Consolidated Balance Sheets of $6,376 and $5,196, respectively, related to our estimated repurchase obligation, with the corresponding charges recorded within noninterest income — loan origination and sales in the Unaudited Condensed Consolidated Statements of Operations
F-91

TABLE OF CONTENTS
Social Finance, Inc.
Notes to Unaudited Condensed Consolidated Financial Statements 
(In Thousands, Unless Otherwise Stated and Except for Share and Per Share Data)
and Comprehensive Loss. As of March 31, 2021 and December 31, 2020, the amount associated with loans sold that were subject to the terms and conditions of our repurchase obligations totaled $4.9 billion and $3.9 billion, respectively.
As of March 31, 2021 and December 31, 2020, the Company had a total of $9.3 million and $9.3 million, respectively, in letters of credit outstanding with financial institutions. These outstanding letters of credit were issued for the purpose of securing certain of the Company’s operating lease obligations. A portion of the letters of credit was collateralized by $3.3 million and $3.3 million of the Company’s cash as of March 31, 2021 and December 31, 2020, respectively, which is included within restricted cash and restricted cash equivalents in the Unaudited Condensed Consolidated Balance Sheets.
Mortgage Banking Regulatory Mandates
The Company is subject to certain state-imposed minimum net worth requirements for the states in which the Company is engaged in the business of a residential mortgage lender. Noncompliance with these requirements could result in potential fines or penalties imposed by the applicable state. Future events or changes in mandates may affect the Company’s ability to meet mortgage banking regulatory requirements. As of March 31, 2021 and December 31, 2020, the Company was in compliance with all minimum net worth requirements and, therefore, has not accrued any liabilities related to fines or penalties.
Retirement Plans
The Company has a 401(k) plan that covers all employees meeting certain eligibility requirements. The 401(k) plan is designed to provide tax-deferred retirement benefits in accordance with the provisions of Section 401(k) of the Internal Revenue Code. Eligible employees may defer up to 100% of eligible compensation up to the annual maximum as determined by the Internal Revenue Service. The Company’s contributions to the plan are discretionary. The Company has not made any contributions to the plan to date.
Note 15. Loss Per Share
We compute loss per share attributable to common stock using the two-class method required for participating interests. Our participating interests include all series of our preferred stock. Series 1 preferred stock has preferential cumulative dividend rights. Pursuant to ASC 260, Earnings Per Share, for each period presented, we increased net loss by the contractual amount of dividends payable to Series 1 preferred stock before allocating any remaining undistributed earnings to all participating interests.
All other classes of preferred stock, except for Series C, have stated dividend rights, which have priority over undistributed earnings. The remaining losses are shared pro-rata among the preferred stock (with the exception of Series 1 preferred stock) and common stock outstanding during the measurement period, as if all of the losses for the period had been distributed. While our calculation of loss per share accounted for a loss allocation to all participating shares, we only presented loss per share below for our common stock. Basic loss per share of common stock is computed by dividing net loss, adjusted for the impact of Series 1 preferred stock dividends and loss allocated to other participating interests, by the weighted average number of shares of common stock outstanding during the period. Because of our reported net losses, we did not allocate any loss to participating interests in determining the numerator of the basic and diluted loss per share computation, as the allocation of loss would have been anti-dilutive. Further, we excluded the effect of all potentially dilutive common stock elements from the denominator in the computation of diluted loss per share, as their inclusion would have been anti-dilutive.
F-92

TABLE OF CONTENTS
Social Finance, Inc.
Notes to Unaudited Condensed Consolidated Financial Statements 
(In Thousands, Unless Otherwise Stated and Except for Share and Per Share Data)
Three Months Ended March 31,
2021 2020
Numerator:
Net loss $ (177,564) $ (106,367)
Less: redeemable preferred stock dividends
(9,968) (10,106)
Net loss attributable to common stockholders – basic and diluted $ (187,532) $ (116,473)
Denominator:
Weighted average common stock outstanding – basic 66,647,192  39,815,023 
Weighted average common stock outstanding – diluted 66,647,192  39,815,023 
Loss per share – basic $ (2.81) $ (2.93)
Loss per share – diluted $ (2.81) $ (2.93)

We excluded the effect of the below elements from our calculation of diluted loss per share, as their inclusion would have been anti-dilutive. These amounts represent the number of instruments outstanding at the end of each respective period:
Three Months Ended March 31,
2021 2020
Redeemable preferred stock exchangeable for common stock(1)
253,225,941  215,580,230 
Redeemable preferred stock warrants exchangeable for common stock(1)
6,983,585  6,983,585 
Contingent common stock(1)(2)
919,085  — 
Common stock options(1)
16,174,520  17,400,048 
Unvested RSUs(1)
26,831,732  18,156,174 
____________________
(1)These potential common stock elements were anti-dilutive in the periods to which they applied, as there were no earnings attributable to common stockholders.
(2)For the three months ended March 31, 2021, includes 183,985 contingently issuable common stock in connection with our acquisition of 8 Limited, as further discussed in Note 2, and 735,100 contingently issuable common stock related to an adjustment to a common stock issuance in December 2020, as further discussed in Note 10.
Note 16. Business Segment Information
Each of our reportable segments is a strategic business unit that serves specific needs of our members based on the products and services provided. The segments are based on the manner in which management views the financial performance of the business. Contribution profit is the primary measure of segment profit and loss reviewed by the Chief Operating Decision Maker (“CODM”) and is intended to measure the direct profitability of each segment. Contribution profit is defined as total net revenue for each reportable segment less:
fair value changes in servicing rights and residual interests classified as debt that are attributable to assumption changes, which impact the contribution profit within the Lending segment. These fair value changes are non-cash in nature and are not realized in the period; therefore, they do not impact the amounts available to fund our operations; and
expenses directly attributable to the corresponding reportable segment. Directly attributable expenses primarily include compensation and benefits and sales and marketing, and vary based on the amount of activity within each segment. Directly attributable expenses also include loan origination and servicing expenses, professional services, occupancy related costs, and tools and subscriptions. Expenses are attributed to the reportable segments using either direct costs of the segment or labor costs that can be attributed based upon the allocation of employee time for individual products.
The reportable segments also reflect the Company’s organizational structure. Each segment has a segment manager who reports directly to the CODM. The CODM has ultimate authority and responsibility over resource allocation decisions and performance assessment.
F-93

TABLE OF CONTENTS
Social Finance, Inc.
Notes to Unaudited Condensed Consolidated Financial Statements 
(In Thousands, Unless Otherwise Stated and Except for Share and Per Share Data)
The Company has three reportable segments: Lending, Financial Services and Technology Platform. The Lending segment includes our personal loan, student loan and home loan products and the related servicing activities and, for 2020, a commercial loan. We originate loans in each of the aforementioned channels with the objective of either selling whole loans or securitizing a pool of originated loans for transfer to third-party investors. Revenues in the Lending segment are driven by changes in the fair value of our whole loans and securitization interests, gains or losses recognized on transfers that meet the true sale requirements under ASC 860 and our servicing-related activities, which mainly consist of servicing fees and the changes in our servicing assets over time. We also earn the difference between interest income earned on our loans and interest expense on any loans that are financed. Interest expense primarily impacts our Lending segment, and we present interest income net of interest expense, as our CODM considers net interest income in addition to contribution profit in evaluating the performance of the Lending segment and making resource allocation decisions.
The Financial Services segment includes our SoFi Money product, SoFi Invest product, SoFi Credit Card product (which we launched in the third quarter of 2020), SoFi Relay personal finance management product and other financial services, such as lead generation and content for other financial services institutions and our members. SoFi Money provides members a digital cash management experience, interest income and the ability to separate money balances into various subcategories. SoFi Invest provides investment features and financial planning services that we offer to our members. Revenues in the Financial Services segment include payment network fees on our member transactions and pay for order flow, cryptocurrency transaction fees and share lending arrangements in our SoFi Invest product. Additionally, we earn referral fees in connection with referral activity we facilitate through our platform, which is not directly tied to a particular Financial Services product. The referral fee is paid to us by third-party partners that offer services to end users who do not use one of our product offerings, but who were referred to the partners through our platform.
The Technology Platform segment includes our Technology Platform fees, which commenced with our acquisition of Galileo in May 2020, as well as our equity method investment in Apex, which represents our portion of net earnings on clearing brokerage activity on the Apex platform. The Company purchased an initial interest in Apex in December 2018, and Apex was the Company’s only material equity method investment as of December 31, 2020. During January 2021, the seller of our Apex interest exercised the Seller Call Option, and as such we will no longer recognize Apex equity investment income subsequent to the call date. Due to the additional investment we made during 2020, we will maintain an immaterial investment in Apex, but will no longer qualify for equity method accounting. See Note 2 for additional information on the acquisition of Galileo, and Note 1 for additional information on our Apex equity method investment.
Non-segment operations are classified as Other, which includes net revenues associated with corporate functions that are not directly related to a reportable segment. These non-segment net revenues include interest income earned on corporate cash balances and interest expense on corporate borrowings, such as our revolving credit facility and, for the 2021 period, the seller note issued in connection with our acquisition of Galileo. During the three months ended March 31, 2021, net revenues within Other also included $211 of interest income and $169 of reversal of loss on discount to fair value in connection with related party transactions. During the three months ended March 31, 2020, net revenues within Other included $1,052 of interest income earned in connection with related party transactions. Refer to Note 13 for further discussion of our related party transactions.
The accounting policies of the segments are consistent with those described in Note 1, except for the accounting policies in relation to allocation of consolidated income and allocation of consolidated expenses, as described below.
The following tables present financial information, including the measure of contribution profit (loss), for each reportable segment for the periods indicated. The information is derived from our internal financial reporting used
F-94

TABLE OF CONTENTS
Social Finance, Inc.
Notes to Unaudited Condensed Consolidated Financial Statements 
(In Thousands, Unless Otherwise Stated and Except for Share and Per Share Data)
for corporate management purposes. Assets are not allocated to reportable segments, as the Company’s CODM does not evaluate reportable segments using discrete asset information.
Three Months Ended March 31, 2021
Lending
Financial Services
Technology
Platform(1)
Reportable Segments Total Other Total
Net revenue
Net interest income (loss)
$ 51,777  $ 229  $ (36) $ 51,970  $ (4,690) $ 47,280 
Noninterest income
96,200  6,234  46,101  148,535  169  148,704 
Total net revenue (loss)
$ 147,977  $ 6,463  $ 46,065  $ 200,505  $ (4,521) $ 195,984 
Servicing rights – change in valuation inputs or assumptions(2)
12,109  —  —  12,109 
Residual interests classified as debt – change in valuation inputs or assumptions(3)
7,951  —  —  7,951 
Directly attributable expenses
(80,351) (41,982) (30,380) (152,713)
Contribution profit (loss) $ 87,686  $ (35,519) $ 15,685  $ 67,852 
Three Months Ended March 31, 2020
Lending
Financial Services
Technology
Platform(1)
Reportable Segments Total Other Total
Net revenue
Net interest income
$ 45,661  $ 215  $ —  $ 45,876  $ 1,273  $ 47,149 
Noninterest income
28,217  1,939  997  31,153  —  31,153 
Total net revenue
$ 73,878  $ 2,154  $ 997  $ 77,029  $ 1,273  $ 78,302 
Servicing rights – change in valuation inputs or assumptions(2)
(7,059) —  —  (7,059)
Residual interests classified as debt – change in valuation inputs or assumptions(3)
14,936  —  —  14,936 
Directly attributable expenses
(77,660) (29,137) —  (106,797)
Contribution profit (loss) $ 4,095  $ (26,983) $ 997  $ (21,891)
____________________
(1)Noninterest income within the Technology Platform segment for the three months ended March 31, 2021 and 2020 included $— and $997, respectively, of earnings from our equity method investment in Apex. See Note 1 under “—Equity Method Investments” for additional information. During the three months ended March 31, 2021, the five largest clients in the Technology Platform segment contributed 70% of the total net revenue within the segment, which represented 16% of our consolidated total net revenue.
(2)Reflects changes in fair value inputs and assumptions, including market servicing costs, conditional prepayment and default rates and discount rates. This non-cash change, which is recorded within noninterest income in the Unaudited Condensed Consolidated Statements of Operations and Comprehensive Loss is unrealized during the period and, therefore, has no impact on our cash flows from operations. As such, the changes in fair value attributable to assumption changes are adjusted to provide management and financial users with better visibility into the cash flows available to finance our operations.
(3)Reflects changes in fair value inputs and assumptions, including conditional prepayment and default rates and discount rates. When third parties finance our consolidated VIEs through purchasing residual interests, we receive proceeds at the time of the securitization close and, thereafter, pass along contractual cash flows to the residual interest owner. These obligations are measured at fair value on a recurring basis, with fair value changes recorded within noninterest income in the Unaudited Condensed Consolidated Statements of Operations and Comprehensive Loss. The fair value change attributable to assumption changes has no impact on our initial financing proceeds, our future obligations to the residual interest owner (because future residual interest claims are limited to securitization collateral cash flows), or the general operations of our business. As such, this non-cash change in fair value during the period is adjusted to provide management and financial users with better visibility into the cash flows available to finance our operations.
F-95

TABLE OF CONTENTS
Social Finance, Inc.
Notes to Unaudited Condensed Consolidated Financial Statements 
(In Thousands, Unless Otherwise Stated and Except for Share and Per Share Data)
The following table reconciles contribution profit (loss) to loss before income taxes for the periods presented. Expenses not allocated to reportable segments represent items that are not considered by our CODM in evaluating segment performance or allocating resources.
Three Months Ended March 31,
2021 2020
Reportable segments total contribution profit (loss) $ 67,852  $ (21,891)
Other total net revenue (loss) (4,521) 1,273 
Servicing rights – change in valuation inputs or assumptions (12,109) 7,059 
Residual interests classified as debt – change in valuation inputs or assumptions (7,951) (14,936)
Expenses not allocated to segments:
Share-based compensation expense (37,454) (19,685)
Depreciation and amortization expense (25,977) (4,715)
Fair value change of warrant liability (89,920) (2,879)
Employee-related costs(1)
(32,280) (27,896)
Other corporate and unallocated expenses(2)
(34,105) (22,640)
Loss before income taxes $ (176,465) $ (106,310)
__________________
(1)Includes compensation, benefits, recruiting, certain occupancy-related costs and various travel costs of executive management, certain technology groups and general and administrative functions that are not directly attributable to the reportable segments.
(2)Includes corporate overhead costs that are not allocated to reportable segments, such as tools and subscription costs, corporate marketing costs and professional services costs.
In April 2020, the Company acquired 8 Limited for total consideration of $16,126, which represented the Company’s first international expansion. See Note 2 for additional information on the acquisition. As we do not have material operations outside of the U.S., we did not make the geographic disclosures pursuant to ASC 280, Segment Reporting. No single customer accounted for more than 10% of our consolidated revenues for any of the periods presented.
Note 17. Subsequent Events
Management of the Company performed an evaluation of subsequent events that occurred after the balance sheet date through the date of this filing. In addition to the item noted below, we discuss events that occurred after the balance sheet date throughout these Notes to Unaudited Condensed Consolidated Financial Statements.
During January 2021, Social Finance, Inc. entered into the Agreement by and among SCH and Merger Sub. The transactions contemplated by the terms of the Agreement were completed on May 28, 2021. See Note 2 for additional information on the transaction.
F-96

TABLE OF CONTENTS
REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
To the shareholders and the Board of Directors of Social Finance Inc.
Opinion on the Financial Statements
We have audited the accompanying consolidated balance sheets of Social Finance, Inc. and subsidiaries (the "Company") as of December 31, 2020 and 2019, the related consolidated statements of operations and comprehensive income (loss), changes in temporary equity and permanent equity (deficit), and cash flows, for each of the three years in the period ended December 31, 2020, and the related notes and the schedule listed in the Index at Schedule I (collectively referred to as the "financial statements"). In our opinion, the financial statements present fairly, in all material respects, the financial position of the Company as of December 31, 2020 and 2019, and the results of its operations and its cash flows for each of the three years in the period ended December 31, 2020, in conformity with accounting principles generally accepted in the United States of America.
Basis for Opinion
These financial statements are the responsibility of the Company's management. Our responsibility is to express an opinion on the Company's financial statements based on our audits. We are a public accounting firm registered with the Public Company Accounting Oversight Board (United States) (PCAOB) and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.
We conducted our audits in accordance with the standards of the PCAOB and in accordance with auditing standards generally accepted in the United States of America. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement, whether due to error or fraud. The Company is not required to have, nor were we engaged to perform, an audit of its internal control over financial reporting. As part of our audits, we are required to obtain an understanding of internal control over financial reporting but not for the purpose of expressing an opinion on the effectiveness of the Company’s internal control over financial reporting. Accordingly, we express no such opinion.
Our audits included performing procedures to assess the risks of material misstatement of the financial statements, whether due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the financial statements. Our audits also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the financial statements. We believe that our audits provide a reasonable basis for our opinion.
Critical Audit Matters
The critical audit matters communicated below are matters arising from the current-period audit of the financial statements that were communicated or required to be communicated to the audit committee and that (1) relate to accounts or disclosures that are material to the financial statements and (2) involved our especially challenging, subjective, or complex judgments. The communication of critical audit matters does not alter in any way our opinion on the financial statements, taken as a whole, and we are not, by communicating the critical audit matters below, providing separate opinions on the critical audit matters or on the accounts or disclosures to which they relate.
Fair Value Measurements — Valuation of Loans, Servicing Rights, Residual Investments, and Residual Interest Classified as Debt — Refer to Notes 1, 4, and 8 to the financial statements
Critical Audit Matter Description
The Company has elected the fair value option to measure loans, servicing rights, and residual investments, and measures residual interests classified as debt at fair value. The Company determines the fair value of each of its financial assets using a discounted cash flow methodology, while also considering market data as it becomes available. The Company classifies loans, servicing rights, residual investments, and residual interests classified as debt as Level 3 because the valuations utilize significant unobservable inputs.
F-97

TABLE OF CONTENTS
The fair value measurement of loans, servicing rights, residual investments, and residual interests classified as debt involves judgements made by management, including the use of assumptions and estimates, some of which are unobservable and require significant judgement. This required a high degree of auditor judgment and an increased extent of effort, including the need to involve our fair value specialists.
How the Critical Audit Matter Was Addressed in the Audit
Our audit procedures related to the fair value measurement of loans, servicing rights, residual investments, and residual interests classified as debt included the following, among others:
We performed inquiries with management and the Company’s third-party valuation expert to understand the process for developing, and assumptions used in, the valuation models.
We tested the completeness and accuracy of the source information derived from the Company’s loan data, which is used in the valuation model.
With the assistance of our fair value specialists, we developed independent fair value estimates and compared our estimates to the Company’s estimates.
Acquisition of Galileo Financial Technologies, Inc. — Refer to Notes 1, 2 and 3 to the financial statements
Critical Audit Matter Description
The Company acquired 100% of the outstanding stock of Galileo Financial Technologies, Inc. ("Galileo”) and its subsidiaries on May 14, 2020 for a purchase price of $1.2 billion. The acquisition was accounted for using the acquisition method of accounting. Accordingly, the purchase consideration was allocated to the tangible and intangible assets acquired and liabilities assumed based on the estimated fair values, including developed technology and customer-related intangible assets of $378 million. Management used the income approach to estimate the fair value of the developed technology and customer-related intangible assets, which included using the multi-period excess earnings method and the with and without method, respectively. The fair value determination of developed technology and customer-related intangible assets required management to make significant estimates and assumptions related to estimated annual revenues and net cash flows, technology migration curve, revenue ramp-up period and discount rates.
Given the fair value determination of developed technology and customer-related intangible assets requires management to make significant estimates and assumptions related to the estimated annual revenues and net cash flows, technology migration curve, revenue ramp-up period, discount rates, and the selected income approach methodologies, performing audit procedures to evaluate the reasonableness of these estimates and assumptions required a high degree of auditor judgment and an increased extent of effort, including the need to involve our fair value specialists.
How the Critical Audit Matter Was Addressed in the Audit
Our audit procedures related to the developed technology and customer-related intangible assets assumed for the Galileo acquisition included the following, among others:
We assessed the reasonableness of management’s estimated annual revenues and net cash flows forecasts by comparing the projections to historical results of Galileo, as well as to certain peer companies of Galileo.
We assessed the reasonableness of management’s assumption of the revenue ramp-up period by evaluating Galileo's historical growth trends, and testing the source information, including the number of existing customers through inspection of customer contracts.
With the assistance of our fair value specialists, we evaluated:
the reasonableness of the income approach valuation methodologies by assessing management’s application of the multi-period excess earnings method and the with and without method,
F-98

TABLE OF CONTENTS
the reasonableness of the technology migration curve and discount rates by developing a range of independent estimates and comparing those to the assumptions selected by management, and
the mathematical accuracy of the valuation by performing a recalculation.
/s/ Deloitte & Touche LLP
San Francisco, California
March 17, 2021
We have served as the Company’s auditor since 2017.
F-99

TABLE OF CONTENTS
Social Finance, Inc.
Consolidated Balance Sheets
(In Thousands, Except for Share Data)
December 31,
2020 2019
Assets
Cash and cash equivalents $ 872,582  $ 499,486 
Restricted cash and restricted cash equivalents(1)
450,846  190,720 
Loans(1)(2)
4,879,303  5,387,958 
Servicing rights 149,597  201,618 
Securitization investments 496,935  653,952 
Equity method investments 107,534  104,049 
Property, equipment and software 81,489  59,553 
Goodwill 899,270  15,673 
Intangible assets 355,086  11,783 
Operating lease right-of-use assets 116,858  101,446 
Related party notes receivable 17,923  9,174 
Other assets(3)
136,076  53,748 
Total assets $ 8,563,499  $ 7,289,160 
Liabilities, temporary equity and permanent deficit
Liabilities:
Accounts payable, accruals and other liabilities(1)
$ 452,909  $ 103,590 
Operating lease liabilities 139,796  124,745 
Debt(1)
4,798,925  4,688,378 
Residual interests classified as debt(1)
118,298  271,778 
Total liabilities 5,509,928  5,188,491 
Commitments, guarantees, concentrations and contingencies (Note 15)
Temporary equity(4):
Redeemable preferred stock: 311,842,666 and 254,842,666 shares authorized; 256,459,941 and 218,814,230 shares issued and outstanding as of December 31, 2020 and 2019, respectively
3,173,686  2,439,731 
Permanent deficit:
Common stock, $0.00 par value: 452,815,616 and 395,815,616 shares authorized; 66,034,174 and 39,614,844 shares issued and outstanding as of December 31, 2020 and 2019, respectively(5)
—  — 
Additional paid-in capital 579,228  135,517 
Accumulated other comprehensive loss (166) (21)
Accumulated deficit (699,177) (474,558)
Total permanent deficit (120,115) (339,062)
Total liabilities, temporary equity and permanent deficit $ 8,563,499  $ 7,289,160 
__________________
(1)Financial statement line items include amounts in consolidated variable interest entities (“VIEs”). See Note 5.
(2)As of December 31, 2020, includes loans measured at fair value of $4,859,068 and loans measured at amortized cost of $20,235. All loans as of December 31, 2019 are measured at fair value. See Note 4 and 8.
(3)Other assets includes accounts receivable, net, of $32,374 and $12,145 as of December 31, 2020 and 2019, respectively, with allowance for credit losses of $562 and $0, respectively.
(4)Redemption amounts are $3,210,470 and $2,476,891 as of December 31, 2020 and 2019, respectively.
(5)Includes 5,000,000 non-voting common shares authorized and 1,380,852 non-voting common shares issued and outstanding as of December 31, 2020 and 2019. See Note 11 for additional information.
The accompanying notes are an integral part of these consolidated financial statements.
F-100

TABLE OF CONTENTS
Social Finance, Inc.
Consolidated Statements of Operations and Comprehensive Income (Loss)
(In Thousands, Except for Share and Per Share Data)
Year Ended December 31,
2020 2019 2018
Interest income
Loans
$ 330,353  $ 570,466  $ 568,209 
Securitizations
24,031  23,179  19,300 
Related party notes
3,189  3,338  — 
Other
5,964  11,210  2,109 
Total interest income 363,537  608,193  589,618 
Interest expense
Securitizations and warehouses
155,150  268,063  330,186 
Other
30,456  10,296  368 
Total interest expense 185,606  278,359  330,554 
Net interest income 177,931  329,834  259,064 
Noninterest income
Loan origination and sales
371,323  299,265  123,046 
Securitizations
(70,251) (199,125) (114,705)
Servicing
(19,426) 8,486  1,197 
Technology Platform fees
90,128  —  — 
Other
15,827  4,199  797 
Total noninterest income 387,601  112,825  10,335 
Total net revenue 565,532  442,659  269,399 
Noninterest expense
Technology and product development
201,199  147,458  99,319 
Sales and marketing
276,577  266,198  212,604 
Cost of operations
178,896  116,327  88,885 
General and administrative
237,381  152,275  121,948 
Total noninterest expense 894,053  682,258  522,756 
Loss before income taxes (328,521) (239,599) (253,357)
Income tax (expense) benefit
104,468  (98) 958 
Net loss $ (224,053) $ (239,697) $ (252,399)
Other comprehensive income (loss)
Foreign currency translation adjustments, net (145) (9) 21 
Total other comprehensive income (loss) (145) (9) 21 
Comprehensive loss $ (224,198) $ (239,706) $ (252,378)
Loss per share (Note 16)
Loss per share – basic $ (7.49) $ (7.00) $ (7.19)
Loss per share – diluted $ (7.49) $ (7.00) $ (7.19)
Weighted average common stock outstanding – basic 42,374,976  37,651,687  35,091,026 
Weighted average common stock outstanding – diluted 42,374,976  37,651,687  35,091,026 




The accompanying notes are an integral part of these consolidated financial statements.
F-101

TABLE OF CONTENTS
Social Finance, Inc.
Consolidated Statements of Changes in Temporary Equity and Permanent Equity (Deficit) 
(In Thousands, Except for Share Data)
Common Stock
Additional
Paid-In
Capital
Treasury
Stock
Accumulated
Other
Comprehensive
Income (Loss)
Retained
Earnings
(Accumulated
Deficit)
Permanent
Equity
(Deficit)
Temporary Equity
Shares
Amount
Shares Amount
Balance at January 1, 2018 39,492,695  $ —  $ 113,820  $ (2,914) $ (33) $ 29,256  $ 140,129  199,355,696  $ 1,890,554 
Stock-based compensation expense
—  —  42,936  —  —  —  42,936  —  — 
Equity-based payments to non-employees
43,655  —  523  —  —  —  523  —  — 
Vesting of RSUs
730,900  —  —  —  —  —  —  —  — 
Stock withheld related to taxes on vested RSUs
(279,043) —  (3,154) —  —  —  (3,154) —  — 
Exercise of common stock options
812,467  —  2,581  —  —  —  2,581  —  — 
Issuance of common stock in asset acquisition
87,311  —  941  —  —  —  941  —  — 
Foreign currency translation adjustments, net of tax of $0
—  —  —  —  21  —  21  —  — 
Net loss —  —  —  —  —  (252,399) (252,399) —  — 
Balance at December 31, 2018 40,887,985  $ —  $ 157,647  $ (2,914) $ (12) $ (223,143) $ (68,422) 199,355,696  $ 1,890,554 
Stock-based compensation expense
—  —  60,936  —  —  —  60,936  —  — 
Equity-based payments to non-employees
43,656  —  483  —  —  —  483  —  — 
Vesting of RSUs
4,417,306  —  —  —  —  —  —  —  — 
Stock withheld related to taxes on vested RSUs
(1,877,549) —  (21,411) —  —  —  (21,411) —  — 
Exercise of common stock options
1,879,956  —  7,844  —  —  —  7,844  —  — 
Common stock purchases
(1,018,177) —  —  —  —  (8,804) (8,804) —  — 
Redeemable preferred stock dividends
—  —  (23,923) —  —  —  (23,923) —  — 
Constructive retirement of treasury shares
(4,718,333) —  —  2,914  —  (2,914) —  —  — 
Note receivable issuance to stockholder, inclusive of interest
—  —  (61,214) —  —  —  (61,214) —  — 
Note receivable payments from stockholder, inclusive of interest
—  —  15,155  —  —  —  15,155  —  — 
Issuance of redeemable preferred stock
—  —  —  —  —  —  —  19,458,534  551,577 
Preferred stock issuance costs
—  —  —  —  —  —  —  —  (2,400)
Foreign currency translation adjustments, net of tax of $0
—  —  —  —  (9) —  (9) —  — 
Net loss
—  —  —  —  —  (239,697) (239,697) —  — 
Balance at December 31, 2019
39,614,844  $ —  $ 135,517  $ —  $ (21) $ (474,558) $ (339,062) 218,814,230  $ 2,439,731 


The accompanying notes are an integral part of these consolidated financial statements.
F-102

TABLE OF CONTENTS
Social Finance, Inc.
Consolidated Statements of Changes in Temporary Equity and Permanent Equity (Deficit) (Continued)
(In Thousands, Except for Share Data)
Common Stock
Additional Paid-In Capital
Accumulated Other Comprehensive Income (Loss)
Retained Earnings (Accumulated Deficit)
Permanent Equity (Deficit)
Temporary Equity
Shares
Amount
Shares
Amount
Balance at December 31, 2019
39,614,844  $ —  $ 135,517  $ (21) $ (474,558) $ (339,062) 218,814,230  $ 2,439,731 
Stock-based compensation expense
—  —  99,870  —  —  99,870  —  — 
Equity-based payments to non-employees
75,000  —  908  —  —  908  —  — 
Vesting of RSUs
6,614,661  —  —  —  —  —  —  — 
Stock withheld related to taxes on vested RSUs
(2,543,013) —  (31,259) —  —  (31,259) —  — 
Exercise of common stock options
1,169,956  —  3,781  —  —  3,781  —  — 
Vested stock options assumed in acquisition
—  —  32,197  —  —  32,197  —  — 
Common stock purchases
(65,882) —  —  —  (566) (566) —  — 
Redeemable preferred stock dividends
—  —  (40,536) —  —  (40,536) —  — 
Note receivable issuance to stockholder, inclusive of interest
—  —  (1,764) —  —  (1,764) —  — 
Note receivable payments from stockholder, inclusive of interest
—  —  47,823  —  —  47,823  —  — 
Issuance of redeemable preferred stock
—  —  —  —  —  —  52,743,298  814,156 
Preferred stock redemption —  —  (52,658) —  —  (52,658) (15,097,587) (80,201)
Issuance of common stock in acquisition
1,101,306  —  15,565  —  —  15,565  —  — 
Issuance of common stock 20,067,302  —  369,840  —  —  369,840  —  — 
Common stock issuance costs —  —  (56) —  —  (56) —  — 
Foreign currency translation adjustments, net of tax of $0
—  —  —  (145) —  (145) —  — 
Net loss —  —  —  —  (224,053) (224,053) —  — 
Balance at December 31, 2020 66,034,174  $ —  $ 579,228  $ (166) $ (699,177) $ (120,115) 256,459,941  $ 3,173,686 




The accompanying notes are an integral part of these consolidated financial statements.
F-103

TABLE OF CONTENTS
Social Finance, Inc.
Consolidated Statements of Cash Flows 
(In Thousands)
Year Ended December 31,
2020 2019 2018
Operating activities
Net loss $ (224,053) $ (239,697) $ (252,399)
Adjustments to reconcile net loss to net cash provided by (used in) operating activities:
Depreciation and amortization 69,832  15,955  10,912 
Deferred debt issuance and discount expense 28,310  33,205  23,858 
Stock-based compensation expense 99,870  60,936  42,936 
Equity-based payments to non-employees 908  483  523 
Deferred income taxes (104,504) 52  (1,089)
Equity method investment earnings (4,314) (869) 50 
Accretion of seller note interest expense 6,002  —  — 
Fair value changes in residual interests classified as debt 38,216  17,157  (27,481)
Fair value changes in securitization investments (13,919) (11,363) (2,668)
Fair value changes in warrant liabilities 20,525  (2,834) — 
Fair value adjustment to related party notes receivable 319  —  — 
Other 803  2,205  500 
Changes in operating assets and liabilities:
Originations and purchases of loans (10,406,813) (11,579,679) (12,001,921)
Proceeds from sales and repayments of loans 9,949,805  11,635,228  13,128,583 
Other changes in loans (58,743) 69,214  102,218 
Servicing assets 52,021  (35,913) (15,975)
Related party notes receivable interest income 1,121  (2,670) — 
Other assets (29,883) (18,171) 2,004 
Accounts payable, accruals and other liabilities 95,161  2,028  13,226 
Net cash provided by (used in) operating activities $ (479,336) $ (54,733) $ 1,023,277 
Investing activities
Purchases of property, equipment, software and intangible assets $ (24,549) $ (37,590) $ (13,729)
Related party notes receivable issuances (7,643) (9,050) — 
Purchases of non-securitization investments (145) (3,608) (100,401)
Proceeds from non-securitization investments 974  —  — 
Receipts from securitization investments 322,704  165,116  101,879 
Acquisition of business, net of cash acquired (32,392) —  — 
Net cash provided by (used in) investing activities $ 258,949  $ 114,868  $ (12,251)



The accompanying notes are an integral part of these consolidated financial statements.
F-104

TABLE OF CONTENTS
Social Finance, Inc.
Consolidated Statements of Cash Flows (Continued)
(In Thousands)
Year Ended December 31,
2020 2019 2018
Financing activities
Proceeds from debt issuances $ 10,234,378  $ 12,458,120  $ 13,702,867 
Repayment of debt (9,708,991) (12,826,085) (14,634,415)
Payment of debt issuance costs (16,443) (20,596) (22,672)
Taxes paid related to net share settlement of stock-based awards (31,259) (21,411) (3,154)
Purchases of common stock (40) (8,804) — 
Proceeds from stock option exercises 3,781  7,844  2,581 
Note receivable issuance to stockholder —  (58,000) — 
Note receivable principal repayments from stockholder 43,513  14,487  — 
Proceeds from common stock issuances 369,840  —  — 
Proceeds from redeemable preferred stock issuances —  573,845  — 
Payment of redeemable preferred stock issuance costs —  (2,400) — 
Payment of redeemable preferred stock dividends (40,536) (23,923) — 
Finance lease principal payments (489) —  — 
Net cash provided by (used in) financing activities $ 853,754  $ 93,077  $ (954,793)
Effect of exchange rates on cash and cash equivalents (145) (9) 21 
Net increase in cash, cash equivalents, restricted cash and restricted cash equivalents 633,222  153,203  56,254 
Cash, cash equivalents, restricted cash and restricted cash equivalents at beginning of period 690,206  537,003  480,749 
Cash, cash equivalents, restricted cash and restricted cash equivalents at end of period $ 1,323,428  $ 690,206  $ 537,003 
Reconciliation to amounts on Consolidated Balance Sheets (as of period end)
Cash and cash equivalents $ 872,582  $ 499,486  $ 325,114 
Restricted cash and restricted cash equivalents 450,846  190,720  211,889 
Total cash, cash equivalents, restricted cash and restricted cash equivalents $ 1,323,428  $ 690,206  $ 537,003 







The accompanying notes are an integral part of these consolidated financial statements.
F-105

TABLE OF CONTENTS
Social Finance, Inc.
Consolidated Statements of Cash Flows (Continued)
(In Thousands)
Year Ended December 31,
2020 2019 2018
Supplemental cash flow information
Interest paid $ 129,131  $ 224,916  $ 223,440 
Income taxes paid 529  138 
Supplemental non-cash investing and financing activities
Securitization investments acquired via loan transfers $ 151,768  $ 351,254  $ 348,455 
Redeemable preferred stock warrants accounted for as liabilities —  22,268  — 
Non-cash property, equipment, software and intangible asset additions 358  15,247  — 
Deconsolidation of residual interests classified as debt 101,718  97,928  — 
Deconsolidation of securitization debt 770,918  1,366,992  — 
Issuance of residual interests classified as debt as consideration for loan additions —  116,906  34,499 
Deferred debt issuance costs accrued but not paid 1,600  —  — 
Seller note issued in acquisition 243,998  —  — 
Redeemable preferred stock issued in acquisition 814,156  —  — 
Common stock options assumed in acquisition 32,197  —  — 
Issuance of common stock in acquisition 15,565  —  941 
Finance lease ROU assets acquired 15,100  —  — 
Property, equipment and software acquired in acquisition 2,026  —  — 
Debt assumed in acquisition 5,832  —  — 
Accrued but unpaid deferred equity costs 56  —  — 
Redeemed but unpaid common stock 526  —  — 
Redeemed but unpaid redeemable preferred stock 132,859  —  — 










The accompanying notes are an integral part of these consolidated financial statements.
F-106

TABLE OF CONTENTS
Social Finance, Inc.
Notes to Consolidated Financial Statements 
(In Thousands, Unless Otherwise Stated and Except for Share and Per Share Data)

Note 1. Organization, Summary of Significant Accounting Policies and New Accounting Standards
Organization
Social Finance, Inc. (collectively with its subsidiaries, “SoFi”, the “Company”, “we”, “us” or “our”) is a financial services platform. The Company was founded in 2011 to offer an innovative approach to the private student loan market by providing student loan refinancing options. Since its founding, SoFi has expanded its lending strategy to offer home loans, personal loans and credit cards. SoFi predominantly operates in the U.S. via its lending activities. The Company has also developed non-lending financial products, such as money management and investment product offerings, and has also leveraged its financial services platform to empower other businesses. Through strategic acquisitions made during the year ended December 31, 2020, the Company expanded its investment product offerings into Hong Kong, and now also operates as a platform-as-a-service for a variety of financial service providers, providing the infrastructure to facilitate core customer-facing and back-end capabilities, such as account setup, account funding, direct deposit, authorizations and processing, payments functionality and check account balance features.
Summary of Significant Accounting Policies
Basis of Presentation
The consolidated financial statements include the accounts of the Company, its wholly-owned and majority-owned subsidiaries and certain consolidated VIEs. All intercompany accounts were eliminated in consolidation. The consolidated financial statements were prepared in conformity with accounting principles generally accepted in the United States (“GAAP”) and in accordance with the rules and regulations of the Securities and Exchange Commission (“SEC”).
Use of Judgments, Assumptions and Estimates
The preparation of our Consolidated Financial Statements and related disclosures in conformity with GAAP requires management to make assumptions and estimates that affect the amounts reported in our Consolidated Financial Statements and accompanying notes. Management bases its estimates on historical experience and on various other factors it believes to be reasonable under the circumstances, the results of which form the basis for making judgments about the carrying values of our assets and liabilities. These judgments, assumptions and estimates include, but are not limited to, the following: (i) fair value measurements; (ii) stock-based compensation expense, and (iii) business combinations. These judgments, estimates and assumptions are inherently subjective in nature and, therefore, actual results may differ from our estimates and assumptions.
Business Combinations
We account for acquisitions of entities or asset groups that qualify as businesses using the acquisition method of accounting in accordance with ASC 805, Business Combinations. Purchase consideration is allocated to the tangible and intangible assets acquired and liabilities assumed based on the estimated fair values as of the acquisition date, which are measured in accordance with the principles outlined in Accounting Standards Codification (“ASC”) 820, Fair Value Measurement. The determination of fair value requires management to make estimates about discount rates, future expected cash flows, market conditions and other future events that are highly subjective in nature. The excess of the total purchase consideration over the fair value of the identified net assets acquired is recognized as goodwill. See “— Goodwill and Intangible Assets” for our related accounting policy. The results of the acquired businesses are included in our results of operations beginning from the date of acquisition. Acquisition-related costs are expensed as incurred.
During the measurement period, which may be up to one year from the acquisition date, we may record adjustments to the allocation of purchase consideration and to the fair values of assets acquired and liabilities assumed to the extent that additional information becomes available. After this period, any subsequent adjustments are recorded in the Consolidated Statements of Operations and Comprehensive Income (Loss).
F-107

TABLE OF CONTENTS
Social Finance, Inc.
Notes to Consolidated Financial Statements  (continued)
(In Thousands, Unless Otherwise Stated and Except for Share and Per Share Data)
Consolidation of Variable Interest Entities
We enter into arrangements in which we originate loans, establish a special purpose entity (“SPE”), and transfer loans to the SPE. We retain the servicing rights of those loans and hold additional interests in the SPE. We evaluate each such arrangement to determine whether we have a variable interest. If we determine that we have a variable interest in an SPE, we then determine whether the SPE is a VIE. If the SPE is a VIE, we assess whether we are the primary beneficiary of the VIE, such that we must consolidate the VIE on our Consolidated Balance Sheets. To determine if we are the primary beneficiary, we identify the most significant activities and determine who has the power over those activities, and who absorbs the variability in the economics of the VIE. As of December 31, 2020 and 2019, we had 15 and 18 consolidated VIEs, respectively, on our Consolidated Balance Sheets. Refer to Note 5 for more details regarding our consolidated VIEs. As of each balance sheet date presented, there was one consolidated VIE which did not have securitization debt.
We periodically reassess our involvement with each VIE in which we have a variable interest. We monitor matters related to our ability to control economic performance, such as management of the SPE and its underlying loans, contractual changes in the services provided, the extent of our ownership, and the rights of third parties to terminate us as the VIE servicer. In addition, we monitor the financial performance of each VIE for indications that we may or may not have the right to absorb benefits or the obligation to absorb losses associated with variability in the financial performance of the VIE that could potentially be significant to that VIE, which we define as a variable interest of greater than 10%.
A significant change to the pertinent rights of us or other parties, or a significant change to the ranges of possible financial performance outcomes used in our assessment of the variability of cash flows due to us, could impact the determination of whether or not a VIE should be consolidated in future periods. VIE consolidation and deconsolidation may lead to increased volatility in our financial results and impact period-over-period comparability. Our maximum exposure to loss as a result of our involvement with consolidated VIEs is limited to our investment, which is eliminated in consolidation. There are no liquidity arrangements, guarantees or other commitments by third parties that may affect the fair value or risk of our variable interests in consolidated VIEs.
Foreign Currency Translation Adjustments
We revalue assets, liabilities, income and expense denominated in non-U.S. currencies into U.S. dollars using applicable exchange rates. Gains and losses relating to foreign currency translation adjustments are included in accumulated other comprehensive loss in our Consolidated Balance Sheets.
Fair Value Measurements
Fair value is defined as the price that would be received for an asset or paid to transfer a liability (an exit price) in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants on the measurement date. We use a three-level fair value hierarchy to classify and disclose all assets and liabilities measured at fair value on a recurring basis in periods subsequent to their initial measurement. The hierarchy requires us to use observable inputs when available and to minimize the use of unobservable inputs when determining fair value. The three levels are defined as follows:
Level 1 — Quoted prices in active markets for identical assets or liabilities, accessible by us at the measurement date.
Level 2 — Quoted prices for similar assets or liabilities in active markets, or quoted prices for identical or similar assets or liabilities in markets that are not active, or other observable inputs other than quoted prices.
Level 3 — Unobservable inputs for assets or liabilities for which there is little or no market data, which requires us to develop our own assumptions. These unobservable assumptions reflect estimates of inputs that market participants would use in pricing the asset or liability. Valuation techniques include the use of option pricing models, discounted cash flow models, or similar techniques, which incorporate
F-108

TABLE OF CONTENTS
Social Finance, Inc.
Notes to Consolidated Financial Statements  (continued)
(In Thousands, Unless Otherwise Stated and Except for Share and Per Share Data)
management’s own estimates of assumptions that market participants would use in pricing the asset or liability.
A financial instrument’s categorization within the fair value hierarchy is based on the lowest level of input that is significant to the fair value measurement. Instruments are categorized in Level 3 of the fair value hierarchy based on the significance of unobservable factors in the overall fair value measurement. As a result, the related gains and losses for assets and liabilities within the Level 3 category presented in Note 8 may include changes in fair value that are attributable to both observable and unobservable inputs.
Transfers of Financial Assets
The transfer of an entire financial asset and, to a much lesser extent, a participating interest in an entire financial asset in which we surrender control over the asset is accounted for as a sale if all of the following conditions are met:
the financial asset is isolated from the transferor and its consolidated affiliates as well as its creditors, even in bankruptcy or other receivership;
the transferee or beneficial interest holders have the right to pledge or exchange the transferred financial asset; and
the transferor, its consolidated affiliates and its agents do not maintain effective control over the transferred financial asset.
Loan sales are aggregated in the financial statements due to the similarity of both the loans transferred and servicing arrangements. The portion of our income relating to ongoing servicing and the fair value of our servicing rights are dependent upon the performance of the sold loans. We measure the gain or loss on the sale of financial assets as the net assets received from the sale less the carrying amount of the loans sold. The net assets received from the sale represent the fair value of any assets obtained or liabilities incurred as part of the transaction, including but not limited to cash, servicing assets, retained securitization investments and recourse obligations.
When securitizing loans, we employ a two-step transaction that includes the isolation of the underlying loans in a trust and the sale of beneficial interests in the trust to a bankruptcy-remote entity. Transfers of financial assets that do not qualify for sale accounting are reported as secured borrowings. Accordingly, the related assets remain on our Consolidated Balance Sheets and continue to be reported and accounted for as if the transfer had not occurred. Cash proceeds received from these transfers are reported as liabilities, with related interest expense recognized over the life of the related secured borrowing.
As a component of the loan sale agreements, we make certain representations to third parties that purchase our previously-held loans, some of which include Federal National Mortgage Association (“FNMA”) repurchase requirements and all of which are standard in nature and do not constrain our ability to recognize a sale for accounting purposes. Any significant estimated post-sale obligations or contingent obligations to the purchaser of the loans arising from these representations are accrued if probable and estimable. Pursuant to ASC 460, Guarantees, we establish a loan repurchase liability, which is based on historical experience and any current developments which would make it probable that we would buy back loans previously sold to third parties at the historical sales price. The loan repurchase liability is presented within accounts payable, accruals and other liabilities in the Consolidated Balance Sheets, with the corresponding charges recorded within noninterest income — loan origination and sales in the Consolidated Statements of Operations and Comprehensive Income (Loss).
Cash and Cash Equivalents
Cash and cash equivalents include unrestricted deposits with financial institutions in checking, money market and short-term certificate of deposit accounts. We consider all highly liquid investments with original maturity dates of three months or less to be cash equivalents.
F-109

TABLE OF CONTENTS
Social Finance, Inc.
Notes to Consolidated Financial Statements  (continued)
(In Thousands, Unless Otherwise Stated and Except for Share and Per Share Data)
Restricted Cash and Restricted Cash Equivalents
Restricted cash and restricted cash equivalents consist primarily of cash deposits, certificate of deposit accounts held on reserve, money market funds held by consolidated VIEs, funds reserved for committed stock purchases, and collateral collection balances. These accounts are earmarked as restricted because these balances are either held in escrow as required for certain debt facilities and derivative agreements or represent consolidated VIE cash balances that we cannot use for general operating purposes.
Loans
Our loan portfolio consists of personal loans, student loans and home loans, which are measured at fair value, and credit card loans and a commercial loan, which are measured at amortized cost and were new to our business in 2020.
Loans Measured at Fair Value
Our personal, student and home loans are carried at fair value on a recurring basis and, therefore, all direct fees and costs related to the origination process are recognized in earnings as earned or incurred. We elected the fair value option to measure these loans, as we believe that fair value best reflects the expected economic performance of the loans, as well as our intentions given our gain on sale origination model. We record the initial fair value measurement and subsequent measurement changes in fair value in the period in which the changes occur within noninterest income — loan origination and sales in the Consolidated Statements of Operations and Comprehensive Income (Loss). Our consolidated loans are originated with the intention to sell to third-party investors and are, therefore, considered held for sale. Securitized loans are assets held by consolidated SPEs as collateral for bonds issued, for which fair value changes are recorded within noninterest income — securitizations in the Consolidated Statements of Operations and Comprehensive Income (Loss). Gains or losses recognized upon deconsolidation of a VIE are also recorded within noninterest income — securitizations.
Loans do not trade in an active market with readily observable prices. We determine the fair value of our loans using a discounted cash flow methodology, while also considering market data as it becomes available. We classify loans as Level 3 because the valuations utilize significant unobservable inputs.
We consider a loan to be delinquent when the borrower has not made the scheduled payment amount within one day of the scheduled payment date, provided the borrower is not in school or in deferment, forbearance or within an agreed-upon grace period. Loan deferment is a provision in the student loan contract that permits the borrower to defer payments while enrolled at least half time in school. During the deferment period, interest accrues on the loan balance and is capitalized to the loan when the loan enters repayment status, which begins when the student no longer qualifies for deferment.
Whereas deferment only relates to student loans, forbearance applies to student loans, personal loans and home loans. A borrower in repayment may generally request forbearance for reasons including a FEMA-declared disaster, unemployment, economic hardship or general economic uncertainty. Forbearance typically cannot exceed a total of 12 months over the life of the loan. During the year ended December 31, 2020, requests for forbearance have also included impacts related to the COVID-19 pandemic. If forbearance is granted, interest continues to accrue during the forbearance period and is capitalized to the loan when the borrower resumes making payments. At the conclusion of a forbearance period, the contractual monthly payment is recalculated and is generally higher as a result.
Delinquent loans are charged off after 120 days of nonpayment or on the date of confirmed loss, at which time we stop accruing interest and reverse all accrued but unpaid interest as of such date. Additional information about our loans measured at fair value is included in Note 4 through Note 6, as well as Note 8.
F-110

TABLE OF CONTENTS
Social Finance, Inc.
Notes to Consolidated Financial Statements  (continued)
(In Thousands, Unless Otherwise Stated and Except for Share and Per Share Data)
Loans Measured at Amortized Cost
As of December 31, 2020, loans measured at amortized cost include credit card loans and a commercial loan. We did not have any loans measured at amortized cost as of December 31, 2019. For loans measured at amortized cost, we present accrued interest within loans in the Consolidated Balance Sheets.
During the fourth quarter of 2020, we issued a commercial loan, which had a principal balance of $16,500 and accumulated unpaid interest of $12 as of December 31, 2020, all of which was repaid during January 2021.
We launched our credit card product in the third quarter of 2020, which was expanded to a broader market in the fourth quarter of 2020. Credit card loans are reported as delinquent when they become 30 or more days past due. Credit card loans will be charged off after 180 days of nonpayment or on the date of the confirmed loss, at which time we will stop accruing interest and reverse all accrued but unpaid interest as of such date. When payments are received against charged off credit card loans, we will use the cash basis method and resume the accrual of interest. As our credit card loans were outstanding for less than 180 days as of December 31, 2020, there were no credit card loans subject to charge off.
The following table presents the aging analysis of our credit card loans as of December 31, 2020, which excludes accrued interest of $2:
December 31, 2020
Delinquent Loans
Current 30–59 Days 60–89 Days ≥ 90 Days Total Delinquent Loans Total Loans
Credit card loans $ 3,864  $ 74  $ $ —  $ 76  $ 3,940 
We did not have any credit card loans that were 90 days or more past due nor any credit card loans on nonaccrual status as of December 31, 2020.
Allowance for Credit Losses
Effective January 1, 2020, we adopted the provisions of Accounting Standards Update (“ASU”) 2016-13, Measurement of Credit Losses on Financial Instruments, which requires upfront recognition of lifetime expected credit losses using a current expected credit loss model. As of December 31, 2020, the standard was applicable to (i) cash equivalents and restricted cash equivalents, (ii) accounts receivable from contracts with customers, inclusive of servicing related receivables, (iii) related party notes receivable, (iv) margin receivables, which were attributable to our activities at 8 Limited, (v) certain loan repurchase reserves representing guarantees of credit exposure, and (vi) loans measured at amortized cost, including credit card loans and a commercial loan, which were new to our business in 2020. We did not recognize any allowance for credit losses on our single commercial loan as of December 31, 2020 because it was fully repaid prior to the issuance of our year-end financial statements. Our approaches to measuring the allowance for credit losses on the other applicable financial assets are as follows:
Cash equivalents and restricted cash equivalents: Our cash equivalents and restricted cash equivalents are short-term in nature and of high credit quality; therefore, we determined that our exposure to credit losses over the life of these instruments was immaterial.
Accounts receivable from contracts with customers: Accounts receivable from contracts with customers as of the balance sheet date are recorded at their original invoice amounts reduced by any allowance for credit losses. In accordance with the standard, we pool our accounts receivable, all of which are short-term in nature and arise from contracts with customers, based on shared risk characteristics to assess their risk of loss, even when that risk is remote. Certain of our historical accounts receivable balances did not have any write-offs. We use the aging method to establish an allowance for expected credit losses on accounts receivable balances and consider whether current conditions or reasonable and supportable forecasts about future conditions warrant an adjustment to our historical loss experience. In applying such adjustments, we primarily evaluate changes in customer creditworthiness, current
F-111

TABLE OF CONTENTS
Social Finance, Inc.
Notes to Consolidated Financial Statements  (continued)
(In Thousands, Unless Otherwise Stated and Except for Share and Per Share Data)
economic conditions, expectations of near-term economic trends and changes in customer payment terms and collection trends.
When we determine that a receivable is not collectible, we write off the uncollectible amount as a reduction to both the allowance and the gross asset balance. Recoveries are recorded when received and credited to provision for credit losses. Accrued interest is excluded from the measurement of the allowance for credit losses. Any change in the assumptions used in analyzing a specific account receivable may result in an additional allowance for credit losses being recognized in the period in which the change occurs. See “— Recently Adopted Accounting Standards” for discussion of our adoption of the provisions of ASU 2016-13 and Note 7 for additional information on our accounts receivable.
Related party notes receivable: Our related party notes receivable consist of loans to an equity method investee, as further discussed in Note 14. We determined that our exposure to credit losses on our related party notes receivable was immaterial. Subsequent to the balance sheet date, the equity method investee paid off the outstanding principal balance and accrued interest. See Note 18 for additional information.
Margin receivables: Our margin receivables of $1.6 million as of December 31, 2020 associated with margin lending services we offer to members through 8 Limited, which we acquired in 2020, are fully collateralized by the borrowers’ securities under collateral maintenance provisions, to which we regularly monitor adherence. Therefore, using the practical expedient in ASC 326-20-35-6, Financial Instruments — Credit Losses, we did not record expected credit losses on this pool of margin receivables, as the fair value of the underlying collateral is expected to exceed the amortized cost of the receivables.
Loan repurchase reserves: We issue financial guarantees related to certain non-agency loan transfers, which are subject to repurchase based on the occurrence of certain credit-related events within a specified amount of time following loan transfer, which does not exceed 90 days from origination. We estimate the contingent guarantee liability based on our historical repurchase activity for similar types of loans and assess whether adjustments to our historical loss experience are required based on current conditions and forecasts of future conditions, as appropriate, as our exposure under the guarantee is short-term in nature. See Note 15 for additional information on our guarantees.
Credit card loans: Our credit card loan portfolio had a carrying value of $3,723 as of December 31, 2020. Accordingly, our estimate of the allowance for credit losses as of December 31, 2020 of $219 was immaterial to the Consolidated Financial Statements. Our credit card loan portfolio consists of small balance, homogenous loans. We pool credit card loans using ten internal risk tier categories. We assign the risk tier of our credit card loans primarily based on credit scores, such as FICO, and utilizing a proprietary risk model that relies on other attributes from the credit bureau data to model account-level charge off probability. These pools will be reassessed periodically to confirm that all loans within each pool continue to share similar risk characteristics. As we do not yet have meaningful historical credit card data, we establish an allowance for the pooled credit card loans within each internal risk tier using a combination of historical industry and bureau data, which are then adjusted for current conditions and reasonable and supportable forecasts of future conditions, including economic conditions. We apply the probability-of-default and loss-given-default methods to the drawn balance of credit card loans within each internal risk tier to estimate the lifetime expected credit losses within each tier, which are then aggregated to determine the allowance for credit losses. We estimate the average life over which expected credit losses may occur for the pools of credit card loans within each risk tier using historical industry data for credit card loans with comparable risk profiles, which primarily reflects expectations of future payments on the credit card account. Similarly, we estimate the expected annual loss rate for the pools of credit card loans within each risk tier using historical credit bureau data for credit card loans with comparable risk profiles. We do not measure credit losses on the undrawn credit exposure, as such undrawn credit exposure is unconditionally cancellable by us. Management further considers an evaluation of overall portfolio credit quality based on indicators such as changes in our credit decisioning process, underwriting and collection management policies; the effects of external factors, such as regulatory requirements; general economic conditions and inherent uncertainties in applying the methodology. The assignment of internal risk tiers and determination of comparable industry and credit bureau data involves subjective management judgment.
F-112

TABLE OF CONTENTS
Social Finance, Inc.
Notes to Consolidated Financial Statements  (continued)
(In Thousands, Unless Otherwise Stated and Except for Share and Per Share Data)
When a credit card loan is charged off, which was not applicable to the current period, we will record a reduction to the allowance and the credit card loan balance. Accrued interest associated with a charged off receivable will be reversed through interest income. We did not have any accrued interest receivables written off during the year ended December 31, 2020. Recoveries of amounts previously charged off will be recorded when received as a direct reduction to the provision for credit losses. We elected to exclude interest on credit card loans from the measurement of our allowance, as our policy allows for accrued interest to be reversed in a timely manner. Further, we elected the practical expedient to exclude the accrued interest component of our credit card loans from the quantitative disclosures presented in accordance with the guidance.
When necessary, we will apply a separate credit loss methodology to assets that have deteriorated in credit quality and, as such, no longer share similar risk characteristics with other assets in the pool. We will either estimate the allowance for credit losses on such assets with deteriorated credit quality individually based on individual risk characteristics or as part of a separate pool of assets that shares similar risk characteristics.
Servicing Rights
Each time we enter into a servicing agreement, we determine whether we should record a servicing asset, servicing liability, or neither a servicing asset nor liability. We elected the fair value option to measure our servicing rights subsequent to initial recognition. We measure the initial and subsequent fair value of our servicing rights using a discounted cash flow methodology, which includes our contractual servicing fee, ancillary income, prepayment rate assumptions, default rate assumptions, a discount rate commensurate with the risk of the servicing asset or liability being valued, and an assumed market cost of servicing, which is based on active quotes from third-party servicers. For servicing rights retained in connection with loan transfers that do not meet the requirements for sale accounting treatment, there is no recognition of a servicing asset or liability.
Servicing rights are initially measured at fair value and recognized as a component of the gain or loss from sales of loans and the initial capitalization is reported within noninterest income — loan origination and sales in the Consolidated Statements of Operations and Comprehensive Income (Loss). Servicing rights are measured at fair value at each subsequent reporting date and changes in fair value are reported in earnings in the period in which they occur. Subsequent measurement changes, including servicing fee payments and fair value changes, are included within noninterest income — servicing in the Consolidated Statements of Operations and Comprehensive Income (Loss). We elected the fair value option to measure our servicing rights to better align with the valuation of our loans, which are impacted by similar factors, such as conditional prepayment rates. We consider the risk of the assets and the observability of inputs in determining the classes of servicing rights. We have three classes of servicing assets: personal loans, home loans and student loans. No servicing was acquired or assumed from a third party during the years ended December 31, 2020, 2019 and 2018. There is prepayment and delinquency risk inherent in our servicing rights, but we currently do not use any instruments to mitigate such risks.
See Note 8 for the key inputs used in the fair value measurements of our classes of servicing rights.
Securitization Investments
In Company-sponsored securitization transactions that meet the applicable criteria to be accounted for as a sale, we retain certain residual interests and asset-backed bonds. We measure these investments at fair value on a recurring basis. Gains and losses related to our securitization investments are reported within noninterest income — securitizations in the Consolidated Statements of Operations and Comprehensive Income (Loss). We determine the fair value of our securitization investments using a discounted cash flow methodology, while also considering market data as it becomes available. We classify the residual investments as Level 3 due to the reliance on significant unobservable valuation inputs. We classify asset-backed bonds as Level 2 due to the use of quoted prices for similar assets in markets that are not active, as well as certain factors specific to us.
Our residual investments accrete interest income over the expected life using the effective yield method pursuant to ASC 325-40, Investments — Other, which reflects a portion of the overall fair value adjustment recorded each period on our residual investments. On a quarterly basis, we reevaluate the cash flow estimates over the life of
F-113

TABLE OF CONTENTS
Social Finance, Inc.
Notes to Consolidated Financial Statements  (continued)
(In Thousands, Unless Otherwise Stated and Except for Share and Per Share Data)
the residual investments to determine if a change to the accretable yield is required on a prospective basis. Additionally, we record interest income associated with asset-backed bonds over the term of the underlying bond using the effective interest method on unpaid bond amounts. Interest income on residual investments and asset-backed bonds is presented within interest income — securitizations in the Consolidated Statements of Operations and Comprehensive Income (Loss).
See Note 8 for the key inputs used in the fair value measurements of our residual investments and asset-backed bonds.
Equity Method Investments
We purchased a 16.7% interest in Apex Clearing Holdings, LLC (“Apex”) for $100,000 in December 2018, which represented our only significant equity method investment. This equity method investment was motivated by us seeking partial integration of transaction clearing and asset custody functions integral to our investment brokerage business, and the desire to diversify our earnings from lending and financial services activities. Based on accounting guidance in ASC 323, Investments — Equity Method and Joint Ventures, we concluded that we had significant influence over Apex because of our representation on Apex’s board of directors. However, we did not control Apex and, therefore, accounted for our investment under the equity method of accounting. We initially measured our equity method investments at cost, which included direct acquisition costs.
We recorded our portion of Apex equity method earnings within noninterest income — other in the Consolidated Statements of Operations and Comprehensive Income (Loss) and as an increase to the carrying value of our equity method investment in the Consolidated Balance Sheets. We recognized equity method earnings on our investment in Apex of $4,442, $795 and $117 during the years ended December 31, 2020, 2019 and 2018, respectively. Our recognized equity method earnings included basis difference amortization. Additionally, in 2020, our equity method earnings included an impairment charge, as further discussed below. The investment in Apex resulted in a $76,305 basis difference between the purchase price of the equity method investment and our ownership percentage of Apex’s net assets on the date of investment. The basis difference was attributable to separately-identified Apex software, definite-lived intangible assets and equity method goodwill. The basis difference attributable to software and definite-lived intangible assets was amortized into income as an offset to equity method earnings from Apex over the useful lives of the separately-identified Apex software and definite-lived intangible assets, which ranged from three to nine years. Our policy for amortizing separately-identified Apex assets was consistent with our policy for amortizing our purchased software and definite-lived intangible assets of a similar type.
We assess our Apex investment for possible impairment when events indicate that the fair value of the investment may be below its carrying value. When a decline in fair value is determined to be other than temporary, we adjust the carrying value of the investment to its fair value and record the impairment expense within noninterest income — other in the Consolidated Statements of Operations and Comprehensive Income (Loss). In determining whether a decline in fair value is other than temporary, we consider factors such as the duration and extent of the decline, the investee’s financial performance, and our ability and intent to retain the investment for a duration sufficient to allow for any anticipated recovery of the investment’s market value. The cost basis of the investment is not adjusted for subsequent recoveries in fair value. We did not recognize any impairment related to our Apex equity method investment during the years ended December 31, 2019 and 2018. See below for impairment recognized during the year ended December 31, 2020.
The seller of the Apex interest had call rights over our initial equity interest in Apex (“Seller Call Option”) from April 14, 2020 (“Option Start Date”) to December 14, 2023. If the Seller Call Option was exercised on or before the one-month anniversary of the Option Start Date, the aggregate purchase price would be equal to $100,000. If the Seller Call Option was exercised after the one-month anniversary of the Option Start Date, the aggregate purchase price would be $100,000 plus a per diem amount of $27 for each day elapsed following the Option Start Date. We concluded that the Seller Call Option was neither a freestanding derivative, nor an embedded derivative that required separate classification on our Consolidated Balance Sheets. Therefore, we evaluated the provisions of the Seller Call Option arrangement in our investment impairment assessment at each reporting date.
F-114

TABLE OF CONTENTS
Social Finance, Inc.
Notes to Consolidated Financial Statements  (continued)
(In Thousands, Unless Otherwise Stated and Except for Share and Per Share Data)
During January 2021, the seller of our Apex interest exercised the Seller Call Option on our initial Apex equity investment. Therefore, we will no longer recognize Apex equity investment income subsequent to the call date. We measured the carrying value of the Apex equity method investment as of December 31, 2020 equal to the call payment that we received in January 2021 of $107,534, which resulted in the recognition of an impairment charge of $4,340 during the fourth quarter of 2020. During the year ended December 31, 2020, we invested an additional $145 in Apex. We had a total equity method investment balance of $102,946 as of December 31, 2019 related to our investment in Apex, which included $1,633 of direct acquisition costs that were capitalized as part of the equity method investment balance. We did not receive any distributions during the years ended December 31, 2020, 2019 or 2018. Due to the additional investment we made during 2020, we will maintain an immaterial investment in Apex, but we will no longer qualify for equity method accounting, given our lack of influence and infinitesimal ownership percentage in Apex.
As of December 31, 2019, we also had a total equity method investment balance related to a residential mortgage origination joint venture of $1,103. During the year ended December 31, 2020, this joint venture was discontinued, at which point we received a closing distribution of $974 related to this investment, and we recognized an immaterial loss on the dissolution date. Historically, the income and loss related to this joint venture was immaterial, and we made an immaterial incremental investment during 2019.
We evaluate our equity method investments for significance in accordance with Regulation S-X, Rule 3-09 (“Rule 3-09”) and Regulation S-X, Rule 4-08(g) (“Rule 4-08(g)”) and present separate annual financial statements or summarized financial information, respectively, as required by those rules. See Note 14 for the financial information of the entities in which we have equity method investments.
Property, Equipment and Software
All property, equipment and software are initially recorded at cost; repairs and maintenance are expensed as incurred. Computer hardware, furniture and fixtures, finance lease ROU assets and software are depreciated or amortized on a straight-line basis over the estimated useful life of each class of depreciable or amortizable assets (ranging from 2.5 to 7.0 years). Leasehold improvements are amortized over the shorter of the respective lease term or the estimated lives of the leasehold improvements.
Software includes both purchased and internally-developed software. Internally-developed software is capitalized when preliminary project efforts are successfully completed, and it is probable that both the project will be completed and the software will be used as intended. Capitalized costs consist of salaries and compensation costs for employees, fees paid to third-party consultants who are directly involved in development efforts and costs incurred for upgrades and functionality enhancements. Other costs are expensed as incurred.
F-115

TABLE OF CONTENTS
Social Finance, Inc.
Notes to Consolidated Financial Statements  (continued)
(In Thousands, Unless Otherwise Stated and Except for Share and Per Share Data)
The table below presents our major classes of depreciable and amortizable assets by function as of the dates indicated:
Gross
Balance
Accumulated Depreciation/Amortization Carrying
Value
December 31, 2020
Computer hardware(1)
$ 13,494  $ (6,037) $ 7,457 
Leasehold improvements 36,725  (7,920) 28,805 
Furniture and fixtures(2)
12,361  (5,251) 7,110 
Software(3)
42,323  (18,587) 23,736 
Finance lease ROU assets(4)
15,100  (719) 14,381 
Total $ 120,003  $ (38,514) $ 81,489 
December 31, 2019
Computer hardware $ 6,518  $ (3,052) $ 3,466 
Leasehold improvements 35,571  (3,923) 31,648 
Furniture and fixtures(2)
9,736  (3,134) 6,602 
Software 26,188  (8,351) 17,837 
Total $ 78,013  $ (18,460) $ 59,553 
__________________
(1)During the year ended December 31, 2020, we recognized computer hardware assets primarily associated with our acquisition of Galileo and expansion of one of the Galileo data centers, as well as to accommodate our growing workforce and our remote work environment during the COVID-19 pandemic.
(2)As of December 31, 2020, furniture and fixtures included office equipment as well as other furniture and fixtures associated with SoFi Stadium. The description as of December 31, 2019 was changed to conform to the current period presentation.
(3)During the year ended December 31, 2020, we recognized software assets primarily for internally-developed software projects related to significant development and enhancements for SoFi Money, SoFi Invest, Technology Platform and SoFi Credit Card.
(4)As of December 31, 2020, finance lease ROU assets included our rights to certain physical signage within SoFi Stadium. See Note 15 for additional information on our leases.
Depreciation and amortization expense for the years ended December 31, 2020, 2019 and 2018 was $20,097, $12,947 and $7,609, respectively. We recognized software abandonment of $2,137 during the year ended December 31, 2019. There was no software abandonment during the years ended December 31, 2020 and 2018. There were no fixed asset or software impairments during any of the years presented.
Goodwill and Intangible Assets
Goodwill represents the fair value of an acquired business in excess of the fair value of the identified net assets acquired. Goodwill is tested for impairment annually or whenever indicators of impairment exist. We apply the provisions of ASU 2017-04, Simplifying the Test for Goodwill Impairment, to calculate goodwill impairment (if any) on at least an annual basis, which provides for an unconditional option to bypass the qualitative assessment.
Impairment of goodwill is the condition that exists when the carrying amount of a reporting unit that includes goodwill exceeds its fair value. A goodwill impairment loss is recognized for the amount that the carrying amount of a reporting unit, including goodwill, exceeds its fair value, limited to the total amount of goodwill allocated to that reporting unit. Therefore, if the fair value of a reporting unit exceeds its carrying amount, goodwill of the reporting unit is not impaired. Our annual impairment testing date is October 1.
Intangible assets as of December 31, 2020 included acquired technology; customer-related contracts; trade names, trademarks and domain names; core banking infrastructure; and broker-dealer license and trading rights. Definite-lived intangible assets are straight-line amortized over their useful lives and reviewed for impairment annually and whenever events or circumstances indicate that the carrying amount of such assets may not be recoverable. We do not have any indefinite-lived intangible assets.
F-116

TABLE OF CONTENTS
Social Finance, Inc.
Notes to Consolidated Financial Statements  (continued)
(In Thousands, Unless Otherwise Stated and Except for Share and Per Share Data)
See Note 2 and Note 3 for further discussion of goodwill and intangible assets, including those recognized in connection with recent business acquisitions.
Leases
In accordance with ASC 842, Leases, which we began applying as of January 1, 2019, we determine if an arrangement is or contains a lease at inception of the contract. A contract is or contains a lease if the contract conveys the right to control the use of identified property or equipment for a period of time in exchange for consideration. For our current office and non-office classes of operating leases, we elected the practical expedient to choose not to separate non-lease components from lease components and instead to account for each separate lease component and the non-lease components associated with that lease component as a single lease component. For our current classes of finance leases, we did not elect to apply this practical expedient and, instead, separately identify and measure the non-lease components of the contracts. As an accounting policy election, we apply the short-term lease exemption practical expedient to any lease that, at the commencement date, has a lease term of 12 months or less and does not include an option to purchase the underlying asset that we are reasonably certain to exercise.
Operating leases are presented within operating lease right-of-use (“ROU”) assets and operating lease liabilities in the Consolidated Balance Sheets. Finance lease ROU assets are presented within property, equipment and software and finance lease liabilities are presented within accounts payable, accruals and other liabilities in the Consolidated Balance Sheets. Operating and finance lease ROU assets represent our right to use an underlying asset for the lease term and operating and finance lease liabilities represent our obligation to make lease payments arising from the lease. ROU assets and lease liabilities are recognized at commencement date based on the present value of lease payments over the lease term. As our leases do not provide an implicit borrowing rate, we use our incremental borrowing rate based on the information available at commencement date in determining the present value of lease payments.
The operating lease ROU assets are increased by any prepaid lease payments and are reduced by any unamortized lease incentives. Our lease terms may include options to extend or terminate the lease when it is reasonably certain that we will exercise that option. Base rent is subject to rent escalations on each annual anniversary from the lease commencement dates. Lease expense for lease payments, including any step rent provisions specified in the lease agreements, is recognized on a straight-line basis over the lease term and is allocated among the components of noninterest expense in the Consolidated Statements of Operations and Comprehensive Income (Loss). The finance lease ROU assets are depreciated on a straight-line basis over the estimated useful life of seven years. Interest expense on finance leases is recognized for the difference between the present value of the lease liabilities and the scheduled lease payments within interest expense — other in the Consolidated Statements of Operations and Comprehensive Income (Loss).
See Note 15 for additional information on our leases.
Derivative Financial Instruments
We enter into derivative contracts to manage future loan sale execution risk. We did not elect hedge accounting, as management’s hedging intentions are to economically hedge the risk of unfavorable changes in the fair value of our student loans, personal loans and home loans. Our derivative instruments include interest rate futures, interest rate options, interest rate swaps, interest rate lock commitments (“IRLC”), credit default swaps and mortgage pipeline hedges. The interest rate futures, interest rate options and mortgage pipeline hedges are measured at fair value and categorized as Level 1 fair value assets and liabilities, as all contracts held are traded in active markets for identical assets or liabilities and quoted prices are accessible by us at the measurement date. The interest rate swaps are measured at fair value and categorized as Level 2 fair value assets and liabilities, as all contracts held are traded in active markets for similar assets or liabilities and other observable inputs are available at the measurement date. IRLCs are categorized as Level 3 fair value assets and liabilities, as the fair value is highly dependent on an assumed loan funding probability. Changes in derivative instrument fair values are recognized in earnings as they occur. For the years ended December 31, 2020, 2019 and 2018, we recorded a gain (loss) of $(40,299), $(23,887) and $38,205, respectively, in the Consolidated Statements of Operations and Comprehensive Income (Loss) within noninterest
F-117

TABLE OF CONTENTS
Social Finance, Inc.
Notes to Consolidated Financial Statements  (continued)
(In Thousands, Unless Otherwise Stated and Except for Share and Per Share Data)
income — loan origination and sales related to our derivative assets and liabilities associated with our management of future loan sale execution risk. The loss during the year ended December 31, 2020 was inclusive of a $22,269 gain on credit default swaps that were opened and settled during the 2020 period. Depending on the measurement date position, derivative financial instruments are presented within other assets or accounts payable, accruals and other liabilities in the Consolidated Balance Sheets.
In addition, in the past we have entered into derivative contracts to hedge the market risk associated with some of our non-securitization investments, which are also presented within other assets or accounts payable, accruals and other liabilities in the Consolidated Balance Sheets. Gains and losses are recorded within noninterest income — other in the Consolidated Statements of Operations and Comprehensive Income (Loss). For the years ended December 31, 2020 and 2019, we recorded a gain (loss) of $996 and $(1,151), respectively. There was no gain or loss recorded for the year ended December 31, 2018.
Certain derivative instruments are subject to enforceable master netting arrangements. Accordingly, we present our net asset or liability position by counterparty within the Consolidated Balance Sheets. Additionally, since our cash collateral balances do not approximate the fair value of the derivative position, we do not offset our right to reclaim cash collateral or obligation to return cash collateral against recognized derivative assets or liabilities. Cash collateral included within restricted cash and restricted cash equivalents in the Consolidated Balance Sheets related to our master netting arrangements was $1,746 and $379 as of December 31, 2020 and 2019, respectively. Our right of offset resulted in us netting $0 and $145 of gross derivative liabilities against derivative assets as of December 31, 2020 and 2019, respectively. The corresponding net derivative asset and liability positions were $0 and $2,955, respectively, as of December 31, 2020 and $960 and $396, respectively, as of December 31, 2019. See Note 8 for additional information on our derivative assets and liabilities. Our derivative instruments are reported within cash from operating activities in the Consolidated Statements of Cash Flows.
Residual Interests Classified as Debt
For residual interests related to consolidated securitizations, the residual interests held by third parties are presented as residual interests classified as debt in the Consolidated Balance Sheets. We measure residual interests classified as debt at fair value on a recurring basis. We record subsequent measurement changes in fair value in the period in which the change occurs within noninterest income — securitizations in the Consolidated Statements of Operations and Comprehensive Income (Loss). We determine the fair value of residual interests classified as debt using a discounted cash flow methodology, while also considering market data as it becomes available. We classify the residual interests classified as debt as Level 3 due to the reliance on significant unobservable valuation inputs.
We recognize interest expense related to residual interests classified as debt over the expected life using the effective yield method, which reflects a portion of the overall fair value adjustment recorded each period on our residual interests classified as debt. Interest expense related to residual interests classified as debt is presented within interest expense — securitizations and warehouses in the Consolidated Statements of Operations and Comprehensive Income (Loss). On a quarterly basis, we reevaluate the cash flow estimates to determine if a change to the accretable yield is required on a prospective basis.
See Note 8 for the key inputs used in the fair value measurements of residual interests classified as debt.
Deferred Debt Issuance Costs and Debt
We borrow from various financial institutions to finance our lending activities. Costs incurred in connection with financing, such as banker fees, origination fees and legal fees, are classified as deferred debt issuance costs. We capitalize these costs and report the amounts as a direct deduction from the carrying amount of the debt balance. The capitalized costs are amortized over the expected life of the related financing agreements using the straight-line method for revolving facilities and the effective interest method for securitization debt. Remaining unamortized fees are expensed immediately upon early extinguishment of the debt. In a debt modification for revolving debt, the initial issuance costs and any additional fees incurred as a result of the modification are deferred over the term of the new agreement, if the borrowing capacity of the revolving facility is increased. In the case that a modification results
F-118

TABLE OF CONTENTS
Social Finance, Inc.
Notes to Consolidated Financial Statements  (continued)
(In Thousands, Unless Otherwise Stated and Except for Share and Per Share Data)
in a decrease in our borrowing capacity, any fees paid to the creditor and any third-party costs incurred are associated with the new arrangement and are, therefore, deferred and amortized over the term of the new arrangement. Any unamortized deferred costs relating to the old arrangement at the time of the modification are written off in proportion to the decrease in borrowing capacity of the old arrangement. The remaining unamortized deferred costs relating to the old arrangement are deferred and amortized over the term of the new arrangement.
Redeemable Preferred Stock
Our redeemable preferred stockholders are entitled to receive up to their liquidation value upon the occurrence of a change in control or other liquidity event and, therefore, redeemable preferred stock has been classified outside of permanent equity. The carrying values of redeemable preferred stock, which have been reduced by preferred stock issuance costs, have not been accreted to their redemption values as of the dates presented, as a change in control or other liquidity event was not yet considered probable.
Accumulated Deficit
We purchase SoFi common stock from time to time and constructively retire the common stock. We record purchases of common stock as a reduction to accumulated deficit in the Consolidated Balance Sheets.
Interest Income
We record interest income associated with loans over the term of the underlying loans using the effective interest method on unpaid loan principal amounts, which is presented within interest income — loans in the Consolidated Statements of Operations and Comprehensive Income (Loss). For our loans measured at fair value, delinquent loans are charged off after 120 days of nonpayment or on the date of the confirmed loss and for our credit card loans measured at amortized cost, delinquent loans are charged off after 180 days of nonpayment or on the date of the confirmed loss, at which time we stop accruing interest and reverse all accrued but unpaid interest. Loans are returned to accrual status if the loans are brought to nondelinquent status or have performed in accordance with the contractual terms for a reasonable period of time and, in management’s judgment, will continue to make scheduled periodic principal and interest payments.
As of the balance sheet dates presented, related party interest income primarily arose from a note receivable we issued to a stockholder in 2019 and lending activities with our equity method investee. See Note 14 and Note 18 for additional information. Other interest income is primarily earned on our bank balances and on member deposits with our member bank holding companies that enable our SoFi Money product.
Loan Origination and Sales Activities
For our loans measured at fair value, all direct fees and costs related to the origination process are recognized in earnings as earned or incurred. Direct fees, which primarily relate to home loan originations, and direct loan origination costs are recorded within noninterest income — loan origination and sales and noninterest expense — cost of operations, respectively, in the Consolidated Statements of Operations and Comprehensive Income (Loss). For our credit card loans, direct loan origination costs are deferred in other assets on the Consolidated Balance Sheets and amortized on a straight-line basis over the privilege period, which we have determined to be 12 months, within interest income — loans in the Consolidated Statements of Operations and Comprehensive Income (Loss). These costs were immaterial as of and for the year ended December 31, 2020.
As part of our loan sale agreements, we may retain the rights to service sold loans. We calculate a gain or loss on the sale based on the sum of the proceeds from the sale and any servicing asset recognized, less the carrying value of the loans sold. Our gain or loss calculation is also inclusive of repurchase liabilities recognized at the time of sale.
F-119

TABLE OF CONTENTS
Social Finance, Inc.
Notes to Consolidated Financial Statements  (continued)
(In Thousands, Unless Otherwise Stated and Except for Share and Per Share Data)
Servicing
On a monthly basis, we receive servicing fees on certain portfolios of sold loans from the purchasers of these loans. These servicing fees are accounted for under ASC 860, Transfers and Servicing. Servicing fees compensate us for the costs incurred in servicing the related loans, including managing payments from borrowers, payments to investors and maintaining investors’ account portfolios. In the Consolidated Statements of Operations and Comprehensive Income (Loss), the initial recognition of servicing assets in conjunction with loan sales in which we retain servicing is presented within noninterest income — loan origination and sales, while subsequent changes in fair market value are presented within noninterest income — servicing.
Revenue Recognition
In accordance with ASC 606, Revenue from Contracts with Customers, in each of our revenue arrangements outlined below, revenue is recognized when control of the promised goods or services is transferred to the customer in an amount that reflects our expected consideration in exchange for those goods or services.
Technology Platform Fees
Commencing in May 2020 with our acquisition of Galileo, we earn Technology Platform fees for providing an integrated platform as a service for financial and non-financial institutions. Our single performance obligation is the promise to stand ready to provide integrated technology platform services as needed throughout the contract term. The Technology Platform fees are determined based on the number of accounts supported on the platform and on the volume of transactions generated on the platform. We satisfy our performance obligation continuously throughout the contractual arrangements and our customers receive and consume the benefits simultaneously as we perform. Our integrated platform as a service is a stand-ready obligation, as the timing and quantity of accounts on the platform and transactions generated on the platform are not determinable ex ante. Under a stand-ready obligation, our performance obligation is satisfied over time throughout the contract term rather than at a point in time. Because the service of standing ready to fulfill our integrated platform as a service offering is substantially the same each day and has the same pattern of transfer to the customer, we determined that our stand-ready performance obligation comprises a series of distinct days of service.
Certain arrangements contain provisions for monthly minimum fees, which are scheduled throughout the initial term of the contract. We assess the substance of the contractual minimum fees on an individual contract basis. When there is reasonable certainty that Technology Platform fees over the contract term will exceed the minimum thresholds, and the minimum fee is not deemed substantive as a percentage of the expected transaction price, we recognize revenue as we satisfy our performance obligation and, as such, the minimum fee is of no effect. Alternatively, when we are not reasonably certain that the contractual minimum fee will be exceeded over the life of the contract, or when the minimum fee represents a substantive portion of the expected transaction price, we recognize the minimum guarantee and expected variable fees over time by using an appropriate measure of progress over the contract period. In our case, the appropriate measure of progress is the stand-ready obligation to provide technology platform services over the life of the contract. However, we concluded that in certain cases we do not qualify for the variable allocation exception outlined in ASC 606-10-32-40. As such, on a quarterly basis we reassess our estimates of variable consideration and prospectively adjust our recognition of variable consideration over the life of the customer contract. During the period subsequent to our acquisition of Galileo through December 31, 2020, we did not make any material adjustments to our recognition of variable consideration. In our technology platform transactions, we act in the capacity of a principal, as we are primarily responsible for satisfying the technology platform performance obligation, and demonstrate the requisite control and power to fulfill the performance obligation and, therefore, present revenue on a gross basis.
In addition, certain contracts contain a provision for a fixed, upfront implementation fee related to setup activities, which represents an advance payment for future technology platform services and is recorded as a deferred revenue liability at contract inception. The setup activity related to the implementation fee does not constitute an activity that results in the transfer of a promised good or service to our customers. Our implementation fees do not relate to a performance obligation and are, therefore, recognized ratably over the contract life, as we
F-120

TABLE OF CONTENTS
Social Finance, Inc.
Notes to Consolidated Financial Statements  (continued)
(In Thousands, Unless Otherwise Stated and Except for Share and Per Share Data)
consider the implementation fee partially earned each month that we meet our performance obligation over the life of the contract. We had deferred revenues of $2,520 and $0 as of December 31, 2020 and 2019, which are presented within accounts payable, accruals and other liabilities in the Consolidated Balance Sheets. We recognized revenue of $342 from the date of acquisition through December 31, 2020 associated with deferred revenues, which is presented within noninterest income — Technology Platform fees in the Consolidated Statements of Operations and Comprehensive Income (Loss).
Sales commissions: Our commissions incurred in connection with obtaining a technology platform contract qualify for capitalization under ASC 340-40, Other Assets and Deferred Costs, and are amortized ratably over the contract term. Capitalized sales commissions presented within other assets in the Consolidated Balance Sheets were $527 as of December 31, 2020. Additionally, we incur ongoing monthly commissions, which are expensed as incurred, as the benefit of such sales efforts are realized only in the period in which the commissions are earned. Commissions recorded within noninterest expense — sales and marketing in the Consolidated Statements of Operations and Comprehensive Income (Loss) were $1,659 during the year ended December 31, 2020, of which $185 represented amortization of capitalized sales commissions from the date of acquisition through December 31, 2020.
Payments to customers: Certain contracts include provisions for customer incentives, which may be payable up front or applied to future or past Technology Platform fees. Payments to customers reduce the gross transaction price, as they represent constraints on the revenues expected to be realized. Upfront customer incentives are recorded as prepaid assets and presented within other assets in the Consolidated Balance Sheets, and are applied against revenue in the period such incentives are earned by the customer. Customer incentives for future Technology Platform fees are applied ratably against future Technology Platform activity in accordance with the contract terms to the extent that cumulative revenues with the customer, net of incentives, are positive. Any incentive in excess of cumulative revenues is expensed as a contract cost. Customer incentives for past Technology Platform fees are recorded as a reduction to revenue in the period incurred, subject to the same cumulative revenue constraints.
Payment Network Fees
In customer arrangements separate from our Technology Platform fees, we earn payment network fees, which primarily constitute interchange fees, for satisfying our performance obligation to enable transactions through a payment network as the sponsor of such transactions. Interchange fees, which are remitted by the merchant, are calculated by multiplying a set fee percentage (as stipulated by the debit card payment network) by the transaction volume processed through such network. Transaction volume and related fees payable to us for interchange and other network fees are reported to us on a daily basis. Therefore, there is no constrained variable consideration within a reporting period. Using the expected value method, we assign a 100% probability to the transaction price as calculated using actual transaction volume processed through the payment network.
Our performance obligation is completely satisfied once we successfully fulfill a requested transaction. We measure our progress toward complete satisfaction of our performance obligation using the output method, with processed transaction volume representing the measure that faithfully depicts the transfer of our services. The value of our services is represented by the network fee rates, as stipulated by the applicable payment network.
In addition to payment network fees earned on our own branded cards, we also earn payment network fees for serving as a transaction card program manager for enterprise customers that are the program marketers for separate card programs. In these arrangements, we have two performance obligations: i) performing card program services and ii) performing transaction card enablement services, for which we arrange for performance by the network associations and bank issuers to enable certain aspects of the transaction card process. The transaction price in these arrangements is largely dependent on network association guidelines and the program management economics are pooled, with the Company receiving a contractual share of payment network fees.
The payment network fees are determined based on the type and volume of monthly card program activity and, therefore, represent variable consideration, as such amounts are not known at contract inception. However, as payment network fees are settled on a monthly basis, the variable consideration within a reporting period is not
F-121

TABLE OF CONTENTS
Social Finance, Inc.
Notes to Consolidated Financial Statements  (continued)
(In Thousands, Unless Otherwise Stated and Except for Share and Per Share Data)
constrained. We satisfy both performance obligations continuously throughout the contractual arrangements and our customers receive and consume the benefits simultaneously as we perform. Further, satisfaction of both performance obligations occurs within the same measurement period. As such, allocation of the transaction price between the performance obligations is not meaningful, as it would not impact the pattern of revenue recognition. Using the expected value method, we assign a 100% probability to the transaction price as calculated using actual monthly card program activity.
Our program management performance obligations are completely satisfied once we successfully enable and process transaction card activity. We measure our progress toward complete satisfaction of our performance obligations using the output method, with card program activity representing the measure that faithfully depicts the transfer of program management services. The value of our services is represented by the transaction fee rates, as stipulated by the network association guidelines.
In our payment network fee transactions, we act in the capacity of an agent due to our lack of pricing power and because we are not primarily responsible for fulfilling the transaction enablement performance obligation, and ultimately lack control over fulfilling the performance obligations to the customer. Therefore, we recognize revenue net of fees paid to other parties within the payment networks.
Referrals
We earn a specified referral fee in connection with referral activity we facilitate through our platform. The referral fee is paid to us by third-party partners that offer services to end users who do not use one of our product offerings, but who were referred to the partners through our platform. As such, the third-party enterprise partners are our customers in these referral arrangements.
Our single performance obligation is to present referral leads to our enterprise partner customers. In some instances, the referral fee is calculated by multiplying a set fee percentage by the dollar amount of a completed transaction between our partners and their customers. In other instances, the referral fee represents the price per referral multiplied by the number of referrals (referred units) as measured by a consummated transaction between our partners and their customers.
As the transaction volume or referred units are not known at contract inception, these arrangements contain variable consideration. However, as referral fees are billed to, and collected directly from, our partners on a monthly basis, the variable consideration within a reporting period is not constrained. We recognize revenue at the time of a referral-based transaction by applying the expected value method, wherein we assign 100% probability to the transaction price as calculated using actual transaction volume or referred units.
We satisfy our performance obligation continuously throughout the contractual arrangements with our partners and our partners receive and consume the benefits simultaneously as we perform. Our referral fee performance obligation is completely satisfied once we provide referrals to our partners and there is a consummated transaction. We measure our progress toward complete satisfaction of our performance obligation using the output method, with referred units or referred transaction volume representing the measure that faithfully depicts the transfer of referral services to our partners. The value of our services transferred to our partners is represented by the referral fee rate, as agreed upon at contract inception.
In our referral arrangements, we act in the capacity of a principal, as we are primarily responsible for fulfilling our referral promise to our enterprise customers, exhibit control, and have discretion in setting the price we charge to our enterprise customers. Therefore, we present our revenue on a gross basis.
Enterprise Services
We earn fees in connection with services we provide to enterprise partners to facilitate transactions for the benefit of their employees, such as 529 plan contributions or student loan payments, which represents our single performance obligation in the arrangements. Similar to our referral services, we agree on a rate per transaction with each of our customers, which represents variable consideration at contract inception. However, as enterprise service
F-122

TABLE OF CONTENTS
Social Finance, Inc.
Notes to Consolidated Financial Statements  (continued)
(In Thousands, Unless Otherwise Stated and Except for Share and Per Share Data)
fees are billed to, and collected directly from, our partners on a monthly basis, the variable consideration within a reporting period is not constrained.
We satisfy our performance obligation to provide enterprise services continuously throughout our contractual arrangements with our enterprise partners. Our enterprise partners receive and consume the benefits of our enterprise services simultaneously as we perform. Our enterprise service performance obligation is completely satisfied upon completion of a transaction on behalf of our enterprise partners. For instance, we may facilitate student loan payments made by enterprise partners on behalf of their employees by directing those payments to the appropriate student loan servicer. Once the student loan servicer recognizes the payment, the transaction and our performance obligation are simultaneously complete. We measure our progress toward complete satisfaction of our performance obligation using the output method, with completed transaction requests representing the measure that faithfully depicts the transfer of enterprise services. The value of our enterprise services is represented by a negotiated fee, as agreed upon at contract inception. Our revenue is reported on a gross basis, as we act in the capacity of a principal, demonstrate the requisite control over the service, and are primarily responsible for fulfilling the performance obligation to our enterprise service customer.
Brokerage
We earn fees in connection with facilitating investment-related transactions through our platform, which constitutes our single performance obligation in the arrangements. Our performance obligation is determined by the specific service selected by the customer, such as brokerage transactions, share lending, digital assets transactions and exchange conversion. In certain brokerage transactions, we act in the capacity of a principal and earn negotiated fees based on the number and type of transactions requested by our customers. In our share lending arrangements and pay for order flow arrangements, we do not oversee the execution of the transactions, and ultimately lack requisite control, but benefit through a negotiated revenue sharing arrangement. Therefore, we act in the capacity of an agent and recognize revenue net of fees paid to satisfy the performance obligation. In our digital assets arrangements, our fee is calculated as a negotiated percentage of the transaction volume. In these arrangements, we act in the capacity of a principal and recognize revenue gross of the fees we pay to obtain the digital assets for access by our members. In our exchange conversion arrangements, we act in the capacity of a principal and earn fees for exchanging one currency for another.
As the investment-related transaction volume and type are not known at contract inception, these arrangements contain variable consideration. However, as our brokerage fees are settled on a monthly basis or sometimes daily basis, the variable consideration within a reporting period is not constrained. We recognize revenue at the time of an investment transaction by applying the expected value method, wherein we assign 100% probability to the transaction price as calculated using actual investment transaction activity.
Our brokerage performance obligation is completely satisfied upon completion of an investment-related transaction. We measure our progress toward complete satisfaction of our performance obligation using the output method, with investment transaction activity representing the measure that faithfully depicts the transfer of brokerage services. The value of our brokerage services is represented by the transaction fees, as determined at the point of transaction.
We incur costs for clearing and processing services that relate to satisfied performance obligations within our brokerage arrangements. In accordance with ASC 340-40, we expense these costs as incurred. Although certain of our commission costs qualify for capitalization, their amortization period is less than one year. Therefore, utilizing the practical expedient related to incremental costs of obtaining a contract, we expense these costs as incurred. Additionally, we pay upfront account funding incentives to customers that are not tied to a contract period. Therefore, we expense these payments as incurred.
Disaggregated Revenue
For the periods accounted for in accordance with ASC 606, the table below presents revenue from contracts with customers disaggregated by type of service, which best depicts how the revenue and cash flows are affected by
F-123

TABLE OF CONTENTS
Social Finance, Inc.
Notes to Consolidated Financial Statements  (continued)
(In Thousands, Unless Otherwise Stated and Except for Share and Per Share Data)
economic factors, and by the reportable segment to which each revenue stream relates. Revenues from contracts with customers are presented within noninterest income — Technology Platform fees and noninterest income — other in the Consolidated Statements of Operations and Comprehensive Income (Loss). There are no revenues from contracts with customers attributable to our Lending segment for any of the periods presented.
Year Ended December 31,
2020 2019 2018
Financial Services
Referrals
$ 5,889  $ 3,652  $ 680 
Brokerage
3,470  84  — 
Payment network
2,433  660  41 
Enterprise services
244  124  102 
Total
$ 12,036  $ 4,520  $ 823 
Technology Platform
Technology Platform fees
$ 90,128  $ —  $ — 
Payment network
1,167  —  — 
Total
$ 91,295  $ —  $ — 
Total Revenue from Contracts with Customers
Technology Platform fees
$ 90,128  $ —  $ — 
Referrals
5,889  3,652  680 
Payment network
3,600  660  41 
Brokerage
3,470  84  — 
Enterprise services
244  124  102 
Total
$ 103,331  $ 4,520  $ 823 
Advertising, Sales and Marketing
Included within noninterest expense — sales and marketing in the Consolidated Statements of Operations and Comprehensive Income (Loss) are advertising production costs and advertising communication costs, as well as amounts paid to various affiliates to market our products. For the years ended December 31, 2020, 2019 and 2018, advertising totaled $138,888, $169,942 and $143,081, respectively. Advertising costs are expensed either as incurred or when the advertising takes place, depending on the nature of the advertising activity.
Expenses incurred by us related to member acquisition, including brand development, business development and direct member marketing expenses, are also presented within noninterest expense — sales and marketing in the Consolidated Statements of Operations and Comprehensive Income (Loss).
Technology and Product Development
Expenses incurred by us related to technology, product design and implementation, which includes compensation and benefits, are classified as noninterest expense — technology and product development in the Consolidated Statements of Operations and Comprehensive Income (Loss).
Loss Contingencies
Loss contingencies, including claims and legal actions arising in the ordinary course of business, are recorded in accounts payable, accruals and other liabilities in the Consolidated Balance Sheets, as further described in Note 15. Such liabilities and associated expenses are recorded when the likelihood of loss is probable and an amount or range of loss can be reasonably estimated. Such estimates are based on the best information available at the time. As additional information becomes available, we reassess the potential liability and record an estimate in the period in which the adjustment is probable and an amount or range can be reasonably estimated. Due to the inherent
F-124

TABLE OF CONTENTS
Social Finance, Inc.
Notes to Consolidated Financial Statements  (continued)
(In Thousands, Unless Otherwise Stated and Except for Share and Per Share Data)
uncertainties of loss contingencies, estimates may be different from the actual outcomes. With respect to legal proceedings, we recognize legal fees as they are incurred within noninterest expense — general and administrative expense in our Consolidated Statements of Operations and Comprehensive Income (Loss).
Stock-Based Compensation
Stock-based compensation made to employees and non-employees, which includes stock options and RSUs, is measured based on the grant date fair value of the awards and is recognized as compensation expense typically on a straight-line basis over the period during which the stock-based award holder is required to perform services in exchange for the award (the vesting period). Stock-based compensation expense is allocated among the components of noninterest expense in the Consolidated Statements of Operations and Comprehensive Income (Loss). We use the Black-Scholes Option Pricing Model (the “Black-Scholes Model”) to estimate the fair value of stock options. RSUs are measured based on the fair values of the underlying stock on the dates of grant. We recognize forfeitures as incurred and, therefore, reverse previously recognized stock-based compensation expense at the time of forfeiture.
Comprehensive Loss
Comprehensive loss consists of net loss and foreign currency translation adjustments.
Income Taxes
We recognize deferred tax assets and liabilities for the expected future tax consequences of temporary differences between the financial reporting and tax basis of assets and liabilities, as well as for operating loss and tax credit carryforwards. Deferred tax assets and liabilities are measured using the tax rates that are expected to apply to taxable income for the years in which those tax assets and liabilities are expected to be realized or settled. In assessing the realizability of deferred tax assets, management reviews all available positive and negative evidence. Valuation allowances are recorded to reduce deferred tax assets to the amount we believe is more likely than not to be realized.
We follow accounting guidance in ASC 740, Income Taxes, as it relates to uncertain tax positions, which provides information and procedures for financial statement recognition and measurement of tax positions taken, or expected to be taken, in tax returns. The tax effects from an uncertain tax position can be recognized in the financial statements only if the tax position would more likely than not be upheld on examination by the taxing authorities based on the merits of the tax position. Management is required to analyze all open tax years, as defined by the statute of limitations, for all jurisdictions. We accrue tax penalties and interest, if any, as incurred and recognize them within income tax (expense) benefit in our Consolidated Statements of Operations and Comprehensive Income (Loss).
Recently Adopted Accounting Standards
Measurement of Credit Losses on Financial Instruments
In June 2016, the FASB issued ASU 2016-13, Financial Instruments — Credit Losses: Measurement of Credit Losses on Financial Instruments. This ASU required timelier recording of credit losses on loans and other financial instruments. This standard aligned the accounting with the economics of lending by requiring banks and other lending institutions to immediately record the full amount of credit losses that were expected in their loan portfolios. The new guidance required an organization to measure all expected credit losses for financial assets held at the reporting date based on historical experience, current conditions and reasonable and supportable forecasts. This standard required enhanced disclosures related to the significant estimates and judgments used in estimating credit losses, as well as the credit quality and underwriting standards of an organization’s portfolio. Additionally, the new guidance amended the accounting for credit losses on available-for-sale debt securities and purchased financial assets with credit deterioration.
Subsequently in November 2018, the FASB issued ASU 2018-19, Codification Improvements to Topic 326, Financial Instruments — Credit Losses, which extended the transition date of the amendments in ASU 2016-13 to
F-125

TABLE OF CONTENTS
Social Finance, Inc.
Notes to Consolidated Financial Statements  (continued)
(In Thousands, Unless Otherwise Stated and Except for Share and Per Share Data)
January 1, 2022, with early application permitted. At the time of adoption, the standard applied to our measurement of expected credit losses on trade accounts receivable from contracts with customers, certain financing receivables and certain loan repurchase reserves representing guarantees of credit exposure. We adopted ASU 2016-13 on January 1, 2020, and there was not a material impact on our consolidated financial statements.
Codification Improvements to Financial Instruments
In March 2020, the FASB issued ASU 2020-03, Codification Improvements to Financial Instruments, which revised a wide variety of topics in the Codification with the intent to make the Codification easier to understand and apply by eliminating inconsistencies and providing clarifications. ASU 2020-03 was effective immediately upon its release in March 2020 and had an immaterial impact on our consolidated financial statements.
Recent Accounting Standards Issued, But Not Yet Adopted
Facilitation of the Effects of Reference Rate Reform on Financial Reporting
In March 2020, the FASB issued ASU 2020-04, Reference Rate Reform (Topic 848): Facilitation of the Effects of Reference Rate Reform on Financial Reporting. This ASU provides optional expedients and exceptions, subject to meeting certain criteria, for applying existing U.S. GAAP contract modification accounting due to the expected phase out of the London Interbank Offered Rate (“LIBOR”) by the end of 2021. The standard applies to both contract modifications that replace a reference rate affected by reference rate reform and contemporaneous modifications of other contract terms related to the replacement of the reference rate. The standard was effective upon issuance and may be applied to contract modifications from January 1, 2020 through December 31, 2022. The provisions of the standard must be applied prospectively for all similar eligible contract modifications. We are in the process of reviewing our borrowings and Series 1 redeemable preferred stock dividends that utilize LIBOR as the reference rate and are evaluating options for modifying such arrangements in accordance with the provisions of the standard and the potential impact that such modifications may have on the consolidated financial statements and related disclosures. We have not modified the reference rates in any applicable agreements as of December 31, 2020.
Accounting for Convertible Instruments and Contracts in an Entity’s Own Equity
In August 2020, the FASB issued ASU 2020-06, Debt — Debt with Conversion and Other Options (Subtopic 470-20) and Derivatives and Hedging — Contracts in Entity’s Own Equity (Subtopic 815-40): Accounting for Convertible Instruments and Contracts in an Entity’s Own Equity. This ASU simplifies the accounting for certain convertible instruments, amends the guidance on derivative scope exceptions for contracts in an entity’s own equity, and modifies the guidance on diluted earnings per share calculations as a result of these changes. The standard is effective for fiscal years and interim periods beginning after December 15, 2023. Early adoption is permitted, but no earlier than fiscal years beginning after December 15, 2020, including interim periods within those fiscal years. We are currently evaluating the effect of adopting this standard on our consolidated financial statements and related disclosures.
Note 2. Acquisitions
Acquisition of Galileo Financial Technologies, Inc.
On May 14, 2020, we acquired Galileo Financial Technologies, Inc. and its subsidiaries (“Galileo”) by acquiring 100% of the outstanding Galileo stock as of that date. Galileo primarily provides technology platform services to financial and non-financial institutions. Our acquisition of Galileo enabled us to diversify our business from primarily consumer based to also serve institutions that rely upon Galileo’s integrated platform as a service to serve their customers.
As a result of the acquisition, Galileo stockholders received shares of Series H-1 preferred stock of SoFi in exchange for their shares of Galileo common or preferred stock at an exchange ratio of 3.83 shares of Series H-1 preferred stock for each share of Galileo common or preferred stock, with cash paid in lieu of fractional shares. Additionally, Galileo stockholders received rights to payments due under a seller note and cash consideration. We
F-126

TABLE OF CONTENTS
Social Finance, Inc.
Notes to Consolidated Financial Statements  (continued)
(In Thousands, Unless Otherwise Stated and Except for Share and Per Share Data)
also contemporaneously converted outstanding options to acquire common stock of Galileo into corresponding options to acquire common stock of SoFi (“Replacement Options”) at an exchange ratio of one Galileo option to 3.83 Replacement Options. The Replacement Options are subject to either the same terms and conditions (including vesting, exercisability or payment terms) as were applicable to the original Galileo awards, or in some cases to modified vesting terms. We allocated the fair value of the common stock options assumed between the pre-combination period, which amount was recognized as purchase consideration, and post-combination period, which amount was recognized as stock-based compensation expense, based on the vesting requirements of the Replacement Options.
The following table presents the components of the purchase consideration to acquire Galileo:
Cash paid(1)
$ 75,633 
Seller note(2)
243,998 
Fair value of preferred stock issued(3)
814,156 
Fair value of common stock options assumed(4)
32,197 
Total purchase consideration $ 1,165,984 
_________________
(1) We funded the cash consideration using borrowings under our revolving credit facility.
(2) On May 14, 2020, as part of the purchase price consideration, Galileo agreed to a seller note financing arrangement. The seller note has an aggregate principal amount of $250.0 million and a scheduled maturity of May 14, 2021. During the first six months of the twelve-month borrowing term, there was no interest due to the seller and, as such, the Company expected to pay off the seller note prior to the end of the six month no interest rate period. Given our prepayment assumption, we initially did not expect to pay any interest expense and, therefore, imputed an annual interest rate of 4.9% based on market interest rates and credit factors specific to the Company as of the note issuance date. We did not pay off the seller note before the promotional period ended on November 14, 2020. At the seller note inception, we determined that our call option on the seller note was an embedded derivative, which was not separately valued because it was clearly and closely related to the host contract, and such call option was expected to be exercised during the promotional period. However, the promotional period lapsed, which triggered incremental interest of $12.5 million incurred to the Galileo sellers on the call date of November 14, 2020, reflecting an interest rate of 10.0% per annum during the six-month promotional borrowing period. This incremental interest is payable at seller note maturity. Subsequent to the promotional borrowing period, we pay interest quarterly in arrears at an interest rate of 10.0% per annum. During February 2021, we paid off the seller note and accrued interest. See Note 18 for additional information.
(3) The fair value of the 52,743,298 shares of the Company’s Series H-1 preferred stock issued as of the date of acquisition was determined using a Black-Scholes Model via the backsolve method, resulting in a per share value of $15.44. The preferred stock issued is subject to adjustment as part of the closing net working capital calculation, as discussed below, which was not finalized as of December 31, 2020. Refer to Note 10 for additional information on the Series H-1 preferred stock.
(4) The fair value of Galileo common stock options assumed in the purchase consideration was first determined by using Black-Scholes option pricing techniques using the following assumptions:
Stock price on acquisition date $46.38
Risk-free rate
0.16% – 0.32%
Dividend yield —%
Volatility
28.4% – 37.4%
Expected term (years)
2.0 – 5.2
The stock price was determined as the fair value of the Company’s common stock as of the date of acquisition of $12.11, multiplied by the stock exchange ratio per the Galileo merger agreement. The price of the Company’s common stock was determined using a Black-Scholes Model via the backsolve method. The Company utilized the simplified method for establishing the expected term of the options. The risk-free rate was based on the U.S. Treasury rates for the estimated expected term of the options. The volatility assumption was driven by the observed stock price volatility of Galileo’s public company peer group over the estimated expected term of each award. The public company peer group was considered using such factors as industry, stage of life cycle and size. Lastly, Galileo does not have a history of paying dividends, which informed the dividend yield assumption.
Refer to Note 12 for additional information on the common stock options of SoFi, including the Replacement Options.
F-127

TABLE OF CONTENTS
Social Finance, Inc.
Notes to Consolidated Financial Statements  (continued)
(In Thousands, Unless Otherwise Stated and Except for Share and Per Share Data)
In the Consolidated Statements of Cash Flows, we present supplemental non-cash financing activities associated with: (i) the issuance of the seller note, (ii) the issuance of preferred stock, and (iii) the portion of assumed common stock options included in the purchase consideration.
Upon the finalization of the closing net working capital calculation, we currently expect the total purchase consideration to be reduced by $743, which will be settled through the return to SoFi of an equivalent value of 48,116 previously issued Series H-1 preferred stock, which will be retired upon receipt. The adjustment will similarly reduce the carrying value of recognized goodwill, but will not impact the estimated fair values of the assets acquired and liabilities assumed in conjunction with the transaction. The closing net working capital calculation remains the only open item with regard to the purchase price allocation process for Galileo. The following table presents the allocation of the total purchase consideration to the estimated fair values of the identified assets acquired and liabilities assumed of Galileo as of the date of acquisition, as well as a reconciliation to the total consideration transferred:
Assets acquired
Cash and cash equivalents
$ 10,305 
Accounts receivable(1)
12,999 
Property, equipment and software
2,026 
Intangible assets(2)
388,000 
Operating lease ROU assets
5,361 
Other assets(3)
10,631 
Total identifiable assets acquired
429,322 
Liabilities assumed
Accounts payable, accruals and other liabilities(3)
20,668 
Operating lease liabilities 5,361 
Debt 5,832 
Deferred income taxes(4)
104,835 
Total liabilities assumed
136,696 
Total identified net assets acquired
292,626 
Goodwill(5)
873,358 
Total consideration
$ 1,165,984 
_________________
(1)The fair value of accounts receivable acquired was $12,999, with a gross contractual amount of $13,844. At the date of acquisition, the Company expected $845 to be uncollectible.
(2)Intangible assets consist of finite-lived intangible assets with a gross carrying amount of $388,000, as follows:
Gross Carrying Amount
Weighted Average Useful Life (Years)
Developed technology(a)
$ 253,000  8.6
Customer-related(b)
125,000  3.6
Trade names, trademarks and domain names(c)
10,000  8.6
________________
(a) Valued using the Multi-Period Excess Earnings Method (“MPEEM”), which is a form of the income approach. The significant assumptions include: (i) the estimated annual net cash flows, which are a function of expected earnings attributable to the asset (and include an assumed technology migration curve), contributory asset charges and the applicable tax rate, (ii) an assumed discount rate, which reflects the risk of the asset relative to the overall risk of Galileo, and (iii) the tax amortization benefit.
(b) Valued using the With and Without Method, which is a form of the income approach. The significant assumptions include: (i) the estimated annual revenues and net cash flows both with the existing customer base and without the existing customer base, which include assumptions regarding revenue ramp-up periods and attrition rates, (ii) an assumed discount rate, and (iii) the tax amortization benefit.
F-128

TABLE OF CONTENTS
Social Finance, Inc.
Notes to Consolidated Financial Statements  (continued)
(In Thousands, Unless Otherwise Stated and Except for Share and Per Share Data)
(c) Valued using the Relief from Royalty Method, which is a form of the income approach. The significant assumptions include: (i) the estimated annual net cash flows, which are a function of expected earnings attributable to the asset, the probability of use of the asset, the royalty rate and the applicable tax rate, (ii) the discount rate, and (iii) the tax amortization benefit.
(3)Other liabilities at the acquisition date included a contingent liability associated with a class action litigation in which Galileo was a co-defendant involving service disruption for Galileo’s most significant customer stemming from Galileo’s system experiencing technology platform downtime. Additionally, the customer sought compensatory payment from Galileo as part of the system outage. At the acquisition date, the Company believed it was probable that a settlement would be reached and estimated the loss to be $6,195. Other assets at the acquisition date included $6,195 for the expected insurance recovery on the expected settlement. See Note 15 for additional disclosure on this contingent matter.
(4)The deferred tax liabilities recognized in the acquisition were primarily related to the acquired intangible assets recognized at a fair value of $388.0 million, in which we had no tax basis.
(5)The excess of the total purchase consideration over the fair value of the identified net assets acquired was allocated to goodwill, none of which is expected to be deductible for tax purposes. Upon finalization of the closing net working capital calculation, we currently expect the total purchase consideration to be reduced by $743, which will result in a corresponding reduction to the carrying amount of goodwill. Goodwill is primarily attributable to synergies expected from leveraging SoFi’s resources to further build upon Galileo’s product offerings, scaling Galileo’s operations and expanding its market reach. As such, the goodwill is fully allocated to the Technology Platform segment.
See Note 3 for additional information related to goodwill, including a reconciliation of the carrying amount of goodwill at the beginning and end of the period, as well as intangible assets.
The Company incurred acquisition-related costs of $9,341 related to the Galileo acquisition for the year ended December 31, 2020, which were presented within noninterest expense — general and administrative in the Consolidated Statements of Operations and Comprehensive Income (Loss) and of which $908 were associated with equity-based payments to advisors and were, therefore, non-cash in nature. Acquisition-related costs primarily relate to advisory, legal, valuation and other professional fees.
From the date of acquisition through December 31, 2020, the acquired results of operations for Galileo contributed total net revenue of $91,221 and net loss of $19,209 to the Company’s consolidated results, which was inclusive of amortization expense recognized on the acquired intangible assets.
The following unaudited supplemental pro forma financial information presents the Company’s consolidated results of operations for the years ended December 31, 2020 and 2019 as if the business combination had occurred on January 1, 2019:
Year Ended December 31,
2020 2019
Total net revenue $ 625,413  $ 483,921 
Net loss (304,219) (209,770)
The unaudited supplemental pro forma financial information is presented for comparative purposes only and is not necessarily indicative of the actual results of operations that would have been achieved, nor is it indicative of future results of operations.
The unaudited supplemental pro forma financial information reflects pro forma adjustments that give effect to applying the Company’s accounting policies and certain events the Company believes to be directly attributable to the acquisition. The pro forma adjustments primarily include:
incremental straight-line amortization expense associated with acquired intangible assets;
adjustments to depreciation expense resulting from accounting policy alignment between the acquirer and acquiree;
adjustments to reflect interest on the seller note, including accretion of interest and incremental interest incurred after the interest-free period lapsed as if the interest was incurred during the earliest period presented;
F-129

TABLE OF CONTENTS
Social Finance, Inc.
Notes to Consolidated Financial Statements  (continued)
(In Thousands, Unless Otherwise Stated and Except for Share and Per Share Data)
an adjustment to reflect post-combination stock-based compensation expense associated with the Replacement Options as if they had been granted on January 1, 2019;
a reversal of the Company’s previously-established deferred tax asset valuation allowance of $99,793 resulting from deferred tax liabilities acquired in connection with the acquisition as if it occurred during the earliest period presented;
an adjustment to reflect $9,341 of acquisition-related costs as if they were incurred during the earliest period presented; and
the related income tax effects, at the statutory tax rate applicable for each period, of the pro forma adjustments noted above.
The unaudited supplemental pro forma financial information does not give effect to any anticipated cost savings, operating efficiencies or other synergies that may be associated with the acquisition, or any estimated costs that have been or will be incurred by the Company to integrate the assets and operations of Galileo.
Other Acquisitions
On April 28, 2020, the Company acquired 100% of the outstanding stock of 8 Limited, a Hong Kong brokerage services firm, for total consideration of $16,126, consisting of $561 in cash and $15,565 in fair value of common stock issued. The fair value of the 1,285,291 shares of the Company’s common stock issuable in connection with the acquisition, of which 1,101,306 shares were issued at the date of acquisition, was determined using a Black-Scholes Model via the backsolve method, resulting in a per share value of $12.11. The remaining issuable common stock is subject to certain representations and warranties and is expected to be issued within 18 months of the date of acquisition. The share awards issued in connection with this acquisition have both performance and service based requirements, which we expense using the graded vesting attribution method. The total purchase consideration was allocated to the assets acquired and liabilities assumed based on the estimated fair values at the date of acquisition, which were measured in accordance with the principles outlined in ASC 820. The excess of the total purchase consideration over the fair value of the net assets acquired of $10,239 was allocated to goodwill, none of which is expected to be deductible for tax purposes. The results of operations of 8 Limited are included in SoFi’s Consolidated Financial Statements as of and for the year ended December 31, 2020. As the acquisition was not determined to be a significant acquisition as contemplated in ASC 805, the Company did not disclose the pro forma impact of this acquisition to the results of operations for the year ended December 31, 2020.
Identifiable intangible assets at the date of acquisition included finite-lived intangible assets for developed technology, customer-related contracts and broker-dealer license and trading rights with an aggregate fair value of $5,038. The intangible assets are being amortized over a period of 3.6 to 5.7 years based on the estimated economic benefit derived from each of the underlying assets. See Note 3 for additional information related to goodwill and intangible assets.
Note 3. Goodwill and Intangible Assets
A rollforward of our goodwill balance is presented below as of the dates indicated:
December 31,
2020 2019
Beginning balance
$ 15,673  $ 15,741 
Less: accumulated impairment
—  — 
Beginning balance, net
15,673  15,741 
Additional goodwill recognized(1)
883,597  — 
Other adjustments(2)
—  (68)
Ending balance(3)
$ 899,270  $ 15,673 
F-130

TABLE OF CONTENTS
Social Finance, Inc.
Notes to Consolidated Financial Statements  (continued)
(In Thousands, Unless Otherwise Stated and Except for Share and Per Share Data)
__________________
(1) Additional goodwill recognized as of December 31, 2020 includes $873,358 related to the acquisition of Galileo and $10,239 related to the acquisition of 8 Limited. See Note 2 for additional information.
(2) We utilized a discounted cash flow analysis to determine the difference between the fair value of the SoFi Money reporting unit and its carrying value. This analysis did not result in impairment expense. However, we had an immaterial non-cash overstatement of goodwill in our historical balance, which we expensed through noninterest expense — general and administrative in the Consolidated Statements of Operations and Comprehensive Income (Loss).
(3) As of December 31, 2020, we had goodwill attributable to the following reportable segments: $25,912 to Financial Services and $873,358 to Technology Platform. As of December 31, 2019, all of our goodwill was attributable to the Financial Services reportable segment.
There were no goodwill impairment charges during the years ended December 31, 2020, 2019 and 2018.
The following is a summary of the carrying amount and estimated useful lives of our intangible assets by class as of the dates indicated:
Weighted Average Useful Life (Years)
Gross Balance
Accumulated Amortization
Net Book Value
December 31, 2020
Developed technology(1)
8.5 $ 257,438  $ (19,142) $ 238,296 
Customer-related(1)
3.6 125,350  (22,102) 103,248 
Trade names, trademarks and domain names(1)
8.6 10,000  (736) 9,264 
Core banking infrastructure(2)
1.0 17,100  (13,043) 4,057 
Broker-dealer license and trading rights(1)
5.7 250  (29) 221 
Total
6.7 $ 410,138  $ (55,052) $ 355,086 
December 31, 2019
Core banking infrastructure(2)
9.0 $ 17,100  $ (5,383) $ 11,717 
Partnerships(3)
1.0 123  (57) 66 
Total
8.9 $ 17,223  $ (5,440) $ 11,783 
__________________
(1) During the year ended December 31, 2020, the Company acquired $253,000 in developed technology, $125,000 in customer-related intangible assets and $10,000 in trade names, trademarks and domain names related to the acquisition of Galileo. Other additions to developed technology, customer-related and broker-dealer license and trading rights intangible assets related to the acquisition of 8 Limited. See Note 2 for additional information.
(2) As of December 31, 2019, our core banking infrastructure was a full-stack multi-currency banking platform that we acquired during 2017. In conjunction with the acquisition of Galileo during the year ended December 31, 2020, we changed the estimated useful life for core banking infrastructure from nine years to one year, ending May 14, 2021, as Galileo’s infrastructure rendered the existing core banking infrastructure redundant, albeit there will be a transition period before we fully migrate to Galileo’s infrastructure. In accordance with Topic 250, Accounting Changes and Error Corrections, this change in estimate was applied prospectively. The change in estimate resulted in higher amortization expense of $5,759, or $(0.14) per common share, for the year ended December 31, 2020.
(3) Partnership intangible assets were acquired during the year ended December 31, 2019 and represent banking relationships, which help facilitate certain financial services activities. The acquired partnership intangible assets had a weighted average amortization period of one year.
Amortization expense for the years ended December 31, 2020, 2019 and 2018 was $49,735, $3,008 and $3,303, respectively. During the year ended December 31, 2020, we abandoned the partnership intangible assets that were acquired in 2019, which were fully amortized at the time of abandonment, by reversing the $123 gross asset and accumulated amortization. There was no impact to the Consolidated Statements of Operations and Comprehensive Income (Loss). There were no impairments during the year ended December 31, 2020. There were no abandonments or impairments during the years ended December 31, 2019 and 2018. We accelerated amortization expense during 2019 related to certain partnership and other intangible assets because we determined that the costs of these assets had already been recovered, which meant there was no expected future benefit as of December 31, 2019. The acceleration of amortization expense had an immaterial impact during the period.
F-131

TABLE OF CONTENTS
Social Finance, Inc.
Notes to Consolidated Financial Statements  (continued)
(In Thousands, Unless Otherwise Stated and Except for Share and Per Share Data)
Estimated future amortization expense as of December 31, 2020 is as follows:
2021 $ 70,507 
2022 66,449 
2023 64,753 
2024 31,468 
2025 31,468 
Thereafter 90,441 
Total $ 355,086 
Note 4. Loans
Our loan portfolio consists of personal loans, student loans and home loans, which are measured at fair value, and credit card loans and a commercial loan, which were new to our business in 2020 and are measured at amortized cost. Below is a disaggregated presentation of our loans, inclusive of fair market value adjustments and accrued interest income, as applicable, as of the dates indicated:
December 31,
2020 2019
Loans at fair value
Securitized student loans $ 908,427  $ 1,428,924 
Securitized personal loans 559,743  1,563,603 
Student loans 1,958,032  1,756,309 
Home loans 179,689  91,695 
Personal loans 1,253,177  547,427 
Total loans at fair value 4,859,068  5,387,958 
Loans at amortized cost(1)
Credit card loans(2)
3,723  — 
Commercial loan(3)
16,512  — 
Total loans at amortized cost 20,235  — 
Total loans $ 4,879,303  $ 5,387,958 
__________________
(1) See Note 1 for additional information on our loans at amortized cost as it pertains to the allowance for credit losses pursuant to ASC 326.
(2) The carrying value of credit card loans as of December 31, 2020 reflects originations of $6,957 and accrued interest of $2, reduced by gross repayments of $3,017 and allowance for credit losses of $219.
(3) During the fourth quarter of 2020, we issued a commercial loan that had a principal balance of $16,500 and accumulated unpaid interest of $12 as of December 31, 2020, all of which was repaid during January 2021.
F-132

TABLE OF CONTENTS
Social Finance, Inc.
Notes to Consolidated Financial Statements  (continued)
(In Thousands, Unless Otherwise Stated and Except for Share and Per Share Data)
Loans Measured at Fair Value
The following table summarizes the aggregate fair value of our loans measured at fair value on a recurring basis as of the dates indicated:
Student Loans Home Loans Personal Loans Total
December 31, 2020
Unpaid principal $ 2,774,511  $ 171,967  $ 1,780,246  $ 4,726,724 
Accumulated interest 9,472  141  11,558  21,171 
Cumulative fair value adjustments 82,476  7,581  21,116  111,173 
Total fair value of loans $ 2,866,459  $ 179,689  $ 1,812,920  $ 4,859,068 
December 31, 2019
Unpaid principal $ 3,111,032  $ 91,225  $ 2,112,306  $ 5,314,563 
Accumulated interest 8,186  120  13,936  22,242 
Cumulative fair value adjustments 66,015  350  (15,212) 51,153 
Total fair value of loans $ 3,185,233  $ 91,695  $ 2,111,030  $ 5,387,958 
The following table summarizes the aggregate fair value of loans 90 days or more delinquent as of the dates indicated. As delinquent loans are charged off after 120 days of nonpayment, amounts presented below represent the fair value of loans that are 90 to 120 days delinquent.
Student Loans
Home Loans
Personal Loans
Total
December 31, 2020
Unpaid principal
$ 1,046  $ —  $ 4,199  $ 5,245 
Accumulated interest
37  —  210  247 
Cumulative fair value adjustments
(442) —  (3,872) (4,314)
Fair value of loans 90 days or more delinquent $ 641  $ —  $ 537  $ 1,178 
December 31, 2019
Unpaid principal
$ 2,772  $ —  $ 10,625  $ 13,397 
Accumulated interest
47  —  334  381 
Cumulative fair value adjustments
(1,508) —  (9,356) (10,864)
Fair value of loans 90 days or more delinquent
$ 1,311  $ —  $ 1,603  $ 2,914 
F-133

TABLE OF CONTENTS
Social Finance, Inc.
Notes to Consolidated Financial Statements  (continued)
(In Thousands, Unless Otherwise Stated and Except for Share and Per Share Data)
The following table presents the changes in our loans measured at fair value on a recurring basis:
Student Loans
Home Loans
Personal Loans
Total
Fair value as of January 1, 2019
$ 3,365,741  $ 42,698  $ 3,803,550  $ 7,211,989 
Origination of loans
6,695,138  773,684  3,731,981  11,200,803 
Principal payments
(852,019) (1,107) (1,677,532) (2,530,658)
Sales of loans
(6,051,418) (726,443) (2,604,263) (9,382,124)
Deconsolidation of securitizations
—  —  (1,538,620) (1,538,620)
Purchases(1)
36,120  1,137  10,055  47,312 
Additions of loans to securitizations(2)
—  —  448,470  448,470 
Change in accumulated interest
(1,047) 65  (10,684) (11,666)
Change in fair value(3)
(7,282) 1,661  (51,927) (57,548)
Fair value as of December 31, 2019
$ 3,185,233  $ 91,695  $ 2,111,030  $ 5,387,958 
Origination of loans 4,928,880  2,183,521  2,580,757  9,693,158 
Principal payments (883,761) (2,748) (1,015,046) (1,901,555)
Sales of loans (4,534,286) (2,102,101) (1,531,058) (8,167,445)
Deconsolidation of securitizations (495,507) —  (406,687) (902,194)
Purchases(1)
648,153  2,070  39,975  690,198 
Change in accumulated interest 1,286  21  (2,379) (1,072)
Change in fair value(3)
16,461  7,231  36,328  60,020 
Fair value as of December 31, 2020 $ 2,866,459  $ 179,689  $ 1,812,920  $ 4,859,068 
__________________
(1) Purchases reflect unpaid principal balance and relate to previously transferred loans. Purchase activity includes securitization clean-up calls during the years ended December 31, 2020 and 2019 of $76,044 and $31,807, respectively. Additionally, during the year ended December 31, 2020, the Company elected to purchase $606,264 of previously sold loans from certain investors. The Company was not required to buy back these loans. The remaining purchases related to standard representations and warranties pursuant to our various loan sale agreements.
(2) We consolidate certain VIEs and, prior to finalizing the related securitization transaction in certain instances, a portion of the loans transferred to the SPE are contributed by third parties.
(3) Changes in fair value of loans are recorded in the Consolidated Statements of Operations and Comprehensive Income (Loss) within noninterest income — loan origination and sales for loans held on the balance sheet prior to transfer and within noninterest income — securitizations for loans in a consolidated VIE.
Note 5. Variable Interest Entities
Consolidated VIEs
The Company consolidates certain securitization trusts in which we have a variable interest and are deemed to be the primary beneficiary. Our consolidation policy is further discussed in Note 1.
The VIEs are SPEs with portfolio loans securing debt obligations. The SPEs were created and designed to transfer credit and interest rate risk associated with consumer loans through the issuance of collateralized notes and trust certificates. The Company makes standard representations and warranties to repurchase or replace qualified portfolio loans. Aside from these representations, the holders of the asset-backed debt obligations have no recourse to the Company if the cash flows from the underlying portfolio loans securing such debt obligations are not sufficient to pay all principal and interest on the asset-backed debt obligations. We hold a significant interest in these financing transactions through our ownership of a portion of the residual interest in certain VIEs. In addition, in some cases, we invest in the debt obligations issued by the VIE. Our investments in consolidated VIEs eliminate in consolidation. The residual interest is the first VIE interest to absorb losses should the loans securing the debt obligations not provide adequate cash flows to satisfy more senior claims and is, by design, the interest that we expect to absorb the expected gains and losses of the VIE. The Company’s exposure to credit risk in sponsoring SPEs is limited to our investment in the VIE. VIE creditors have no recourse against our general credit.
F-134

TABLE OF CONTENTS
Social Finance, Inc.
Notes to Consolidated Financial Statements  (continued)
(In Thousands, Unless Otherwise Stated and Except for Share and Per Share Data)
The following table presents the assets and liabilities of consolidated VIEs that were included in our Consolidated Balance Sheets. The assets in the below table may only be used to settle obligations of consolidated VIEs and were in excess of those obligations as of the dates presented. Additionally, the assets and liabilities in the table below exclude intercompany balances, which eliminate upon consolidation:
December 31,
2020 2019
Assets:
Restricted cash and restricted cash equivalents $ 76,973  $ 117,733 
Loans 1,468,170  2,992,527 
Total assets $ 1,545,143  $ 3,110,260 
Liabilities:
Accounts payable, accruals and other liabilities $ 759  $ 1,479 
Debt(1)
1,248,822  2,539,610 
Residual interests classified as debt 118,298  271,778 
Total liabilities $ 1,367,879  $ 2,812,867 
___________________
(1)Debt is presented net of debt issuance costs and debt discounts.
Nonconsolidated VIEs
We have created and designed personal and student loan trusts to transfer associated credit and interest rate risk associated with the loans through the issuance of collateralized notes and residual certificates. We have a variable interest in the nonconsolidated loan trusts, as we own collateralized notes and residual certificates in the loan trusts that absorb variability. We also have continuing, non-controlling involvement with the trusts as the servicer. As servicer, we have the power to perform the activities which most impact the economic performance of the VIE, but since we hold an insignificant financial interest in the trusts, we are not the primary beneficiary. We define an insignificant financial interest as less than 10% of the expected gains and losses of the VIE. This financial interest represents the equity ownership interest in the loan trusts, wherein there is an obligation to absorb losses and the right to receive benefits from residual certificate ownership. The maximum exposure to loss as a result of our involvement with the nonconsolidated VIE is limited to our investment. There are no liquidity arrangements, guarantees or other commitments by third parties that may affect the fair value or risk of our variable interests in nonconsolidated VIEs.
Personal Loans
We established one and seven personal loan trusts during the years ended December 31, 2020 and 2019, respectively, that were not consolidated as of the respective balance sheet date. As of December 31, 2020 and 2019, we had investments in nine and thirteen nonconsolidated personal loan VIEs, respectively.
We did not provide financial support to any personal loan trusts beyond our initial equity investment during any of the periods presented. We deconsolidated three VIEs during the year ended December 31, 2020, which were originally consolidated in 2017. We deconsolidated six VIEs during the year ended December 31, 2019, which were also created during 2019.
Student Loans
We established four and nine student loan trusts during the years ended December 31, 2020 and 2019, respectively, that were not consolidated as of the respective balance sheet date. As of both December 31, 2020 and 2019, we had investments in 20 nonconsolidated student loan VIEs.
F-135

TABLE OF CONTENTS
Social Finance, Inc.
Notes to Consolidated Financial Statements  (continued)
(In Thousands, Unless Otherwise Stated and Except for Share and Per Share Data)
We did not provide financial support to the student loan trusts beyond our initial equity investment during any of the periods presented. We consolidated one VIE during the year ended December 31, 2020 that was also deconsolidated during the year. There were no VIEs deconsolidated during the years ended December 31, 2019 and 2018.
The following table presents the aggregate outstanding value of asset-backed bonds and residual interests owned by the Company in nonconsolidated VIEs, which were included in our Consolidated Balance Sheets:
December 31,
2020 2019
Personal loans $ 71,115  $ 181,703 
Student loans 425,820  472,249 
Securitization investments $ 496,935  $ 653,952 

Note 6. Transfers of Financial Assets
We regularly transfer financial assets and account for such transfers as either sales or secured borrowings depending on the facts and circumstances. When a transfer of financial assets qualifies as a sale, in many instances we have continued involvement as the servicer of those financial assets. As we expect the benefits of servicing to be more than just adequate, we recognize a servicing asset. Further, in the case of securitization-related transfers that qualify as sales, we have additional continued involvement as an investor, albeit at insignificant levels relative to the expected gains and losses of the securitization. In instances where a transfer is accounted for as a secured borrowing, we perform servicing (but do not recognize a servicing asset) and typically maintain a significant investment relative to the expected gains and losses of the securitization. In whole loan sales, we do not have a residual financial interest in the loans, nor do we have any other power over the loans that would constrain us from recognizing a sale. Additionally, we have no repurchase requirements related to transfers of personal loans, student loans and non-FNMA home loans other than standard origination representations and warranties, for which we record a liability based on expected repurchase obligations. For FNMA home loans, we have customary FNMA repurchase requirements, which do not constrain sale treatment but result in a liability for the expected repurchase requirement. Finally, in participating interest transactions, we strictly maintain a pro rata ownership in a pool of loans, but we have no other power over the remaining participating interests or exposure to any other variability.
F-136

TABLE OF CONTENTS
Social Finance, Inc.
Notes to Consolidated Financial Statements  (continued)
(In Thousands, Unless Otherwise Stated and Except for Share and Per Share Data)
The following table summarizes the loan securitization transfers qualifying for sale accounting treatment for the years presented. There were no loan securitization transfers qualifying for sale accounting treatment of home loans during any of the years presented.
Year Ended December 31,
2020 2019 2018
Student loans
Fair value of consideration received:
Cash $ 2,015,357  $ 4,542,431  $ 4,718,093 
Securitization investments 130,807  239,698  266,399 
Deconsolidation of debt(1)
458,375  —  — 
Servicing assets recognized 19,903  42,826  38,179 
Total consideration 2,624,442  4,824,955  5,022,671 
Aggregate unpaid principal balance and accrued interest of loans sold 2,540,052  4,677,471  4,929,724 
Gain from loan sales $ 84,390  $ 147,484  $ 92,947 
Personal loans
Fair value of consideration received:
Cash $ 316,503  $ 397,962  $ 1,148,626 
Securitization investments 20,961  111,556  82,056 
Deconsolidation of debt(1)
414,261  1,464,920  — 
Servicing assets recognized 2,086  11,229  4,218 
Total consideration 753,811  1,985,667  1,234,900 
Aggregate unpaid principal balance and accrued interest of loans sold 708,346  1,906,757  1,213,929 
Gain from loan sales $ 45,465  $ 78,910  $ 20,971 
_____________________
(1)Deconsolidation of debt reflects the impacts of previously consolidated VIEs that became deconsolidated during the period because we no longer held a significant financial interest in the underlying securitization entity. See Note 5 for further discussion of deconsolidations.
F-137

TABLE OF CONTENTS
Social Finance, Inc.
Notes to Consolidated Financial Statements  (continued)
(In Thousands, Unless Otherwise Stated and Except for Share and Per Share Data)
The following table summarizes the whole loan sales for the years presented:
Year Ended December 31,
2020 2019 2018
Student loans
Fair value of consideration received:
Cash $ 2,596,719  $ 1,399,921  $ 1,664,224 
Servicing assets recognized 25,734  21,145  18,231 
Repurchase liabilities recognized (510) (314) (211)
Total consideration 2,621,943  1,420,752  1,682,244 
Aggregate unpaid principal balance and accrued interest of loans sold 2,503,821  1,389,986  1,667,592 
Gain from loan sales $ 118,122  $ 30,766  $ 14,652 
Home loans
Fair value of consideration received:
Cash $ 2,173,709  $ 733,860  $ 925,265 
Servicing assets recognized 20,440  5,724  2,688 
Repurchase liabilities recognized (3,034) (1,720) (299)
Total consideration 2,191,115  737,864  927,654 
Aggregate unpaid principal balance and accrued interest of loans sold 2,101,895  726,379  919,693 
Gain from loan sales $ 89,220  $ 11,485  $ 7,961 
Personal loans
Fair value of consideration received:
Cash $ 1,285,689  $ 2,316,771  $ 2,196,881 
Servicing assets recognized 8,429  31,138  22,789 
Repurchase liabilities recognized (3,535) (2,948) (6,437)
Total consideration received 1,290,583  2,344,961  2,213,233 
Aggregate unpaid principal balance and accrued interest of loans sold 1,238,474  2,257,223  2,250,943 
Gain (loss) from loan sales $ 52,109  $ 87,738  $ (37,710)
The following table summarizes our participating interest sales, which were limited to student loan transactions during the year ended December 31, 2018. We did not have any participating interest sales during the years ended December 31, 2020 and 2019. Our participating interest in the transferred loans is presented within loans in our Consolidated Balance Sheets.
Year Ended December 31, 2018
Fair value of consideration received:
Cash $ 91,946 
Servicing assets recognized 3,163 
Total consideration received 95,109 
Aggregate unpaid principal balance and accrued interest of loans sold 91,976 
Gain from participating interest sales $ 3,133 
F-138

TABLE OF CONTENTS
Social Finance, Inc.
Notes to Consolidated Financial Statements  (continued)
(In Thousands, Unless Otherwise Stated and Except for Share and Per Share Data)
The following table presents information as of the dates indicated about the unpaid principal balances of transferred loans that are not recorded in our Consolidated Balance Sheets, but with which we have a continuing involvement through our servicing agreements:
Student Loans Home Loans Personal Loans Total
December 31, 2020
Loans in repayment $ 12,059,702  $ 2,629,015  $ 4,796,404  $ 19,485,121 
Loans in-school/grace/deferment 26,158  —  —  26,158 
Loans in forbearance 275,659  46,357  35,677  357,693 
Loans in delinquency 91,424  8,493  110,640  210,557 
Total loans serviced $ 12,452,943  $ 2,683,865  $ 4,942,721  $ 20,079,529 
Servicing fees collected $ 50,794  $ 4,499  $ 45,574  $ 100,867 
Charge-offs, net of recoveries 16,999  —  197,927  214,926 
December 31, 2019
Loans in repayment $ 13,119,596  $ 1,292,171  $ 6,153,313  $ 20,565,080 
Loans in-school/grace/deferment 48,157  —  —  48,157 
Loans in forbearance 56,767  —  12,922  69,689 
Loans in delinquency 103,489  2,120  140,558  246,167 
Total loans serviced $ 13,328,009  $ 1,294,291  $ 6,306,793  $ 20,929,093 
Servicing fees collected $ 47,038  $ 2,635  $ 31,268  $ 80,941 
Charge-offs, net of recoveries 27,740  —  233,628  261,368 

Note 7. Accounts Receivable
We measure our allowance for credit losses on accounts receivable, which relates to Galileo, under ASC 326, which we adopted on January 1, 2020. Given our methods of collecting funds on servicing receivables, our historical experience of no write offs, and that we have not observed meaningful changes in our counterparties’ abilities to pay, we determined that the exposure to credit losses on servicing related receivables was immaterial.
For our accounts receivable, we used an aging method and historical loss rates as a basis for estimating the percentage of current and delinquent accounts receivable balances that will result in credit losses. We considered the conditions at the measurement date and reasonable and supportable forecasts about future conditions to consider if adjustments to the historical loss rate were warranted. Given our methods of collecting funds on our receivables, and that we have not observed meaningful changes in our customers’ payment behavior, we determined that our historical loss rates remain most indicative of our lifetime expected losses. Accounts receivable balances, net of allowance for credit losses, are recorded within other assets in the Consolidated Balance Sheets.
The following table summarizes the activity in the balance of allowance for credit losses during the year indicated:
Year Ended December 31, 2020
Beginning balance $ — 
Provision for expected losses 766 
Write-offs charged against the allowance (204)
Recoveries collected — 
Ending balance $ 562 
F-139

TABLE OF CONTENTS
Social Finance, Inc.
Notes to Consolidated Financial Statements  (continued)
(In Thousands, Unless Otherwise Stated and Except for Share and Per Share Data)
Note 8. Fair Value Measurements
The following table summarizes, by level within the fair value hierarchy, the carrying amounts and estimated fair values of our assets and liabilities measured at fair value on a recurring basis, measured at fair value on a nonrecurring basis, or disclosed, but not carried, at fair value in the Consolidated Balance Sheets as of the dates presented.
December 31, 2020 December 31, 2019
Level
Carrying
Value
Fair Value
Carrying
Value
Fair Value
Assets
Cash and cash equivalents(1)
1 $ 872,582  $ 872,582  $ 499,486  $ 499,486 
Restricted cash and restricted cash equivalents(1)
1 450,846  450,846  190,720  190,720 
Student loans(2)
3 2,866,459  2,866,459  3,185,233  3,185,233 
Home loans(2)
3 179,689  179,689  91,695  91,695 
Personal loans(2)
3 1,812,920  1,812,920  2,111,030  2,111,030 
Credit card loans(1)
3 3,723  3,723  —  — 
Commercial loan(1)
3 16,512  16,512  —  — 
Servicing rights(2)
3 149,597  149,597  201,618  201,618 
Asset-backed bonds(2)(9)
2 357,411  357,411  391,072  391,072 
Residual investments(2)(9)
3 139,524  139,524  262,880  262,880 
Non-securitization investments – ETFs(2)(11)
1 6,850  6,850  6,851  6,851 
Non-securitization investments – other(3)
3 1,147  1,147  1,950  1,950 
Derivative assets(2)(4)(8)
1 —  —  1,105  1,105 
Interest rate lock commitments(2)(5)
3 15,620  15,620  1,090  1,090 
Total assets $ 6,872,880  $ 6,872,880  $ 6,944,730  $ 6,944,730 
Liabilities
Debt(1)
2 $ 4,798,925  $ 4,851,658  $ 4,688,378  $ 4,750,815 
Residual interests classified as debt(2)
3 118,298  118,298  271,778  271,778 
Warrant liabilities(2)(10)
3 39,959  39,959  19,434  19,434 
Derivative liabilities(2)(6)(8)
1 2,008  2,008  396  396 
Interest rate swaps(2)(7)(8)
2 947  947  145  145 
ETF short positions(2)(11)
1 5,241  5,241  —  — 
Total liabilities $ 4,965,378  $ 5,018,111  $ 4,980,131  $ 5,042,568 
_____________________
(1)Disclosed, but not carried, at fair value. The carrying value of our debt is net of unamortized discounts and debt issuance costs. The fair values of our warehouse facility debt, revolving credit facility debt, seller note debt and other financing arrangements assumed in the Galileo acquisition were based on market factors and credit factors specific to us. The fair value of the seller note as of December 31, 2020 was determined to approximate our carrying value due to our ability to prepay the loan without penalty and the short term maturity of the note. The securitization debt was valued using a discounted cash flow model, with key inputs relating to the underlying contractual coupons, terms, discount rate and expectations for defaults and prepayments. The carrying amounts of our cash and cash equivalents and restricted cash and restricted cash equivalents approximate their fair values due to the short-term maturities and highly liquid nature of these accounts. The fair value of our commercial loan was also determined to approximate our carrying value, as the loan was issued in the fourth quarter of 2020, was short-term in nature, and repaid in full in January 2021.
(2)Measured at fair value on a recurring basis.
(3)Measured at fair value on a nonrecurring basis.
(4)Derivative assets classified as Level 1 are based on broker quotes in active markets and represent economic hedges of loan fair values.
(5)Interest rate lock commitments are classified as Level 3 because of our reliance on an assumed loan funding probability, which is based on our internal historical experience with home loans similar to those in the pipeline on the measurement date.
F-140

TABLE OF CONTENTS
Social Finance, Inc.
Notes to Consolidated Financial Statements  (continued)
(In Thousands, Unless Otherwise Stated and Except for Share and Per Share Data)
(6)Derivative liabilities classified as Level 1 are based on broker quotes in active markets and consist of economic hedges of loan fair values and certain non-securitization investments.
(7)Interest rate swaps are classified as Level 2, because these financial instruments do not trade in active markets with observable prices, but rely on observable inputs other than quoted prices. Interest rate swaps are valued using the three-month LIBOR swap yield curve, which is an observable input from an active market.
(8)Gross derivative assets and liabilities included herein are subject to master netting arrangements. See Note 1 for additional information on our master netting arrangements, including the amounts netted against these gross derivative assets and liabilities.
(9)These assets represent the carrying value of our holdings in VIEs wherein we were not deemed the primary beneficiary. As we do not provide financial support beyond our initial equity investment, our maximum exposure to loss as a result of our involvement with nonconsolidated VIEs is limited to the investment amount. See Note 5 for additional information.
(10)See Note 10 for additional information on our warrant liabilities, including inputs to the valuation.
(11)ETF short positions classified as Level 1 are based on quoted prices in actively traded markets and serve as an economic hedge to our non-securitization investments in exchange-traded funds.
Loans
The following key unobservable assumptions were used in the fair value measurement of our loans as of the dates indicated:
December 31, 2020 December 31, 2019
Range Weighted Average Range Weighted Average
Student loans
Conditional prepayment rate
15.8% – 33.3%
18.4%
14.1% – 34.2%
18.6%
Annual default rate
0.2% – 4.9%
0.4%
0.2% – 5.7%
0.3%
Discount rate
1.1% – 7.1%
3.3%
2.5% – 6.2%
4.1%
Home loans
Conditional prepayment rate
4.4% – 17.6%
14.9%
7.1% – 11.5%
8.3%
Annual default rate
0.1% – 4.9%
0.1%
0.2% – 7.9%
0.2%
Discount rate
1.3% – 10.0%
1.6%
3.2% – 11.2%
3.5%
Personal loans
Conditional prepayment rate
14.5% – 23.2%
18.1%
12.1% – 17.4%
15.7%
Annual default rate
3.3% – 33.8%
4.2%
4.3% – 29.2%
5.5%
Discount rate
5.0% – 10.7%
6.0%
4.5% – 8.3%
6.0%
The key assumptions included in the above table are defined as follows:
Conditional prepayment rate — The monthly annualized proportion of the principal of a pool of loans that is assumed to be paid off prematurely in each period. An increase in the conditional prepayment rate, in isolation, would result in a decrease in a fair value measurement. The weighted average assumption was weighted based on relative fair value.
Annual default rate — The annualized rate of borrowers who do not make loan payments on time. An increase in the annual default rate, in isolation, would result in a decrease in a fair value measurement. The weighted average assumption was weighted based on relative fair value.
Discount rate — The weighted average rate at which the expected cash flows are discounted to arrive at the net present value of the loans. An increase in the discount rate, in isolation, would result in a decrease in a fair value measurement. The weighted average assumption was weighted based on relative fair value.
See Note 4 for additional loan fair value disclosures.
F-141

TABLE OF CONTENTS
Social Finance, Inc.
Notes to Consolidated Financial Statements  (continued)
(In Thousands, Unless Otherwise Stated and Except for Share and Per Share Data)
Servicing Rights
Servicing rights for student loans and personal loans do not trade in an active market with readily observable prices. Similarly, home loan servicing rights infrequently trade in an active market. At the time of the underlying loan sale, the fair value of servicing rights is determined using a discounted cash flow methodology based on observable and unobservable inputs. Management classifies servicing rights as Level 3 due to the use of significant unobservable inputs in the fair value measurement.
The following key unobservable inputs were used in the fair value measurement of our classes of servicing rights as of the dates presented:
December 31, 2020 December 31, 2019
Range Weighted Average Range Weighted Average
Student loans
Market servicing costs
0.1% – 0.2%
0.1%
0.1% – 0.1%
0.1%
Conditional prepayment rate
13.8% – 24.7%
18.7%
10.3%  – 39.4%
14.4%
Annual default rate
0.2% – 4.8%
0.4%
0.1% – 5.3%
0.3%
Discount rate
7.3% – 7.3%
7.3%
7.3% – 7.3%
7.3%
Home loans
Market servicing costs
0.1% – 0.1%
0.1%
0.1% – 0.1%
0.1%
Conditional prepayment rate
13.9% – 20.3%
16.5%
5.9% – 10.0%
7.5%
Annual default rate
0.1% – 0.1%
0.1%
0.1% – 0.4%
0.2%
Discount rate
10.0% – 10.0%
10.0%
10.2% – 10.4%
10.3%
Personal loans
Market servicing costs
0.2% – 0.7%
0.3%
0.2% – 0.5%
0.3%
Conditional prepayment rate
16.2% – 26.1%
19.1%
15.2% – 20.2%
15.8%
Annual default rate
3.1% – 7.5%
5.5%
4.6% – 11.0%
5.8%
Discount rate
7.3% – 7.3%
7.3%
7.3% – 7.3%
7.3%
The key assumptions included in the above table are defined as follows:
Market servicing costs — The fee a willing market participant, which we validate through actual third-party bids for our servicing, would require for the servicing of student loans, home loans and personal loans with similar characteristics as those in our serviced portfolio. An increase in the market servicing cost, in isolation, would result in a decrease in a fair value measurement. The weighted average assumption was weighted based on relative fair value.
Conditional prepayment rate — The monthly annualized proportion of the principal of a pool of loans that is assumed to be paid off prematurely in each period. An increase in the conditional prepayment rate, in isolation, would result in a decrease in a fair value measurement. The weighted average assumption was weighted based on relative fair value.
Annual default rate — The annualized rate of default within the total serviced loan balance. An increase in the annual default rate, in isolation, would result in a decrease in a fair value measurement. The weighted average assumption was weighted based on relative fair value.
Discount rate — The weighted average rate at which the expected cash flows are discounted to arrive at the net present value of the servicing rights. An increase in the discount rate, in isolation, would result in a decrease in a fair value measurement. The weighted average assumption was weighted based on relative fair value.
F-142

TABLE OF CONTENTS
Social Finance, Inc.
Notes to Consolidated Financial Statements  (continued)
(In Thousands, Unless Otherwise Stated and Except for Share and Per Share Data)
The following table presents the estimated decrease to the fair value of our servicing rights as of the dates indicated if the key assumptions had each of the below adverse changes:
December 31,
2020 2019
Market servicing costs
2.5 basis points increase $ (10,472) $ (12,177)
5.0 basis points increase (20,944) (24,345)
Conditional prepayment rate
10% increase $ (5,430) $ (5,477)
20% increase (10,230) (10,591)
Annual default rate
10% increase $ (336) $ (723)
20% increase (681) (1,489)
Discount rate
100 basis points increase $ (2,986) $ (3,839)
200 basis points increase (5,820) (7,474)
The sensitivity calculations above are hypothetical and should not be considered to be predictive of future performance. The effect on fair value of a variation in assumptions generally cannot be determined because the relationship of the change in assumptions to the fair value may not be linear. Additionally, the effect of an adverse variation in a particular assumption on the fair value of our servicing rights is calculated while holding the other assumptions constant. In reality, changes in one factor may lead to changes in other factors, which could impact the above hypothetical effects.
The following table presents the changes in the Company’s servicing rights, which are measured at fair value on a recurring basis. Servicing rights are initially measured at fair value and recognized as a component of the gain or loss from sales of loans and the initial capitalization is reported within noninterest income — loan origination and sales in the Consolidated Statements of Operations and Comprehensive Income (Loss). Subsequent changes in the fair value of servicing rights are reported within noninterest income — servicing in the Consolidated Statements of Operations and Comprehensive Income (Loss).
Student Loans Home Loans Personal Loans Total
Fair value as of January 1, 2019 $ 122,075  $ 8,623  $ 35,007  $ 165,705 
Recognition of servicing from transfers of financial assets 63,971  5,724  42,367  112,062 
Derecognition of servicing via loan purchases (208) —  —  (208)
Change in valuation inputs or other assumptions 233  1,482  6,772  8,487 
Realization of expected cash flows and other changes (47,489) (2,648) (34,291) (84,428)
Fair value as of December 31, 2019 $ 138,582  $ 13,181  $ 49,855  $ 201,618 
Recognition of servicing from transfers of financial assets 45,637  20,440  10,515  76,592 
Derecognition of servicing via loan purchases (12,924) —  (934) (13,858)
Change in valuation inputs or other assumptions (20,168) (5,056) 7,765  (17,459)
Realization of expected cash flows and other changes (50,490) (4,651) (42,155) (97,296)
Fair value as of December 31, 2020 $ 100,637  $ 23,914  $ 25,046  $ 149,597 
F-143

TABLE OF CONTENTS
Social Finance, Inc.
Notes to Consolidated Financial Statements  (continued)
(In Thousands, Unless Otherwise Stated and Except for Share and Per Share Data)
Asset-Backed Bonds
The fair value of asset-backed bonds is determined using a discounted cash flow methodology. Management classifies asset-backed bonds as Level 2 due to the use of quoted prices for similar assets in markets that are not active, as well as certain factors specific to us. The following key inputs were used in the fair value measurement of our asset-backed bonds as of the dates indicated:
December 31,
2020 2019
Discount rate (range)
0.8% – 4.0%
2.0% – 5.7%
Conditional prepayment rate (range)
18.8% – 21.9%
14.7% – 18.8%
As of the dates indicated, the fair value of our asset-backed bonds was not materially impacted by default assumptions on the underlying securitization loans, as the subordinate residual interests, by design, are expected to absorb all estimated losses based on our default assumptions for the respective periods.
Residual Investments and Residual Interests Classified as Debt
Residual investments and residual interests classified as debt do not trade in active markets with readily observable prices, and there is limited observable market data for reference. The fair values of residual investments and residual interests classified as debt are determined using a discounted cash flow methodology. Management classifies residual investments and residual interests classified as debt as Level 3 due to the use of significant unobservable inputs in the fair value measurements.
The following key unobservable inputs were used in the fair value measurements of our residual investments and residual interests classified as debt as of the dates indicated:
December 31, 2020 December 31, 2019
Range Weighted Average Range Weighted Average
Residual investments
Conditional prepayment rate
18.8% – 22.3%
20.2%
14.7%  – 24.4%
16.7%
Annual default rate
0.3% – 6.2%
0.7%
0.2% – 6.7%
0.9%
Discount rate
3.0% – 18.5%
6.2%
3.9% – 13.1%
5.4%
Residual interests classified as debt
Conditional prepayment rate
19.5% – 24.8%
21.4%
14.9% – 21.5%
17.8%
Annual default rate
0.4% – 6.4%
3.1%
0.3% – 6.9%
4.1%
Discount rate
8.5% – 18.0%
10.8%
7.8% – 12.0%
10.2%
The key assumptions included in the above table are defined as follows:
Conditional prepayment rate — The monthly annualized proportion of the principal of a pool of loans that is assumed to be paid off prematurely in each period for the pool of loans in the securitization. An increase in the conditional prepayment rate, in isolation, would result in a decrease in a fair value measurement. The weighted average assumption was weighted based on relative fair value.
Annual default rate — The annualized rate of borrowers who fail to remain current on their loans for the pool of loans in the securitization. An increase in the annual default rate, in isolation, would result in a decrease in a fair value measurement. The weighted average assumption was weighted based on relative fair value.
Discount rate — The weighted average rate at which the expected cash flows are discounted to arrive at the net present value of the residual investments and residual interests classified as debt. An increase in the
F-144

TABLE OF CONTENTS
Social Finance, Inc.
Notes to Consolidated Financial Statements  (continued)
(In Thousands, Unless Otherwise Stated and Except for Share and Per Share Data)
discount rate, in isolation, would result in a decrease in a fair value measurement. The weighted average assumption was weighted based on relative fair value.
The following table presents the changes in the residual investments and residual interests classified as debt, which are both measured at fair value on a recurring basis. We record changes in fair value within noninterest income — securitizations in the Consolidated Statements of Operations and Comprehensive Income (Loss), a portion of which is subsequently reclassified to interest expense — securitizations and warehouses for residual interests classified as debt and to interest income — securitizations for residual investments, but does not impact the liability or asset balance, respectively.
Residual Investments Residual Interests Classified as Debt
Fair value as of January 1, 2019 $ 135,142  $ 444,846 
Additions 171,061  116,906 
Change in valuation inputs or other assumptions 6,384  17,157 
Payments (49,707) (209,203)
Derecognition upon achieving true sale accounting treatment —  (97,928)
Fair value as of December 31, 2019 $ 262,880  $ 271,778 
Additions 10,708  — 
Change in valuation inputs or other assumptions 9,702  38,216 
Payments(1)
(96,505) (89,978)
Transfers(2)
(47,261) — 
Derecognition upon achieving true sale accounting treatment —  (101,718)
Fair value as of December 31, 2020 $ 139,524  $ 118,298 
______________________
(1)Payments of residual investments included $8.4 million of residual investment sales made during the year ended December 31, 2020.
(2)During the year ended December 31, 2020, includes a transfer from residual investments (Level 3) to asset-backed bonds (Level 2) associated with a repackaged securitization transaction in which we formed a new VIE and, in the process, exchanged our residual interest for an asset-backed bond interest.
Instrument-Specific Credit Risk
The change in the fair value of certain financial instruments measured at fair value using the fair value option that resulted from instrument-specific credit risk was as follows during the years indicated:
Year Ended December 31,
2020 2019 2018
Loans $ 133,294  $ 195,917  $ 342,886 
Residual investments 8,127  19,102  14,760 
The changes in the fair values attributable to instrument-specific credit risk were estimated by incorporating the Company’s current default and loss severity assumptions for each above financial instrument. These assumptions are based on historical performance, market trends and performance expectations over the term of the underlying instrument.
Interest Rate Lock Commitments
As part of our home loan origination activities, we commit to interest rate terms prior to completing the home loan origination process. These interest rate commitments are “locked”, despite changes in interest rates between the
F-145

TABLE OF CONTENTS
Social Finance, Inc.
Notes to Consolidated Financial Statements  (continued)
(In Thousands, Unless Otherwise Stated and Except for Share and Per Share Data)
time of home loan application approval and loan closure. Given that a home loan origination is contingent on a plethora of factors, our IRLCs are inherently uncertain. We account for the probability of honoring an IRLC using an assumed loan funding probability, which is the percentage likelihood that an approved loan application will close based on historical experience. A significant difference in the actual funded rate compared to the assumed funded rate at a measurement date could result in a significantly higher or lower fair value measurement. Our key valuation input was as follows as of the dates indicated:
December 31, 2020 December 31, 2019
Range Weighted Average Range Weighted Average
IRLCs
Loan funding probability
54.5% – 54.5%
54.5%
50.0% – 50.0%
50.0%
The key assumption included in the above table is defined as follows:
Loan funding probability — Our expectation of the percentage of IRLCs which will become funded loans. An increase in the loan funding probability, in isolation, would result in an increase in a fair value measurement. The weighted average assumption was weighted based on relative fair value.
The following table presents the changes in our IRLCs, which are measured at fair value on a recurring basis. Changes in the fair value of IRLCs are recorded within noninterest income — loan origination and sales in the Consolidated Statements of Operations and Comprehensive Income (Loss).
IRLCs
Fair value as of January 1, 2019 $ 174 
Revaluation adjustments 3,635 
Funded loans(1)
(1,677)
Unfunded loans(1)
(1,042)
Fair value as of December 31, 2019 $ 1,090 
Revaluation adjustments 62,528 
Funded loans(1)
(27,321)
Unfunded loans(1)
(20,677)
Fair value as of December 31, 2020 $ 15,620 
___________________
(1)Funded and unfunded loans fair value adjustments represent the unpaid principal balance of funded and unfunded loans, respectively, multiplied by the IRLC price in effect at the beginning of each quarter.
Non-Securitization Investments
Non-securitization investments — ETFs include investments in exchange-traded funds that were launched beginning in 2019 and are measured at fair value on a recurring basis using the net asset value expedient in accordance with ASC 820 and are presented within other assets in the Consolidated Balance Sheets.
As of December 31, 2020 and 2019, we also had a non-securitization investment, which is presented within non-securitization investments — other, related to an investment for which fair value was not readily determinable, which we elected to measure using the measurement alternative method of accounting. Under the measurement alternative method, we measure the investment at cost, less any impairment and adjusted for changes resulting from observable price changes in orderly transactions for identical or similar investments of the same issuer. The carrying value of the investment is presented within other assets in the Consolidated Balance Sheets. Adjustments to the carrying value, such as impairments, are recognized within noninterest income — other in the Consolidated Statements of Operations and Comprehensive Income (Loss). During the year ended December 31, 2020, we
F-146

TABLE OF CONTENTS
Social Finance, Inc.
Notes to Consolidated Financial Statements  (continued)
(In Thousands, Unless Otherwise Stated and Except for Share and Per Share Data)
recorded an impairment charge of $803 and adjusted the carrying value of the investment accordingly, which was based on a discounted cash flow analysis, wherein we weighted different valuation scenarios with different assumed internal rates of return and time to liquidity events. In performing a qualitative impairment assessment, we determined that the carrying amount of the investment exceeded its fair value due to a significant decline in investee operating results relative to expectations, primarily as a result of the COVID-19 pandemic. The fair value measurement is classified within Level 3 of the fair value hierarchy due to the use of unobservable inputs in the fair value measurement.
Non-securitization investments measured at fair value excludes our equity method investment in Apex, which is discussed further in Note 1.
Note 9. Debt
The following table summarizes the Company’s principal outstanding debt, debt discounts and debt issuance costs as of the dates indicated:
Outstanding as of
Borrowing Description
Collateral Balances (1)
Interest Rate(2)
Termination/
Maturity(3)
Total Capacity
December 31,
2020(4)
December 31,
2019(4)
Student Loan Warehouse Facilities
SoFi Funding I $ 421,356 
1 ML + 175 bps
April 2021 $ 600,000  $ 374,575  $ 152,008 
SoFi Funding III 33,425 
PR – 134 bps(12)
September 2024 75,000  30,170  13,104 
SoFi Funding V — 
1 ML + 250 bps
May 2023 350,000  —  143,501 
SoFi Funding VI 469,660 
3 ML + 150 bps
March 2023 600,000  432,437  88,791 
SoFi Funding VII 303,140 
1 ML + 125 bps
September 2022 500,000  276,910  251,731 
SoFi Funding VIII 242,142 
1 ML + 150 bps
March 2021 300,000  221,342  151,007 
SoFi Funding IX(9)
76,535 
3 ML+ 350 bps and
CP + 143 bps
July 2023 500,000  70,780  204,642 
SoFi Funding X(10)
50,291 
CP + 200 bps
August 2023 100,000  44,136  — 
SoFi Funding XI(11)
98,525 
CP + 115 bps
November 2023 500,000  87,404  — 
Total $ 1,695,074  $ 3,525,000  $ 1,537,754  $ 1,004,784 
Unamortized debt issuance costs $ (7,940) $ (6,100)
Weighted average effective interest rate 2.29  % 3.92  %
Personal Loan Warehouse Facilities
SoFi Funding PL I $ — 
1 ML + 350 bps
December 2021 $ 250,000  $ —  $ — 
SoFi Funding PL II 148,123 
3 ML + 225 bps
July 2023 400,000  137,420  — 
SoFi Funding PL III 3,538 
1 ML + 325 bps
May 2023 250,000  2,793  95,833 
SoFi Funding PL IV 147,991 
CP + 170 bps
November 2023 500,000  132,416  152,041 
SoFi Funding PL VI 122,482 
3 ML + 200 bps
September 2022 150,000  107,595  — 
SoFi Funding PL VII 18,898 
1 ML + 250 bps
June 2021 250,000  15,610  — 
SoFi Funding PL IX — 
1 ML + 200 bps
August 2020 —  —  110,325 
SoFi Funding PL X 3,598 
1 ML + 142.5 bps
February 2023 200,000  3,004  — 
SoFi Funding PL XI 129,543 
1 ML + 170 bps
January 2022 200,000  112,478  — 
SoFi Funding PL XII 139,194 
1 ML + (225-315 bps)
March 2029 250,000  127,724  — 
SoFi Funding PL XIII 254,808 
1 ML + 175 bps
January 2030 300,000  219,362  — 
Total $ 968,175  $ 2,750,000  $ 858,402  $ 358,199 
Unamortized debt issuance costs $ (6,692) $ (9,516)
Weighted average effective interest rate 3.63  % 4.83  %
Home Loan Warehouse Facilities
Mortgage Warehouse V $ — 
1 ML + 325 bps
June 2021 $ 150,000  $ —  $ 32,366 
Total $ —  $ 150,000  $ —  $ 32,366 
Unamortized debt issuance costs
$ —  $ (29)
Weighted average effective interest rate —% 4.26  %
F-147

TABLE OF CONTENTS
Social Finance, Inc.
Notes to Consolidated Financial Statements  (continued)
(In Thousands, Unless Otherwise Stated and Except for Share and Per Share Data)
Outstanding as of
Borrowing Description
Collateral Balances (1)
Interest Rate(2)
Termination/
Maturity(3)
Total Capacity
December 31,
2020(4)
December 31,
2019(4)
Risk Retention Warehouse Facilities(5)
SoFi RR Funding I $ 84,312 
1 ML + 200 bps
June 2022 $ 250,000  $ 54,304  $ 174,006 
SoFi RR Repo 133,953 
3 ML + 185 bps
June 2023 192,141  75,863  124,064 
SoFi EU RR Repo — 
3 ML + 425 bps
June 2021 —  70,272 
SoFi C RR Repo 49,260 
3 ML + (180-185 bps)
December 2021 42,757  75,439 
SoFi RR Funding II 179,468 
1 ML + 125 bps
November 2024 160,199  167,826 
SoFi RR Funding III 68,538 
1 ML + 375 bps
November 2024 60,786  — 
SoFi RR Funding IV 43,309 
1 ML + 250 bps
October 2026 100,000  37,334  — 
Total $ 558,840  $ 431,243  $ 611,607 
Unamortized debt issuance costs $ (2,052) $ (2,198)
Weighted average effective interest rate 2.24  % 3.82  %
Revolving Credit Facility(6)
SoFi Corporate Revolver n/a
1 ML + 100 bps(7)
September 2023 $ 560,000  $ 486,000  $ 161,000 
Total $ 560,000  $ 486,000  $ 161,000 
Unamortized debt issuance costs $ (987) $ (1,345)
Weighted average effective interest rate 1.26  % 3.03  %
Seller note(8)
n/a
1000 bps
May 2021 $ 250,000  $ — 
Total $ 250,000  $ — 
Unamortized discount $ —  $ — 
Weighted average effective interest rate 10.00  % —%
Other financing – various notes(8)
n/a
331 – 557 bps
April 2021 –  January 2023 $ 4,375  $ — 
Total $ 4,375  $ — 
Unamortized debt issuance costs $ —  $ — 
Weighted average effective interest rate 3.64  % —%
Student Loan Securitizations
SoFi PLP 2016-B LLC $ 78,173 
1 ML + (120-380 bps)
April 2037 $ 69,448  $ 109,333 
SoFi PLP 2016-C LLC 90,628 
1 ML + (110-335 bps)
May 2037 81,115  128,858 
SoFi PLP 2016-D LLC 106,421 
1 ML + (95-323 bps)
January 2039 93,942  145,272 
SoFi PLP 2016-E LLC 130,056 
1 ML + (85-443 bps)
October 2041 117,800  187,872 
SoFi PLP 2017-A LLC 161,082 
1 ML + (70-443 bps)
March 2040 146,064  221,873 
SoFi PLP 2017-B LLC 142,903 
183 – 444 bps
May 2040 129,873  208,459 
SoFi PLP 2017-C LLC 178,794 
1 ML + (60-421 bps)
July 2040 161,897  252,400 
Total $ 888,057  $ 800,139  $ 1,254,067 
Unamortized debt issuance costs $ (5,958) $ (8,914)
Unamortized discount (1,654) (2,404)
Weighted average effective interest rate 3.22  % 4.39  %
F-148

TABLE OF CONTENTS
Social Finance, Inc.
Notes to Consolidated Financial Statements  (continued)
(In Thousands, Unless Otherwise Stated and Except for Share and Per Share Data)
Outstanding as of
Borrowing Description
Collateral Balances (1)
Interest Rate(2)
Termination/
Maturity(3)
Total Capacity
December 31,
2020(4)
December 31,
2019(4)
Personal Loan Securitizations
SoFi CLP 2016-1 LLC $ 49,199 
326 bps
August 2025 $ 36,546  $ 78,223 
SoFi CLP 2016-2 LLC 49,641 
309 – 477 bps
October 2025 37,973  90,229 
SoFi CLP 2016-3 LLC 69,955 
305 – 449 bps
December 2025 30,780  110,175 
SoFi CLP 2017-1 LLC — 
328 – 473 bps
March 2020 —  139,098 
SoFi CLP 2017-2 LLC — 
328 – 473 bps
March 2020 —  89,365 
SoFi CLP 2017-3 LLC — 
277 – 385 bps
July 2020 —  166,177 
SoFi CLP 2018-3 LLC 188,461 
320 – 467 bps
August 2027 163,784  292,146 
SoFi CLP 2018-4 LLC 212,940 
354 – 476 bps
November 2027 184,831  326,295 
SoFi CLP 2018-3 Repack LLC 10,495 
200 bps
August 2027 2,457  4,708 
SoFi CLP 2018-4 Repack LLC 12,775 
200 bps
December 2027 5,853  8,465 
Total $ 593,466  $ 462,224  $ 1,304,881 
Unamortized debt issuance costs $ (3,057) $ (7,476)
Unamortized discount (2,872) (544)
Weighted average effective interest rate 4.47  % 4.09  %
Total $ 4,830,137  $ 4,726,904 
Less: unamortized debt issuance costs and discounts (31,212) (38,526)
Total reported debt $ 4,798,925  $ 4,688,378 
_________________
(1)As of December 31, 2020, and represents unpaid principal balances, with the exception of the risk retention warehouse facilities, which include securitization-related investments carried at fair value. In addition, certain securitization interests that eliminate in consolidation are pledged to risk retention warehouse facilities.
(2)Unused commitment fees ranging from 0 to 200 bps on our various warehouse facilities are recognized as noninterest expense — general and administrative in our Consolidated Statements of Operations and Comprehensive Income (Loss). “ML” stands for “Month LIBOR”. As of December 31, 2020, 1 ML and 3 ML was 0.14% and 0.24%, respectively. As of December 31, 2019, 1 ML and 3 ML was 1.76% and 1.91%, respectively. “PR” stands for “Prime Rate”. As of December 31, 2020 and 2019, PR was 3.25% and 4.75%, respectively. Our total weighted average effective interest rate for the years ended December 31, 2020 and 2019 was 3.18% and 4.12%, respectively.
(3)For the securitization debt, the maturity of the notes issued by the various trusts occurs upon either the maturity of the loan collateral or full payment of the loan collateral held in the trusts. Our maturity date represents the legal maturity of the last class of maturing notes. Securitization debt matures as loan collateral payments are made. In instances where the related securitization was deconsolidated during the current period, the termination date is equivalent to our deconsolidation date.
(4)There were $2,953 and $1,431 of debt discounts issued during the years ended December 31, 2020 and 2019, respectively.
(5)Financing was obtained for both asset-backed bonds and residual investments in various personal and student loan securitizations, and the underlying collateral are the underlying asset-backed bonds and residual investments. We only state capacity amounts in this table for risk retention facilities wherein we can pledge additional asset-backed bonds and residual investments as of December 31, 2020.
(6)As of December 31, 2020, $6.0 million of the revolving credit facility total capacity was not available for general borrowing purposes because it was utilized to secure a letter of credit. Refer to our letter of credit disclosures in Note 15 for more details.
(7)Interest rate presented represents the interest rate on standard withdrawals on our revolving credit facility, while same-day withdrawals incur interest based on PR.
(8)Part of our consideration to acquire Galileo was in the form of a seller note financing arrangement, which is prepayable without penalty. See Note 2 for additional information. We also assumed certain other financing arrangements resulting from our acquisition of Galileo.
(9)Warehouse facility incurs different interest rates on its two types of asset classes. One such class incurs interest based on a commercial paper rate (“CP”) rate, which is determined by the facility lender. As of December 31, 2020, the CP rate for this facility was 0.25%. As of December 31, 2019, this warehouse incurred interest based on 3 ML.
(10)Warehouse facility incurs interest based on a CP rate, which is determined by the facility lender. As of December 31, 2020, the CP rate for this facility was 0.28%.
(11)Warehouse facility incurs interest based on a CP rate, which is determined by the facility lender. As of December 31, 2020, the CP rate for this facility was 0.25%.
(12)This facility has a prime rate floor of 309 bps.
F-149

TABLE OF CONTENTS
Social Finance, Inc.
Notes to Consolidated Financial Statements  (continued)
(In Thousands, Unless Otherwise Stated and Except for Share and Per Share Data)
Material Changes to Debt Arrangements
During the year ended December 31, 2020, we:
opened three loan warehouse facilities that had an aggregate maximum available capacity of $900,000, as well as two risk retention warehouse facilities;
closed two loan warehouse facilities that had an aggregate maximum available capacity of $225,000;
consolidated one student loan securitization, which resulted in gross debt issued of $458,375, which was later deconsolidated during the period resulting in the deconsolidation of debt of $458,375;
deconsolidated three personal loan securitizations, which were originally consolidated in 2017, resulting in the deconsolidation of debt of $312,543; and
issued a seller note with a principal balance of $250,000 in connection with our acquisition of Galileo.
During the year ended December 31, 2019, we:
opened four warehouse facilities that had an aggregate maximum available capacity of $650,000;
closed two warehouse facilities that had an aggregate maximum available capacity of $147,000; and
consolidated eight personal loan securitizations, which resulted in gross debt issued of $1,739,106, of which six securitizations were deconsolidated during the year resulting in the deconsolidation of debt of $1,366,992.
One securitization was called and dissolved in May 2019, resulting in the retirement of debt of $23,205 during the year ended December 31, 2019.
The total accrued interest payable on our debt as of December 31, 2020 and 2019 was $19,817 and $5,872, respectively, and was included as a component of accounts payable, accruals and other liabilities in the Consolidated Balance Sheets.
Our warehouse and securitization debt is secured by a continuing lien and security interest in the loans financed by the proceeds. Within each of our debt facilities, we must comply with certain operating and financial covenants. These financial covenants include, but are not limited to, maintaining: (i) a certain minimum tangible net worth, (ii) minimum cash and cash equivalents, and (iii) a maximum leverage ratio of total debt to tangible net worth. Our debt covenants can lead to restricted cash classifications in our Consolidated Balance Sheets. Our subsidiaries are restricted in the amount that can be distributed to the parent company only to the extent that such distributions would cause the financial covenants to not be met. We were in compliance with all financial covenants required per each agreement as of each balance sheet date presented.
We act as a guarantor for our wholly-owned subsidiaries in several arrangements in the case of default. As of December 31, 2020, we have not identified any risks of nonpayment by our wholly-owned subsidiaries.
F-150

TABLE OF CONTENTS
Social Finance, Inc.
Notes to Consolidated Financial Statements  (continued)
(In Thousands, Unless Otherwise Stated and Except for Share and Per Share Data)
Maturities of Borrowings
As of December 31, 2020, future maturities of our outstanding debt with scheduled payments, which included our revolving credit facility, seller note and other financings obtained in connection with our acquisition of Galileo, were as follows:
2021 $ 252,420 
2022 1,809 
2023 486,146 
2024 — 
2025 — 
Thereafter — 
Total $ 740,375 
Note 10. Temporary Equity
The following table summarizes the original issuance price per share and authorized and outstanding number of shares of redeemable preferred stock as of the dates indicated:
December 31, 2020
December 31, 2019
Series Name
Original Issuance Price
Number of Shares Authorized
Number of Shares Outstanding
Number of Shares Authorized
Number of Shares Outstanding
Series 1
$ 100.00  4,500,000  3,234,000  4,500,000  3,234,000 
Series A
0.20  19,687,500  19,687,500  19,687,500  19,687,500 
Series B
2.20  37,252,051  26,693,795  37,252,051  37,252,051 
Series C
2.20 – 3.05
2,209,991  2,038,643  2,209,991  2,038,643 
Series D
3.45  23,411,503  22,369,041  23,411,503  23,411,503 
Series E
9.46  24,483,290  24,262,476  24,483,290  24,483,290 
Series F
15.78  63,386,220  60,110,165  63,386,220  63,386,220 
Series G
17.18  29,096,495  29,096,489  29,096,495  29,096,489 
Series H
15.44  50,815,616  16,224,534  50,815,616  16,224,534 
Series H-1
15.44  57,000,000  52,743,298  —  — 
Total
311,842,666  256,459,941  254,842,666  218,814,230 
The original issuance price excludes any applicable discounts and the cost of issuance. Any shares of redeemable preferred stock that are redeemed, converted, purchased or acquired by the Company may be reissued, except as restricted by law or contract.
Recent Issuances and Redemptions
During December 2020, we exercised a call and redeemed 15,097,587 shares of redeemable preferred stock consisting of: 10,558,256 shares of Series B; 1,042,462 shares of Series D; 220,814 shares of Series E and 3,276,055 shares of Series F. The amount payable resulted in a reduction to redeemable preferred stock of $80,201 for the redeemable preferred stock balance at the time of the exercise. The shares were retired upon receipt. See Note 14 for additional information.
In May 2020, the Company issued 52,743,298 shares of Series H-1 redeemable preferred stock as a component of the purchase consideration for the acquisition of Galileo at a fair value of $814,156. See Note 2 for additional information on the acquisition.
F-151

TABLE OF CONTENTS
Social Finance, Inc.
Notes to Consolidated Financial Statements  (continued)
(In Thousands, Unless Otherwise Stated and Except for Share and Per Share Data)
In May 2019, the Company issued 13,967,169 shares of Series H and 3,234,000 shares of Series 1 redeemable preferred stock. The Company received $539.0 million of gross proceeds in connection with this redeemable preferred stock offering, which was reduced by $2.4 million of direct costs. In October 2019, the Company issued an additional 2,257,365 shares of Series H preferred stock. The Company received $34.8 million of gross proceeds in connection with this redeemable preferred stock offering and had no direct costs associated with the offering.
Series 1 Preference and Rights
SoFi is party to the Series 1 Preferred Stock Investors’ Agreement (the “Series 1 Agreement”), dated as of May 29, 2019, with certain holders of its capital stock, including (i) entities affiliated with Silver Lake, which is affiliated with Michael Bingle, one of the directors of SoFi, (ii) entities affiliated with QIA, which is affiliated with Ahmed Al-Hammadi, one of the directors of SoFi, and (iii) Mr. Noto, the Chief Executive Officer and one of the directors of SoFi. The agreement provides holders of the Series 1 preferred stock, who also hold Series H Preferred Stock (the “Series 1 Holders”), upon request by QIA, with certain registration rights, provides for certain shelf registration filing obligations by SoFi and limits the future registration rights that SoFi may grant other parties, contains financial and other covenants, and provides for information rights and special payment rights, among other rights, as discussed further below.
The Series 1 redeemable preferred stock has no stated maturity. However, the Series 1 redeemable preferred shares have limited price protection in the instance that the Company liquidates, finalizes an initial public offering (“IPO”), or sells control of the Company to a third party. In the instance where the Company enters one of the foregoing transaction types during a period commencing on May 29, 2020 and ending one year later, if the Company does not achieve an IPO or sales price of $19.30 per share, then the Series 1 Holders have a right to a special payment for the difference between $19.30 and $15.44 per share (the “Special Payment”).
We evaluated the Special Payment provision and determined that the special payment feature was an embedded derivative that was not clearly and closely related to the host contract, and therefore should be accounted for as a derivative liability when the special payment becomes payable. In the event that a Special Payment event triggers a Special Payment becoming payable, it will be recognized within noninterest expense — general and administrative in the Consolidated Statements of Operations and Comprehensive Income (Loss). See Note 18 for discussion of an amendment to the Series 1 Investor Agreement subsequent to December 31, 2020 and the expected accounting treatment of the Special Payment upon completion of the Business Combination.
Additionally, subsequent to an IPO or change of control event (collectively, a “Change of Control”), within 120 days after the first date on which such Change of Control has occurred, each Series 1 Holder will have the right to require the Company, at the Series 1 Holder’s election, to purchase for cash some or all of the shares of Series 1 redeemable preferred stock held by such Series 1 Holder on the Change of Control put date at a redemption price in the amount of the initial Series 1 investment of $323.4 million. See Note 18, wherein we discuss that the Series 1 Holders waived their rights to settlement of the initial Series 1 investment following the liquidation triggered by the consummation of the Business Combination, but the Series 1 redeemable preferred stock will remain in temporary equity following the Business Combination because the Series 1 redeemable preferred stock is not fully controlled by SoFi.

F-152

TABLE OF CONTENTS
Social Finance, Inc.
Notes to Consolidated Financial Statements  (continued)
(In Thousands, Unless Otherwise Stated and Except for Share and Per Share Data)
Dividends
The following summarizes the dividend provisions of each series of redeemable preferred stock (excluding Series 1, which is discussed separately below). The per-share amounts below are applied to the outstanding redeemable preferred shares then held by each Series at the time of the dividend declaration (if any). In the event dividends are declared, the below stated dividends are received in parity with each other, and prior and in preference to any dividends paid to Series C redeemable preferred shares or any class of common shares.
December 31,
Series Name(1)
2020 2019
Series A $ 0.02  $ 0.02 
Series B 0.18  0.18 
Series D 0.28  0.28 
Series E 0.76  0.76 
Series F 1.26  1.26 
Series G 1.37  1.37 
Series H 1.23  1.23 
Series H-1 1.23  — 
____________________
(1)Series C redeemable preferred shares do not have a stated dividend.
With respect to the series of redeemable preferred stock presented in the table above, no dividends were declared or paid during the years ended December 31, 2020 and 2019. All such dividends per share are non-cumulative and non-mandatory.
Series 1 redeemable preferred stock are entitled to receive cumulative cash dividends from and including the closing date of May 29, 2019 (“Closing Date”) at a fixed rate equal to $12.50 per annum per share, or 12.5% of the Series 1 redeemable preferred share price of $100.00 (“Series 1 Dividend Rate”). The Series 1 Dividend Rate resets to a new fixed rate on the fifth anniversary of the Closing Date and on every one-year anniversary of the Closing Date subsequent to the fifth anniversary of the Closing Date (“dividend reset date”), equal to six-month LIBOR as in effect on the second London banking day prior to such dividend reset date plus a spread of 9.94% per annum. During the years ended December 31, 2020 and 2019, we declared and paid dividends of $40,536 and $23,923, respectively, to our Series 1 preferred stockholders, which reflected the Series 1 Dividend Rate of $12.50 per annum per share of Series 1 preferred stock. There were no dividends payable as of December 31, 2020 and 2019.
Dividends are payable semiannually in arrears on the 30th day of June and 31st day of December of each year, when and as authorized by the board of directors. The Company may defer any scheduled dividend payment for up to three semiannual dividend periods, subject to such deferred dividend accumulating and compounding at the applicable Series 1 Dividend Rate. If the Company defers any single scheduled dividend payment on the Series 1 redeemable preferred stock for four or more semiannual dividend periods, the Series 1 Dividend Rate applicable to (i) the compounding following the date of such default on all then-deferred dividend payments (whether or not deferred for four or more semiannual dividend periods) is applied on a go-forward basis and not retroactively, and (ii) new dividends declared following the date of such default and the compounding on such dividends if such new dividends are deferred shall be equal to the otherwise applicable Series 1 Dividend Rate plus 400 basis points. This default-related increase shall continue to apply until the Company pays all deferred dividends and related compounding. Once the Company is current on all such dividends, it may again commence deferral of any pre-scheduled dividend payment for up to three semiannual dividend periods, following the same procedure as outlined in the foregoing. There were no dividend deferrals during the years ended December 31, 2020 and 2019.
F-153

TABLE OF CONTENTS
Social Finance, Inc.
Notes to Consolidated Financial Statements  (continued)
(In Thousands, Unless Otherwise Stated and Except for Share and Per Share Data)
Conversion
In respect of every Series, other than Series 1, each redeemable preferred share automatically converts at the conversion rate then in effect into common stock upon a firm-commitment underwritten IPO of the Company’s common stock with an IPO not less than $17.06 per share (as adjusted for stock splits and the like) and aggregate cash proceeds of not less than $100.0 million.
The common stock conversion prices for each series were as follows:
December 31,
Series Name 2020 2019
Series A $ 0.20  $ 0.20 
Series B 2.20  2.20 
Series C 1.00  1.00 
Series D 3.45  3.45 
Series E 9.46  9.46 
Series F 15.75  15.75 
Series G 17.06  17.06 
Series H 15.44  15.44 
Series H-1 15.44  — 
In respect of Series A, Series B, Series D, Series E, Series H and Series H-1 shares, each share is convertible at the option of the holder into common stock at a one-to-one conversion rate of the price per preferred share to its conversion price but is subject to adjustments for events of dilution. Series F and G conversion rates were lowered in 2019 in conjunction with the Series H preferred stock offering and, therefore, the conversion prices no longer equal their respective prices per preferred share. Automatic conversion into common stock will occur upon written consent of a majority of Series A and Series B holders (voting as a single class), Series D holders (voting as a single class), Series E holders (voting as a single class), Series F holders (voting as a single class), Series G holders (voting as a single class), Series H (voting as a single class) and Series H-1 (voting as a single class).
In respect of Series C shares, each share is convertible at the option of the holder into non-voting common stock at a one-to-one conversion rate of $1.00 per redeemable preferred share to its conversion price. Automatic conversion into non-voting common stock will occur upon the conversion of all Series A and Series B shares into common stock.
Liquidation
In the event of any liquidation, dissolution, merger or consolidation (resulting in the common and preferred stockholders’ loss of a collective 50% or more ownership in the Company), disposition or transfer of assets, or winding up of the Company, whether voluntary or involuntary (a “Liquidation Event”), the following summarizes the preference of each series of redeemable preferred stock:
In respect to all redeemable preferred stock, the preference is equal to an amount per share equal to the original issue price per share, and Series 1 has priority over all other redeemable preferred stock classes.
If, upon the Liquidation Event, the assets and funds are insufficient to permit payment of all outstanding preferences, the Company’s entire assets and funds will be distributed ratably among the redeemable preferred stockholders following the holders’ liquidation preferences (after the Series 1 liquidation preference is fully satisfied).
F-154

TABLE OF CONTENTS
Social Finance, Inc.
Notes to Consolidated Financial Statements  (continued)
(In Thousands, Unless Otherwise Stated and Except for Share and Per Share Data)
The various liquidation preferences (redemption amounts) are itemized below:
December 31,
Series Name 2020 2019
Series 1 $ 323,400  $ 323,400 
Series A 3,938  3,938 
Series B 58,668  81,873 
Series C 4,837  4,837 
Series D 77,240  80,840 
Series E 229,470  231,558 
Series F 948,316  1,000,000 
Series G 500,000  500,000 
Series H 250,445  250,445 
Series H-1 814,156  — 
Total $ 3,210,470  $ 2,476,891 
Settlement Rights
The Series 1 redeemable preferred stock is redeemable at SoFi’s option in certain circumstances. SoFi may, at any time but no more than three times, at its option, settle the Series 1 redeemable preferred stock, in whole or in part, but if in part, in an amount no less than one-third of the total amount of Series 1 redeemable preferred stock originally issued or the remainder of Series 1 redeemable preferred stock outstanding (the “Minimum Redemption Amount”). In addition, SoFi may settle the Series 1 redeemable preferred stock in whole or in part (subject to the Minimum Redemption Amount) in the event of a liquidation transaction or a direct sale of control transaction by a majority of SoFi’s stockholders, or within 120 days of (i) an IPO, or (ii) following an IPO, a change of control of SoFi, each of which would result in a payment of the initial purchase price of the Series 1 shares of $323.4 million plus any unpaid dividends on the Series 1 redeemable preferred stock and any special payment due under the Series 1 investor agreement (whether deferred or otherwise) (the “Series 1 Redemption Price”). Such settlement is determined at the discretion of the board of directors.
If the Series 1 redeemable preferred stock is not earlier redeemed by SoFi as described in the preceding paragraph, the holders of Series 1 redeemable preferred stock have the right to force SoFi to settle their Series 1 redeemable preferred stock in the following circumstances: (i) upon a change of control of SoFi following an IPO, or (ii) during the six-month period following (a) a default in payment of any dividend on the Series 1 redeemable preferred stock, or (b) the cure period for any covenant default under the Series 1 investor agreement, in each case at the Series 1 Redemption Price.
All other preferred stock is convertible in the case of an IPO into common stock at defined conversion prices as disclosed above, but there is no stated term for settling the liquidation preference for all other Series of preferred stock.
Refer to Note 18 for more details regarding the Series 1 redeemable preferred stock treatment in conjunction with the consummation of the Business Combination.
Voting Rights
Series A and Series B together have the right to elect one member of the board of directors provided the number of shares outstanding is at least 14,000,000. Series D and Series E together have the right to elect one member of the board of directors provided the number of shares outstanding is at least 14,000,000. Series F holders have the right to elect one member of the board of directors provided the number of shares outstanding is at least 7,000,000. Series G holders have the right to elect one member of the board of directors provided the number of shares
F-155

TABLE OF CONTENTS
Social Finance, Inc.
Notes to Consolidated Financial Statements  (continued)
(In Thousands, Unless Otherwise Stated and Except for Share and Per Share Data)
outstanding is at least 3,000,000. Series H holders have the right to elect one member of the board of directors provided the number of shares outstanding is at least 1,396,717. The Series C, Series 1 and Series H-1 holders do not have explicit Board rights per our current Articles of Incorporation.
Warrants
In connection with the Series 1 and Series H redeemable preferred stock issuances during the year ended December 31, 2019, we also issued 6,983,585 Series H warrants, which were accounted for as liabilities in accordance with ASC 480, Distinguishing Liabilities from Equity, and were included within accounts payable, accruals and other liabilities in the Consolidated Balance Sheets. At inception, we allocated $22.3 million of the $539.0 million of proceeds we received from the Series 1 and Series H preferred stock issuances to the Series H warrants, with such valuation determined using the Black-Scholes Model, in order to establish an initial fair value for the Series H warrants. The remaining proceeds were allocated to the Series 1 and Series H preferred stock balances based on their initial relative fair values.
The Series H warrants are subsequently measured at fair value on a recurring basis and are classified as Level 3 because of our reliance on unobservable assumptions, with fair value changes recognized within noninterest expense — general and administrative in the Consolidated Statements of Operations and Comprehensive Income (Loss). The key inputs into our Black-Scholes Model valuation were as follows at inception and as of the dates indicated:
December 31, Initial Measurement Assumptions
Input 2020 2019
Risk-free interest rate 0.2  % 1.7  % 2.1  %
Expected term (years) 3.4 4.4 5
Expected volatility 32.6  % 25.0  % 25.0  %
Dividend yield —% —% —%
Exercise price $ 15.44  $ 15.44  $ 15.44 
Fair value of Series H preferred stock $ 18.43  $ 14.02  $ 14.13 
The Company’s use of the Black-Scholes Model requires the use of subjective assumptions:
The risk-free interest rate assumption was initially based on the five-year U.S. Treasury rate, which was commensurate with the expected term of the warrants. The warrants automatically convert into Series H redeemable shares at the later of an IPO or five years from the issuance date of the warrants (May 29, 2019). At inception, we assumed that the term would be five years, given by design the warrants were only expected to extend for greater than five years if the Company was still not publicly traded by that point in time. An increase in the expected term, in isolation, would typically correlate to a higher risk-free interest rate and result in an increase in the fair value measurement of the warrant liabilities and vice versa. See below for a development in connection with the Business Combination.
The expected volatility assumption for the initial measurement and as of December 31, 2019 was based on the volatility of our common stock and adjusted for the reduced volatility inherent in redeemable preferred stock, given the Series H liquidity preference. As of December 31, 2020, we updated our expected volatility assumption to reflect the expectation that the Series H warrants will convert into common stock upon consummation of the Business Combination, and the Series H preference would be of no further effect, in which case the Series H preference would not have a material impact on the stock volatility measure. As such, the expected volatility assumption reflects our common stock volatility as of December 31, 2020. An increase in the expected volatility, in isolation, would result in an increase in the fair value measurement of the warrant liabilities and vice versa.
The initial fair value of the Series H redeemable preferred stock was based on the purchase price of the Series H redeemable preferred stock, which was contemporaneous with the issuance of the warrants. The
F-156

TABLE OF CONTENTS
Social Finance, Inc.
Notes to Consolidated Financial Statements  (continued)
(In Thousands, Unless Otherwise Stated and Except for Share and Per Share Data)
fair value measurement of the Series H redeemable preferred stock as of December 31, 2019 was determined using the Black-Scholes Model, via the backsolve method. The fair value measurement of the Series H redeemable preferred stock as of December 31, 2020 was informed from a common stock transaction during December 2020 at a price of $18.43 per common share. Additionally, the proximity to an expected Business Combination informed our valuation of our redeemable preferred stock. We determined that this common stock transaction was a reasonable proxy for the valuation of the Series H redeemable preferred stock as of December 31, 2020; therefore, no further adjustments were made for the Series H concluded price per share.
We assumed no dividend yield because we have historically not paid out dividends to our existing redeemable preferred stockholders, other than to the Series 1 redeemable preferred stockholders, which were considered special circumstances.
At inception of the warrants, we allocated the remaining net proceeds of $514.3 million from the combined Series H and Series 1 redeemable preferred stock offering to the Series H and Series 1 redeemable preferred stock balances in proportion to their relative fair values. This resulted in an initial allocation of $193.9 million and $320.4 million to the Series H and Series 1 redeemable preferred stock, respectively.
The following table presents the changes in the fair value of warrant liabilities:
Warrant Liabilities
Fair value as of January 1, 2019 $ — 
Initial measurement 22,268 
Change in valuation inputs or other assumptions(1)
(2,834)
Fair value as of December 31, 2019 $ 19,434 
Change in valuation inputs or other assumptions(1)
20,525 
Fair value as of December 31, 2020 $ 39,959 
___________________
(1)Changes in valuation inputs or other assumptions are recognized in noninterest expense — general and administrative in the Consolidated Statements of Operations and Comprehensive Income (Loss).
In connection with the Business Combination, the Series H warrants will convert into warrants to purchase common stock of the combined entity at the conversion price and ratio for Series H established under “— Conversion” above.
Note 11. Permanent Equity
The Company is authorized to issue common stock and non-voting common stock. As of December 31, 2020 and 2019, the Company was authorized to issue 447,815,616 and 390,815,616 shares of common stock, respectively, and 5,000,000 shares of non-voting common stock.
During December 2020, we issued 20,067,302 shares of common stock for gross proceeds received of $369.8 million, which was offset by direct legal costs of $56 (the “Common Stock Issuance”). The number of shares issued in the Common Stock Issuance is subject to upward adjustment if we consummate the Business Combination described in Note 18, with the amount of any adjustment based on the implied per-share consideration in the Business Combination and the number of shares of our capital stock issued in certain dilutive issuances prior to the closing of the Business Combination. We expect the adjustment to result in the issuance of an additional 735,100 shares at the time of closing the Business Combination.
F-157

TABLE OF CONTENTS
Social Finance, Inc.
Notes to Consolidated Financial Statements  (continued)
(In Thousands, Unless Otherwise Stated and Except for Share and Per Share Data)
The Company reserved the following common stock for future issuance as of the dates indicated:
December 31,
2020 2019
Conversion of outstanding redeemable preferred stock 253,525,467  215,884,709 
Unissued redeemable preferred stock reserved for issued warrants 6,983,585  6,983,585 
Unissued redeemable preferred stock 47,133,140  27,778,851 
Outstanding stock options and RSUs 42,775,741  32,153,427 
Possible future issuance under stock plans 19,177,343  6,526,084 
Contingent common stock in connection with acquisition(1)
183,985  — 
Total common stock reserved for future issuance 369,779,261  289,326,656 
___________________
(1)Represents contingently issuable common stock in connection with our acquisition of 8 Limited. See Note 2 for additional information.
Dividends
Common stockholders and non-voting common stockholders are entitled to dividends when and if declared by the board of directors, but as stated in Note 10, only after dividends are paid to redeemable preferred stockholders, with the exception of Series C preferred stockholders. All redeemable preferred shares, except for Series 1 preferred stock, participate in dividends with common stock. There were no dividends declared or paid to common stockholders during the years ended December 31, 2020 and 2019.
Conversion and Redemption
Upon the Company’s sale of its common stock in a firm commitment underwritten IPO, each share of non-voting common stock would automatically be converted into such number of common stock as is determined by dividing $1.00 by the conversion price applicable to such shares. The initial conversion price per share shall be $1.00. Both prices are subject to adjustment for any stock splits and stock dividends. The common stock and non-voting common stock are otherwise non-redeemable.
Liquidation
Upon completion of the distribution to preferred stockholders, as discussed within Note 10, if assets remain in the Company, the holders of common stock and non-voting common stock would receive all of the remaining assets pro rata based on the number of shares of common stock then held by each holder (assuming conversion of all such non-voting common stock into common stock).
Voting Rights
Each holder of common stock has the right to one vote per share of common stock and is entitled to notice of any stockholders’ meeting. Non-voting common stock does not have any voting rights or other powers. The common stockholders, voting together as a single class, can elect one member to the board of directors.
Note 12. Stock-Based Compensation
The Company maintains the Amended and Restated 2011 Stock Option Plan, which provides for granting stock options and RSUs, pursuant to which the Company has authorized 88,426,267 shares of its common stock for issuance to its employees, non-employee directors and non-employee third parties and also has 35,000 shares authorized under a stock plan assumed in a business combination as of December 31, 2020. Further, during the years ended December 31, 2020, 2019 and 2018, we incurred cash outflows of $31,259, $21,411 and $3,154, respectively, related to the payment of withholding taxes for vested RSUs. These cash outflows are presented within financing activities in the Consolidated Statements of Cash Flows.
F-158

TABLE OF CONTENTS
Social Finance, Inc.
Notes to Consolidated Financial Statements  (continued)
(In Thousands, Unless Otherwise Stated and Except for Share and Per Share Data)
Stock-based compensation expense related to stock options and RSUs is presented within the following line items in the Consolidated Statements of Operations and Comprehensive Income (Loss) for the periods indicated:
Year Ended December 31,
2020 2019 2018
Technology and product development $ 28,271  $ 16,107  $ 7,872 
Sales and marketing 8,045  4,192  2,301 
Cost of operations 6,067  1,678  1,841 
General and administrative 57,487  38,959  30,922 
Total $ 99,870  $ 60,936  $ 42,936 
Common Stock Valuations
Prior to us contemplating a public market transaction, we established the fair value of our common stock by using the option pricing model (Black-Scholes Model based) via the backsolve method and through placing weight on previously redeemable preferred stock transactions, such as our Series H redeemable preferred stock transactions during 2019, Series H-1 redeemable preferred stock transaction during 2020 and a secondary market transaction involving our Series F preferred stock during 2020, transactions in our common stock during the period and a guideline public company multiples analysis. Our use of the Black-Scholes Model required the use of subjective assumptions, including the risk-free interest rate, expected term, expected stock price volatility and dividend yield. The risk-free interest rate assumption was based upon observed interest rates for constant maturity U.S. Treasury securities consistent with the expected term of our stock options. The expected term represented the period of time the stock options were expected to be outstanding and was based on the simplified method. Under the simplified method, the expected term of a stock option is presumed to be the midpoint between the vesting date and the end of the contractual term. Management used the simplified method due to the lack of sufficient historical exercise data to provide a reasonable basis upon which to otherwise estimate the expected term of the stock options. Expected volatility was based on historical volatility for publicly traded stock of comparable companies over the estimated expected life of the stock options. In identifying comparable companies, we considered factors such as industry, stage of life cycle and size. The valuations also applied discounts for lack of marketability to reflect the fact that there was no market mechanism to sell our common stock and, as such, the common stock option and RSU holders would need to wait for a liquidity event to facilitate the sale of their equity awards. In addition, there were contractual transfer restrictions placed on common stock in the event that we remained a private company.
During the third quarter of 2020, once we made intentional progress toward pursuing a public market transaction, we began applying the PWERM to determine the fair value of our common stock. The probability weightings assigned to certain potential exit scenarios were based on management’s expected near-term and long-term funding requirements and assessment of the most attractive liquidation possibilities at the time of the valuation. During this process, we assigned probability weightings to “go public” event scenarios and a “stay private” scenario, wherein the enterprise valuation was based on either estimated exit valuations determined from conversations held with external parties or was based on public company comparable net book value multiples at the time of our valuation, respectively. In addition, our “stay private” scenario valuation approach continued to rely on a guideline public company multiples analysis with an option pricing model to determine the amount of aggregate equity value allocated to our common stock.
During the fourth quarter of 2020, we valued our common stock on a monthly basis. A common stock transaction that closed in December 2020 at a price of $18.43 per common share, which was of substantial size and in close proximity to the Business Combination, served as the key input for the fair value of our common stock for grants made during the fourth quarter of 2020. We decreased the assumed discount for lack of marketability throughout the fourth quarter of 2020, corresponding with our decreased time to liquidity assumption throughout the quarter, as we became more certain about the possibility of entering into the Business Combination over time.
F-159

TABLE OF CONTENTS
Social Finance, Inc.
Notes to Consolidated Financial Statements  (continued)
(In Thousands, Unless Otherwise Stated and Except for Share and Per Share Data)
Stock Options
The terms of the stock option grants, including the exercise price per share and vesting periods, are determined by our board of directors. At the discretion and determination of our board of directors, the Plan allows for the granting of stock options that may be exercised before the stock options have vested.
Stock options are typically granted at exercise prices equal to the fair value of our common stock at the date of grant. Our stock options typically vest at a rate of 25% after one year from the vesting commencement date and then monthly over an additional three-year period. While the vesting schedule noted is typical, stock options have been issued under other vesting schedules. These alternative schedules include, but are not limited to, (i) vesting at a rate of 20% after one year from vesting commencement date and then monthly over an additional four years, (ii) monthly vesting beginning on the vesting commencement date for a period of four years, and (iii) monthly vesting beginning on the vesting commencement date for a period of two years. Our stock options expire ten years from the grant date or within 90 days of employee termination.
There were no stock option grants during the year ended December 31, 2019.
The following is a summary of stock option activity for the year indicated:
Number of
Stock Options
Weighted Average
Exercise Price
Weighted Average
Remaining
Contractual Term
(in years)
Outstanding as of December 31, 2019 17,640,539  $ 12.11  7.7
Granted(1)
217,275  11.39 
Replacement Options(2)
3,980,300  0.65 
Exercised(3)
(1,169,956) 3.23 
Modifications(4)
(2,346,628) 13.34 
Forfeited (314,195) 11.61 
Expired (823,507) 11.42 
Outstanding as of December 31, 2020 17,183,828  $ 9.92  6.6
Exercisable as of December 31, 2020 12,012,098  $ 10.28  6.4
____________________
(1)The weighted average grant date fair value of stock options granted during the year ended December 31, 2020 was $4.26.
(2)In connection with our acquisition of Galileo, we converted outstanding stock options to acquire common stock of Galileo into corresponding options to acquire common stock of SoFi at an exchange ratio of one Galileo option to 3.83 Replacement Options. See Note 2 for additional information.
(3)The tax benefit from stock options exercised was not material for the period presented.
(4)On May 14, 2020, certain employees were given the option to exchange stock options for RSUs at a conversion ratio of one RSU for every $13.00 of stock option value on the date of the offer. There were 296 employees who participated in this offer. On the date of the modification, the fair value of our common stock was $12.11. We concluded that all stock options were probable of vesting, as the impetus for the modification was to give certain employees who had stock options prior to RSU issuances becoming more ubiquitous at SoFi an opportunity to have more RSUs. Modifications of equity-classified awards that have performance and/or service conditions can be categorized into four types. We concluded that the facts and circumstances aligned with a probable-to-probable modification (Type I modification) for the modified stock options, and did not recognize any incremental share-based compensation expense because the fair value of the replacement award was less than the fair value of the replaced award at the time of the modification.

F-160

TABLE OF CONTENTS
Social Finance, Inc.
Notes to Consolidated Financial Statements  (continued)
(In Thousands, Unless Otherwise Stated and Except for Share and Per Share Data)
The following table summarizes the inputs used for estimating the fair value of stock options granted during the years indicated. During the year ended December 31, 2020, the inputs disclosed below exclude those associated with Replacement Options granted in connection with our acquisition of Galileo. See Note 2 for the inputs used to estimate the fair value of the Replacement Options. There were no stock options granted during the year ended December 31, 2019.
Year Ended December 31,
Input 2020 2018
Risk-free interest rate
0.3% – 1.4%
2.5% – 3.1%
Expected term (years)
5.5 – 6.0
5.7 – 6.3
Expected volatility
36.5% – 42.5%
35.0%
Fair value of common stock
$11.21 – $12.11
$10.78 – $11.97
Dividend yield —% —%
Total compensation cost related to unvested stock options not yet recognized as of December 31, 2020 was $17,209, and will be recognized over a weighted average period of approximately 1.8 years. The aggregate intrinsic value of stock options exercised during the years ended December 31, 2020, 2019 and 2018 was $13,610, $13,422 and $6,713, respectively. The aggregate intrinsic value of stock options outstanding and stock options exercisable as of December 31, 2020 was $146,144 and $97,911, respectively. The weighted average grant date fair value of stock options granted during the year ended December 31, 2018 was $3.63.
Restricted Stock Units
The Company began issuing RSUs to its employees in 2017. RSUs are equity awards granted to employees that entitle the holder to shares of our common stock when the awards vest. RSUs granted to newly hired employees typically vest 25% on the first vesting date, which occurs approximately one year after the date of grant, and ratably each quarter of the ensuing 12-quarter period. RSUs have been issued under other vesting schedules. These alternative schedules include, but are not limited to, (i) vesting at a rate of 20% after one year from vesting commencement date and then monthly over an additional four years, (ii) vesting at a rate of 25% after one year and then monthly over an additional three years, and (iii) other vesting schedules ranging in total duration from one to four years. During the year ended December 31, 2020, we also made RSU grants to certain executive officers in which vesting commences approximately two years after the date of grant and then quarterly over an additional two years. RSUs are measured based on the fair value of our common stock on the date of grant.
The weighted average fair value of our common stock was $13.37 and $11.28 during the years ended December 31, 2020 and 2019, respectively.
The following table summarizes RSU activity for the year indicated:
Number of
RSUs
Weighted Average Grant Date Fair Value
Outstanding at December 31, 2019 14,512,888 $ 11.33 
Granted 20,636,594 13.57 
Modifications(1)
732,724 n/a
Vested(2)
(6,614,661) 11.53 
Forfeited (3,675,632) 11.64 
Outstanding at December 31, 2020(3)
25,591,913 $ 13.06 
________________________
(1)On May 14, 2020, certain employees were given the option to exchange options for RSUs. See “— Stock Options” above for additional information. The fair value of our common stock on the date of the modification was $12.11. There was no incremental fair value obtained based on the modification, and we continue to recognize stock-based compensation expense based on the original grant date fair value of the respective awards.
F-161

TABLE OF CONTENTS
Social Finance, Inc.
Notes to Consolidated Financial Statements  (continued)
(In Thousands, Unless Otherwise Stated and Except for Share and Per Share Data)
(2)The total fair value, based on grant date fair value, of RSUs that vested during the years ended December 31, 2020, 2019 and 2018 was $76.3 million, $50.4 million and $8.6 million, respectively.
(3)The weighted average grant date fair value of outstanding RSUs at December 31, 2020 includes the grant date fair value of modified unvested RSUs as described above in footnote (1).
As of December 31, 2020, there was $310.1 million of unrecognized compensation cost related to unvested RSUs, which will be recognized over a weighted average period of approximately 3.4 years. The weighted average grant date fair value of RSUs issued during the years ended December 31, 2019 and 2018 was $11.28 and $11.45, respectively.
Note 13. Income Taxes
Loss before income taxes consisted of the following for the years presented:
Year Ended December 31,
2020 2019 2018
Domestic $ (316,252) $ (238,533) $ (251,950)
Foreign (12,269) (1,066) (1,407)
Loss before income taxes $ (328,521) $ (239,599) $ (253,357)
Income tax expense (benefit) consisted of the following for the years presented:
Year Ended December 31,
2020 2019 2018
Current tax expense:
U.S. federal
$ —  $ —  $ 34 
U.S. state and local
23  17  80 
Foreign
13  29  17 
Total current tax expense
36  46  131 
Deferred tax expense (benefit):
U.S. federal
(70,692) (34) 2,664 
U.S. state and local
(33,823) 94  (3,753)
Foreign
11  (8) — 
Total deferred tax expense (benefit)
(104,504) 52  (1,089)
Income tax expense (benefit)
$ (104,468) $ 98  $ (958)
On March 27, 2020, the Coronavirus Aid, Relief, and Economic Security Act (“CARES Act”) was signed into law. The CARES Act has not had a material impact on our provision for income taxes.
The significant change in our income tax position for the year ended December 31, 2020 relative to 2019 was primarily due to a partial release of our valuation allowance in the second quarter of 2020 in connection with deferred tax liabilities resulting from intangible assets acquired from Galileo in May 2020, as well as additional tax benefits recognized during the fourth quarter of 2020 resulting from adjustments to the deferred tax liabilities created by the Galileo acquisition that were made outside of the purchase accounting adjustment window due to the closure of the measurement period for provisional amounts related to taxes.

F-162

TABLE OF CONTENTS
Social Finance, Inc.
Notes to Consolidated Financial Statements  (continued)
(In Thousands, Unless Otherwise Stated and Except for Share and Per Share Data)
A reconciliation of the expected income tax benefit at the statutory federal income tax rate to the income tax expense (benefit) at the effective income tax rate was as follows for the years presented:
Year Ended December 31,
2020 2019 2018
Expected income tax benefit at federal statutory rate $ (68,921) $ (50,316) $ (53,205)
Valuation allowance for deferred tax assets (9,445) 53,431  55,920 
State and local income taxes, net of federal benefit (26,681) 52  (2,894)
Research and development tax credits (6,883) (5,469) (3,505)
Change in fair value of warrants(1)
4,310  (595) — 
Other(1)
3,152  2,995  2,726 
Income tax expense (benefit) $ (104,468) $ 98  $ (958)
Effective tax rate 31.80  % (0.04) % 0.38  %
___________________
(1)We modified the presentation in the current period to separately present only the change in fair value of warrants component of non-deductible expenses. The remaining non-deductible expenses are included within “other”. We reclassified amounts for the prior periods to conform to the current period presentation.
A reconciliation of unrecognized tax benefits was as follows for the years presented:
Year Ended December 31,
2020 2019 2018
Unrecognized tax benefits at beginning of year $ 4,307  $ 1,928  $ 1,393 
Gross increases – tax positions in prior period 55  1,306  121 
Gross decreases – tax positions in prior period (331) (11) — 
Gross increases – tax positions in current period 1,086  1,084  414 
Unrecognized tax benefits at end of year $ 5,117  $ 4,307  $ 1,928 
If the unrecognized tax benefit of $5,117 and $4,307 as of December 31, 2020 and 2019, respectively, is recognized, there will be no effect on our effective tax rate, as the tax benefit would increase a deferred tax asset, which is offset with a full valuation allowance. We expect to continue to accrue unrecognized tax benefits for certain recurring tax positions; however, we do not expect any other significant increases or decreases to unrecognized tax benefits within the next twelve months.
F-163

TABLE OF CONTENTS
Social Finance, Inc.
Notes to Consolidated Financial Statements  (continued)
(In Thousands, Unless Otherwise Stated and Except for Share and Per Share Data)
The significant components of the Company’s net deferred tax liabilities were as follows as of the dates indicated:
December 31,
2020 2019
Deferred tax assets:
Net operating loss carryforwards $ 230,866  $ 176,564 
Operating lease liabilities 29,340  29,969 
Stock-based compensation 16,876  10,120 
Research and development credits 25,538  16,081 
Capital loss carryforwards 733  2,619 
Amortization —  1,333 
Accruals and other 14,614  6,643 
Gross deferred tax assets 317,967  243,329 
Valuation allowance (141,101) (148,426)
Total deferred tax assets $ 176,866  $ 94,903 
Deferred tax liabilities:
Depreciation $ (4,951) $ (968)
Amortization(1)
(95,819) — 
Operating lease ROU assets (26,121) (27,279)
Servicing rights (41,556) (56,978)
Securitization investments (7,268) (9,576)
Other (1,734) (353)
Total deferred tax liabilities (177,449) (95,154)
Net deferred tax liabilities $ (583) $ (251)
___________________
(1)During the year ended December 31, 2020, our deferred tax liabilities increased primarily due to acquired intangible assets recognized at fair value in connection with our acquisition of Galileo in which we had no tax basis. See Note 2 for additional information.
The following table details the activity of the deferred tax asset valuation allowance during the years indicated:
Balance at Beginning of Period
Additions
Deductions(2)
Balance at End of Period
Charged to Costs and Expenses
Charged to
Other
Accounts(1)
Year Ended December 31, 2018
Deferred tax asset valuation allowance
$ 3,464  $ 74,180  $ —  $ —  $ 77,644 
Year Ended December 31, 2019
Deferred tax asset valuation allowance
77,644  70,782  —  —  148,426 
Year Ended December 31, 2020
Deferred tax asset valuation allowance
148,426  87,552  4,916  (99,793) 141,101 
___________________
(1)Additions charged to other accounts for the year ended December 31, 2020 related to the increase in our valuation allowance in connection with net deferred tax assets acquired in our acquisition of 8 Limited in April 2020. See Note 2 for additional information.
F-164

TABLE OF CONTENTS
Social Finance, Inc.
Notes to Consolidated Financial Statements  (continued)
(In Thousands, Unless Otherwise Stated and Except for Share and Per Share Data)
(2)Deductions for the year ended December 31, 2020 related to the release of our valuation allowance in connection with deferred tax liabilities acquired in our acquisition of Galileo in May 2020. See Note 2 for additional information.
In assessing the realizability of deferred tax assets, management reviews all available positive and negative evidence.
During the year ended December 31, 2018, available negative evidence, such as non-forecasted losses realized on loan sales and a strategic shift in priorities that changed projections for near-term profitability, led us to establish a full valuation allowance, resulting in an increase of $74,180.
During the year ended December 31, 2019, we maintained a full valuation allowance against our net deferred tax assets, increasing our valuation allowance by $70,782.
During the year ended December 31, 2020, we continued to maintain a full valuation allowance against our net deferred tax assets in applicable jurisdictions, increasing our valuation allowance by $87,552. Additionally, we increased our valuation allowance by $4,916 in connection with the acquisition of net operating loss deferred tax assets from 8 Limited, and decreased our valuation allowance by $99,793 due to deferred tax liabilities resulting from intangible assets acquired from Galileo. The deferred tax liabilities arising from our acquisition of intangible assets from Galileo provided for additional sources of income whereby the valuation allowance against pre-combination deferred tax assets could be reduced, which resulted in a tax benefit recognized for the year. In certain state jurisdictions where sufficient deferred tax liabilities exist, no valuation allowance is recognized. We will continue to recognize a full valuation allowance until there is sufficient positive evidence to support its release.
The following table provides information about the Company’s net operating loss carryforwards by jurisdiction as of the dates indicated:
December 31,
Expiration 2020 2019
U.S. federal(1)
2031 – 2037 $ 209,564  $ 209,564 
Indefinite 589,996  426,646 
U.S. state(2)
2021 – 2040 689,298  543,401 
Indefinite 130,404  95,330 
Foreign Indefinite 44,419  — 
___________________
(1)Federal net operating loss carryforwards generated in periods after December 31, 2017 are subject to an 80% limitation when used in future tax periods as a result of the Tax Cuts and Jobs Act (“TCJA”) passed in 2017. The CARES Act provided for the temporary elimination of the 80% limitation for any net operating loss utilization prior to January 1, 2021.
(2)State conformity to either TCJA or the CARES Act is established by each state’s local statutes and conformity to one act does not require conformity to both acts.
Federal and state research and development tax credits were $30,448 and $19,413 as of December 31, 2020 and 2019, respectively, and, if not utilized, will expire at various dates beginning in 2031.
The Company files a federal income tax return in the United States and also files in various state jurisdictions. As of December 31, 2020, all federal and state tax returns since inception of the Company remain subject to examination by the respective taxing authorities, with the exception of the Company’s New York tax returns for 2013 through 2015.
Note 14. Related Parties
The Company defines related parties as members of our board of directors, entity affiliates, executive officers and principal owners of the Company’s outstanding stock and members of their immediate families. Related parties also include any other person or entity with significant influence over the Company’s management or operations.
F-165

TABLE OF CONTENTS
Social Finance, Inc.
Notes to Consolidated Financial Statements  (continued)
(In Thousands, Unless Otherwise Stated and Except for Share and Per Share Data)
Stockholder Note
2019: In March 2019, the Company entered into a $58,000 note receivable agreement with a stockholder (“Note Receivable Stockholder”), which accrued interest at 7.0%, and was collateralized by the stockholder’s common stock and redeemable preferred stock. Related to this collateralization, the Company obtained call rights to purchase the collateral at $8.80 per share (“Call Option Rights”). The Call Option Rights were not freestanding and were not considered an embedded derivative because they did not qualify for net settlement. The initial scheduled maturity date was December 2019, but certain extensions were built into the note receivable agreement and the note receivable agreement remained outstanding as of December 31, 2019. Both the Company and the stockholder had the option to extend the note receivable for six months beyond the initial scheduled maturity, and the extension option was exercised by the Company in September 2019. After this six-month period, we had a unilateral extension option for unlimited consecutive three-month terms. Our Call Option Rights were effective through the then-current note receivable maturity date in the event the note was prepaid before its then-current maturity date.
In October 2019, the Company assigned a portion of its Call Option Rights to another stockholder who paid $15,155 to purchase an aggregate 1,722,144 of the Note Receivable Stockholder’s common stock and redeemable preferred stock. The Note Receivable Stockholder was then able to use the proceeds from the sale to pay off a portion of the outstanding note receivable and accrued interest owed to us. During the year ended December 31, 2019, we recognized related party interest income of $3,214. As of December 31, 2019, we had an interest income receivable of $2,546 and an outstanding principal balance on the note receivable of $43,513, which were recorded within additional paid-in capital in the Consolidated Balance Sheets.
2020: During the year ended December 31, 2020, the Note Receivable Stockholder made payments totaling $47,823 toward the outstanding principal balance and accrued interest, with the final payment made in November 2020. During the year ended December 31, 2020, we recognized related party interest income of $1,764 and as of December 31, 2020, there was no remaining receivable associated with this related party note; however, our Call Option Rights remained outstanding post settlement, per the terms of our Note Receivable Stockholder agreement.
During December 2020, we exercised our Call Option Rights to acquire the Note Receivable Stockholder collateral, which represented 59,750 shares of common stock and 15,097,587 shares of redeemable preferred stock consisting of: 10,558,256 shares of Series B; 1,042,462 shares of Series D; 220,814 shares of Series E and 3,276,055 shares of Series F. The amount payable in connection with the exercise of $133,385 resulted in a reduction to accumulated deficit of $526 for the common stock retired, a reduction to redeemable preferred stock of $80,201 for the redeemable preferred stock balance at the time of the exercise, and the remainder amount of $52,658 recorded as a reduction to additional paid-in capital. The Call Option Rights shares were retired upon receipt. The option exercise payable remained outstanding as of December 31, 2020 and the reserved funds were presented within restricted cash and cash equivalents on the Consolidated Balance Sheets. The payment was subsequently made in January 2021.
Apex Loan
In November 2019, we lent $9,050 to Apex at an interest rate of 12.5% per annum, which had a scheduled maturity date of August 31, 2020 and remained outstanding as a related party note receivable as of December 31, 2019. We recognized related party interest income of $124 during the year ended December 31, 2019. In August 2020, we extended the maturity date to August 31, 2021 and modified the interest rate to 5.0% per annum, which we determined to be below the market rate of interest, from the amendment date until the outstanding principal balance is paid in full. In accordance with ASC 835-30, Interest, during the year ended December 31, 2020, we recognized a loss of $319 within noninterest income — other in the Consolidated Statements of Operations and Comprehensive Income (Loss) representing the discounted fair value of the loan receivable relative to its stated value at the market rate of interest. The loss is accreted into interest income over the remaining term of the loan. During the year ended December 31, 2020, we lent an additional $7,643 to Apex at an interest rate of 10.0% per annum, which matures on March 31, 2021. We recognized related party interest income of $1,425 during the year ended December 31, 2020, which included $1,319 related to the principal balances of the Apex loans and $106
F-166

TABLE OF CONTENTS
Social Finance, Inc.
Notes to Consolidated Financial Statements  (continued)
(In Thousands, Unless Otherwise Stated and Except for Share and Per Share Data)
related to the discount accretion. We had an interest income receivable of $1,443 as of December 31, 2020. See Note 18 for a subsequent event associated with the Apex loans.
We did not enter into any related party arrangements during the year ended December 31, 2018, and had no related party income or expense during the year then ended.
Equity Method Investments
Our interest in Apex, which we acquired in December 2018, was deemed significant under Rule 4-08(g). The seller of the Apex interest had a Seller Call Option over our equity interest in Apex, which the seller exercised during January 2021. See Note 1 under “—Equity Method Investments” for additional information. We also had an equity method investment in a residential mortgage origination joint venture that we exited in the third quarter of 2020, which was not deemed significant for any periods presented. The following tables present summarized financial information for the entities in which we have equity method investments on an aggregated basis since the dates of acquisition:
As of December 31,
2020(1)
2019
Total assets
$ 10,254,902  $ 5,098,943 
Total liabilities
10,032,736  4,932,181 
_________________
(1)Does not reflect any amounts attributable to the residential mortgage origination joint venture, as we exited the arrangement in the third quarter of 2020.
Year Ended December 31,
2020(1)
2019
2018(2)
Total revenues
$ 276,968  $ 149,922  $ 5,014 
Net income
58,426  22,255  432 
_________________
(1)For the residential mortgage origination joint venture, reflects amounts through the third quarter of 2020, when we exited the arrangement.
(2)For Apex, reflects amounts subsequent to the date on which we entered into the equity method arrangement.
Note 15. Commitments, Guarantees, Concentrations and Contingencies
Leases
As discussed in Note 1, we adopted the provisions of ASU 2016-02 and ASU 2018-11 as of January 1, 2019. Periods subsequent to this adoption date are presented and disclosed in accordance with ASC 842, Leases, while comparative periods continue to be presented and disclosed in accordance with legacy guidance in ASC 840, Leases.
We primarily lease our office premises under multi-year, non-cancelable operating leases. In September 2019, we entered into several agreements associated with being the named sponsor of the LA Stadium and Entertainment District at Hollywood Park in Inglewood, California (“SoFi Stadium”), which includes the stadium itself, a performance venue and a future shopping district, which were determined to contain both lease and non-lease components and which either commenced during the year ended December 31, 2020 or have not yet commenced as of December 31, 2020, as summarized below:
Our rights to use two multi-purpose stadium suites were determined to be operating leases that commenced on September 1, 2020, for which we elected the practical expedient to not bifurcate the lease component from the non-lease components;
F-167

TABLE OF CONTENTS
Social Finance, Inc.
Notes to Consolidated Financial Statements  (continued)
(In Thousands, Unless Otherwise Stated and Except for Share and Per Share Data)
Our rights to certain physical signage within the stadium, which commenced September 1, 2020, were determined to be finance leases, as the lease term constitutes the major part of the remaining economic life of the underlying assets;
Our rights to certain event space within the stadium and performance venue on a rent-free basis were determined to be operating leases to which we applied the short-term lease exemption practical expedient and, as such, recognize lease payments on a straight-line basis within short-term lease cost over the lease term that commenced September 1, 2020;
We bifurcated lease components from non-lease components of the arrangements, which represent sponsorship and advertising opportunities rather than the rights to physical assets that we control. The standalone values of the lease and non-lease components in the arrangement were determined based on: (i) an estimate of rent per square foot, (ii) an observable market quote for the asset, or (iii) project details provided by contractors on the stadium project, all of which were adjusted by an annual expected inflation rate, as appropriate. We allocated the total contract consideration to the lease and non-lease components on a relative standalone price basis. The payments are tranched based on the value of the benefit we expect to derive from SoFi Stadium each year. The non-lease costs are recognized evenly each month based on the payment tranche within noninterest expense — sales and marketing in the Consolidated Statements of Operations and Comprehensive Income (Loss), which is commensurate with the value we expect to receive from this arrangement over time. The non-lease components associated with the stadium and performance venue were recognized beginning in the third quarter of 2020; and
The agreement associated with the shopping district did not commence as of December 31, 2020 and is currently expected to commence no earlier than 2022. We do not expect the agreement to contain a material lease component, although the evaluation remains ongoing. The non-lease components of the shopping district agreement associated with marketing and advertising will be recognized evenly each month based on the payment tranche within noninterest expense — sales and marketing in the Consolidated Statements of Operations and Comprehensive Income (Loss), with payments beginning in April 2025, which is commensurate with the value we expect to receive from this arrangement over time.
Our operating leases have terms expiring from 2021 through 2040, exclusive of renewal option periods. Our office leases contain renewal option periods ranging from one to ten years from the expiration dates. These options were not recognized as part of our ROU assets and operating lease liabilities, as we did not conclude at the commencement date of the leases that we were reasonably certain to exercise these options. However, in our normal course of business, we expect our office leases to be renewed, amended or replaced by other leases.
Our finance leases expire in 2040.
F-168

TABLE OF CONTENTS
Social Finance, Inc.
Notes to Consolidated Financial Statements  (continued)
(In Thousands, Unless Otherwise Stated and Except for Share and Per Share Data)
The components of lease expense and supplemental cash flow information related to our leases for the years ended December 31, 2020 and 2019 were as follows. For our office leases, we net sublease income against other lease costs shown in the below table. Furthermore, cash flow information is presented net of sublease income.
Year Ended December 31,
2020 2019
Operating lease cost
$ 17,371  $ 16,380 
Finance lease cost – amortization of ROU assets
719  — 
Finance lease cost – interest expense on lease liabilities
167  — 
Short-term lease cost
463  323 
Variable lease cost(1)
2,382  880 
Sublease income(2)
(820) (512)
Total lease cost
$ 20,282  $ 17,071 
Cash paid for amounts included in the measurement of lease liabilities
Operating cash outflows from operating leases
$ 17,444  $ 12,446 
Operating cash outflows from finance leases
85  — 
Financing cash outflows from finance leases
489  — 
____________________
(1)Variable lease cost includes non-lease components classified as lease costs, such as common area maintenance fees, property taxes and utilities, that vary in amount for reasons other than the passage of time. We elected the practical expedient to not bifurcate the lease component from the non-lease components.
(2)We entered into a sublease arrangement in July 2019, through which we earn sublease income, which offsets our lease cost related to the underlying premises. During the year ended December 31, 2020, we offered the sublessee a partial rent abatement as a result of the COVID-19 pandemic. The sublease arrangement terminates in August 2021.
Total lease cost was $11,569 for the year ended December 31, 2018.
We obtained non-cash operating lease ROU assets in exchange for new operating lease liabilities of $26,417 and $24,715 during the years ended December 31, 2020 and 2019, respectively, of which $5,640 during the 2020 period was obtained in our acquisitions. Modifications to operating leases resulted in an aggregate non-cash increase (decrease) in operating lease ROU assets of $79 and $(5,407) during the years ended December 31, 2020 and 2019, respectively. We obtained non-cash finance lease ROU assets in exchange for new finance lease liabilities of $15,100 during the year ended December 31, 2020. We did not have any finance leases prior to 2020.
In April 2020, the FASB issued guidance allowing entities to make a policy election whether to account for lease concessions related to the COVID-19 pandemic as lease modifications. The election applies to any lessor-provided lease concession related to the impact of the COVID-19 pandemic, provided that the concession does not result in a substantial increase in the rights of the lessor or in the obligations of the lessee. During the year ended December 31, 2020, the lessor for one of our operating leases allowed us to defer payments on the lease beginning in April 2020 as a result of our inability to use the leased premises during the COVID-19 pandemic. We elected to not account for this non-substantial concession as a lease modification. In the absence of this concession, we would have recognized $1,698 in additional operating lease cost during the year ended December 31, 2020.
F-169

TABLE OF CONTENTS
Social Finance, Inc.
Notes to Consolidated Financial Statements  (continued)
(In Thousands, Unless Otherwise Stated and Except for Share and Per Share Data)
Supplemental balance sheet information related to our leases was as follows as of the dates presented:
December 31,
2020
2019
Operating Leases
ROU assets
$ 116,858  $ 101,446 
Operating lease liabilities
$ 139,796  $ 124,745 
Weighted average remaining lease term (in years)
9.5 9.0
Weighted average discount rate
4.7  % 5.1  %
Finance Leases
ROU assets(1)
$ 14,381  $ — 
Lease liabilities(2)
$ 14,693  $ — 
Weighted average remaining lease term (in years)
19.2 — 
Weighted average discount rate
3.4  % —  %
____________________
(1)Finance lease ROU assets as of December 31, 2020 were presented within property, equipment and software in the Consolidated Balance Sheets.
(2)Finance lease liabilities as of December 31, 2020 were presented within accounts payable, accruals and other liabilities in the Consolidated Balance Sheets.
For the periods presented, maturities of lease liabilities as of the dates indicated and a reconciliation of the total undiscounted cash flows to the lease liabilities in the Consolidated Balance Sheets were as follows in accordance with ASC 842:
Operating Leases
Finance Leases
As of December 31, 2020
2021 $ 19,168  $ 1,004 
2022 19,793  959 
2023 19,437  964 
2024 19,091  968 
2025 18,036  1,038 
Thereafter
77,903  15,113 
Total
173,428  20,046 
Less: imputed interest
(33,632) (5,353)
Lease liabilities
$ 139,796  $ 14,693 
Other Commitments
In September 2019, we entered into a 20-year partnership with LA Stadium and Entertainment District at Hollywood Park in Inglewood, California that granted us the exclusive naming rights to SoFi Stadium and official partnerships with the Los Angeles Chargers and Los Angeles Rams, as well as rights with the performance venue and surrounding entertainment district (“Naming and Sponsorship Agreement”). Payments under the Naming and Sponsorship Agreement total $625.0 million beginning in 2020 and ending in 2040 and include operating lease
F-170

TABLE OF CONTENTS
Social Finance, Inc.
Notes to Consolidated Financial Statements  (continued)
(In Thousands, Unless Otherwise Stated and Except for Share and Per Share Data)
obligations, finance lease obligations and sponsorship and advertising opportunities at the complex, which are payable during the following years indicated:
As of December 31, 2020
2021(1)
$ 24,375 
2022 25,077 
2023 25,183 
2024 25,292 
2025 29,157 
Thereafter 479,041 
Total $ 608,125 
____________________
(1)Represents the contractual payments for 2021 under the Naming and Sponsorship Agreement. See “Contingencies — SoFi Stadium Contingency” below for discussion of an associated contingent matter, the outcome of which could increase payments for 2021 by up to $10,342, as the third payment associated with the contingent matter was paid in 2021.
We made payments totaling $6,533 during the year ended December 31, 2020. See “Contingencies — SoFi Stadium Contingency” below for discussion of an associated contingent matter.
Additionally, during the year ended December 31, 2020, we had principal commitments for a seller note issued in connection with the acquisition of Galileo. See Note 2 for additional information.
Concentrations
Financial instruments that potentially subject us to significant concentrations of credit risk consist principally of cash and cash equivalents, restricted cash and restricted cash equivalents, residual investments and loans. We hold cash and cash equivalents and restricted cash and restricted cash equivalents in accounts at regulated domestic financial institutions in amounts that may exceed FDIC insured amounts. We believe these institutions are of high credit quality and have not experienced any related losses to date.
We are dependent on third-party funding sources to originate loans. Additionally, we sell loans to various third parties. During the year ended December 31, 2020, the two largest third-party buyers accounted for a combined 49% of our loan sales volume. During the year ended December 31, 2019, approximately 10% of our loan sales volume was concentrated in the largest third-party buyer. There were no significant concentrations for the year ended December 31, 2018. No individual third-party buyer accounted for 10% or more of consolidated total net revenues for any of the periods presented.
The Company is exposed to default risk on borrower loans originated and financed by us. There is no single borrower or group of borrowers that comprise a significant concentration of the Company’s loan portfolio. Likewise, the Company is not overly concentrated within a group of channel partners or other customers, with the exception of our distribution of personal loan residual interests in our sponsored personal loan securitizations, which we market to third parties and the aforementioned whole loan buyers. Given we have a limited number of prospective buyers for our personal loan securitization residual interests, this might result in us utilizing a significant amount of our own capital to fund future residual interests in personal loan securitizations, or impact the execution of future securitizations if we are limited in our own ability to invest in the residual interest portion of future securitizations, or find willing buyers for securitization residual interests.
See Note 17 for a discussion of concentrations in revenues from contracts with customers.
Contingencies
In limited instances, the Company may be subject to a variety of claims and lawsuits in the ordinary course of business. As of December 31, 2020 and 2019, there were no material claims requiring disclosure.
F-171

TABLE OF CONTENTS
Social Finance, Inc.
Notes to Consolidated Financial Statements  (continued)
(In Thousands, Unless Otherwise Stated and Except for Share and Per Share Data)
Galileo Contingency
Galileo, our wholly owned subsidiary that we acquired in May 2020, is subject to a class action litigation as a co-defendant involving service disruption for customers of Galileo’s largest client stemming from Galileo’s system experiencing technology platform downtime. Additionally, the client sought compensatory payment from Galileo as part of the technology platform outage. Galileo’s maximum exposure to loss associated with the combined litigation is $7,200. At the acquisition date, the Company believed it was probable that a settlement would be reached and estimated the combined loss to be $6,195. This estimated loss remained the best estimate as of December 31, 2020. During November 2020, we settled a claim arising from one of Galileo’s customers associated with a technology platform outage for $3,341, which represented a portion of our contingent liability, along with a corresponding portion of the insurance recovery recorded within other assets. As such, the settlement had no impact on our Consolidated Statements of Operations and Comprehensive Income (Loss). The estimated contingent liability associated with the related class action litigation remains unresolved and we determined that the remaining contingent liability of $2,854 as of December 31, 2020, which was presented within accounts payable, accruals and other liabilities in the Consolidated Balance Sheets, was appropriate. Other assets as of December 31, 2020 included $2,854 for the expected insurance recovery on the expected settlement. We expense legal fees associated with this litigation as they are incurred.
SoFi Stadium Contingency
In September 2020, we discussed certain provisions of the Naming and Sponsorship Agreement for SoFi Stadium entered into by the same parties in September 2019 in light of the COVID-19 pandemic. Based on these discussions and as of the date of this filing, SoFi is paying sponsorship fees for the initial contract year (July 1, 2020 to March 31, 2021) of $9.8 million, payable in three equal installments, of which the first two installments were paid during the year ended December 31, 2020, and the third installment was paid in January 2021.
The parties will revisit the sponsorship fees and determine the ultimate amount payable for the initial contract year. Therefore, the Company is exposed to additional potential sales and marketing expense of up to $12.7 million, which reflects the difference between the sponsorship payment terms discussed in the foregoing and the commitment for the initial contract year made under the 2019 agreement, and which we expect to be resolved shortly after the end of the initial contract year. As of December 31, 2020, the Company is unable to estimate the amount of reasonably possible additional costs it may incur with respect to this contingency. Moreover, the Company has not determined that the likelihood of additional cost is probable. Therefore, as of December 31, 2020, the Company has not recorded additional expense related to this contingency.
Guarantees
We have three types of repurchase obligations that we account for as financial guarantees pursuant to ASC 460. First, we issue financial guarantees to FNMA on loans that we sell to FNMA, which manifest as repurchase requirements if it is later discovered that loans sold to FNMA do not meet FNMA guidelines. We have a three-year repurchase obligation from the time of origination to buy back originated loans that do not meet FNMA guidelines, and we are required to pay the full initial purchase price back to FNMA. We recognize a liability for the full amount of expected loan repurchases, which is based on historical experience. The liability we record is equal to what we expect to buy back and, therefore, approximates fair value. Second, we make standard representations and warranties related to other loan transfers, breaches of which would require us to repurchase the transferred loans. Finally, we have limited repurchase obligations for certain loan transfers associated with credit-related events, such as early prepayment or events of default within 90 days after origination. Estimated losses associated with credit-related repurchases are evaluated pursuant to ASC 326. In the event of a repurchase, we are typically required to pay the purchase price of the loans transferred.
As of December 31, 2020 and 2019, the Company accrued liabilities within accounts payable, accruals and other liabilities in the Consolidated Balance Sheets of $5,196 and $5,972, respectively, related to our estimated repurchase obligation, with the corresponding charges recorded within noninterest income — loan origination and sales in the Consolidated Statements of Operations and Comprehensive Income (Loss). As of December 31, 2020
F-172

TABLE OF CONTENTS
Social Finance, Inc.
Notes to Consolidated Financial Statements  (continued)
(In Thousands, Unless Otherwise Stated and Except for Share and Per Share Data)
and 2019, the amount associated with loans sold that were subject to the terms and conditions of our repurchase obligations totaled $3.9 billion and $4.2 billion, respectively.
As of December 31, 2020 and 2019, the Company had a total of $9.3 million and $9.4 million, respectively, in letters of credit outstanding with financial institutions. These outstanding letters of credit were issued for the purpose of securing certain of the Company’s operating lease obligations. A portion of the letters of credit was collateralized by $3.3 million and $3.4 million of the Company’s cash as of December 31, 2020 and 2019, respectively, which is included within restricted cash and restricted cash equivalents in the Consolidated Balance Sheets.
Mortgage Banking Regulatory Mandates
The Company is subject to certain state-imposed minimum net worth requirements for the states in which the Company is engaged in the business of a residential mortgage lender. Noncompliance with these requirements could result in potential fines or penalties imposed by the applicable state. Future events or changes in mandates may affect the Company’s ability to meet mortgage banking regulatory requirements. As of December 31, 2020 and 2019, the Company was in compliance with all minimum net worth requirements and, therefore, has not accrued any liabilities related to fines or penalties.
Retirement Plans
The Company has a 401(k) plan that covers all employees meeting certain eligibility requirements. The 401(k) plan is designed to provide tax-deferred retirement benefits in accordance with the provisions of Section 401(k) of the Internal Revenue Code. Eligible employees may defer up to 100% of eligible compensation up to the annual maximum as determined by the Internal Revenue Service. The Company’s contributions to the plan are discretionary. The Company has not made any contributions to the plan to date.
Note 16. Earnings (Loss) Per Share
We compute earnings (loss) per share (“EPS”) attributable to common stock using the two-class method required for participating interests. Our participating interests include all series of our preferred stock. Series 1 preferred stock, which was issued during the year ended December 31, 2019, has preferential cumulative dividend rights. Pursuant to ASC 260, Earnings Per Share, for each period presented, we reduced net income (or increased net loss) by the contractual amount of dividends payable to Series 1 preferred stock before allocating any remaining undistributed earnings to all participating interests.
All other classes of preferred stock, except for Series C, have stated dividend rights, which have priority over undistributed earnings. The remaining losses are shared pro-rata among the preferred stock (with the exception of Series 1 preferred stock) and common stock outstanding during the measurement period, as if all of the losses for the period had been distributed. While our calculation of loss per share accounted for a loss allocation to all participating shares, we only presented loss per share below for our common stock. Basic loss per share of common stock is computed by dividing net loss, adjusted for the impact of Series 1 preferred stock dividends and loss allocated to other participating interests, by the weighted average number of shares of common stock outstanding during the period. Because of our reported net losses, we did not allocate any loss to participating interests in determining the numerator of the basic and diluted loss per share computation, as the allocation of loss would have been anti-dilutive. Further, we excluded the effect of all potentially dilutive common stock elements from the denominator in the computation of diluted loss per share, as their inclusion would have been anti-dilutive.
F-173

TABLE OF CONTENTS
Social Finance, Inc.
Notes to Consolidated Financial Statements  (continued)
(In Thousands, Unless Otherwise Stated and Except for Share and Per Share Data)
Year Ended December 31,
2020 2019 2018
Numerator:
Net loss $ (224,053) $ (239,697) $ (252,399)
Less: preferred stock dividends
(40,536) (23,923) — 
Less: preferred stock redemptions, net(1)
(52,658) —  — 
Net loss attributable to common stockholders – basic
$ (317,247) $ (263,620) $ (252,399)
Denominator:
Weighted average common stock outstanding – basic 42,374,976  37,651,687  35,091,026 
Add: Dilutive effects, as shown separately below
Common stock options —  —  — 
Unvested RSUs —  —  — 
Weighted average common stock outstanding – diluted 42,374,976  37,651,687  35,091,026 
Loss per share – basic $ (7.49) $ (7.00) $ (7.19)
Loss per share – diluted $ (7.49) $ (7.00) $ (7.19)
___________________
(1)In December 2020, we exercised a call and redeemed certain redeemable preferred stock, as further discussed in Note 10 and Note 14. We considered the premium paid on redemption of $52,658 to be akin to a dividend to the redeemable preferred stockholder. As such, the premium, which represented the amount paid upon redemption over the carrying value of the preferred stock (such carrying value being reduced for preferred stock issuance costs) was deducted from net loss to determine the loss available to common stockholders.
We excluded the effect of the below elements from our calculation of diluted EPS, as their inclusion would have been anti-dilutive. These amounts represent the number of instruments outstanding at the end of the year.
Year Ended December 31,
2020 2019 2018
Redeemable preferred stock exchangeable for common stock(1)
253,225,941  215,580,230  199,355,696 
Redeemable preferred stock warrants exchangeable for common stock(1)
6,983,585  6,983,585  — 
Contingent common stock in connection with acquisition(1)(2)
183,985  —  — 
Common stock options(1)
17,183,828  17,640,539  22,822,810 
Unvested RSUs(1)
25,591,913  14,512,888  10,910,000 
____________________
(1)For the years ended December 31, 2020, 2019 and 2018, these potential common stock elements were anti-dilutive in the periods to which they applied, as there were no earnings attributable to common stockholders.
(2)For the year ended December 31, 2020, represents contingently issuable common stock in connection with our acquisition of 8 Limited. See Note 2 for additional information.
Note 17. Business Segment Information
Each of our reportable segments is a strategic business unit that serves specific needs of our members based on the products and services provided. The segments are based on the manner in which management views the financial performance of the business. Contribution profit is the primary measure of segment profit and loss reviewed by the Chief Operating Decision Maker (“CODM”) and is intended to measure the direct profitability of each segment. Contribution profit is defined as total net revenue for each reportable segment less:
fair value changes in servicing rights and residual interests classified as debt that are attributable to assumption changes, which impact the contribution profit within the Lending segment. These fair value changes are non-cash in nature and are not realized in the period; therefore, they do not impact the amounts available to fund our operations; and
F-174

TABLE OF CONTENTS
Social Finance, Inc.
Notes to Consolidated Financial Statements  (continued)
(In Thousands, Unless Otherwise Stated and Except for Share and Per Share Data)
expenses directly attributable to the corresponding reportable segment. Directly attributable expenses primarily include sales and marketing, commissions and bonuses, and loan origination and servicing expenses, and vary based on the amount of activity within each segment. Directly attributable expenses also include certain employee salaries and benefits, professional services, occupancy, sales and marketing, tools and subscriptions, and bank service charges expenses. Expenses are attributed to the reportable segments using either direct costs of the segment or labor costs that can be attributed based upon the allocation of employee time for individual products.
The reportable segments also reflect the Company’s organizational structure. Each segment has a segment manager who reports directly to the CODM. The CODM has ultimate authority and responsibility over resource allocation decisions and performance assessment.
The Company has three reportable segments: Lending, Financial Services and Technology Platform. The Lending segment includes our personal, student and home loan products and the related servicing activities and, for 2020, a commercial loan. We originate loans in each of these three channels with the objective of either selling whole loans or securitizing a pool of originated loans for transfer to third-party investors. Revenues in the Lending segment are driven by changes in the fair value of our whole loans and securitization interests, gains or losses recognized on transfers that meet the true sale requirements under ASC 860 and our servicing-related activities, which mainly consist of servicing fees and the changes in our servicing assets over time. We also earn the difference between interest income earned on our loans and interest expense on any loans that are financed. Interest expense primarily impacts our Lending segment, and we present interest income net of interest expense, as our CODM considers net interest income in evaluating the performance of the Lending segment and making resource allocation decisions in addition to contribution profit.
The Financial Services segment includes our SoFi Money product, SoFi Invest product, SoFi Credit Card product (which we launched in the third quarter of 2020), SoFi Relay personal finance management product and other financial services, such as lead generation and content for other financial services institutions and our members. SoFi Money provides members a digital cash management experience, interest income and the ability to separate money balances into various subcategories. SoFi Invest provides investment features and financial planning services that we offer to our members. Revenues in the Financial Services segment include payment network fees on our member transactions and pay for order flow and share lending arrangements in our SoFi Invest product. Additionally, we earn referral fees in connection with referral activity we facilitate through our platform, which is not directly tied to a particular Financial Services product. The referral fee is paid to us by third-party partners that offer services to end users who do not use one of our product offerings, but who were referred to the partners through our platform.
The Technology Platform segment includes our Technology Platform fees, which commenced with our acquisition of Galileo in May 2020, as well as our equity method investment in Apex, which represents our portion of net earnings on clearing brokerage activity on the Apex platform. The Company purchased an initial interest in Apex in December 2018, and Apex was the Company’s only material equity method investment as of December 31, 2020, 2019 and 2018. During January 2021, the seller of our Apex interest exercised the Seller Call Option, and as such we will no longer recognize Apex equity investment income subsequent to the call date. Due to the additional investment we made during 2020, we will maintain an immaterial investment in Apex, but will no longer qualify for equity method accounting. See Note 2 for additional information on the acquisition of Galileo, and Note 1 for additional information on our Apex equity method investment.
Non-segment operations are classified as Other, which includes net revenues associated with corporate functions that are not directly related to a reportable segment. These non-segment net revenues include interest income earned on corporate cash balances and interest expense on corporate borrowings, such as our revolving credit facility and, for the 2020 period, the seller note issued in connection with our acquisition of Galileo. Net revenues within Other also include $3,189 and $3,338 of interest income earned in connection with related party transactions during the years ended December 31, 2020 and 2019, respectively. Refer to Note 14 for further discussion of the Company’s related party transactions.
F-175

TABLE OF CONTENTS
Social Finance, Inc.
Notes to Consolidated Financial Statements  (continued)
(In Thousands, Unless Otherwise Stated and Except for Share and Per Share Data)
The accounting policies of the segments are consistent with those described in Note 1, except for the accounting policies in relation to allocation of consolidated income and allocation of consolidated expenses, as described below.
The following tables present financial information, including the measure of contribution profit (loss), for each reportable segment for the years indicated. The information is derived from our internal financial reporting used for corporate management purposes. Assets are not allocated to reportable segments, as the Company’s CODM does not evaluate reportable segments using discrete asset information.
Year Ended December 31, 2020 Lending Financial Services
Technology
Platform(1)
Reportable Segments Total Other Total
Net revenue
Net interest income (loss) $ 199,345  $ 484  $ (107) $ 199,722  $ (21,791) $ 177,931 
Noninterest income (loss) 281,521  11,386  95,737  388,644  (1,043) 387,601 
Total net revenue (loss)
$ 480,866  $ 11,870  $ 95,630  $ 588,366  $ (22,834) $ 565,532 
Servicing rights – change in valuation inputs or assumptions(2)
17,459  —  —  17,459 
Residual interests classified as debt – change in valuation inputs or assumptions(3)
38,216  —  —  38,216 
Directly attributable expenses (294,812) (143,280) (42,427) (480,519)
Contribution profit (loss)
$ 241,729  $ (131,410) $ 53,203  $ 163,522 
____________________
(1)Noninterest income within the Technology Platform segment included $4,442 of earnings from our equity method investment in Apex, net of an impairment charge in the fourth quarter of 2020. See Note 1 under “—Equity Method Investments” for additional information. During the year ended December 31, 2020, the five largest customers in the Technology Platform segment contributed 69% of the total net revenue within the segment, which represented 12% of our consolidated total net revenue for the period.
(2)Reflects changes in fair value inputs and assumptions, including market servicing costs, conditional prepayment and default rates and discount rates. This non-cash change, which is recorded within noninterest income in the Consolidated Statements of Operations and Comprehensive Income (Loss) is unrealized during the period and, therefore, has no impact on our cash flows from operations. As such, the changes in fair value attributable to assumption changes are adjusted to provide management and financial users with better visibility into the cash flows available to finance our operations.
(3)Reflects changes in fair value inputs and assumptions, including conditional prepayment and default rates and discount rates. When third parties finance our consolidated VIEs through purchasing residual interests, we receive proceeds at the time of the securitization close and, thereafter, pass along contractual cash flows to the residual interest owner. These obligations are measured at fair value on a recurring basis, with fair value changes recorded within noninterest income in the Consolidated Statements of Operations and Comprehensive Income (Loss). The fair value change attributable to assumption changes has no impact on our initial financing proceeds, our future obligations to the residual interest owner (because future residual interest claims are limited to securitization collateral cash flows), or the general operations of our business. As such, this non-cash change in fair value during the period is adjusted to provide management and financial users with better visibility into the cash flows available to finance our operations.
F-176

TABLE OF CONTENTS
Social Finance, Inc.
Notes to Consolidated Financial Statements  (continued)
(In Thousands, Unless Otherwise Stated and Except for Share and Per Share Data)
Year Ended December 31, 2019 Lending Financial Services
Technology
Platform(1)
Reportable Segments Total Other Total
Net revenue
Net interest income $ 325,589  $ 614  $ —  $ 326,203  $ 3,631  $ 329,834 
Noninterest income 108,712  3,318  795  112,825  —  112,825 
Total net revenue
$ 434,301  $ 3,932  $ 795  $ 439,028  $ 3,631  $ 442,659 
Servicing rights – change in valuation inputs or assumptions(2)
(8,487) —  —  (8,487)
Residual interests classified as debt – change in valuation inputs or assumptions(3)
17,157  —  —  17,157 
Directly attributable expenses (350,511) (122,732) —  (473,243)
Contribution profit (loss)
$ 92,460  $ (118,800) $ 795  $ (25,545)
____________________
(1)Noninterest income within the Technology Platform segment consisted entirely of earnings from our equity method investment in Apex. Therefore, there were no directly attributable expenses to this reportable segment.
(2)See Note (2) in the table above for the year ended December 31, 2020.
(3)See Note (3) in the table above for the year ended December 31, 2020.
Year Ended December 31, 2018 Lending Financial Services
Technology
Platform(1)
Reportable Segments Total Other Total
Net revenue
Net interest income $ 257,344  $ 30  $ —  $ 257,374  $ 1,690  $ 259,064 
Noninterest income (loss) 9,404  844  117  10,365  (30) 10,335 
Total net revenue
$ 266,748  $ 874  $ 117  $ 267,739  $ 1,660  $ 269,399 
Servicing rights – change in valuation inputs or assumptions(2)
(1,197) —  —  (1,197)
Residual interests classified as debt – change in valuation inputs or assumptions(3)
(27,481) —  —  (27,481)
Directly attributable expenses (347,348) (20,117) —  (367,465)
Contribution profit (loss)
$ (109,278) $ (19,243) $ 117  $ (128,404)
______________
(1)Noninterest income within the Technology Platform segment consisted entirely of earnings from our equity method investment in Apex. Therefore, there were no directly attributable expenses to this reportable segment.
(2)See Note (2) in the table above for the year ended December 31, 2020.
(3)See Note (3) in the table above for the year ended December 31, 2020.
F-177

TABLE OF CONTENTS
Social Finance, Inc.
Notes to Consolidated Financial Statements  (continued)
(In Thousands, Unless Otherwise Stated and Except for Share and Per Share Data)
The following table reconciles contribution profit (loss) to loss before income taxes for the years presented. Expenses not allocated to reportable segments represent items that are not considered by our CODM in evaluating segment performance or allocating resources.
Year Ended December 31,
2020 2019 2018
Reportable segments total contribution profit (loss) $ 163,522  $ (25,545) $ (128,404)
Other total net revenue (loss) (22,834) 3,631  1,660 
Servicing rights – change in valuation inputs or assumptions (17,459) 8,487  1,197 
Residual interests classified as debt – change in valuation inputs or assumptions (38,216) (17,157) 27,481 
Expenses not allocated to segments:
Share-based compensation expense (99,870) (60,936) (42,936)
Depreciation and amortization expense (69,832) (15,955) (10,912)
Employee-related costs(1)
(114,599) (53,080) (46,724)
Other corporate and unallocated expenses(2)
(129,233) (79,044) (54,719)
Loss before income taxes $ (328,521) $ (239,599) $ (253,357)
______________
(1)Includes compensation, benefits, recruiting, certain occupancy-related costs and various travel costs of executive management, certain technology groups and general and administrative functions that are not directly attributable to the reportable segments.
(2)Includes corporate overhead costs that are not allocated to reportable segments, such as tools and subscription costs, corporate marketing costs and professional services costs.
In April 2020, the Company acquired 8 Limited for total consideration of $16,126, which represented the Company’s first international expansion. See Note 2 for additional information on the acquisition. As we do not have material operations outside of the U.S., we did not make the geographic disclosures pursuant to ASC 280, Segment Reporting. No single customer accounted for more than 10% of our consolidated revenues for any of the periods presented.
Note 18. Subsequent Events
Management of the Company performed an evaluation of subsequent events that occurred after the balance sheet date through the date of this filing.
During January 2021, Social Finance, Inc. entered into a business combination agreement (the “Agreement”) by and among Social Finance, Inc., Social Capital Hedosophia Holdings Corp. V, a Cayman Islands exempted company limited by shares (“Social Capital”), and Plutus Merger Sub Inc., a Delaware corporation and a wholly owned subsidiary of Social Capital (“Merger Sub”). Pursuant to the Agreement, Merger Sub will merge with and into Social Finance, Inc., and Social Finance, Inc. will be the surviving corporation and a wholly owned subsidiary of Social Capital.
In conjunction with the Agreement, the redeemable preferred stockholders waived their rights in the event of a liquidation, inclusive of the Series 1 Holders’ right to immediately receive the Series 1 proceeds of $323.4 million. The redeemable preferred stock redemption value will remain at $323.4 million, and all other material rights will remain the same, with the exception of added voting rights and the former liquidation provision triggered by an IPO is no longer of any effect.
In conjunction with the Business Combination, the Special Payment provision from our 2019 Series 1 Investor Agreement was amended. The amended Series 1 Investor Agreement provides for a special distribution of $22.1 million to Series 1 investors, which is subject to adjustment in accordance with the Merger Agreement, and is contingent upon approval of the Agreement. Upon Agreement approval, the Special Payment will be initially measured and recognized within noninterest expense — general and administrative in the Consolidated Statements
F-178

TABLE OF CONTENTS
Social Finance, Inc.
Notes to Consolidated Financial Statements  (continued)
(In Thousands, Unless Otherwise Stated and Except for Share and Per Share Data)
of Operations and Comprehensive Income (Loss), because this feature will be accounted for as an embedded derivative, which is not clearly and closely related to the host contract.
During January 2021, the seller of our Apex interest exercised its Seller Call Option on our Apex equity investment, which resulted in a call payment of $107.5 million. Therefore, we will no longer recognize Apex equity investment income subsequent to the date the investment was called. See Note 1 under “—Equity Method Investments” for additional information.
During January 2021, we made a payment of $133.4 million to repurchase certain Note Receivable Stockholder collateral in connection with exercising our Call Option Rights.
During February 2021, we paid off the seller note issued in connection with our acquisition of Galileo for a total payment of $269.9 million, consisting of outstanding principal of $250.0 million and accrued interest of $19.9 million.
During February 2021, Apex paid us $18.3 million in settlement of all of their outstanding obligations to us, which consisted of outstanding principal balances of $16.7 million and accrued interest of $1.6 million.
During March 2021, the Company and Golden Pacific Bancorp, Inc. (“Golden Pacific”), a California corporation, entered into an Agreement and Plan of Merger (the “Bank Merger”), by and among the Company, a wholly-owned subsidiary of the Company and Golden Pacific, pursuant to which the Company will acquire all of the outstanding equity interests in Golden Pacific and thereby acquire its wholly-owned subsidiary, Golden Pacific Bank, National Association (“Golden Pacific Bank”), for total cash purchase consideration of $22.3 million, of which approximately $0.7 million could be held back by the Company in escrow (“Holdback Amount”) if certain legal proceedings with which Golden Pacific is involved as a plaintiff are not resolved at the time the Bank Merger closes. The Holdback Amount will be used for further financing or costs incurred associated with the litigation and any remaining amount upon resolution of the litigation will be released to the Golden Pacific shareholders. Alternatively, if the legal proceedings are resolved prior to the close of the Bank Merger and a favorable settlement is received, the merger consideration will be increased by the amount of such proceeds, net of all fees and expenses and taxes payable in respect of such proceeds, such that the settlement will be returned to the Golden Pacific shareholders.
Golden Pacific is duly registered as a bank holding company with the Board of Governors of the Federal Reserve System. Golden Pacific Bank is a national banking association duly organized and validly existing and in good standing under the laws of the United States and is regulated by the OCC. Deposit accounts of Golden Pacific Bank are insured by the FDIC through the Deposit Insurance Fund to the fullest extent permitted by law. The closing of the Bank Merger is subject to regulatory approval, including approval from the OCC of a revised business plan for Golden Pacific Bank, and approval from the Federal Reserve to become a bank holding company and for a change of control, and other customary closing conditions, which the Company anticipates can be completed by the end of 2021. The Bank Merger will be accounted for as a business combination. The purchase consideration will be allocated to the tangible and intangible assets acquired and liabilities assumed based on the estimated fair values as of the acquisition date. The acquisition is not expected to be a significant acquisition under ASC 805 or Regulation S-X, Rule 3-05. In March 2021, we submitted an application to the Federal Reserve to become a bank holding company.
F-179

TABLE OF CONTENTS
Financial Statement Schedules
Schedule I — Condensed Financial Information of Registrant
Social Finance, Inc.
Condensed Balance Sheets
(Parent Company Only)
(In Thousands, Except for Share Data)
December 31,
2020 2019
Assets
Cash and cash equivalents $ 451,510  $ 49,522 
Restricted cash and restricted cash equivalents 142,457  5,930 
Intercompany receivables 71,852  301,924 
Investments in subsidiaries and VIEs(1)
3,054,120  1,711,181 
Securitization investments 496,935  653,952 
Equity method investments 107,534  102,946 
Operating lease right-of-use assets 107,329  96,588 
Related party notes receivable 17,923  9,174 
Other assets 139,792  111,044 
Total assets $ 4,589,452  $ 3,042,261 
Liabilities, temporary equity and permanent deficit
Liabilities:
Accounts payable, accruals and other liabilities $ 243,357  $ 54,003 
Operating lease liabilities 128,319  118,525 
Debt 1,164,205  769,064 
Total liabilities 1,535,881  941,592 
Temporary equity(2):
Redeemable preferred stock: 311,842,666 and 254,842,666 shares authorized; 256,459,941 and 218,814,230 shares issued and outstanding as of December 31, 2020 and 2019, respectively
3,173,686  2,439,731 
Permanent deficit:
Common stock, $0.00 par value: 452,815,616 and 395,815,616 shares authorized; 66,034,174 and 39,614,844 shares issued and outstanding as of December 31, 2020 and 2019, respectively(3)
—  — 
Additional paid-in capital 579,228  135,517 
Accumulated other comprehensive loss (166) (21)
Accumulated deficit (699,177) (474,558)
Total permanent deficit (120,115) (339,062)
Total liabilities, temporary equity and permanent deficit $ 4,589,452  $ 3,042,261 
_______________
(1)See Note 5 to the Notes to Consolidated Financial Statements for information on VIEs.
(2)Redemption amounts are $3,210,470 and $2,476,891 at December 31, 2020 and 2019, respectively.
(3)Includes 5,000,000 non-voting common shares authorized and 1,380,852 non-voting common shares issued and outstanding as of December 31, 2020 and 2019. See Note 11 to the Notes to Consolidated Financial Statements for additional information.

See accompanying Notes to Condensed Financial Information of Registrant.
F-180

TABLE OF CONTENTS
Social Finance, Inc.
Condensed Statements of Operations and Comprehensive Loss
(Parent Company Only)
(In Thousands)
Year Ended December 31,
2020 2019 2018
Interest income
Securitizations
$ 22,541  $ 18,424  $ 16,106 
Related party notes
3,189  3,338  — 
Intercompany
3,575  6,230  7,276 
Other
925  899  423 
Total interest income
30,230  28,891  23,805 
Interest expense
Securitizations and warehouses
11,906  23,545  15,868 
Corporate borrowing and other
28,140  4,962  233 
Total interest expense
40,046  28,507  16,101 
Net interest income (expense) (9,816) 384  7,704 
Noninterest income
Securitizations
4,189  4,382  (4,555)
Other
(87) 1,502  534 
Total noninterest income (loss)
4,102  5,884  (4,021)
Total net revenue
(5,714) 6,268  3,683 
Noninterest expense
Technology and product development
105,056  103,278  37,653 
Sales and marketing
70,219  65,158  39,441 
Cost of operations
16,722  9,299  896 
General and administrative
125,401  59,090  27,776 
Total noninterest expense
317,398  236,825  105,766 
Loss before income taxes
(323,112) (230,557) (102,083)
Income tax (expense) benefit
113,548  5,122  (33,914)
Loss before equity in loss of subsidiaries
(209,564) (225,435) (135,997)
Equity in loss of subsidiaries
(14,489) (14,262) (116,402)
Net loss
$ (224,053) $ (239,697) $ (252,399)
Other comprehensive income (loss)
Foreign currency translation adjustments, net
(145) (9) 21 
Total other comprehensive income (loss)
(145) (9) 21 
Comprehensive loss
$ (224,198) $ (239,706) $ (252,378)





See accompanying Notes to Condensed Financial Information of Registrant.
F-181

TABLE OF CONTENTS
Social Finance, Inc.
Condensed Statements of Cash Flows
(Parent Company Only)
(In Thousands)
Year Ended December 31,
2020 2019 2018
Operating activities
Net cash used in operating activities
$ (226,217) $ (99,301) $ (107,115)
Investing activities
Purchases of property, equipment, software and intangible assets
$ (18,327) $ (37,529) $ (11,222)
Related party notes receivable issuances
(7,643) (9,050) — 
Issuances of notes to subsidiaries
(1,387,801) (1,123,568) (479,829)
Repayments of notes by subsidiaries
1,443,765  461,849  122,438 
Purchases of non-securitization investments
(145) (3,583) (100,401)
Receipts from securitization investments
322,704  165,116  101,879 
Acquisition of business, net of cash acquired
(76,194) —  — 
Net cash provided by (used in) investing activities
$ 276,359  $ (546,765) $ (367,135)
Financing activities
Proceeds from debt issuances
$ 596,176  $ 462,410  $ 612,935 
Repayment of debt
(451,540) (302,600) (107,236)
Payment of debt issuance costs
(928) (544) (4,296)
Taxes paid related to net share settlement of stock-based awards
(31,259) (21,411) (3,154)
Purchases of common stock
(40) (8,804) — 
Proceeds from common stock issuances 369,840  —  — 
Proceeds from stock option exercises 3,781  7,844  2,581 
Note receivable issuance to stockholder —  (58,000) — 
Note receivable principal repayments from stockholder 43,513  14,487  — 
Proceeds from redeemable preferred stock issuances —  573,845  — 
Payment of redeemable preferred stock issuance costs —  (2,400) — 
Payment of redeemable preferred stock dividends (40,536) (23,923) — 
Finance lease principal payments (489) —  — 
Net cash provided by financing activities $ 488,518  $ 640,904  $ 500,830 
Effect of exchange rates on cash and cash equivalents (145) (9) 21 
Net increase (decrease) in cash, cash equivalents, restricted cash and restricted cash equivalents 538,515  (5,171) 26,601 
Cash, cash equivalents, restricted cash and restricted cash equivalents at beginning of period 55,452  60,623  34,022 
Cash, cash equivalents, restricted cash and restricted cash equivalents at end of period $ 593,967  $ 55,452  $ 60,623 
Supplemental non-cash investing and financing activities
Non-cash settlement of notes receivable via beneficial loan interest transfers $ 176,449  $ 486,168  $ 510,910 
Redeemable preferred stock warrants accounted for as liabilities —  22,268  — 
Non-cash property, equipment, software and intangible asset additions 47  13,955  — 
Seller note issued in acquisition 243,998  —  — 
Redeemable preferred stock issued in acquisition 814,156  —  — 
Common stock options assumed in acquisition 32,197  —  — 
Issuance of common stock in acquisition 15,565  —  941 
Finance lease ROU assets acquired 15,100  —  — 
Accrued but unpaid deferred equity costs 56  —  — 
Redeemed but unpaid common stock 526  —  — 
Redeemed but unpaid redeemable preferred stock 132,859  —  — 
See accompanying Notes to Condensed Financial Information of Registrant.
F-182

TABLE OF CONTENTS
Social Finance, Inc.
Notes to Consolidated Financial Information of Registrant
(In Thousands, Unless Otherwise Stated and Except for Share and Per Share Data)

Note 1. Organization
Social Finance, Inc. (the “parent company”) was founded in 2011 as a Delaware corporation.
Note 2. Basis of Presentation
The Condensed Financial Information of Registrant should be read in conjunction with the Consolidated Financial Statements of Social Finance, Inc. and accompanying notes thereto included elsewhere in this prospectus. For purposes of the Condensed Financial Information of Registrant, the parent company’s interest in consolidated subsidiaries is recorded based upon its proportionate share of the subsidiaries’ net assets, and the parent company’s equity in income (loss) of its consolidated subsidiaries is recorded based upon its proportionate share of the subsidiaries’ net income (loss), similar to the presentation under the equity method of accounting.
Certain amounts presented in the Condensed Financial Information of Registrant are eliminated in the Consolidated Financial Statements of Social Finance, Inc.
Note 3. Debt
The parent company’s debt as of December 31, 2020 and 2019 consisted of a revolving credit facility, which matures in September 2023, risk retention warehouse facilities, which mature from June 2021 through November 2024, and a seller note, which was issued in connection with our acquisition of Galileo in May 2020 and which we paid off in full in February 2021. See Note 9 to the Notes to Consolidated Financial Statements for additional information on the parent company debt arrangements. See Note 2 to the Notes to Consolidated Financial Statements for additional information on our acquisitions.
Note 4. Temporary Equity
See Note 10 to the Notes to Consolidated Financial Statements for information on the parent company redeemable preferred stock.
Note 5. Income Taxes
The parent company files a consolidated federal income tax return with its U.S. subsidiaries. Additionally, the parent company files various consolidated or separate company state income tax returns. The parent company regularly reviews the realizability of deferred tax assets and records valuation allowances where deferred tax assets are not more-likely-than-not to be realizable. In each jurisdiction in which the parent company files consolidated returns, deferred tax liabilities of its subsidiaries can be used as evidence of future sources of income, which allows the parent company to recognize deferred tax assets to the extent its subsidiaries incur net deferred tax liabilities. Parent company deferred tax assets were $17,101 and $8,445 as of December 31, 2020 and 2019, respectively, which primarily consisted of net operating loss and other credit carryforwards and are presented within other assets in the Condensed Balance Sheets. Income tax (expense) benefit of $113,548, $5,122 and $(33,914) for the years ended December 31, 2020, 2019 and 2018, respectively, reflect the valuation allowance position of the consolidated group in each respective year. The significant change in the parent company income tax position for the year ended December 31, 2020 relative to 2019 was primarily due to a partial release of the valuation allowance in the second quarter of 2020 in connection with deferred tax liabilities acquired in the acquisition of Galileo in May 2020. See Note 13 to the Notes to Consolidated Financial Statements for additional information regarding the valuation allowance in each year and consolidated tax results.
Note 6. Commitments, Guarantees and Contingencies
Commitments
The parent company’s commitments as of December 31, 2020 and 2019 consisted of multi-year, non-cancelable operating leases primarily for leases of office space. Additionally, in September 2019, the parent company entered
F-183

TABLE OF CONTENTS
into several agreements associated with SoFi Stadium, which include the stadium itself, a performance venue and a future shopping district, which were determined to contain both lease and non-lease components and which either commenced during the year ended December 31, 2020 or have not yet commenced as of December 31, 2020. See Note 15 to the Notes to Consolidated Financial Statements for additional information on these commitments.
Guarantees
As of December 31, 2020 and 2019, the parent company had a total of $8.6 million in letters of credit outstanding with financial institutions, which were issued for the purpose of securing certain of its operating lease obligations. A portion of the letters of credit was collateralized by $2.6 million of the parent company’s cash as of December 31, 2020 and 2019, which is included within restricted cash and restricted cash equivalents in the Condensed Balance Sheets.
Contingencies
The parent company has a contingency with regard to certain provisions of the Naming and Sponsorship Agreement for SoFi Stadium as it relates to the sponsorship fees for the initial contract year (July 1, 2020 to March 31, 2021). As of December 31, 2020, the parent company determined that the contingent liability remained appropriate and, therefore, did not record any additional expense. See Note 15 to the Notes to Consolidated Financial Statements for additional information related to the contingent matter and the parent company’s potential exposure.
Note 7. Cash Dividends
The parent company has not received cash dividends from its subsidiaries during the years ended December 31, 2020, 2019 and 2018.
Note 8. Intercompany Transactions
Management Services Agreement
In April 2019, the parent company entered into a management services agreement with its wholly-owned subsidiary, SoFi Securities, LLC (“SoFi Securities”), which replaced a similar agreement in effect during the year ended December 31, 2018. The agreement provides for SoFi Securities to reimburse the parent company for any direct third-party expenses paid by the parent company on behalf of SoFi Securities. Amounts due from SoFi Securities were $2,780 and $3,654 as of December 31, 2020 and 2019, respectively, and are presented within intercompany receivables in the Condensed Balance Sheets.
Promissory Note
In January 2015, the parent company entered into an agreement with SoFi Lending Corp. for the issuance of a promissory note, which is uncollateralized, has no stated limit or maturity date and is payable on demand. The promissory note incurs interest at a variable rate equal to three-month LIBOR plus 2.0%. Interest income on the promissory note is recorded within interest income — intercompany in the Condensed Statements of Operations and Comprehensive Loss. Amounts due from SoFi Lending Corp., inclusive of accrued interest, were $69,072 and $298,269 as of December 31, 2020 and 2019, respectively, and are presented within intercompany receivables in the Condensed Balance Sheets.
Note 9. Related Party Transactions
See Note 14 to the Notes to Consolidated Financial Statements for information about related party transactions.
F-184

TABLE OF CONTENTS
PART II: INFORMATION NOT REQUIRED IN PROSPECTUS
Item 13. Other Expenses of Issuance and Distribution.
The following table sets forth the estimated expenses to be borne by the registrant in connection with the issuance and distribution of the shares of common stock and warrants being registered hereby.
SEC registration fee $ 1,172,339 
Accounting fees and expenses 40,000 
Legal fees and expenses 225,000 
Financial printing and miscellaneous expenses — 
Total $ 1,437,339 
Item 14. Indemnification of Directors and Officers.
Subsection (a) of Section 145 of the General Corporation Law of the State of Delaware (the “DGCL”) empowers a corporation to indemnify any person who was or is a party or who is threatened to be made a party to any threatened, pending or completed action, suit or proceeding, whether civil, criminal, administrative or investigative (other than an action by or in the right of the corporation) by reason of the fact that the person is or was a director, officer, employee or agent of the corporation, or is or was serving at the request of the corporation as a director, officer, employee or agent of another corporation, partnership, joint venture, trust or other enterprise, against expenses (including attorneys’ fees), judgments, fines and amounts paid in settlement actually and reasonably incurred by the person in connection with such action, suit or proceeding if the person acted in good faith and in a manner the person reasonably believed to be in or not opposed to the best interests of the corporation, and, with respect to any criminal action or proceeding, had no reasonable cause to believe the person’s conduct was unlawful.
Subsection (b) of Section 145 empowers a corporation to indemnify any person who was or is a party or is threatened to be made a party to any threatened, pending or completed action or suit by or in the right of the corporation to procure a judgment in its favor by reason of the fact that the person acted in any of the capacities set forth above, against expenses (including attorneys’ fees) actually and reasonably incurred by the person in connection with the defense or settlement of such action or suit if the person acted in good faith and in a manner the person reasonably believed to be in or not opposed to the best interests of the corporation, except that no indemnification shall be made in respect of any claim, issue or matter as to which such person shall have been adjudged to be liable to the corporation unless and only to the extent that the Court of Chancery or the court in which such action or suit was brought shall determine upon application that, despite the adjudication of liability but in view of all the circumstances of the case, such person is fairly and reasonably entitled to indemnity for such expenses which the Court of Chancery or such other court shall deem proper.
Section 145 further provides that to the extent a director or officer of a corporation has been successful on the merits or otherwise in the defense of any action, suit or proceeding referred to in subsections (a) and (b) of Section 145, or in defense of any claim, issue or matter therein, such person shall be indemnified against expenses (including attorneys’ fees) actually and reasonably incurred by such person in connection therewith; that indemnification provided for by Section 145 shall not be deemed exclusive of any other rights to which the indemnified party may be entitled; and the indemnification provided for by Section 145 shall, unless otherwise provided when authorized or ratified, continue as to a person who has ceased to be a director, officer, employee or agent and shall inure to the benefit of such person’s heirs, executors and administrators. Section 145 also empowers the corporation to purchase and maintain insurance on behalf of any person who is or was a director, officer, employee or agent of the corporation, or is or was serving at the request of the corporation as a director, officer, employee or agent of another corporation, partnership, joint venture, trust or other enterprise against any liability asserted against such person and incurred by such person in any such capacity, or arising out of his status as such, whether or not the corporation would have the power to indemnify such person against such liabilities under Section 145.
II-1

TABLE OF CONTENTS
Section 102(b)(7) of the DGCL provides that a corporation’s certificate of incorporation may contain a provision eliminating or limiting the personal liability of a director to the corporation or its stockholders for monetary damages for breach of fiduciary duty as a director, provided that such provision shall not eliminate or limit the liability of a director (i) for any breach of the director’s duty of loyalty to the corporation or its stockholders, (ii) for acts or omissions not in good faith or which involve intentional misconduct or a knowing violation of law, (iii) under Section 174 of the DGCL, or (iv) for any transaction from which the director derived an improper personal benefit.
Additionally, our Certificate of Incorporation limits the liability of our directors to the fullest extent permitted by the DGCL, and our Bylaws provide that we will indemnify them to the fullest extent permitted by such law. We have entered into and expect to continue to enter into agreements to indemnify our directors, executive officers and other employees as determined by our board of directors. Under the terms of such indemnification agreements, we are required to indemnify each of our directors and officers, to the fullest extent permitted by the laws of the state of Delaware, if the basis of the indemnitee’s involvement was by reason of the fact that the indemnitee is or was our director or officer or was serving at our request in an official capacity for another entity. We must indemnify our officers and directors against all reasonable fees, expenses, charges and other costs of any type or nature whatsoever, including any and all expenses and obligations paid or incurred in connection with investigating, defending, being a witness in, participating in (including on appeal), or preparing to defend, be a witness or participate in any completed, actual, pending or threatened action, suit, claim or proceeding, whether civil, criminal, administrative or investigative, or establishing or enforcing a right to indemnification under the indemnification agreement. The indemnification agreements also require us, if so requested, to advance all fees, expenses and other costs that such director or officer incurred, provided that such person will return any such advance if it is ultimately determined that such person is not entitled to indemnification by us. Any claims for indemnification by our directors and officers may reduce our available funds to satisfy successful third-party claims against us and may reduce the amount of money available to us.
Item 15. Recent Sales of Unregistered Securities.
Since January 1, 2018, we have made sales of the following unregistered securities:
On October 14, 2020, SCH issued 8,000,000 private placement warrants to the Sponsor concurrently with the closing of SCH’s IPO; and
On May 28, 2021, we issued 122,500,000 shares of common stock to certain qualified institutional buyers and accredited investors that agreed to purchase such shares in connection with the Business Combination for aggregate consideration of $1,225,000,000.
We issued the foregoing securities in transactions not involving an underwriter and not requiring registration under Section 5 of the Securities Act of 1933, as amended, in reliance on the exemption afforded by Section 4(a)(2) thereof.
Item 16. Exhibits and Financial Statement Schedules.
The financial statements filed as part of this registration statement are listed in the index to the financial statements immediately preceding such financial statements, which index to the financial statements is incorporated herein by reference.
Exhibit No. Description
1.1** Form of Underwriting Agreement
2.1+
2.2
II-2

2.3*
3.1
3.2
4.1
4.2
4.3
5.1##
Opinion of Goodwin Procter LLP
10.1
10.2
10.3
10.4
10.5
10.6
10.7
10.8
10.9#
10.10#
10.11
10.12*†
II-3

10.13*
10.14*
10.15*
10.16*#
10.17*#
10.18*#
10.19*#
10.20*#
10.21*#
10.22*#
10.23*#
10.24#
16.1
21.1
23.1*
23.2*
23.3##
Consent of Goodwin Procter LLP (included as part of Exhibit 5.1)
24.1*
101.INS* XBRL Instance Document
101.SCH* XBRL Taxonomy Extension Schema Document
101.CAL* XBRL Taxonomy Extension Calculation Linkbase Document
101.DEF* XBRL Taxonomy Extension Definition Linkbase Document
101.LAB* XBRL Taxonomy Extension Label Linkbase Document
101.PRE* XBRL Taxonomy Extension Presentation Linkbase Document
__________________
*Filed herewith.
**To be filed, if necessary, subsequent to the effectiveness of this registration statement by an amendment to this registration statement or incorporated by reference pursuant to a Current Report on Form 8-K in connection with the offering of securities.
+      Schedules and exhibits have been omitted pursuant to Item 601(b)(2) of Regulation S-K. The Registrant agrees to furnish supplementally a copy of any omitted schedule or exhibit to the SEC upon request.
†      Certain confidential portions (indicated by brackets and asterisks) have been omitted from this exhibit.
#      Indicates a management contract or any compensatory plan, contract or arrangement.
##    To be filed by amendment.
Item 17. Undertakings.
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 of 1933, as amended (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,
II-4

TABLE OF CONTENTS
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 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 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 (i), (ii) and (iii) do not apply if the registration statement is on Form S-1 and the information required to be included in a post-effective amendment by those paragraphs is contained in reports filed with or furnished to the Commission by the registrant pursuant to Section 13 or Section 15(d) of the Securities Exchange Act of 1934 that are incorporated by reference in the registration statement, or is contained in a form of prospectus filed pursuant to Rule 424(b) that is part of the 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;
(4)that, for the purpose of determining liability under the Securities Act to any purchaser:
Each prospectus filed pursuant to Rule 424(b) as part of a registration statement relating to an offering, other than registration statements relying on Rule 430B or other than prospectuses filed in reliance on Rule 430A, shall be deemed to be part of and included in the registration statement as of the date it is first used after effectiveness.
Provided, however, that no statement made in a registration statement or prospectus that is part of the registration statement or made in a document incorporated or deemed incorporated by reference into the registration statement or prospectus that is part of the registration statement will, as to a purchaser with a time of contract of sale prior to such first use, supersede or modify any statement that was made in the registration statement or prospectus that was part of the registration statement or made in any such document immediately prior to such date of first use; and
(5)that, for the purpose of determining liability of the registrant under the Securities Act to any purchaser in the initial distribution of the securities, the undersigned registrant undertakes that in a primary offering of securities of the undersigned registrant pursuant to this registration statement, regardless of the underwriting method used to sell the securities to the purchaser, if the securities are offered or sold to such purchaser by means of any of the following communications, the undersigned registrant will be a seller to the purchaser and will be considered to offer or sell such securities to such purchaser:
(a)any preliminary prospectus or prospectus of the undersigned registrant relating to the offering required to be filed pursuant to Rule 424;
(b)any free writing prospectus relating to the offering prepared by or on behalf of the undersigned registrant or used or referred to by the undersigned registrant;  
(c)the portion of any other free writing prospectus relating to the offering containing material information about the undersigned registrant or its securities provided by or on behalf of an undersigned registrant; and
(d)any other communication that is an offer in the offering made by the undersigned registrant to the purchaser.
II-5

TABLE OF CONTENTS
Insofar as indemnification for liabilities arising under the Securities Act of 1933 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 Securities and Exchange Commission, such indemnification is against public policy as expressed in the Securities Act of 1933 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 whether such indemnification by it is against public policy as expressed in the Securities Act of 1933 and will be governed by the final adjudication of such issue.
II-6

TABLE OF CONTENTS
SIGNATURES
Pursuant to the requirements of the Securities Act, the registrant has duly caused this registration statement to be signed on its behalf by the undersigned, thereunto duly authorized, in the City of San Francisco, State of California, on June 14, 2021.
SOFI TECHNOLOGIES, INC.
By:
/s/ Christopher Lapointe
Name: Christopher Lapointe
Title: Chief Financial Officer

II-7

TABLE OF CONTENTS
Each person whose signature appears below constitutes and appoints each of Anthony Noto and Christopher Lapointe, acting alone or together with another attorney-in-fact, as his or her true and lawful attorney-in-fact and agent, with full power of substitution and resubstitution, for such person and in his or her name, place and stead, in any and all capacities, to sign any or all further amendments (including post-effective amendments) to this registration statement (and any additional registration statement related hereto permitted by Rule 462(b) promulgated under the Securities Act (and all further amendments, including post-effective amendments, thereto)), and to file the same, with all exhibits thereto, and other documents in connection therewith, with the SEC, 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 might or could do in person, hereby ratifying and confirming all that said attorney-in-fact and agent, or his or her substitute or substitutes, may lawfully do or cause to be done by virtue hereof.
Pursuant to the requirements of the Securities Act, this registration statement has been signed by the following persons in the capacities and on June 14, 2021.
Signature Title
/s/ Anthony Noto
Director and Chief Executive Officer
(Principal Executive Officer)
Anthony Noto
/s/ Christopher Lapointe
Chief Financial Officer
(Principal Financial Officer and Principal
Accounting Officer)
Christopher Lapointe
/s/ Ahmed Al-Hammadi
Director
Ahmed Al-Hammadi
/s/ Ruzwana Bashir
Director
Ruzwana Bashir
/s/ Michael Bingle
Director
Michael Bingle
/s/ Michel Combes
Director
Michel Combes
/s/ Richard Costolo
Director
Richard Costolo
/s/ Steven Freiberg
Director
Steven Freiberg
/s/ Tom Hutton
Director
Tom Hutton
/s/ Clara Liang
Director
Clara Liang
/s/ Carlos Medeiros
Director
Carlos Medeiros
/s/ Harvey Schwartz
Director
Harvey Schwartz
/s/ Clay Wilkes
Director
Clay Wilkes
/s/ Magdalena Yeşil
Director
Magdalena Yeşil
II-8
Exhibit 2.3
CONFIDENTIAL
Execution Version

AGREEMENT AND PLAN OF MERGER AND REORGANIZATION
BY AND AMONG
SOCIAL FINANCE, INC.,
SFI ACQUISITION CO., INC.,
SFI FINANCIAL TECHNOLOGIES LLC,
GALILEO FINANCIAL TECHNOLOGIES, INC.
and
SHAREHOLDER REPRESENTATIVE SERVICES LLC
as the STOCKHOLDERS’ REPRESENTATIVE
Dated as of April 6, 2020



Table of Contents
ARTICLE I DEFINITIONS, TERMS AND INTERPRETIVE MATTERS 2
Section 1.01
Certain Definitions
2
Section 1.02
Other Terms
25
ARTICLE II THE MERGERS 25
Section 2.01
Mergers
25
Section 2.02
Closing
25
Section 2.03
Effective Time
26
Section 2.04
Effects of the Mergers
26
Section 2.05
Certificate of Incorporation and By-laws
26
Section 2.06
Directors and Officers
27
Section 2.07
Conversion of Company Shares
27
Section 2.08
Stock Options
28
Section 2.09
Conversion of Common Stock of Merger Sub; Conversion of Common Stock of Surviving Corporation
29
Section 2.10 Closing Adjustments 29
Section 2.11
Tax Treatment and Cooperation
31
Section 2.12
Withholding Taxes
31
Section 2.13
Closing of the Company’s Transfer Books
31
Section 2.14
Payment of Merger Consideration and Other Payments
31
Section 2.15
Stockholders’ Representative
35
Section 2.16
Dissenting Shares
37
ARTICLE III REPRESENTATIONS AND WARRANTIES OF THE COMPANY 38
Section 3.01
Organization
38
Section 3.02
Capitalization
38
Section 3.03
Authority
41
Section 3.04
Consents and Approvals; No Violations
42
Section 3.05
Financial Statements
42
Section 3.06
Absence of Undisclosed Liabilities
42
Section 3.07
Absence of Changes; Operations in Ordinary Course
43
Section 3.08
Taxes; Tax Matters
43
Section 3.09
Plans
46
Section 3.10
Intellectual Property
47
Section 3.11
Material Contracts
50
Section 3.12
Compliance with Laws; Permits
53
Section 3.13
Real Property
54
Section 3.14
Environmental and Safety Matters
55
Section 3.15
Labor Matters
56
Section 3.16
Insurance Policies
57
Section 3.17
Legal Proceedings
57
Section 3.18
Privacy and Data Security
58
Section 3.19
Company Systems
58
i


Section 3.20
Export Approvals
59
Section 3.21
Certain Payments
59
Section 3.22
Brokers
60
Section 3.23
Books and Records
60
Section 3.24
Customers and Vendors
60
Section 3.25
Anti-Money Laundering
61
Section 3.26
Independent Investigation; No Other Representations and Warranties
61
ARTICLE IV REPRESENTATIONS AND WARRANTIES OF PARENT,
MERGER SUB, and MERGER SUB II
62
Section 4.01 Organization, Good Standing and Qualification 62
Section 4.02 Capitalization 62
Section 4.03 Authority 64
Section 4.04 Valid Issuance of Securities 65
Section 4.05 Governmental Consents and Filings 65
Section 4.06 No “Bad Actor” Disqualification 65
Section 4.07 Litigation 66
Section 4.08 Parent IP 66
Section 4.09 Compliance with Other Instruments and Law 67
Section 4.10 Agreements; Actions 67
Section 4.11 No Conflict of Interest 68
Section 4.12 Rights of Registration and Voting Rights 68
Section 4.13 Title to Property and Assets 69
Section 4.14 Financial Statements 69
Section 4.15 Absence of Undisclosed Liabilities 69
Section 4.16 Changes 69
Section 4.17 Employee Benefit Plans 70
Section 4.18 Tax Matters; Tax Returns, Payments and Elections 70
Section 4.19 Confidential Information and Invention Assignment Agreements 71
Section 4.20 Governmental Authorizations 71
Section 4.21 Severance Arrangement 71
Section 4.22 Employment Agreements 71
Section 4.23 Compliance with Applicable Laws 71
Section 4.24 Compliance with Parent Credit Facility, Parent Warehouse Facilities and Parent Securitization Documents 72
Section 4.25 Investment Company 73
Section 4.26 Shell Company Status 73
Section 4.27 Section 83(b) Elections 73
Section 4.28 No Claims for Breach of Representation or Warranty 73
Section 4.29 Brokers 73
Section 4.30 Independent Investigation; No Other Representations or Warranties 73
ARTICLE V COVENANTS 74
Section 5.01
Conduct of Business
74
ii


Section 5.02
Control of Operations
77
Section 5.03
Commercially Reasonable Efforts; Cooperation
77
Section 5.04
Consents
77
Section 5.05
Antitrust Notifications and Other Regulatory Approvals
78
Section 5.06
Access to Information
80
Section 5.07
Public Statements
82
Section 5.08
Indemnification of Directors and Officers
83
Section 5.09
Employee Benefits
84
Section 5.10
Termination of Related Party Contracts and Plans
85
Section 5.11
Closing Conditions
86
Section 5.12
Tax Matters
86
Section 5.13
Stockholder Consent
88
Section 5.14
Termination of Equity Agreements
88
Section 5.15
Exclusivity
88
Section 5.16
Advice of Changes
89
Section 5.17
Merger Sub, Surviving Corporation and Merger Sub II
90
Section 5.18 Tax Opinions 90
Section 5.19 Conduct of Parent Business 91
Section 5.20 R&W Policy 91
Section 5.21 Data Room 91
ARTICLE VI CONDITIONS TO CLOSING 92
Section 6.01
Mutual Conditions to the Obligations of the Parties
92
Section 6.02
Conditions to the Obligations of Parent, Merger Sub, and Merger Sub II
92
Section 6.03
Conditions to the Obligations of the Company
95
ARTICLE VII SURVIVAL; INDEMNIFICATION 97
Section 7.01
Survival
97
Section 7.02
Indemnification in Favor of Parent
98
Section 7.03
Indemnification Claim Procedure; Third Party Claims
99
Section 7.04
R&W Policy and Escrow
101
Section 7.05
Limits on Indemnification
102
Section 7.06
Exclusive Remedy
103
Section 7.07
Effect of Investigation
104
ARTICLE VIII TERMINATION 104
Section 8.01
Termination
104
Section 8.02
Effect of Termination; Etc
105
ARTICLE IX MISCELLANEOUS 106
Section 9.01
Notices
106
Section 9.02
Amendment; Waiver, Etc
108
Section 9.03
Assignment
108
Section 9.04
Expenses
108
Section 9.05
Entire Agreement
108
Section 9.06
Severability
108
iii


Section 9.07
Fulfillment of Obligations
109
Section 9.08
Parties in Interest
109
Section 9.09
Governing Law; Jurisdiction; Waiver of Jury Trial
109
Section 9.10
Counterparts; Etc
110
Section 9.11
Headings, Etc
110
Section 9.12
Further Assurances
110
Section 9.13
Remedies
111
Section 9.14
Knowledge
111
Section 9.15
Interpretation
111
Section 9.16
Legal Representation
112
Exhibits
Exhibit A    Form of Support Agreement
Exhibit B    Surviving Entity Charter
Exhibit C    Surviving Corporation Charter
Exhibit D    Form of Seller Note
Exhibit E    Letter of Transmittal
Exhibit F    Escrow Agreement
Exhibit G    Form of Accredited Investor Questionnaire
Exhibit H    Form of Stockholder Consent
Exhibit I    Parent New Charter
Exhibit J    Option Cancellation Agreement
Exhibit K    Payments Administration Agreement
Exhibit L    Omnibus Amendment
iv


Schedules
Company Disclosure Schedule
Parent Disclosure Schedule
Schedule 5.01    Conduct of Business
Schedule 5.01(j)    Change in Control Payments
Schedule 5.01(q)    Specified Contracts
Schedule 5.05(a)    Required Consents
Schedule 5.09(c)    Certain Plans
Schedule 5.10(a)    Certain Related Party Contracts
Schedule 6.02(i)    Third Party Consents and Approvals
Schedule 6.02(k)    Certain Key Employees
Schedule 6.02(n)    Termination of Certain Contracts
Schedule 6.02(q)    Spreadsheet
Schedule 9.14(i)    Company Knowledge Persons
Schedule 9.14(ii)    Parent, Merger Sub and Merger Sub II Knowledge Persons
v


AGREEMENT AND PLAN OF MERGER AND REORGANIZATION
This AGREEMENT AND PLAN OF MERGER AND REORGANIZATION (this “Agreement”), dated as of April 6, 2020, by and among Social Finance, Inc., a Delaware corporation (“Parent”), SFI Acquisition Co., Inc., a Delaware corporation and direct subsidiary of Parent (“Merger Sub”), SFI Financial Technologies LLC, a Delaware limited liability company and direct subsidiary of Parent (“Merger Sub II”), Galileo Financial Technologies, Inc., a Delaware corporation (the “Company”), and Shareholder Representative Services LLC, a Colorado limited liability company (“SRS”), solely in its capacity as the representative, agent and attorney-in-fact of the Equityholders (the “Stockholders’ Representative”).
W I T N E S S E T H:
WHEREAS, the board of directors of the Company has determined that this Agreement and the transactions contemplated hereby, including the Mergers (as defined below), are advisable and fair to, and in the best interests of, the Company and its stockholders;
WHEREAS, the board of directors of the Company has adopted resolutions approving the acquisition of the Company by Parent, the execution of this Agreement and the consummation of the transactions contemplated hereby;
WHEREAS, the boards of directors of each of Parent, Merger Sub, and Merger Sub II have approved and declared advisable and in the best interests of Parent, Merger Sub, and Merger Sub II, respectively, this Agreement and the transactions contemplated hereby, including the Mergers, and the boards of directors of Merger Sub and Merger Sub II have determined that this Agreement and the transactions contemplated hereby, including the Mergers, are fair to and in the best interests of its stockholder;
WHEREAS, as a condition and inducement to the willingness of Parent, Merger Sub and Merger Sub II to enter into this Agreement, concurrently with the execution of this Agreement, the Key Stockholders have entered into, and prior to the Closing certain other Stockholders are expected to enter into, support agreements with Parent in the form attached hereto as Exhibit A (each, a “Support Agreement”);
WHEREAS, as a condition and inducement to the willingness of Parent, Merger Sub and Merger Sub II to enter into this Agreement, concurrently with the execution of this Agreement, each of the Key Employees has entered into Employment Agreements with Parent; and
WHEREAS, the Company, Parent, Merger Sub and Merger Sub II intend for federal income tax purposes that the Mergers constitute a reorganization under the provisions of Section 368(a) of the Code (as hereafter defined), applying the integrated plan doctrine set forth in Revenue Ruling 2001-46, 2001-2 C.B. 321, and that this Agreement be and is adopted as a “plan of reorganization” within the meaning of Treasury Regulations Section 1.368-2(g).
NOW, THEREFORE, in consideration of the mutual representations, warranties, covenants and agreements contained herein and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the parties hereto, intending to be legally bound, agree as follows:
1


ARTICLE I
DEFINITIONS, TERMS AND INTERPRETIVE MATTERS
SECTION 1.01    Certain Definitions. As used in this Agreement, the following terms shall have the meanings set forth or as referenced below:
280G Stockholder Vote” shall have the meaning set forth in Section 5.09(f).
2011 Option Plan” shall mean the Company’s 2011 Stock Plan.
2019 Option Plan” shall mean the Company’s 2019 Equity Incentive Plan.
Accredited Investor Certification” shall mean a version of the form of Accredited Investor Questionnaire attached hereto as Exhibit G pursuant to which a holder of Company Shares certifies to the Company and Parent that such Person is an “accredited investor” as that term is defined in Rule 501 of Regulation D promulgated under the Securities Act.
Accredited Stockholder” shall mean a Stockholder who (a) completes and duly executes and delivers to the Company or Parent an Accredited Investor Certification no later than five (5) Business Days prior to the Effective Time or (b) whom Parent reasonably believes, in the exercise of its sole discretion based on information available to it, is an “accredited investor” as that term is defined in Rule 501 of Regulation D promulgated under the Securities Act.
Accredited Stockholder Per Share Cash Consideration” shall mean the product of (a) the Cash to Note Ratio multiplied by (b) the Per Share Merger Consideration less the Per Share Parent Stock Consideration.
Accredited Stockholder Per Share Note Amount” shall mean the Per Share Merger Consideration, less the Per Share Parent Stock Consideration, less the Accredited Stockholder Per Share Cash Consideration.
ACH Network” shall mean any network maintained or controlled by an operator, including a Federal Reserve bank, for the transmission and calculation of automated clearing house entries for payments.
Acquirer Indemnified Parties” shall have the meaning set forth in Section 7.02.
Acquisition Proposal” shall have the meaning set forth in Section 5.15(a).
Additional Agreements” shall mean the Escrow Agreement, the Omnibus Amendment, the Support Agreements, the Letters of Transmittal, the Option Cancellation Agreements, the Stockholders’ Representative Agreement, the Seller Note and any other certificates or other documents, instruments and/or agreements to be executed or delivered in connection with any of the transactions contemplated by this Agreement.
Adjustment Funds Shortfall” shall have the meaning set forth in Section 2.10(b).
2


Adjusted Operating Budget” shall mean the operating budget approved by the Company’s Board of Directors for the fiscal year 2020 and made available to Parent, except for expenditures related to operating expenses, head count and hiring, sales and marketing (including trade show sponsorships and attendance) and business travel (including sales travel), each of which are less than budget, and for transaction expenses, which exceeds budget.
Adjusted Purchase Price” shall mean $1,200,000,000, less any unpaid Transaction Expenses of the Company immediately prior to the Effective Time (other than the Deferred Transaction Fee), less if Closing Net Working Capital is less than the Working Capital Target, the amount of such shortfall, plus if the Closing Net Working Capital exceeds the Working Capital Target, the amount of such excess, as modified (to the extent necessary) under Section 2.07(c), subject to adjustment as set forth in Section 2.10.
Adjustment Time” shall have the meaning set forth in Section 6.02(q).
Affiliate” shall mean, as to any Person, any other Person which, directly or indirectly, is in control of, is controlled by, or is under common control with, such first Person; provided, that none of SoftBank Group Corp., SoftBank Group Capital Ltd., SB Sonic Holdco, Renren SF Holdings, Oak Pacific Investment, or their respective successors and assigns shall be considered “Affiliates” of Parent. The term “control” (including, with correlative meanings, the terms “controlled by” and “under common control with”) shall mean the possession, directly or indirectly, of the power to direct or cause the direction of the management and policies of such Person, whether through the ownership of voting securities or other ownership interest, by contract or otherwise.
Aggregate Assumed Option Exercise Price” shall mean the aggregate exercise price of all Assumed Options outstanding immediately prior to the Effective Time.
Aggregate Option Exercise Price” shall mean the aggregate exercise price of all Options outstanding immediately prior to the Effective Time.
Aggregate Participating Option Exercise Price” shall mean the aggregate exercise price of all Participating Options outstanding immediately prior to the Effective Time.
Agreement” shall have the meaning set forth in the preamble hereto.
AML Program” shall have the meaning set forth in Section 3.25.
Antitrust Laws” shall have the meaning set forth in Section 5.05(c).
Assumed Option” shall mean the portion of each Option outstanding as of immediately prior to the Effective Time that is not a Participating Option, whether vested or unvested and whether exercisable or not exercisable.
Assumed Option Value” shall mean (i) the aggregate number of Company Shares subject to Assumed Options outstanding as of immediately prior to the Effective Time, multiplied by an amount equal to (A) the Adjusted Purchase Price, less the Representative Expense Amount, less the Escrow Amount, less the Working Capital Escrow Amount, plus the Aggregate Option Exercise Price,
3


divided by (B) the number of Fully Diluted Company Shares, less (ii) the Aggregate Assumed Option Exercise Price.
Audited Financial Statements” shall have the meaning set forth in Section 3.05(a).
Bank” shall mean any Person that (i) is defined as a “bank” or otherwise licensed or authorized under applicable Laws to engage in banking activities (e.g., as defined in the Section 3 of the Bank Holding Company Act of 1956 or permitted under the Federal Deposit Insurance Act) to accept deposits or to hold deposit liabilities and (ii) has entered into any Contract with Parent for Parent to act as agent or service provider for that Person.
Binder Agreement” shall mean a Binder Agreement providing for the issuance, subject to the terms and conditions set forth therein, of the R&W Policy.
Business Day” shall mean any day other than a Saturday, a Sunday or a day on which banks in the State of California or the State of Utah are authorized or obligated by Law or executive order to close.
Capitalization Schedule” shall have the meaning set forth in Section 3.02(a).
Capitalization Update” shall have the meaning set forth in Section 5.16(c).
Card Network” shall mean the following credit, debit, and other payment card networks for which the Company processes payment transactions as a part of the Company’s business: Visa, Mastercard, Discover, Star and Pulse.
Cash Merger Consideration” shall mean the aggregate amount of cash payable in connection with the First Merger, which shall be $75,000,000, less the Representative Expense Amount, less any Closing Indebtedness, less any unpaid Transaction Expenses of the Company immediately prior to the Effective Time (other than the Deferred Transaction Fee), plus any Closing Cash, less if Closing Net Working Capital is less than the Working Capital Target, the amount of such shortfall, plus if the Closing Net Working Capital exceeds the Working Capital Target, the amount of such excess, as modified (to the extent necessary) under Section 2.07(c), subject to adjustment as set forth in Section 2.10.
Cash to Note Ratio” shall mean the quotient obtained by dividing (a) the sum of the Effective Time Cash Merger Consideration plus the Aggregate Participating Option Exercise Price by (b) the sum of the Effective Time Cash Merger Consideration, plus the Aggregate Participating Option Exercise Price, plus the aggregate principal amount of the Seller Note.
Certificate of Conversion” shall mean, collectively, the Certificate of Conversion filed with the Secretary of State of the State of Delaware on March 10, 2020 and the Articles of Transfer filed with the Utah Department of Commerce, Division of Corporations and Commercial Code of the State of Utah on March 10, 2020, copies of which have been made available to Parent.
Certificate of Merger” shall have the meaning set forth in Section 2.03.
4


Change in Control Payments” shall mean (a) any severance, change in control, termination, retention, incentive or similar amounts or benefits payable or due to any employee as a result of or in connection with the transactions contemplated hereby, (b) any Liabilities under any severance agreements entered into on or after March 31, 2020 other than at the request of Parent, (c) the employer’s portion of applicable payroll taxes in respect of the amounts set forth in clauses (a) and (b), and (c) 50% of the employer’s portion of applicable payroll taxes in respect of Participating Options and Assumed Options pursuant to Section 2.08.
Clayton Act” shall mean the Clayton Antitrust Act of 1914, as amended.
Closing” shall have the meaning set forth in Section 2.02.
Closing Cash” shall mean the aggregate amount of the cash and cash equivalents of the Company as of immediately prior to the Effective Time (each determined in accordance with GAAP applied on a consistent basis with the application thereof to the most recent Audited Financial Statements).
Closing Date” shall have the meaning set forth in Section 2.02.
Closing Indebtedness” shall mean the aggregate unpaid Indebtedness of the Company (excluding current liabilities included in the calculation of Closing Net Working Capital and Transaction Expenses) as of immediately prior to the Effective Time (determined in accordance with GAAP applied on a consistent basis with the application thereof to the most recent Audited Financial Statements).
Closing Merger Consideration” shall mean the sum of (a) the Effective Time Cash Merger Consideration, (b) the Closing Stock Consideration and (c) the aggregate principal amount of the Seller Note.
Closing Net Working Capital” shall the Company’s current assets (excluding Closing Cash) less current liabilities (excluding the current portion of Closing Indebtedness and Transaction Expenses) as of the Effective Time (each determined in accordance with GAAP applied on a consistent basis with the application thereof to the most recent Audited Financial Statements).
Closing Stock Consideration” shall mean the aggregate dollar amount of Parent Series H-1 Preferred Stock payable at the Effective Time in connection with the First Merger, which shall be equal to the Stock Consideration less $12,300,000.
Code” shall mean the U.S. Internal Revenue Code of 1986, as amended.
Company” shall have the meaning set forth in the preamble hereto.
Company 401(k) Plan” shall have the meaning set forth in Section 3.09(b).
Company Acquirer” shall have the meaning set forth in Section 3.10(j).
Company Board Recommendation” shall have the meaning set forth in Section 3.03(a).
5


Company Charter” shall mean the Certificate of Incorporation of the Company filed with the Secretary of State of the State of Delaware on March 10, 2020.
Company Common Stock” shall mean the Common Stock of the Company, as defined and with the rights as set forth in the Company Charter.
Company Data” shall mean all Data collected, generated, received or otherwise processed in the operation of the business. Without limiting the foregoing, “Company Data” includes all Customer Data and Company Training Data.
Company Disclosure Schedule” shall mean the schedules delivered by the Company to Parent, dated the date hereof, which schedules relate to this Agreement.
Company Fundamental Representations” shall have the meaning set forth in Section 7.05(b).
Company IP” shall mean any Intellectual Property that is owned or purported to be owned, used, held for use or practiced by the Company or any of its Subsidiaries.
Company IP Registrations” shall mean all of the material registrations and applications for registrations with a Governmental Authority or Internet domain name registrar for Intellectual Property owned by the Company or any of its Subsidiaries.
Company Option Plan” shall mean the 2011 Option Plan or the 2019 Option Plan, as applicable.
Company Owned IP” shall mean any Company IP that is owned or purported by the Company or any of its Subsidiaries to be owned by the Company or any of its Subsidiaries.
Company Owned Software” shall mean solely those portions of Software that embody Company Owned IP.
Company Owned Technology” shall mean any Company Technology that is owned by the Company or any of its Subsidiaries, including all Company Owned Software.
Company Preferred Stock” shall mean the Series B Preferred Stock of the Company, as defined and with the rights as set forth in the Company Charter.
Company Products” shall mean all products and services that are being sold, offered, distributed, licensed, leased or otherwise commercialized by the Company or any of its Subsidiaries to Customers in the ordinary course of business, including processing services.
Company Schedule Supplement” shall have the meaning set forth in Section 5.16(a).
Company Shares” shall mean the Company Common Stock and the Company Preferred Stock.
6


Company Software” shall mean any Software that is or has been owned or purported to be owned, used, held for use or practiced by the Company or any of its Subsidiaries, or is necessary for the conduct of the business of the Company or any of its Subsidiaries.
Company Systems” shall have the meaning set forth in Section 3.19(a).
Company Technology” shall mean any Technology that is or has been owned or purported to be owned, used, held for use or practiced by the Company or any of its Subsidiaries, or is necessary for the conduct of the business of the Company or any of its Subsidiaries, including any Company Software.
Company Training Data” shall mean all Data that has been made available by or to (or used by or for) the Company in connection with developing any Intellectual Property or Company Products, including developing, training or improving algorithms.
Confidential Information” shall mean information and materials not generally known to the public, including Trade Secrets and other confidential and proprietary information.
Confidentiality Agreement” shall mean the Confidentiality Agreement, dated as of March 8, 2020, by and between Parent and the Company, as amended by Section 5.06(e) of this Agreement.
Contract” shall mean any agreement, arrangement, understanding, note, commitment, undertaking, indenture, mortgage, deed, lease, license, franchise, permit, instrument, lease, sublease, bond, indenture, deed of trust, mortgage, loan agreement or other binding commitment, whether written or oral.
Conversion Ratio” shall mean the quotient (rounded to the sixth decimal point) obtained by dividing (a) the Per Share Merger Consideration by (b) the Parent Common Stock Price.
Copyleft License” shall mean any license that requires, as a condition of use, modification or distribution of Software or other Technology subject to such license, that such Software or other Technology, or other Software or other Technology incorporated into, derived from, used or distributed with such Software or other Technology (a) in the case of Software, be made available or distributed in a form other than binary (e.g., source code form), (b) be licensed for the purpose of preparing of derivative works, (c) be licensed under terms that allow the Company Products or Parent Products, as applicable, or portions thereof or interfaces therefor to be reverse engineered, reverse assembled or disassembled (other than by operation of Law) or (d) be redistributable at no license fee. Without limiting the foregoing, “Copyleft Licenses” constitute Open Source Licenses and include the GNU General Public License, the GNU Lesser General Public License, the Affero General Public License, the GNU Affero General Public License, the Mozilla Public License, the Sun Industry Standards License, the Sun Community Source License, the Artistic License, the Netscape Public License, Common Development and Distribution License, the Eclipse Public License and all Creative Commons “sharealike” licenses.
Copyrights” shall mean copyrights and all other rights with respect to works of authorship, and all registrations thereof and applications therefor and renewals, extensions and
7


reversions thereof, and all other rights corresponding thereto throughout the world (including moral and economic rights, however denominated).
Covered Persons” shall have the meaning set forth in Section 4.06.
Customer” shall mean any Person that is a customer of the Company for whom the Company provides, directly or indirectly, processing or program management services pursuant to a Customer Agreement.
Customer Agreement” shall mean, for any Customer, a written agreement between such Customer, on the one hand, and the Company, on the other, for the provision of processing or program management services.
Customer Data” shall mean Data and content uploaded, provided or otherwise made available by or for any customer to the Company or any of its Subsidiaries.
D&O Indemnified Party” shall have the meaning set forth in Section 5.08(a).
D&O Indemnifying Parties” shall have the meaning set forth in Section 5.08(b).
D&O Tail Policy” shall have the meaning set forth in Section 5.08(b).
Data” shall mean data, data structures, technical data and performance data, including any Personal Data.
Databases” shall mean databases and other compilations and collections of Data or information.
DGCL” shall mean the General Corporation Law of the State of Delaware.
Deductible” shall have the meaning set forth in Section 7.05(b).
Deferred Transaction Fee” shall mean the portion of the transaction fee payable to Qatalyst Partners LLC by the Company upon any payment of the Seller Note in accordance with the terms of the engagement letter dated March 24, 2020 between Qatalyst Partners LLC and the Company.
Delaware Conversion” shall have the meaning set forth in Section 3.03(c).
Disqualification Events” shall have the meaning set forth in Section 4.06.
Dissenting Shares” shall have the meaning set forth in Section 2.16(a).
Dissenting Stockholders” shall have the meaning set forth in Section 2.16(a).
DOJ” shall mean the U.S. Department of Justice.
Domain Names” shall mean Internet domain names and numerical addresses.
Effective Time” shall have the meaning set forth in Section 2.03.
8


Effective Time Cash Merger Consideration” shall have the meaning set forth in Section 6.02(q).
Employment Agreements” shall mean the respective agreements between the Surviving Entity and each of the Key Employees, entered into between Parent and such Key Employees as of the date hereof.
Environmental Law” shall mean any Law relating to pollution or protection of the environment, natural resources, or human health and safety, including such Laws pertaining to the Release of or exposure to any Hazardous Materials.
Equity Agreements” shall mean the Amended and Restated Investor Rights Agreement among the Company and certain of its Stockholders, dated as of October 16, 2019, the Amended and Restated Right of First Refusal and Co-Sale Agreement among the Company and certain of its Stockholders, dated as of October 16, 2019, and the Amended and Restated Voting Agreement among the Company and certain of its Stockholders, dated October 16, 2019.
Equity Interests” shall mean any and all shares, interests, participations, other equity interests of any kind or other equivalents (however designated) and any and all ownership or equity interests of any kind in a Person, including capital stock, membership interests, partnership interests, joint venture interests, phantom stock, stock appreciation rights and beneficial interests, and any and all warrants, options, rights to vote or purchase or any other rights or securities convertible into, exercisable for or related to any of the foregoing.
Equityholder” shall mean each Stockholder and each Optionholder as of immediately prior to the Effective Time.
Equityholder Loans” shall have the meaning set forth in Section 5.10.
ERISA” shall mean the U.S. Employee Retirement Income Security Act of 1974, as amended, and the regulations promulgated thereunder.
ERISA Affiliate” shall mean each trade or business (whether or not incorporated) that together with the Company would be deemed to be a “single employer” within the meaning of Section 4001(b) of ERISA or Section 414 of the Code.
Escrow Account” shall have the meaning set forth in Section 2.14(a)(iii).
Escrow Agent” shall mean U.S. Bank, or its successor under the Escrow Agreement.
Escrow Agreement” shall mean the Escrow Agreement to be entered into by Parent, the Company, the Stockholders’ Representative and the Escrow Agent, substantially in the form of Exhibit F.
Escrow Amount” shall have the meaning set forth in Section 2.14(a)(iv).
9


Escrow Termination Date” shall have the meaning set forth in Section 7.04(b).
Excess Amount” shall have the meaning set forth in Section 2.10(b).
Expiration Date” shall have the meaning set forth in Section 7.01.
Financial Statements” shall have the meaning set forth in Section 3.05.
First Merger” shall have the meaning set forth in Section 2.01.
Fractional Cash Amount” shall have the meaning set forth in Section 2.07(a).
Fraud” shall mean, as to any Person, fraud under Delaware common law in the making of a representation or warranty contained in Article III or Article IV, any Support Agreement, Letter of Transmittal or Option Cancellation Agreement made by such Person.
FTC” shall mean the U.S. Federal Trade Commission.
Fully Diluted Company Shares” shall mean the total number of Company Shares issued and outstanding plus the total number of Company Shares subject to outstanding Options, in each case, immediately prior to the Effective Time.
GAAP” shall mean U.S. generally accepted accounting principles.
Government Official” shall have the meaning set forth in Section 3.21(a).
Governmental Authority” shall mean any federal, state, county, local or foreign governmental or quasi-governmental entity or any legislature, arbitrator, executive or regulatory authority, agency, court, department, commission, or other governmental entity, authority or instrumentality, whether domestic or foreign.
Governmental Authorizations” shall have the meaning set forth in Section 4.20.
Hazardous Materials” shall mean any pollutant, contaminant, waste, petroleum or any fraction thereof, asbestos or asbestos-containing material, polychlorinated biphenyls, and toxic or hazardous wastes, substances, materials or agents, including all substances that are defined or regulated as “Hazardous Substances,” “Pollutants,” or “Contaminants” pursuant to, or that could result in Liability under, any Environmental Law.
HSR Act” shall mean the U.S. Hart-Scott-Rodino Antitrust Improvements Act of 1976, as amended.
Indebtedness” at any date shall mean, without duplication, the aggregate amount of (a) all Obligations of the Company or any of its Subsidiaries for borrowed money, (b) all Obligations of the Company or any of its Subsidiaries for the deferred purchase price of property or services, (c) all other Obligations of the Company or any of its Subsidiaries that are evidenced by a note, bond, debenture or similar instrument, (d) all Obligations of the Company or any of its Subsidiaries in respect of letters of credit or acceptances issued or created for the account of such Person (other than letters of credit issued
10


for the benefit of suppliers or vendors to support accounts payable to such suppliers or vendors incurred in the ordinary course of business that are undrawn), (e) all Obligations of the Company or any of its Subsidiaries as a lessee that are capitalized in accordance with GAAP, (f) all Obligations of the Company or any of its Subsidiaries under any interest rate, currency swap or other hedging agreement or arrangement, (g) all guarantees by the Company or any of its Subsidiaries of any of the foregoing for the benefit of another Person; and (h) all Obligations in respect of incurred or accrued (prior to Closing) but unpaid (as of the Closing) amounts for employee related expenses, including costs for salaries, payroll taxes, benefits, bonuses with respect to the portion of the year preceding the Closing, and vacation.
Indemnified Party” shall have the meaning set forth in Section 7.03(a).
Indemnifying Party” shall have the meaning set forth in Section 7.03(a).
Independent Accounting Firm” shall have the meaning set forth in Section 2.10(a).
Intellectual Property” shall mean any and all intellectual property rights (anywhere in the world, whether statutory, common law or otherwise) whether registered or unregistered, including (a) Patents, (b) Copyrights, (c) rights with respect to Software, including registrations thereof and applications therefor, (d) industrial design rights and registrations thereof and applications therefor, (e) rights with respect to Trademarks, (f) rights with respect to Domain Names, including registrations thereof and applications therefor, (g) rights with respect to Trade Secrets and other confidential information, including rights to limit the use or disclosure thereof by any Person, (h) rights with respect to Data or Databases, including registrations thereof and applications therefor, and (i) any rights equivalent or similar to any of the foregoing. Without limiting the foregoing, “Intellectual Property” includes rights to derivatives, improvements, modifications, enhancements, revisions and releases relating to any of the foregoing, claims and causes of action arising out of or related to infringement, misappropriation or violation of any of the foregoing.
Intentional Breach” shall mean, with respect to any representation, warranty, agreement or covenant of a party in this Agreement, an action or omission taken or omitted to be taken by such party that the breaching party intentionally takes (or fails to take) with the knowledge that such action or omission would cause a breach of any such representation, warranty, agreement or covenant.
Invention Assignment Agreements” shall have the meaning set forth in Section 3.10(f).
Investments” shall have the meaning set forth in Section 3.02(e).
IRS” shall mean the U.S. Internal Revenue Service.
Key Employee” shall mean Clay Wilkes, Bryan Brooks, Brad Brooks, Brett Coates, Aaron Dillon, Michael Douglas, Karl Ford, Shane Head, Jordan Hensley, Michael Johnson, Scott Johnson, Todd Sudweeks and Chris Trujillo.
Key Stockholders” shall have the meaning set forth in Section 6.02(j).
Laws” shall mean any federal, national, state, local or foreign law (including common law), statute, ordinance, writ, treaty, rule, regulation, Order, code, judgment or decree, administrative
11


order or decree or administrative or judicial decision, policies, guidelines, enforcement policy or other binding action or requirement of a Governmental Authority.
Leased Real Property” shall have the meaning set forth in Section 3.13(b).
Legal Proceeding” shall mean any suit, claim, counterclaim, action, litigation, arbitration, proceeding (including any civil, criminal, administrative, investigative, judicial, administrative or appellate proceeding), inquiry, hearing, audit, subpoena, complaint, grievance, demand, examination or investigation, whether formal or informal, whether public or private, commenced, brought, conducted or heard by or before, or otherwise involving, any court, arbitrator or other Governmental Authority.
Letter of Transmittal” shall have the meaning set forth in Section 2.14(b).
Liability” shall mean any debt, liability or obligation, whether known or unknown, direct or indirect, matured or unmatured, absolute or contingent, accrued or unaccrued, liquidated or unliquidated, or due or to become due.
Liens” shall mean any lien, security interest, mortgage, pledge, charge or similar encumbrance.
Liquidation Preference” shall mean the aggregate amount of the Liquidation Preference (as defined in the Company Charter) payable to the holders of Preferred Stock pursuant to the Company Charter in connection with any of the transactions contemplated by this Agreement.
Losses” shall mean any and all losses, monetary damages, debts, obligations and other Liabilities, fines, fees, penalties, interest obligations, deficiencies and expenses (including amounts paid in settlement, interest, court costs, costs of investigators, fees and expenses of attorneys, accountants, financial advisors and other experts, and other expenses of litigation, arbitration or other dispute resolution procedures).
Material Adverse Effect” shall mean any fact, condition circumstance, development, event, effect or change that has had, or would reasonably be expected to have, a material adverse effect on (a) the business, operations, assets, liabilities, condition (financial or otherwise) of the Company and its Subsidiaries, taken as a whole, or (b) the ability of the Company to consummate the transactions contemplated hereby or to perform its obligations hereunder, but in the case of (a) above, excluding any such fact, circumstance, development, event or change to the extent resulting from, relating to or arising from (i) the execution of this Agreement or the announcement or existence thereof, the identity of Parent and its Affiliates or the compliance by the Company or any of its Subsidiaries with any of the terms of this Agreement (other than compliance with Section 5.01), (ii) Parent’s announcement or other disclosure of its plans or intentions with respect to the conduct of the business (or any portion thereof) of the Company or any of its Subsidiaries after the Closing, (iii) changes following the date hereof in global or United States or foreign, national or regional economic, financial, regulatory or geopolitical conditions or events, (iv) changes following the date hereof in the credit, debt, financial or capital markets or changes in interest or exchange rates, in each case, in the United States or elsewhere in the world, (v) changes or proposed changes following the date hereof in Laws affecting the Company, (vi) changes or proposed changes following the date hereof in GAAP or any other relevant generally accepted accounting principles or the interpretation of any of the foregoing, (vii) any military conflict,
12


outbreak or escalation of hostilities or declared or undeclared war or act of foreign or domestic terrorism, (viii) any acts of God, natural disasters, terrorism, armed hostilities, sabotage, war or any escalation or worsening of acts of war, epidemic, pandemic or disease outbreak (including the COVID-19 virus), (ix) any action taken or omitted to be taken by, or at the request of, Parent, Merger Sub, Merger Sub II, or any of their respective Affiliates, in each case, after the date hereof and on or prior to the Closing Date, (x) any failure by the Company or any of its Subsidiaries to meet internal or published projections, forecasts or estimates of the Company or any such Subsidiary (provided, however, that any effect that caused or contributed to such failure to meet projections, forecasts or estimates shall not be excluded under this clause (x)); provided, however, in each case under clauses (iii)-(viii), such matter shall be disregarded solely to the extent that such change does not disproportionately affect the Company and its Subsidiaries, taken as a whole, in a disproportionate manner relative to other Persons operating in any of the industries in which the Company and its Subsidiaries conduct their business.
Material Contract” shall have the meaning set forth in Section 3.11.
Mergers” shall have the meaning set forth in Section 2.01.
Merger Consideration” shall mean the sum of (a) the Cash Merger Consideration, (b) the Stock Consideration, (c) the aggregate principal amount of the Seller Note, and (d) the Representative Expense Amount.
Merger Sub” shall have the meaning set forth in the preamble hereto.
Merger Sub Common Stock” shall mean the common stock, $0.0001 par value per share, of Merger Sub.
Merger Sub II” shall have the meaning set forth in the preamble hereto.
Money Laundering Laws” shall have the meaning set forth in Section 3.25.
Most Recent Balance Sheet Date” shall have the meaning set forth in Section 3.05(a).
Most Recent Parent Balance Sheet Date” shall have the meaning set forth in Section 4.14.
NACHA Rules” shall mean the Operating Rules and Operating Guidelines of NACHA for the ACH Network, as amended from time to time.
Non-Accredited Stockholder” shall mean a Stockholder that is not an Accredited Stockholder.
Non-Stock Per Share Cash Consideration” shall mean the product of (a) the Cash to Note Ratio multiplied by (b) the Per Share Merger Consideration.
Non-Stock Per Share Note Amount” shall mean the Per Share Merger Consideration less the Non-Stock Per Share Cash Consideration.
13


Note Pro Rata Share” shall mean, with respect to each Equityholder, the original principal amount of the Seller Note payable to such Equityholder pursuant to Section 2.07(a) and Section 2.08, divided by the aggregate original principal amount of the Seller Note.
Obligations” shall mean, with respect to any Indebtedness, any principal, accrued but unpaid interest, penalties, fees and reimbursements payable under the documentation governing such Indebtedness.
OFAC” shall have the meaning set forth in Section 4.23(b).
Omnibus Amendment” shall have the meaning set forth in Section 6.03(g).
Open Source License” shall mean any license meeting the Open Source Definition (as promulgated by the Open Source Initiative) or the Free Software Definition (as promulgated by the Free Software Foundation), or any substantially similar license, including any license approved by the Open Source Initiative or any Creative Commons License. For the avoidance of doubt, “Open Source Licenses” include Copyleft Licenses.
Open Source Materials” shall mean any Software or other Technology subject to an Open Source License.
Option” shall mean any option to purchase any Company Shares or any other Equity Interest of the Company granted to certain employees or other Persons under any Plans, including the 2011 Option Plan and the 2019 Option Plan.
Option Cancellation Agreement” shall have the meaning set forth in Section 6.02(m).
Option Participation Ratio” shall mean 27.00%.
Optionholder” shall mean each holder of a Participating Option as of immediately prior to the Effective Time.
Optionholder Pro Rata Share” shall mean, with respect to any Optionholder, solely with respect to Company Shares underlying Participating Options (and not any outstanding Company Shares or underlying any Assumed Options) held by such Optionholder, the quotient obtained by dividing (a) the number of Company Shares subject to any Participating Option held by such Optionholder by (b) the total number of Company Shares issued and outstanding plus the total number of Company Shares subject to Participating Options, in each case, immediately prior to the Effective Time.
Order” shall mean any decision, ruling, charge, order, writ, judgment, injunction, decree, stipulation, determination, award or binding agreement issued, promulgated or entered by or with any Governmental Authority.
Ordinary Course Licenses Out” shall mean licenses out of Intellectual Property owned by the Company or its Subsidiaries that are (a) non-exclusive licenses granted to any Person in the ordinary course of business where the license is granted for the purpose of the Person’s provision of services to the Company or any of its Subsidiaries, including such Contracts with individual employees or independent contractors; (b) stand-alone confidentiality agreements entered into in the ordinary
14


course of business; or (c) non-exclusive licenses relating to Company Products with customers and potential customers of the Company or any of its Subsidiaries entered into in the ordinary course of business.
Organizational Documents” shall mean the articles of incorporation, certificate of incorporation, certificate of formation, bylaws, memorandum or articles of incorporation, operating agreement, certificate of limited partnership, partnership agreement and all other similar documents, instruments or certificates executed, adopted or filed in connection with the creation, formation or organization of a Person, including any amendments thereto including for avoidance of doubt, in the case of the Company, the Certificate of Conversion and the Plan of Conversion.
Parent” shall have the meaning set forth in the preamble hereto.
Parent 2011 Stock Plan” shall have the meaning set forth in Section 4.02(c).
Parent 2011 Stock Plan Options” shall have the meaning set forth in Section 4.02(c).
Parent 2012 Zenbanx Plan” shall have the meaning set forth in Section 4.02(c).
Parent 2012 Zenbanx Plan Options” shall have the meaning set forth in Section 4.02(c).
Parent Audited Financial Statements” shall have the meaning set forth in Section 4.14.
Parent Common Stock” shall mean the Common Stock, par value $0.0000025 per share, of Parent.
Parent Common Stock Price” shall mean $15.4362 per share, which the Parties agree shall be the fair market value of one share of Parent Common Stock as of the Closing Date.
Parent Credit Facility” shall mean the Revolving Credit Agreement, dated as of September 27, 2018, among the Company, the Lenders and Issuing Banks party thereto and Goldman Sachs Bank USA, as the Administrative Agent (as amended, amended and restated, supplemented or otherwise modified from time to time).
Parent Data” shall mean all Data collected, generated, received or otherwise processed in the operation of Parent’s or any of its Subsidiaries’ business.
Parent Disclosure Schedule” shall mean the schedules delivered by Parent to the Company, dated the date hereof, which schedules relate to this Agreement and are designated herein as the Parent Disclosure Schedule.
Parent Equity Agreements” shall mean (i) the Parent Investors’ Rights Agreement, (ii) the Sixth Amended and Restated Right of First Refusal and Co-Sale Agreement among Parent and certain holders of Parent’s capital stock, dated as of May 29, 2019 and (iii) the Parent Voting Agreement.
Parent Existing Charter” shall mean the Eleventh Amended and Restated Certificate of Incorporation of Parent dated May 28, 2019.
15


Parent Investors’ Rights Agreement” shall mean the Sixth Amended and Restated Investors’ Rights Agreement among Parent and certain holders of Parent’s capital stock, dated as of May 29, 2019.
Parent Financial Statements” shall have the meaning set forth in Section 4.14.
Parent IP” shall mean any Intellectual Property that is owned or purported to be owned, used, held for use or practiced by Parent or any of its Subsidiaries.
Parent Material Adverse Effect” shall mean any fact, condition circumstance, development, event, effect or change that has had, or would reasonably be expected to have, a material adverse effect on (a) the business, operations, assets, liabilities, condition (financial or otherwise) of Parent and its Subsidiaries, taken as a whole, or (b) the ability of Parent, Merger Sub or Merger Sub II to consummate the transactions contemplated hereby or to perform its obligations hereunder, but in the case of (a) above, excluding any such fact, circumstance, development, event or change to the extent resulting from, relating to or arising from (i) the execution of this Agreement or the announcement or existence thereof, the identity of the Company and its Affiliates or the compliance by Parent or any of its Subsidiaries with any of the terms of this Agreement, (ii) Parent’s announcement or other disclosure of its plans or intentions with respect to the conduct of the business (or any portion thereof) of the Parent or any of its Subsidiaries (including the Surviving Entity) after the Closing, (iii) changes following the date hereof in global or United States or foreign, national or regional economic, financial, regulatory or geopolitical conditions or events, (iv) changes following the date hereof in the credit, debt, financial or capital markets or changes in interest or exchange rates, in each case, in the United States or elsewhere in the world, (v) changes or proposed changes following the date hereof in Laws affecting Parent, (vi) changes or proposed changes following the date hereof in GAAP or any other relevant generally accepted accounting principles or the interpretation of any of the foregoing, (vii) any military conflict, outbreak or escalation of hostilities or declared or undeclared war or act of foreign or domestic terrorism, (viii) any acts of God, natural disasters, terrorism, armed hostilities, sabotage, war or any escalation or worsening of acts of war, epidemic, pandemic or disease outbreak (including the COVID-19 virus), (ix) any action taken or omitted to be taken by, or at the request of the Company, or any of its Affiliates, in each case, after the date hereof and on or prior to the Closing Date, (x) any failure by Parent or any of its Subsidiaries to meet internal or published projections, forecasts or estimates of Parent or any such Subsidiary (provided, however, that any effect that caused or contributed to such failure to meet projections, forecasts or estimates shall not be excluded under this clause (x)); provided, however, in each case under clauses (iii)-(viii), such matter shall be disregarded solely to the extent that such change does not disproportionately affect Parent and its Subsidiaries, taken as a whole, in a disproportionate manner relative to other Persons operating in any of the industries in which Parent and its Subsidiaries conduct their business.
Parent New Charter” shall mean the Twelfth Amended and Restated Certificate of Incorporation of Parent, in the form attached hereto as Exhibit I.
Parent Non-Voting Common Stock” shall mean the Non-Voting Common Stock, par value $0.0000025 per share, of Parent.
Parent Plans” shall have the meaning set forth in Section 5.09(d).
16


Parent Preferred Stock” shall mean the Preferred Stock, par value $0.0000025 per share, of Parent.
Parent Redeemable Preferred Stock” shall mean the Redeemable Preferred Stock, par value $0.0000025 per share, of Parent.
Parent Schedule Supplement” shall have the meaning set forth in Section 5.16(b).
Parent Securitization Document” shall mean any agreement for the sale of Underlying Loans in connection with any direct or indirect offering of certificates or other securities backed in whole or in part by Underlying Loans and any guarantee, indemnity agreement, repurchase agreement, trust agreement or similar agreement related thereto.
Parent Series 1 Preferred Stock” shall mean the Parent Redeemable Preferred Stock designated as Series 1 Fixed-to-Floating Rate Cumulative Redeemable Preferred Stock.
Parent Series A Preferred Stock” shall mean the Parent Preferred Stock designated as Series A Preferred Stock.
Parent Series B Preferred Stock” shall mean the Parent Preferred Stock designated as Series B Preferred Stock.
Parent Series C Preferred Stock” shall mean the Parent Preferred Stock designated as Series C Preferred Stock.
Parent Series D Preferred Stock” shall mean the Parent Preferred Stock designated as Series D Preferred Stock.
Parent Series E Preferred Stock” shall mean the Parent Preferred Stock designated as Series E Preferred Stock.
Parent Series F Preferred Stock” shall mean the Parent Preferred Stock designated as Series F Preferred Stock.
Parent Series G Preferred Stock” shall mean the Parent Preferred Stock designated as Series G Preferred Stock.
Parent Series H Preferred Stock” shall mean the Parent Preferred Stock designated as Series H Preferred Stock.
Parent Series H-1 Preferred Stock” shall mean the Parent Preferred Stock designated as Series H-1 Preferred Stock.
Parent Stock Options” shall have the meaning set forth in Section 4.02(c).
Parent Stock Price” shall mean $15.4362 per share, which the Parties agree is the fair market value of one share of Parent Series H-1 Preferred Stock as of the day prior to the date of this Agreement.
17


Parent Systems” shall have the meaning set forth in Section 4.08(c).
Parent Unaudited Financial Statements” shall have the meaning set forth in Section 4.14.
Parent Voting Agreement” shall mean the Eighth Amended and Restated Voting Agreement among Parent and certain holders of Parent’s capital stock, dated as of May 29, 2019.
Parent Warehouse Facility” shall mean the agreements set forth on Schedule 4.25 of the Parent Disclosure Schedule.
Parent Warrant” shall have the meaning set forth in Section 4.02(d).
Participating Option” shall mean the portion of each Option equal to (i) the total number of Company Shares underlying such Option that are vested and exercisable as of immediately prior to the Effective time multiplied by (ii) the Option Participation Ratio, rounded up to the nearest whole share.
Patents” shall mean (a) any domestic or foreign patents, utility models or inventor’s certificates and applications, drafts and disclosures relating to any of the foregoing (and any patents, utility models or inventor’s certificates that issue as a result of such applications, drafts and disclosures), and (b) any reissues, divisions, divisionals, continuations, continuations-in-part, provisionals, renewals, extensions, substitutions, reexaminations or invention registrations related to any of the foregoing.
Paying Agent” shall mean Acquiom Financial LLC, a Colorado limited liability company, in its capacity as the payments administrator.
Payments Administration Agreement” shall mean the Payments Administration Agreement to be entered into by Parent, the Stockholders’ Representative, the Paying Agent and Parent, substantially in the form of Exhibit K.
Per Share Merger Consideration” shall mean the quotient obtained by dividing (a) the Closing Merger Consideration plus the Aggregate Participating Option Exercise Price by (b) the aggregate number of Company Shares issued and outstanding as of immediately prior to the Effective Time plus the aggregate number of Company Shares subject to Participating Options outstanding as of immediately prior to the Effective Time.
Per Share Parent Stock Consideration” shall mean the quotient obtained by dividing (a) the Closing Stock Consideration by (b) the aggregate number of Company Shares held by Accredited Stockholders as of immediately prior to the Effective Time.
Permits” shall have the meaning set forth in Section 3.12(b).
Permitted Liens” shall mean (a) mechanics’, carriers’, workmen’s, materialmen’s repairmen’s or other similar Liens arising in the ordinary course of business by operation of law for amounts not yet past due, (b) Liens for Taxes, assessments or other governmental charges which are not due and payable or which are being contested in good faith by appropriate proceedings and for which adequate reserves have been established in accordance with GAAP, (c) imperfections in title, charges, easements, rights of way, restrictions, defects, exceptions, encumbrances and other similar matters
18


which affect title to the property or assets but do not materially detract from the value or marketability of the property or asset to which it relates or materially impair the ability to use or operate the property or asset to which it relates, (d) any right, interest, Lien for amounts not yet due and payable or title of a licensor, sublicensor, licensee, sublicensee, lessor or sublessor under any non-exclusive license or lease agreement or in the property being licensed or leased, (e) purchase money Liens and Liens securing rental payments under capital lease arrangements, (f) zoning, building codes and other land use Laws regulating the use or occupancy of real property or the activities conducted thereon which are imposed by any Governmental Authority having jurisdiction over such real property which are not violated in any material respect by the current use or occupancy of the real property subject thereto, (g) matters that would be disclosed by an accurate survey or inspection of the real property which do not materially detract from the value or marketability of the property or asset to which it relates or materially impair the ability to use or operate the property or asset to which it relates, (h) Liens arising under workmen’s compensation, unemployment insurance, social security, retirement and similar Laws, (i) pledges and deposits to secure the performance of bids, trade contracts, leases, surety and appeal bonds, performance bonds and other obligations of a similar nature, in each case in the ordinary course of business and (j) licenses of or other grants of rights to use Intellectual Property.
Person” shall mean an individual, a corporation, a limited liability company, a partnership, a joint venture, a syndicate, an association, a trust or other entity or organization, including any Governmental Authority, and including any successor, by merger or otherwise, of any of the foregoing.
Personal Data” shall mean information held, stored, collected, transmitted, transferred (including cross-border transfers), disclosed or used by the Company or Parent, as applicable, or their Subsidiaries that can reasonably be used to identify an individual natural person, including name, street address, telephone number, email address, photograph, social security number or tax identification number, driver’s license number, passport number, credit card number, bank information, or biometric identifiers, or any other information defined as “personal data,” “personally identifiable information,” “individually identifiable health information,” “protected health information” or “personal information” under any applicable Law and that is regulated by such Law.
Plan of Conversion” shall mean the Plan of Conversion dated March 10, 2020, a copy of which has been made available to Parent.
Plans” shall mean, collectively, each employment, consulting, executive compensation, bonus, deferred compensation, incentive compensation, stock purchase, stock option or other equity-based, retention, change in control, severance or termination pay, hospitalization or other medical, life or other insurance, supplemental unemployment benefits, profit-sharing, pension or retirement plan, program, agreement or arrangement, and each other fringe or other employee benefit plan, program, agreement or arrangement (including any “employee benefit plan”, within the meaning of Section 3(3) of ERISA, whether or not subject to ERISA), (a) sponsored, maintained or contributed to or required to be contributed to by the Company or any of its Subsidiaries for the benefit of any current or former employee, director or independent contractor of the Company or any of its Subsidiaries or (b) pursuant to which the Company or its Subsidiaries has any Liability.
19


Pre-Closing Tax Period” shall mean any taxable period ending on or before the Closing Date, and, with respect to any taxable period beginning before and ending after the Closing Date, the portion of such taxable period ending on and including the Closing Date.
Privacy Laws” shall mean all applicable Laws, rules and industry standards relating to data privacy, data protection and data security (including, as applicable, the General Data Protection Regulation of the European Union).
Processing” shall mean, with respect to Personal Data, the use, collection, capture, scraping, processing, storage, recording, organization, arrangement, selection, aggregation, adaption, alteration, transfer (including cross-border transfers), retrieval, consultation, disclosure, dissemination, visualization, destruction, instruction, training or other learning of such information or combination of such information.
Pro Rata Share” shall mean, with respect to any Equityholder, such Equityholder’s ownership interest in the Company as of immediately prior to the Effective Time, determined by dividing (a) the number of issued and outstanding Company Shares held by such Equityholder plus the number of Company Shares subject to any Participating Option held by such Equityholder divided by (b) the total number of Company Shares issued and outstanding plus the total number of Company Shares subject to Participating Options, in each case, immediately prior to the Effective Time.
R&W Policy” shall mean a representation and warranty insurance policy contemplated to be issued pursuant to the Binder Agreement in favor of Parent and the other named insureds named therein in connection with the transactions contemplated by this Agreement, which policy shall have a coverage amount of no less than $60 million.
R&W Policy Premium” shall mean the premium, underwriting fees, brokerage fees, legal fees for counsel engaged by the insurer of the R&W Policy, surplus lines tax and any other costs and expenses associated with obtaining the R&W Policy and binding coverage thereunder and set forth in invoice(s) from the insurer or other appropriate documentation in respect thereof.
Real Property Lease” shall have the meaning set forth in Section 3.13(b).
Related Party” shall mean, with respect to a particular Person, each past, present and future Affiliate, beneficiary and assign of such Person, any Representative of such Person or Affiliate, any family member of any of the foregoing, and any Affiliate of any of the foregoing.
Related Party Contract” shall mean any contract between any the Company of any of its Subsidiaries, on the one hand, and any Equityholder or officer or director of the Company or any of its Subsidiaries or any Related Party of such Person, on the other hand.
Release” shall mean any release, spill, emission, leaking, pumping, injection, deposit, disposal, discharge, dispersal or leaching of any Hazardous Materials into the indoor or outdoor environment.
Relevant Group” shall mean any affiliated, combined, consolidated, unitary, or similar group.
20


Representative Expense Amount” shall mean $250,000.
Representative’s Expenses” shall have the meaning set forth in Section 2.15(b).
Representatives” shall mean officers, directors, managers, principals, employees, agents, trustees and other representatives of a particular Person, or who are otherwise acting at the direction of such a Person.
Required Consents” shall have the meaning set forth in Section 5.05(a).
Residual Shares” shall have the meaning set forth in Section 7.04(b).
Restraints” shall have the meaning set forth in Section 6.01(a).
Rules” shall mean (a) the NACHA Rules and (b) the applicable bylaws, rules, regulations, documentation and manuals promulgated or adopted by a Card Network, in each case, as may be amended or supplemented from time to time.
SEC” shall have the meaning set forth in Section 4.06.
Second Certificate of Merger” shall have the meaning set forth in Section 2.03.
Second Effective Time” shall have the meaning set forth in Section 2.03.
Second Merger” shall have the meaning set forth in Section 2.01.
Securities Act” shall mean the Securities Act of 1933, as amended.
Seller Note” shall mean a subordinated promissory note with an aggregate principal amount of $250,000,000 in the form attached as Exhibit D hereto.
Seller Note Payment Amount” means the amount of all payments (whether in cash, securities or other property) actually made on the Seller Note, including any payments of principal or interest owing thereunder.
Seller Note Payment Remainder Amount” means the amount equal to the Seller Note Payment Amount minus the amount of the Deferred Transaction Fee.
Sellers” shall have the meaning set forth in Section 9.16(b).
Sherman Act” shall mean the Sherman Antitrust Act of 1890, as amended.
Software” shall mean all (a) computer programs and other software, including firmware and microcode, and including software implementations of algorithms, heuristics, models and methodologies, whether in source code, object code or other form, including libraries, frameworks, software development kits and tools, application programming interfaces, subroutines and other components thereof, (b) computerized Databases and other computerized compilations and collections of Data or information, (c) screens, user interfaces, command structures, report formats, templates, menus, buttons and icons related to any of the foregoing, (d) descriptions, flow-charts, architectures,
21


development tools and other materials used to design, plan, organize and develop any of the foregoing, and (e) all documentation, including development, diagnostic, support, user and training documentation related to any of the foregoing.
Solicitor” shall have the meaning set forth in Section 4.06.
Specified Contracts” shall have the meaning set forth in Section 5.01(q).
Spreadsheet” shall have the meaning set forth in Section 6.02(q).
SRS” shall have the meaning set forth in the preamble hereto.
Stock Consideration” shall mean the aggregate dollar amount of Parent Series H-1 Preferred Stock payable in connection with the First Merger, which shall equal the Adjusted Purchase Price, less the Assumed Option Value, less Cash Merger Consideration, less the aggregate principal amount of the Seller Note, less the Representative Expense Amount.
Stockholder Consent” shall mean an irrevocable written consent evidencing the adoption of this Agreement and the transactions contemplated hereby by Stockholders holding Company Shares representing at least ninety percent (90%) of the outstanding Company Shares and all of the Company Preferred Stock, in substantially the form set forth in Exhibit H attached hereto.
Stockholder Escrow Pro Rata Share” shall mean, with respect to any Stockholder, solely with respect to outstanding Company Shares (and not Company Shares underlying Participating Options or Assumed Options) held by such Stockholder, the quotient obtained by dividing (a) the number of outstanding Company Shares (and not Company Shares underlying Participating Options or Assumed Options) held by such Stockholder by (b) the total number of Company Shares (and not Company Shares underlying Participating Options or Assumed Options) issued and outstanding and held by all Stockholders.
Stockholder Excluded Claims” shall have the meaning set forth in Section 7.04(a).
Stockholder Notice” shall have the meaning set forth in Section 5.13(b).
Stockholder Pro Rata Share” shall mean, with respect to any Stockholder, solely with respect to outstanding Company Shares (and not Company Shares underlying Participating Options or Assumed Options) held by such Stockholder, the quotient obtained by dividing (a) the number of outstanding Company Shares held by such Stockholder divided by (b) the total number of Company Shares issued and outstanding plus the total number of Company Shares subject to Participating Options, in each case, immediately prior to the Effective Time.
Stockholders” shall mean the respective Persons holding capital stock of the Company from time to time entitled to vote on matters pursuant to the Company Charter, including the Key Stockholders.
Stockholders’ Representative” shall have the meaning set forth in the recitals.
22


Stockholders’ Representative Agreement” shall mean that certain Engagement Letter, dated April 6, 2020, by and among the Stockholders’ Representative, the Company and certain of the Stockholders.
Subsidiary” shall mean with respect to any Person, any corporation, partnership, association, trust or other business entity of which (i) if a corporation, a majority of the total voting power of shares of stock entitled (without regard to the occurrence of any contingency) to vote in the election of directors, managers or trustees thereof is at the time owned or controlled, directly or indirectly, by that Person or one or more of the other Subsidiaries of that Person or a combination thereof, or (ii) if a partnership, limited liability company, association or other business entity, a majority of the partnership, membership, limited liability, or other similar ownership interests thereof is at the time owned or controlled, directly or indirectly, by that Person or one or more of the other Subsidiaries of that Person or a combination thereof. For purposes hereof, a Person or Persons shall be deemed to have a majority ownership interest in a partnership, association or other business entity if such Person or Persons shall be allocated a majority of partnership, association or other business entity gains or losses or shall be or control the managing director, managing member, general partner or other managing Person of such partnership, association or other business entity.
Support Agreements” shall have the meaning set forth in the recitals.
Surviving Corporation” shall have the meaning set forth in Section 2.01.
Surviving Corporation Charter” shall mean the Amended and Restated Certificate of Incorporation of the Surviving Corporation in the form attached as Exhibit C hereto.
Surviving Corporation Common Shares” shall mean the shares of common stock, $0.0001 par value per share, of the Surviving Corporation.
Surviving Entity” shall have the meaning set forth in Section 2.01.
Surviving Entity Charter” shall mean the Certificate of Formation of the Surviving Entity in the form attached as Exhibit B hereto.
Surviving Entity Interests” shall mean the limited liability company interests of the Surviving Entity.
Tax Contest” shall have the meaning set forth in Section 3.08(e).
Tax Law” shall mean any Law relating to Taxes.
Tax Return” shall mean any return, report, information return or other similar document required to be filed with any Governmental Authority with respect to Taxes, including, without limitation, any claim for refund or amended return.
Taxes” shall mean all taxes, charges, fees, customs, duties, levies or other similar assessments imposed by any Governmental Authority, including, without limitation, income, gross receipts, premium, windfall profits, environmental, profits, excise, real property, personal property, escheat and unclaimed property, sales, gain, use, license, capital stock, stamp, transfer, franchise,
23


employment, payroll, severance, occupation, disability, withholding, social security, value added, registration, alternative or add-on minimum or base erosion and anti-abuse, estimated, or any other taxes whatsoever, including any interest, penalties, related liabilities or additions attributable thereto whether disputed or not an including any obligations to indemnify or otherwise assume or succeed to the Tax liability of any other Person.
Technology” shall mean any (a) technology, formulae, algorithms, procedures, processes, methods, techniques, systems, know-how, ideas, concepts, creations, inventions and invention disclosures, discoveries, and improvements (whether patentable or unpatentable and whether or not reduced to practice), (b) technical, engineering, manufacturing, product, marketing, servicing, financial, business partner, supplier, customer, personnel, and other information, research, and materials, (c) specifications, designs, models, devices, hardware, prototypes, schematics, manuals and development tools, (d) Software, content, and other works of authorship, (e) Data, (f) Databases, (g) Trade Secrets and (h) tangible embodiments of any of the foregoing, in any form or media whether or not specifically listed in this definition.
Termination Date” shall have the meaning set forth in Section 8.01(b).
Third Party Claim” shall have the meaning set forth in Section 7.03(b).
Top Customer” shall have the meaning set forth in Section 3.24(a).
Top Vendor” shall have the meaning set forth in Section 3.24(a).
Trademarks” shall mean unregistered and registered trademarks and service marks, common law trademarks and service marks, trade dress, symbols, logos, trade names, business names, corporate names, product names and other source or business identifiers and the goodwill associated with any of the foregoing, and all registrations thereof and applications therefor and any registrations, applications, renewals and extensions with respect to any of the foregoing.
Trade Secrets” shall mean information and materials that (a) derive independent economic value, actual or potential, from not being generally known to the public or to other Persons who can obtain economic value from its disclosure or use and (b) are the subject of efforts that are reasonable under the circumstances to maintain their secrecy.
Transaction Expenses” shall mean (a) any and all fees and out-of-pocket costs, expenses and other amounts (including fees and expenses of legal counsel, investment bankers, accountants or other advisors or experts retained by the Company) incurred by the Company or any of its Subsidiaries in connection with the transactions contemplated by this Agreement, including costs and expenses incurred in connection with the negotiation and execution of this Agreement and, for avoidance of doubt, any fees, costs or expenses paid or payable to the Paying Agent pursuant to the Payments Administration Agreement or otherwise in connection with its performance of its obligations or functions contemplated hereby and any fees, costs or expenses paid or payable to the Stockholders’ Representative pursuant to the Stockholders’ Representative Agreement or otherwise in connection with its performance of obligations or functions contemplated hereby as of the Closing (other than the Representative Expense Amount); (b) Change in Control Payments; (c) the cost of the D&O Tail Policy, (d) 50% of any filing fees under the Antitrust Laws; (e) 50% of the R&W Policy Premium; and (f) any Taxes for which the Equityholders are responsible under Section 5.12(b). For the avoidance of doubt,
24


Transaction Expenses will not include any liabilities included in the calculation of Closing Net Working Capital or any amounts that are included in Closing Indebtedness.
Transfer Taxes” shall have the meaning set forth in Section 5.12(b).
Treasury Regulations” shall mean regulations of the U.S. Treasury Department issued pursuant to the Code.
Unaudited Financial Statements” shall have the meaning set forth in Section 3.05(a).
Underlying Loan” shall have the meaning set forth in Section 4.25.
Utah Act” shall mean the Utah Revised Business Corporation Act, Utah Code Section 16-l0A-101 et seq., as amended.
WARN Act” shall have the meaning set forth in Section 3.15(b).
Working Capital Escrow Amount” shall have the meaning set forth in Section 2.14(a)(iii).
Working Capital Shares” shall have the meaning set forth in Section 2.14(a)(iii).
Working Capital Target” shall mean $3,100,000.
SECTION 1.02    Other Terms. Other terms may be defined elsewhere in the text of this Agreement and, unless otherwise indicated, shall have such meaning throughout this Agreement.
ARTICLE II
THE MERGERS
SECTION 2.01    Mergers. At the Effective Time, upon the terms and subject to the conditions set forth in this Agreement and in accordance with the DGCL, Merger Sub will merge with and into the Company (the “First Merger”), with the Company being the surviving corporation of the First Merger (the Company, in its capacity as the surviving corporation of the First Merger, is sometimes referred to as the “Surviving Corporation”); and (b) immediately following the First Merger and as part of the same integrated transaction as the First Merger, the Surviving Corporation will merge with and into Merger Sub II (the “Second Merger” and, together with the First Merger, the “Mergers”), whereupon the separate existence of the Surviving Corporation shall cease and Merger Sub II shall continue as the surviving entity (Merger Sub II, in its capacity as the surviving entity of the Second Merger, is sometimes referred to as the “Surviving Entity”) and all of the assets and liabilities of the Surviving Corporation shall become the assets and liabilities of the Surviving Entity.
SECTION 2.02    Closing. The closing of the transactions contemplated hereby (the “Closing”) shall take place at the offices of Dorsey & Whitney LLP, 111 South Main Street, Suite 2100, Salt Lake City, UT 84111 at 10:00 a.m. (U.S. Pacific Time), or at such other location as may be mutually agreed upon by the parties and may instead be effected by electronic or other transmission of
25


signature pages, as mutually agreed upon, in any case on a date to be specified by the parties hereto, which date shall be no later than the third (3rd) Business Day following the satisfaction or, to the extent permitted, waiver of the conditions set forth in Article VI (other than those conditions that require delivery of a document or certificate or the taking of an action at the Closing, but subject to the satisfaction or, to the extent permitted, waiver of those conditions at the Closing), or on such other date or at such other time or place as Parent and the Company may mutually agree in writing (the day on which the Closing takes place being the “Closing Date”).
SECTION 2.03    Effective Time. As soon as practicable on the Closing Date, the parties hereto shall deliver to the Secretary of State of the State of Delaware a certificate of merger (the “Certificate of Merger”) in accordance with the relevant provisions of the DGCL any other applicable Law of the State of Delaware. The First Merger shall become effective at the time of filing the Certificate of Merger with the Secretary of State of the State of Delaware in accordance with the DGCL or at such later time as the parties hereto may agree in writing and as is provided in the Certificate of Merger in accordance with the DGCL. The date and time at which the First Merger shall so become effective is herein referred to as the “Effective Time”. As soon as practicable following the Effective Time and in any case on the same day as the Effective Time, the parties hereto shall deliver to the Secretary of State of the State of Delaware a certificate of merger (the “Second Certificate of Merger”) in accordance with the relevant provisions of the DGCL any other applicable Law of the State of Delaware. The Second Merger shall become effective at the time of filing the Second Certificate of Merger with the Secretary of State of the State of Delaware in accordance with the DGCL or at such later time as the parties hereto may agree in writing and as is provided in the Second Certificate of Merger in accordance with the DGCL. The date and time at which the Second Merger shall so become effective is herein referred to as the “Second Effective Time”.
SECTION 2.04    Effects of the Mergers.
(a)    The First Merger shall have the effects set forth in this Agreement and in the applicable provisions of the DGCL and, without limiting the foregoing, from and after the Effective Time, (i) the Surviving Corporation shall possess all the rights, privileges, powers and franchises of the Merger Sub and the Company and shall be subject to all liabilities, obligations and penalties of the Merger Sub and the Company except as provided herein, and (ii) the separate existence of the Merger Sub shall cease.
(b)    The Second Merger shall have the effects set forth in this Agreement and in the applicable provisions of the DGCL and, without limiting the foregoing, from and after the Second Effective Time, (i) the Surviving Entity shall possess all the rights, privileges, powers and franchises of the Surviving Corporation and the Surviving Entity and shall be subject to all liabilities, obligations and penalties of the Surviving Corporation and Merger Sub II except as provided herein, and (ii) the separate existence of the Surviving Corporation shall cease.
SECTION 2.05    Certificate of Incorporation and By-laws. Effective upon the Effective Time, (a) the certificate of incorporation of the Surviving Corporation shall be amended and restated as set forth in the Surviving Corporation Charter, and the Surviving Corporation Charter shall be the certificate of incorporation of the Surviving Corporation unless and until amended in accordance with applicable Law, and (b) the by-laws of Merger Sub, as in effect immediately prior to the Effective Time, shall be the by-laws of the Surviving Corporation, unless and until amended in accordance with
26


applicable Law. Effective upon the Second Effective Time, (i) the certificate of formation of the Surviving Entity shall be the Surviving Entity Charter, and the Surviving Entity Charter shall be the certificate of formation of the Surviving Entity unless and until amended in accordance with applicable Law, and (ii) the limited liability company agreement of Merger Sub II, as in effect immediately prior to the Second Effective Time, shall be the limited liability company agreement of the Surviving Entity, unless and until amended in accordance with applicable Law.
SECTION 2.06    Directors and Officers. The parties hereto (other than the Stockholders’ Representative) shall take all action necessary so that each of the directors of Merger Sub immediately prior to the Effective Time shall be a director of the Surviving Corporation and each of the officers of Merger Sub immediately prior to the Effective Time shall be an officer of the Surviving Corporation, in each case until his or her successor is duly elected or appointed and qualified, or until his or her earlier death, resignation or removal in accordance with the Surviving Entity’s certificate of incorporation and by-laws. The parties hereto (other than the Stockholders’ Representative) shall take all action necessary so that each of the directors of Merger Sub II immediately prior to the Second Effective Time shall be a director of the Surviving Entity and each of the officers of Merger Sub II immediately prior to the Second Effective Time shall be an officer of the Surviving Entity, in each case until his or her successor is duly elected or appointed and qualified, or until his or her earlier death, resignation or removal in accordance with the Surviving Entity’s certificate of incorporation and by-laws.
SECTION 2.07    Conversion of Company Shares.
(a)    At the Effective Time, each Company Share (other than the Company Shares to be cancelled pursuant to Section 2.07(b) and Dissenting Shares) shall, by virtue of the First Merger and without any action on the part of the Company or Merger Sub or the holders of any securities of the Company or Merger Sub, be converted into and thereafter evidence the right to receive the applicable number or amount of shares of Parent Series H-1 Preferred Stock, payments due under the Seller Note and cash. Each Company Share that is owned by an Accredited Stockholder shall be converted into and thereafter evidence the right to receive the applicable number or amount of shares of Parent Series H-1 Preferred Stock, payments due under the Seller Note and/or cash. The number of shares of Parent Series H-1 Preferred Stock into which each Company Share owned by an Accredited Stockholder is converted shall be equal to the quotient obtained by dividing the Per Share Parent Stock Consideration by the Parent Stock Price. No fractional shares of Parent Series H-1 Preferred Stock will be issued hereunder, and each Accredited Stockholder will receive, in lieu of any fractional share of Parent Series H-1 Preferred Stock that such Accredited Stockholder would otherwise receive pursuant to this Agreement, an amount of cash equal to the product of such fractional share of Parent Series H-1 Preferred Stock and the Parent Stock Price (such amount, the “Fractional Cash Amount”). The amount of cash into which each Company Share owned by an Accredited Stockholder is converted shall be equal to the Accredited Stockholder Per Share Cash Consideration, and the original principal amount of the Seller Note into which each Company Share owned by an Accredited Stockholder is converted shall be equal to the Accredited Stockholder Per Share Note Amount. Each Company Share that is owned by a Non-Accredited Stockholder shall be converted into and thereafter evidence the right to receive payments due under the Seller Note and cash. The amount of cash into which each Company Share owned by a Non-Accredited Stockholder is converted shall equal the Non-Stock Per Share Cash Consideration, and the original principal amount of the Seller Note into which each Company Share owned by a Non-Accredited Stockholder is converted shall be equal to the Non-Stock Per Share Note Amount. At the
27


Effective Time, each such Company Share shall no longer be outstanding and shall automatically be cancelled and shall cease to exist, and each holder of such Company Share shall cease to have any rights with respect thereto, except the right to receive the Per Share Merger Consideration, in Parent Series H-1 Preferred Stock, the Seller Note and/or in cash as set forth in this Section 2.07(a), and such holder’s right to receive its Stockholder Escrow Pro Rata Share of the Escrow Amount and the Working Capital Escrow Amount and its Stockholder Pro Rata Share of the Representative Expense Amount, subject to the terms and conditions set forth in Section 2.14(b).
(b)    At the Effective Time, each Company Share held in the treasury of the Company, or by any of its Subsidiaries, immediately prior to the Effective Time shall be cancelled and extinguished without any conversion thereof, and no payment shall be made with respect thereto.
(c)    The fair market value of the Parent Series H-1 Preferred Stock provided in the Mergers (as determined using the Parent Stock Price) shall equal or exceed forty percent (40%) of the fair market value of the Merger Consideration received or deemed received by Stockholders in exchange for their Company Shares pursuant to the Mergers (including amounts that (i) may be payable to Dissenting Stockholders and (ii) Fractional Cash Amounts), treating the contingent right of each Stockholder to receive portions of the Escrow Amount, the Working Capital Escrow Amount, and the Representative Expense Amount as having a value equal to the Stockholder’s proportionate share of such amounts, as provided herein), and treating the Seller Note as having a fair market value equal to its original principal face amount. If the preceding sentence would not be true as of the Effective Time based on the Stock Consideration and Cash Merger Consideration as defined in Section 1.01 (without reference to modification under this Section 2.07(c)), the Stock Consideration shall be increased, and the Cash Merger Consideration shall be reduced, by the minimum dollar amount necessary to cause the preceding sentence to be true.
SECTION 2.08    Stock Options.
(a)    Participating Options. Each Participating Option that is outstanding and unexercised as of immediately prior to the Effective Time shall terminate and be cancelled at the Effective Time and each Optionholder shall be entitled to receive from Parent or the Surviving Corporation in settlement of each such Option (i) cash in an amount equal to the product of (A) Non-Stock Per Share Cash Consideration minus the exercise price per share of such Participating Option multiplied by (B) the number of Shares subject to such Participating Option, and (ii) original principal amount of the Seller Note in an amount equal to the product of (C) the Non-Stock Per Share Note Amount multiplied by (D) the number of Shares subject to such Participating Option.
(b)    At the Effective Time, each then outstanding and unexercised Assumed Option shall, by virtue of the First Merger, be assumed by Parent and shall cease to represent a right to acquire shares of Company Common Stock and shall be converted into an option to purchase a number of shares of Parent Common Stock in an amount, at an exercise price and subject to such terms and conditions as provided below. Each such Assumed Option so converted shall be subject to, and shall become exercisable and vested upon, substantially the same the terms and conditions that are currently applicable to such Option, except that (i) each Assumed Option shall be exercisable for, and represent the right to acquire, that number of shares of Parent Common Stock (rounded down to the nearest whole number of shares of Parent Common Stock) equal to (A) the number of shares of Company Common Stock subject to such Assumed Option immediately prior to the Effective Time multiplied by (B) the
28


Conversion Ratio, and (ii) the exercise price per share of Parent Common Stock subject to each Assumed Option shall be an amount (rounded up to the nearest whole cent) equal to (A) the exercise price per share of such Assumed Option in effect immediately prior to the Effective Time divided by (B) the Conversion Ratio. The exercise price of each Assumed Option, the number of shares of Parent Common Stock issuable pursuant to each Assumed Option and the terms and conditions of each Assumed Option shall in all events be determined in compliance with Section 409A of the Code, and in the case of any Assumed Option that qualifies as an “incentive stock option” within the meaning of Section 422 of the Code, Section 424(a) of the Code. It is the intent of the parties that each Assumed Option that, prior to the Effective Time, qualified as an incentive stock option under the Code shall, from and after the Effective Time, continue to be treated as an incentive stock option to the extent permitted under the Code.
(c)    At the Effective Time, Parent shall assume each Company Option Plan solely to the extent necessary to administer the Assumed Options.
SECTION 2.09    Conversion of Common Stock of Merger Sub; Conversion of Common Stock of Surviving Corporation.
(a)    At the Effective Time, all shares of Merger Sub Common Stock issued and outstanding immediately prior to the Effective Time shall, by virtue of the First Merger and without any action on the part of the holder thereof, be converted into and thereafter evidence in the aggregate one (1) Surviving Corporation Common Share. Each share of Merger Sub Common Stock issued and outstanding immediately prior to the Effective Time, when converted in accordance with this Section 2.09, shall no longer be outstanding, shall automatically be cancelled and shall cease to exist.
(b)    At the Second Effective Time, each Surviving Corporation Common Share issued and outstanding immediately prior to the Second Effective Time shall, by virtue of the Second Merger and without any action on the part of the holder thereof, be converted into and thereafter evidence in the aggregate one (1) Surviving Entity Interest.
SECTION 2.10    Closing Adjustments.
(a)    Within sixty (60) calendar days after the Closing, Parent will calculate the Cash Merger Consideration as of the Adjustment Time and will send its calculations (which shall include calculations of each component of Cash Merger Consideration) to the Stockholders’ Representative in writing, along with reasonable supporting details. Parent will make available to the Stockholders’ Representative and its auditors, employees and advisors all records and work papers used in calculating the Cash Merger Consideration and Parent’s employees and representatives who prepared such calculation, and will otherwise reasonably cooperate with Stockholders’ Representative in its review of the same. If the Stockholders’ Representative disagrees with Parent’s calculation of the Cash Merger Consideration, the Stockholders’ Representative may, within thirty (30) calendar days after receipt of Parent’s written statement, deliver a written notice to Parent setting forth in reasonable detail Stockholders’ Representative’s objections to Parent’s calculation of the Cash Merger Consideration. Any such notice of disagreement shall specify those items or amounts as to which Stockholders’ Representative disagrees. If the Stockholders’ Representative does not deliver any such written notice to Parent within thirty (30) calendar days after Parent delivers its calculations of Cash Merger Consideration to the Stockholders’ Representative, the Stockholders’ Representative shall be deemed to
29


have accepted Parent’s calculations. If written notice of disagreement shall have been delivered by the Stockholders’ Representative in accordance with this Section 2.10(a), Parent and the Stockholders’ Representative shall, during the thirty (30) calendar days following such delivery, use their commercially reasonable efforts to reach agreement on the disputed items or amounts in order to determine the Cash Merger Consideration as of the Adjustment Time. If, during such period, Parent and Stockholders’ Representative are unable to reach agreement on the disputed items or amounts, then either Parent or Stockholders’ Representative may submit the disputed items or amounts to BDO USA LLP or, if BDO USA LLP is unable to serve, Parent and Stockholders’ Representative shall appoint by mutual agreement the office of an impartial nationally recognized firm of independent certified public accountants (as applicable, the “Independent Accounting Firm”), which shall be retained jointly by Parent and the Stockholders’ Representative to resolve any disputes between Parent and the Stockholders’ Representative over such disputed items, (and only such disputed items or amounts), consistent with the definitions thereof; provided, that in no event shall the Independent Accounting Firm’s determination of any disputed amount be greater than the highest amount proposed by either Stockholders’ Representative or Parent for the disputed amount, or lower than the lowest amount proposed by either Stockholders’ Representative or Parent for the disputed amount. The determination(s) of the Independent Accounting Firm shall be final and binding on Parent and Stockholders’ Representative absent manifest error. The fees and expenses of the Independent Accounting Firm shall be borne by Stockholders’ Representative (on behalf of the Equityholders) and Parent in proportion to the relative amounts by which their respective calculations of any disputed amounts, in the aggregate, differ from the Independent Accounting Firm’s determination as contemplated by this provision. The Cash Merger Consideration as of the Adjustment Time as finally determined pursuant to this Section 2.10(a) is referred to as the “Actual Cash Merger Consideration”.
(b)    If the Actual Cash Merger Consideration exceeds the Effective Time Cash Merger Consideration, then Parent will pay to the Paying Agent (for further distribution to the Equityholders) the amount by which the Actual Cash Merger Consideration exceeds the Effective Time Cash Merger Consideration in cash by wire transfer of immediately available funds (to an account specified in writing by Paying Agent) within five (5) Business Days after determination of the Actual Cash Merger Consideration; provided, however, that amounts otherwise payable to the Paying Agent pursuant to this sentence shall not be paid to the extent (and only to the extent) that the distribution of such payment to Equityholders would cause the first sentence of Section 2.07(c) to be untrue. If the Effective Time Cash Merger Consideration exceeds the Actual Cash Merger Consideration, then Parent and Stockholders’ Representative shall direct the Escrow Agent to release from the Escrow Account a number of Working Capital Shares having a value equal, assuming that the value of each such Working Capital Share is equal to the Parent Stock Price, to the amount by which the Effective Time Cash Merger Consideration exceeds the Actual Cash Merger Consideration to Parent within five (5) Business Days after determination with any remaining Working Capital Shares in the Escrow Account to be simultaneously released to the Stockholders (subject to Section 2.14(c)(i)) in accordance with their respective Stockholder Escrow Pro Rata Shares. In the event that the full amount by which the Effective Time Cash Merger Consideration exceeds the Actual Cash Merger Consideration (such amount, the “Excess Amount”) is greater than the Working Capital Escrow Amount (the difference between the Working Capital Escrow Amount and the Excess Amount, being the “Adjustment Funds Shortfall”), Parent shall be entitled to recover such Adjustment Funds Shortfall from the Escrow Amount held by the Escrow Agent.
30


(c)    Any payment made with respect to adjustments made pursuant to this Section 2.10 shall be deemed to be, and each of the Company and Parent shall treat such payments as, an adjustment to Merger Consideration for U.S. federal, state and local income Tax purposes.
SECTION 2.11    Tax Treatment and Cooperation. It is intended by the parties hereto that the Mergers constitute a reorganization within the meaning of Section 368(a) of the Code. Each of the parties hereto adopts this Agreement as a “plan of reorganization” within the meaning of Sections 1.368-2(g) and 1.368-3(a) of the Treasury Regulations. Both prior to and after the Closing, each party’s books and records shall be maintained, and all federal, state and local income Tax Returns and schedules thereto of the parties hereto shall be filed, in a manner consistent with the Mergers constituting a reorganization described in Section 368(a) of the Code (and comparable provisions of any applicable Laws), except to the extent the Mergers are determined in a final administrative or judicial decision not to qualify as such a reorganization. Each of the Company, Parent, Merger Sub and Merger Sub II (and the officers thereof) shall reasonably cooperate with the Company and Parent and their respective legal counsel to provide any information reasonably necessary in order for such legal counsel to provide an opinion, dated the Closing Date, to the Company and Parent, respectively, to the effect that the Mergers should be treated as a reorganization described in Section 368(a) of the Code and the Treasury Regulations promulgated thereunder. Such cooperation shall include the execution and delivery to the Company’s and Parent’s legal counsel of customary tax representation letters or certificates of such officers and at such time or times as may be reasonably requested by the applicable legal counsel, in connection with its delivery of such opinions.
SECTION 2.12    Withholding Taxes. Parent, Merger Sub, and the Surviving Corporation shall be entitled to deduct and withhold, or cause to be deducted and withheld, from the consideration otherwise payable pursuant to this Agreement to holders of Company Shares or Options such amounts as are required to be deducted and withheld under the Code or any applicable provision of Tax Law. To the extent that amounts are so deducted and withheld, such amounts shall be treated for all purposes of this Agreement as having been paid to the holder of Company Shares or Options in respect of which such deduction and withholding was made.
SECTION 2.13    Closing of the Company’s Transfer Books. At the Effective Time, the stock transfer books of the Company shall be closed and no transfer of Company Shares shall thereafter be made. If, after the Effective Time, Certificates are presented to the Surviving Corporation or the Surviving Entity for transfer, they shall be cancelled and exchanged as provided for in this Agreement.
SECTION 2.14    Payment of Merger Consideration and Other Payments.
(a)    The aggregate consideration to be paid by Parent with respect to the Company Shares and Participating Options shall be as set forth in this Section 2.14. For the avoidance of doubt, the parties agree and acknowledge that the Merger Consideration shall be paid by Parent with a combination of Parent Series H-1 Preferred Stock, payments due under the Seller Note and cash payments made pursuant to Section 2.07(a) and Section 2.08(a). At the Closing, Parent will make (or cause to be made) the following payments:
(i)    Payment of Company Shares. Subject to compliance with Section 2.14(b), to each holder of Company Shares that delivers to the Paying Agent a properly completed and
31


duly executed Letter of Transmittal, an amount equal to such Stockholder’s Merger Consideration in respect of each Company Share held by such Stockholder, payable in the applicable number or amount of shares of Parent Series H-1 Preferred Stock, evidence of the applicable portion of the Seller Note and/or in cash as set forth in Section 2.07(a), with the aggregate amount of cash payable to all Stockholders under this Section 2.14(a)(i) (whether or not such Stockholders have delivered a Letter of Transmittal to the Paying Agent) being deposited by Parent with the Paying Agent (for further distribution to the Stockholders in accordance with instructions provided to the Paying Agent in the Letter of Transmittal).
(ii)    Participating Options. To the Company, or a payroll agent designated by the Company, for the Optionholders that have delivered to the Company a duly executed Option Cancellation Agreement, an amount equal to the aggregate cash payable to such Optionholders in respect of their Participating Options pursuant to Section 2.08(a) and to the Stockholders’ Representative evidence of the applicable portion of the Seller Note as set forth in Section 2.08(a) with respect to each Optionholder. The Surviving Corporation or the Surviving Entity shall deliver, or cause to be delivered, to each Optionholder the amount of cash to which such Optionholder is entitled as provided in Section 2.08(a) as promptly as practicable after the Effective Time.
(iii)    Working Capital Escrow Amount. To the Escrow Agent, stock certificates or an electronic record representing 19,434 shares of Parent Series H-1 Preferred Stock (the “Working Capital Escrow Amount”), which shares (the “Working Capital Shares”) shall be held by the Escrow Agent in an escrow account (the “Escrow Account”) and used only to pay the payment obligations of the Equityholders pursuant to Section 2.10(b).
(iv)    Escrow Amount. To the Escrow Agent, stock certificates or an electronic record representing 777,393 shares of Parent Series H-1 Preferred Stock (the “Escrow Amount”), which shares shall be held in the Escrow Account by the Escrow Agent and used only to pay any indemnification obligations of the Equityholders pursuant to Section 7.02.
(v)    Representative Expense Amount. To the Stockholders’ Representative, an amount equal to the Representative Expense Amount by wire transfer of immediately available funds to a segregated account designated by the Stockholders’ Representative.
(vi)    Accredited Investor Certifications. The Company shall request (with a copy for completion) and use commercially reasonable efforts to secure delivery of Accredited Investor Certifications from all Equityholders who the Company reasonably believes (or that Parent indicates that it reasonably believes) to be an Accredited Investor and shall deliver all Accredited Investor Certifications that it has obtained as a result of such efforts or otherwise to be delivered to Parent no less than five (5) Business Days prior to the Closing Date.
(vii)    Spreadsheet. The Company shall prepare and deliver to Parent and the Paying Agent for their review (with a copy to the Stockholders’ Representative) no less than five (5) Business Days prior to the Closing Date the proposed Spreadsheet.
(b)    Exchange Procedures. Prior to the Effective Time, the Company shall deliver or mail a letter of transmittal, substantially in the form of Exhibit E attached hereto (the “Letter of
32


Transmittal”) to each holder of Company Shares. Following the Effective Time, each Stockholder submitting a duly completed and validly executed Letter of Transmittal submitted to the Paying Agent (and delivery of copies thereof to Parent as provided below), provided further that Parent shall not have reasonably objected to any such materials proposed to be accepted for payment by the Paying Agent, such Stockholder shall be entitled to receive, subject to the terms and conditions hereof, the Per Share Merger Consideration, payable in Parent Series H-1 Preferred Stock, the Seller Note and/or in cash as set forth in Section 2.07(a) (after giving effect to any required Tax withholdings as provided in Section 2.12) and such Stockholder’s right to receive its Stockholder Escrow Pro Rata Share of the Escrow Amount and the Working Capital Escrow Amount and its Stockholder Pro Rata Share of the Representative Expense Amount, as provided herein and in the Escrow Agreement, as applicable, as such amount may be reduced pursuant to the terms of this Agreement and the Escrow Agreement, as applicable, for each Company Share represented by such Certificate or Certificates cancelled in connection with the submission of a duly completed and validly executed Letter of Transmittal. Company shall cause Paying Agent to deliver to Parent prior to Closing a copy of each duly completed and validly executed Letter of Transmittal, promptly upon receipt by Paying Agent or Company (whichever occurs first), and Company shall cause the Paying Agent prior to Closing to provide Parent a reasonable opportunity to review such materials prior to acceptance for payment by the Paying Agent. Until surrendered as contemplated by this Section 2.14(b), each Certificate shall be deemed at any time after the Effective Time to represent only the right to receive upon such surrender the Per Share Merger Consideration, payable in Parent Series H-1 Preferred Stock, the Seller Note and/or in cash as set forth in Section 2.07(a), and the right to receive the applicable Stockholder Escrow Pro Rata Share of the Escrow Amount and the Working Capital Escrow Amount and the applicable Stockholder Pro Rata Share of the Representative Expense Amount, as provided herein and in the Escrow Agreement, as applicable. No interest will be paid or will accrue on the cash payable upon surrender of any Certificate.
(c)    Retention of Amounts. Notwithstanding any contrary provision set forth in this Agreement, no Equityholder shall be entitled to receive that portion of the Merger Consideration represented by such Equityholder’s applicable share of the Working Capital Escrow Amount, the Escrow Amount or the Representative Expense Amount until such time as such amount (or any portion thereof), if any, is distributed to such Equityholder pursuant to the terms and conditions of this Agreement or the Escrow Agreement, as applicable. The adoption of this Agreement and the approval of the Mergers as evidenced by the Stockholder Consent shall constitute approval by all of the holders of Company Shares of the Escrow Agreement and of all of the arrangements relating thereto, including, without limitation, the placement of the Working Capital Escrow Amount and the Escrow Amount in escrow.
(i)    Following the delivery by the Escrow Agent of any applicable stock certificates or electronic records representing (A) any portion of the Residual Shares released from the Escrow Account pursuant to the Escrow Agreement and Section 7.04(b), or (B) any portion of the Working Capital Shares released from the Escrow Account pursuant to the Escrow Agreement and Section 2.10(b), to Parent for cancellation, together with instructions for distribution provided by the Stockholders’ Representative, Parent shall distribute, pay or cause to be transferred, distributed or paid to each Stockholder that has submitted a duly completed and executed Letter of Transmittal to the Paying Agent, such Stockholder’s Stockholder Escrow Pro Rata Share of the total Residual Shares or Working Capital Shares released, as applicable; provided, that notwithstanding anything to the contrary in this agreement, any Residual Shares or Working Capital Shares, as applicable, otherwise payable to any Non-
33


Accredited Stockholder under this Agreement shall be paid to Foundation Capital, L.L.C., and upon receipt of such Residual Shares or Working Capital Shares, as applicable, Foundation Capital, L.L.C. shall pay such Non-Accredited Stockholder the value of such Residual Shares or Working Capital Shares, as applicable, in immediately available funds, with the value of each Residual Share or Working Capital Share being equal to the Parent Stock Price. Parent and the Stockholders’ Representative shall cooperate to ensure that the Residual Shares or Working Capital Shares so released are as promptly as practicable delivered to, and/or registered in Parent’s stock records in the name of, the Stockholders in accordance with their respective Stockholder Escrow Pro Rata Shares (reduced with respect to any Stockholders by any shares previously released from the Escrow Account in connection with claims against such Stockholder). In lieu of issuing any fractional Residual Shares or Working Capital Shares, Parent shall cancel such fractional shares and pay to the Paying Agent any Fractional Cash Amounts associated with such fractional shares for further distribution to the Stockholders as applicable.
(ii)    Promptly following the Paying Agent receiving any portion of the Representative Expense Amount released by the Stockholders’ Representative, in each case, for further distribution to the Stockholders, the Paying Agent shall distribute, pay or cause to be distributed or paid to each Stockholder that has submitted a duly completed and executed Letter of Transmittal to the Paying Agent, such Stockholder’s Stockholder Pro Rata Share of the total portion of the Representative Expense Amount released by the Stockholders’ Representative, as applicable.
(iii)    No later than concurrently with the first ordinary course payroll of the Surviving Entity that occurs at least two (2) Business Days following the release of any portion of the Representative Expense Amount released by the Stockholders’ Representative, as applicable, Parent shall cause the Surviving Entity to deliver or cause to be delivered, through payroll agent designated by the Surviving Entity, to each Optionholder, such Optionholder’s Optionholder Pro Rata Share of the total portion of the Representative Expense Amount released by the Stockholders’ Representative.
(d)    Any portion of funds held by the Paying Agent which have not been delivered to any Stockholders pursuant to Section 2.14(a)(i) within twelve (12) months after the Closing shall promptly be paid to Parent, and thereafter each Stockholder who has not theretofore complied with the exchange procedures set forth in and contemplated by Section 2.14(b) with respect to such Stockholder’s Company Shares shall look only to Parent (notwithstanding any abandoned property, escheat and similar Laws) for its claim, only as a general unsecured creditor thereof, with respect to such Stockholder’s portion of the Merger Consideration payable in respect of such Company Shares.
(e)    Payments on Seller Note. The Seller Note Payment Remainder Amount shall be delivered by Parent to the Paying Agent for further payment to the Equityholders in proportion to their applicable Note Pro Rata Shares; provided that the Paying Agent may cause any such payments to be delivered to a payroll company designated by the Surviving Entity for further payment to the Optionholders as applicable. The Deferred Transaction Fee shall be delivered by Parent to the Paying Agent for further payment to Qatalyst Partners LLC. The Company and each Equityholder acknowledge that payments under the Seller Note will be reduced by the Deferred Transaction Fee.
34


Parent and the Stockholder Representative shall discuss with Qatalyst Partners LLC the calculation of the Deferred Transaction Fee in connection with payment thereof.
SECTION 2.15    Stockholders’ Representative.
(a)    Appointment. By voting in favor of the adoption of this Agreement, the approval of this Agreement and the Mergers by the requisite vote of the Equityholders, and the consummation of the Mergers or participating in the Mergers and receiving the benefits thereof, including the right to receive the consideration payable in connection with the Mergers, the Equityholders’ Representative shall be deemed to have been irrevocably appointed, and is hereby irrevocably appointed, by each Equityholder to act as the representative, agent and attorney-in-fact for the Equityholders for all purposes in connection with this Agreement and the agreements ancillary hereto, including with respect to all post-Closing matters requiring any action or decision by the Equityholders, and the Stockholders’ Representative shall thereupon be authorized to (i) execute and deliver all documents necessary or desirable to carry out the intent of this Agreement, the Escrow Agreement and any other Additional Agreements, (ii) serve as the named party with respect to any such claims on behalf of each of the Equityholders, (iii) give and receive on behalf of the Equityholders any and all notices and documents from or to any Equityholder hereunder or under this Agreement and any Additional Agreement, (iv) grant any consent, approval or waiver on behalf of the Equityholders under this Agreement and any Additional Agreement, (v) pay amounts from the Representative Expense Amount in connection with this Agreement and enforcement of rights hereunder, and (vi) make all other elections or decisions contemplated by this Agreement and any Additional Agreement. Each Equityholder does hereby give and grant unto the Stockholders’ Representative the power and authority to do and perform each such act and thing whatsoever that the Equityholders may or are required to do pursuant to this Agreement and all Additional Agreements, and to amend, modify or supplement any of the foregoing in each such Equityholder’s name, place and stead, as if such Equityholder had personally done such act, and SRS as the Stockholders’ Representative hereby accepts such appointment. The death, incapacity, dissolution, liquidation, insolvency or bankruptcy of any Equityholder shall not terminate such appointment or the authority and agency of the Stockholders’ Representative. The power-of-attorney granted in this Section 2.15 is coupled with an interest and is irrevocable.
(b)    The Stockholders’ Representative will incur no liability of any kind to the Equityholders with respect to any action or omission by the Stockholders’ Representative in connection with the Stockholders’ Representative’s services pursuant to this Agreement, the Stockholders’ Representative Agreement and any other Additional Agreements, except in the event of liability directly resulting from the Stockholders’ Representative’s gross negligence or willful misconduct. The Stockholders’ Representative shall not be liable for any action or omission pursuant to the advice of counsel. The Equityholders will indemnify, defend and hold harmless the Stockholders’ Representative from and against any and all losses, liabilities, damages, claims, penalties, fines, forfeitures, actions, fees, costs and expenses (including the fees and expenses of counsel and experts and their staffs and all expense of document location, duplication and shipment) (collectively, “Representative’s Expenses”) arising out of or in connection with the Stockholders’ Representative’s execution and performance of this Agreement and any Additional Agreements, in each case as such Representative’s Expense is suffered or incurred; provided, that in the event that any such Representative’s Expense is finally adjudicated to have been directly caused by the gross negligence or willful misconduct of the Stockholders’ Representative, the Stockholders’ Representative will reimburse the Equityholders the amount of such indemnified Representative’s Expense to the extent attributable to such gross negligence
35


or willful misconduct. If not paid directly to the Stockholders’ Representative by the Equityholders, any such Representative’s Expenses may be recovered by the Stockholders’ Representative from (i) the Representative Expense Amount, or (ii) in the event that the Representative Expense Amount has been exhausted, portions of the Escrow Amount paid to the Stockholders’ Representative that otherwise would be distributable to the Equityholders; provided, that while this section allows the Stockholders’ Representative to be paid from the aforementioned sources of funds, this does not relieve the Equityholders from their obligation to promptly pay such Representative’s Expenses as they are suffered or incurred, nor does it prevent the Stockholders’ Representative from seeking any remedies available to it at law or otherwise. In no event will the Stockholders’ Representative be required to advance its own funds on behalf of the Equityholders or otherwise. Notwithstanding anything in this Agreement to the contrary, any restrictions or limitations on liability or indemnification obligations of, or provisions limiting the recourse against non-parties otherwise applicable to, the Equityholders set forth elsewhere in this Agreement are not intended to be applicable to the indemnities provided to the Stockholders’ Representative under this section. The foregoing indemnities will survive the Closing, the resignation or removal of the Stockholders’ Representative or the termination of this Agreement.
(c)    Representative Expense Amount. Upon the Closing, Parent will wire the Representative Expense Amount to the Stockholders’ Representative, which will be used for the purposes of paying directly, or reimbursing the Stockholders’ Representative for, any third party expenses pursuant to this Agreement and any Additional Agreements. The Equityholders will not receive any interest or earnings on the Representative Expense Amount and irrevocably transfer and assign to the Stockholders’ Representative any ownership right that they may otherwise have had in any such interest or earnings. The Stockholders’ Representative will not be liable for any loss of principal of the Representative Expense Amount other than as a result of its gross negligence or willful misconduct. The Stockholders’ Representative will hold these funds separate from its corporate funds, will not use these funds for its operating expenses or any other corporate purposes and will not voluntarily make these funds available to its creditors in the event of bankruptcy. As soon as practicable following the completion of the Stockholders’ Representative’s responsibilities, the Stockholders’ Representative will deliver any remaining balance of the Representative Expense Amount to the Paying Agent or the Surviving Entity, as applicable, for further distribution to the Equityholders. For Tax purposes, the Representative Expense Amount will be treated as having been received and voluntarily set aside by the Equityholders at the time of Closing.
(d)    Reliance. Each party hereto shall be entitled to rely exclusively upon any communication given or other action taken by the Stockholders’ Representative on behalf of the Equityholders pursuant to this Agreement, and shall not be liable for any action taken or not taken in good faith reliance on a communication or other instruction from the Stockholders’ Representative on behalf of the Equityholders.
(e)    Resignation and Replacement. The Stockholders’ Representative may resign at any time by giving written notice to the parties. The Stockholders’ Representative may be discharged, and replaced by another Person to act as such Stockholders’ Representative successor, by an instrument in writing signed by a majority in economic interest of the Equityholders (or their successors in interest).
(f)    Additional Limitation. Notwithstanding the foregoing, the Stockholders’ Representative, each Equityholder, the Company and Parent expressly acknowledge that the Stockholders’ Representative shall have no authority or responsibility to act on behalf of any
36


Equityholder in connection with any claim, action or proceeding initiated against such Equityholder pursuant to a breach by such Equityholder of such Equityholder’s individual representations, warranties or covenants made in any Letter of Transmittal or otherwise in connection with the transactions contemplated by this Agreement.
SECTION 2.16    Dissenting Shares.
(a)    Notwithstanding anything in this Agreement to the contrary, Company Shares that are issued and outstanding immediately prior to the Effective Time and are held by Stockholders who have not voted in favor of the Mergers, consented thereto in writing, or otherwise contractually waived their rights to appraisal and who have complied with all of the relevant provisions of the DGCL with respect to appraisal rights (the “Dissenting Shares,” and the holders thereof the “Dissenting Stockholders”) shall not be converted into or be exchangeable for the right to receive the applicable portion of Merger Consideration and such other payments, in each case, in accordance with this Agreement, unless and until such Stockholders shall have failed to perfect or establish such Dissenting Stockholder’s entitlement to appraisal rights under the DGCL, or shall have effectively withdrawn or lost their rights to appraisal under the DGCL. Prior to Closing, the Company shall give Parent (i) prompt (and, in any event, within one (1) Business Day) notice of any demands for appraisal of any Company Shares, attempted withdrawals of such demands and any other instruments served pursuant to the DGCL and received by the Company relating to stockholders’ rights of appraisal, and (ii) upon request thereafter by Parent, the right to control and direct all negotiations and Legal Proceedings with respect to demands for appraisal under the DGCL. Neither the Company, nor the Surviving Corporation, nor the Surviving Entity shall, except with the prior written consent of Parent, negotiate or voluntarily make any payment with respect to, or settle or offer to settle, any such demand for payment. If any Dissenting Stockholder shall fail to perfect or establish such Dissenting Stockholder’s entitlement to appraisal rights under the DGCL or shall have effectively withdrawn or lost the right to dissent, then (A) as of the occurrence of such event, such holder’s Dissenting Shares shall cease to be Dissenting Shares and (if such event occurs after Closing) shall be converted into and represent the right to receive the Per Share Merger Consideration applicable to such shares, payable in Parent Series H-1 Preferred Stock, the Seller Note and/or in cash as set forth in Section 2.07(a), together with the applicable Stockholder Escrow Pro Rata Share of each of the Escrow Amount and the Working Capital Escrow Amount and the applicable Stockholder Pro Rata Share of the Representative Expense Amount, that thereafter may be disbursed in favor of the Stockholders pursuant to Section 2.14 and (B) promptly following the occurrence of such event (if such event occurs after the Closing), Parent shall remit to the Paying Agent (for further distribution to such holder), the amount contemplated by the foregoing clause (A) to which such holder is entitled.
(b)    From and after the Effective Time, no Stockholder who has properly exercised and perfected appraisal rights pursuant to the DGCL shall be entitled to vote his, her, or its Company Shares for any purpose or receive payment of dividends or other distributions with respect to his, her, or its Company Shares.
(c)    Notwithstanding anything in this Agreement to the contrary, (i) Parent shall not be required to remit to the Paying Agent, the Surviving Entity, the Escrow Agent, or any holder of Company Shares any amount payable pursuant to this Agreement (other than Section 2.16(a)) or the Escrow Agreement to the extent such amount would otherwise be payable in respect of Dissenting Share(s), (ii) the Paying Agent shall not remit any amount to any Dissenting Stockholder or otherwise
37


which has not yet complied with the conditions in this Agreement with respect to such Stockholder’s receipt of the Merger Consideration, and (iii) any amount that would otherwise be payable under this Agreement (other than under Section 2.16(a)) or the Escrow Agreement to any Stockholder that has not yet complied with the conditions in this Agreement with respect to its receipt of the Merger Consideration shall be released to and held by the Paying Agent or (in the case of a Dissenting Share) Parent; provided, however, that subject to the provisions of this Article II, such Stockholder will be entitled to receive such amount (without interest) upon such Stockholder complying with the conditions to its receipt of the Merger Consideration.
ARTICLE III
REPRESENTATIONS AND WARRANTIES OF THE COMPANY
Except to the extent expressly disclosed in the corresponding section of the Company Disclosure Schedule, the Company hereby represents and warrants to Parent, Merger Sub, and Merger Sub II, as of the date hereof and as of the Closing Date, as follows:
SECTION 3.01    Organization. The Company and each of its Subsidiaries is duly organized, validly existing and in good standing (or equivalent status) under the Laws of the jurisdiction of its incorporation or organization and has requisite corporate, partnership, limited liability company or other company (as the case may be) power and authority necessary to own, lease and operate its properties, rights or assets and to carry on its business as now being conducted. The Company and each of its Subsidiaries is duly qualified and/or licensed to do business and is in good standing (or equivalent status) in each jurisdiction in which the nature of its business or the ownership or leasing of its properties, rights or assets makes such qualification or licensing necessary, except in such jurisdictions where the failure to be so duly qualified and/or licensed to do business and in good standing (or equivalent status) would not reasonably be expected to have a Material Adverse Effect. The Company has made available to Parent complete and correct copies of the Company Charter, the Certificate of Conversion and all other Organizational Documents of the Company and each of its Subsidiaries.
SECTION 3.02    Capitalization.
(a)    As of the date of this Agreement, the authorized capital stock of the Company consists of 25,000,000 shares of Company Common Stock, of which 18,245,164 shares are issued and outstanding as of the date hereof, and 379,857 shares of Company Preferred Stock, of which 299,887 shares are issued and outstanding as of the date hereof. No more than 200,000 shares of Company Common Stock and Preferred Stock are issued and outstanding and held by Non-Accredited Stockholders. The authorized capital stock of the Company, together with a true, correct and complete list of all of the outstanding Equity Interests of the Company, whether each Equityholder is, to the actual knowledge of the Company (without due inquiry), a Non-Accredited Stockholder, and the address of each Equityholder’s respective residence or principal place of business as shown in the records of the Company, as applicable, is as set forth on Schedule 3.02(a) of the Company Disclosure Schedule (the “Capitalization Schedule”). All of the issued and outstanding Equity Interests of the Company are owned beneficially and of record as set forth on the Capitalization Schedule, free and clear of all Liens other than Liens under the Securities Act and applicable state securities Laws. All of the issued and outstanding Equity Interests of the Company have been duly authorized, were issued in compliance with applicable Law, and are validly issued, fully paid and nonassessable, and were not issued in violation of
38


any preemptive rights of any current or former holder of Equity Interests of the Company, or any Contract to which the Company, any of its Subsidiaries or any Equityholder is or was a party. Except as set forth on the Capitalization Schedule, there are no outstanding or authorized (i) shares of capital stock or other Equity Interests of the Company, (ii) convertible or exchangeable securities or commitments of any character, contingent or otherwise, whatsoever, relating to the capital stock of, or other Equity Interest in, the Company, (iii) outstanding or authorized subscriptions, options, warrants, puts, calls, preemptive or other rights (including any conversion rights or rights of exchange), agreements, arrangements, restrictive or commitments of any kind relating to the issuance, sale, delivery, transfer, redemption, purchase, repurchase, conversion or exchange of any shares of capital stock of any class or other Equity Interests of the Company, (iv) stock appreciation, phantom stock, profit participation or similar rights with respect to the Company’s Equity Interest, or (v) irrevocable proxies, membership interest holder agreements, voting agreements or trusts or other Contracts (including Contracts imposing transfer restrictions) with respect to any Equity Interests of the Company or to otherwise provide funds to or make any investment (in the form of a loan, capital contribution or otherwise) in the Company or any other Person or that give any Person the right to receive any payment based on the value of any Equity Interests of the Company’s Subsidiaries. Neither the Company has, nor has the Company entered into any contract with respect to, any Indebtedness, the lenders of which have any rights (including voting, governance, or veto rights) typically reserved for holders of Equity Interests.
(b)    Except as set forth in Schedule 3.02(b)(i) of the Company Disclosure Schedule, there are no agreements to register any securities or sales or resales thereof under the federal or state securities Laws. Except for this Agreement, the Stockholders’ Agreement or as set forth on Schedule 3.02(b)(ii) of the Company Disclosure Schedule, the Company and its Subsidiaries are not, and none of the Equityholders is a party to or otherwise bound by, any stockholders’ agreement, option, warrant, purchase right or other Contract that could require any Equityholder to sell, transfer or otherwise dispose of any Company Shares or any other Equity Interests of any of the Company or any of its Subsidiaries or which otherwise relates to the sale, transfer or other disposal of any Equity Interests of any of the Companies, and, except for the Support Agreements, the Stockholders’ Agreement or as set forth on Schedule 3.02(b)(iii) of the Company Disclosure Schedule, none of the Company or any of the Equityholders is a party to, or otherwise bound by, any voting trust, proxy, or other agreement or understanding with respect to the voting of any Equity Interests of any of the Companies.
(c)    As of the date of this Agreement, the Company is authorized to issue 2,563,006 Options, of which 1,490,000 Options have been granted and are outstanding as of the date of this Agreement. As of the date of this Agreement, 1,500,000 of such Options are authorized and 1,490,000 Options have been granted and are outstanding under the 2011 Option Plan, and 1,063,006 of such Options are authorized and no Options are issued and outstanding under the 2019 Option Plan. Schedule 3.02(c) of the Company Disclosure Schedule sets forth a list of all holders of outstanding Options, including the number, class and series of Company Shares subject to each such Option as of the date hereof, the grant date, exercise price and vesting schedule, including vesting commencement date, for such Option, the extent to which such Option is vested and exercisable, and the date on which such Option expires. Each Option was granted in compliance with all applicable Laws and all of the terms and conditions of the applicable stock option Plan pursuant to which it was issued. All Options have been appropriately authorized by the board of directors of the Company or an appropriate committee thereof, and, if required, approved by stockholders by the necessary number of votes or written consent, including approval of the option exercise price or the methodology for determining the Option exercise price and the substantive option terms. Each Option intended to qualify as an “incentive stock option”
39


under Section 422 of the Code so qualifies. No Option has been retroactively granted, or the exercise price of any Option determined retroactively. No Option or other right to acquire Company Common Stock or other equity of any Person employed by the Company (A) has an exercise price that is or could be less than the fair market value of a share of the underlying stock as of the date such Option or right was granted as determined in accordance with Section 409A of the Code, (B) had or has any feature providing for the deferral of compensation other than the deferral of recognition of income until the later of (x) exercise or disposition of such Option or right or (y) the time the stock acquired pursuant to the exercise of Option or right first becomes substantially vested, (C) has been granted with respect to any class of stock of any Person employed by the Company that is not “service recipient stock” (within the meaning of Section 409A of the Code), or (D) has been subject to “modification” or “extension” within the meaning of Section 409A of the Code. Each Option qualifies for the tax and accounting treatment afforded to such Option in the Company’s tax returns and the Company’s financial statements, respectively, and does not trigger any liability for the applicable Equityholder with respect thereto under Section 409A of the Code. The Company has heretofore provided to Parent true and complete copies of the standard form of option agreement and any stock option agreements that differ from such standard form.
(d)    All distributions, dividends, repurchases and redemptions of the capital stock or any other Equity Interests of the Company (including any Series A preferred stock) were undertaken in compliance with the Company’s Organizational Documents then in effect, any agreement to which the Company or any of its Subsidiaries then was a party and in compliance with applicable Law. There are no declared or accrued unpaid dividends with respect to any Company Shares.
(e)    Schedule 3.02(e) of the Company Disclosure Schedule sets forth the name and jurisdiction of organization of each Subsidiary of the Company as of the date hereof. All of the outstanding shares of capital stock of each Subsidiary of the Company that is a corporation have been duly authorized and validly issued and are fully paid and nonassessable, and were not issued in violation of any preemptive rights of any current or former holder of Equity Interests of the Company, or in breach of any Contract to which the Company, any of its Subsidiaries or any Equityholder is or was a party. All of the outstanding shares of capital stock and other Equity Interests of each Subsidiary of the Company are owned by the Company, by one or more Subsidiaries of the Company or by the Company and one or more Subsidiaries of the Company, in each case as indicated on Schedule 3.02(e) of the Company Disclosure Schedule, free and clear of all Liens. Schedule 3.02(e) of the Company Disclosure Schedule sets forth the name, jurisdiction of organization and the Company’s percentage ownership of any and all Persons (other than Subsidiaries) of which the Company directly or indirectly owns an Equity Interest, or an interest convertible into or exchangeable or exercisable for an Equity Interest (collectively, the “Investments”). Except for the capital stock and other ownership interests of the Subsidiaries and the Investments listed in Schedule 3.02(e) of the Company Disclosure Schedule, the Company does not own, directly or indirectly, any capital stock or other Equity Interests in any corporation, partnership, joint venture, limited liability company or other entity and is not a party to any other arrangement treated as a partnership for U.S. federal income tax purposes.
(f)    There are no claims by any Equityholder or former Equityholder of the Company, or any other Person, seeking to assert, or based upon (i) the ownership or rights to ownership of any Equity Interests of the Company or any of its Subsidiaries; (ii) any rights of an Equityholder (other than the right to receive Merger Consideration pursuant to Article II), including any subscriptions, options, warrants, puts, calls, preemptive or other rights (including any conversion rights or rights of exchange)
40


or rights to notice or to vote; (iii) any rights under the Organizational Documents of the Company or any of its Subsidiaries; (iv) any claim that his, her or its shares were wrongfully repurchased by the Company or any of its Subsidiaries; or (v) any claim for appraisal or dissenters rights, including any payment in respect of Dissenting Shares in excess of the amount of payments otherwise payable to the stockholder seeking such rights under this Agreement.
SECTION 3.03    Authority.
(a)    The board of directors of the Company, by resolutions duly adopted by unanimous written consent, and not subsequently rescinded or modified in any way, has, as of the date hereof (i) determined that this Agreement and the transactions contemplated hereby, including the Mergers, are fair to, and in the best interests of, the Stockholders, (ii) approved and declared advisable the “agreement of merger” (as such term is used in Section 251 of the DGCL) contained in this Agreement and the transactions contemplated by this Agreement, including the Mergers, in accordance with the DGCL, (iii) directed that the “agreement of merger” contained in this Agreement be submitted to the Stockholders for adoption, and (iv) resolved to recommend that the Stockholders adopt the “agreement of merger” set forth in this Agreement (collectively, the “Company Board Recommendation”) and directed the officers of the Company to solicit the written consent of the Stockholders to such matter.
(b)    Without in any way limiting Section 3.03(a), the Company has the requisite corporate power and authority to execute and deliver this Agreement and the Additional Agreements to which it is a party and, subject to obtaining the Stockholder Consent, to perform its obligations hereunder and thereunder. The Company’s board of directors has duly and validly approved this Agreement and the Additional Agreements to which the Company is a party and the performance by the Company of the transactions contemplated hereby and thereby. No other corporate proceedings on the part of the Company are necessary to authorize this Agreement or the Additional Agreements to which it is a party or to consummate the transactions contemplated hereby or thereby (other than, with respect to the Mergers, the adoption of this Agreement by the holders of a majority of the Company Shares to the extent required by applicable law). This Agreement and the Additional Agreements have been (or will be) duly executed and delivered by the Company and the Stockholders’ Representative (where appropriate) and constitute the legal and, assuming this Agreement and the Additional Agreements constitute the valid and binding agreements of Parent, Merger Sub, and Merger Sub II (where appropriate), valid and binding agreements of the Company, enforceable against the Company and the Stockholders’ Representative in accordance with their terms, except that the enforcement hereof may be limited by (i) bankruptcy, insolvency, reorganization, moratorium or other similar laws now or hereinafter in effect relating to creditors’ rights generally and (ii) general principles of equity (regardless of whether enforceability is considered in a proceeding in equity or at law).
(c)    The conversion of the Company from a Utah corporation to a Delaware corporation was effected in accordance with all requirements of the Utah Act and the DGCL, the Plan of Conversion and the Certificate of Conversion (collectively, the “Delaware Conversion”). The Company’s board of directors and its stockholders duly and validly approved, adopted and authorized the Delaware Conversion and all documents related thereto as and to the extent required by the Utah Act, the DGCL and the Company’s Organizational Documents as they were in effect immediately prior to the Delaware Conversion. The Delaware Conversion did not (i) require any filing with, or permit, authorization, consent or approval of, any Governmental Authority, except for the filing of the
41


Certificate of Conversion with the Secretary of State of the State of Delaware and the Utah Department of Commerce, Division of Corporations and Commercial Code of the State of Utah, or (ii) result in a breach of, or constitute (with or without due notice or lapse of time or both) a default (or give rise to any right of termination, modification, amendment, cancellation, suspension, revocation or acceleration) under any of the terms, conditions or provisions of any Material Contract or Customer Agreement, (iii) violate any Law applicable to the Company, any of its Subsidiaries or any of their properties or assets or (iv) result in the creation of any Lien on any properties or assets of the Company or any of its Subsidiaries, other than Permitted Liens.
SECTION 3.04    Consents and Approvals; No Violations. Except as set forth on Schedule 3.04 of the Company Disclosure Schedule, neither the execution, delivery or performance of this Agreement and/or the Additional Agreements to which it is a party by the Company nor the consummation by the Company of the transactions contemplated hereby or thereby will (i) conflict with or violate any provision of any Organizational Document of the Company, (ii) require any filing with, or permit, authorization, consent or approval of, any Governmental Authority, except for (A) the filing of the Certificate of Merger and the Second Certificate of Merger with the Secretary of State of the State of Delaware and (B) compliance with the applicable requirements, if any, of the Antitrust Laws, (iii) result in a breach of, or constitute (with or without due notice or lapse of time or both) a default (or give rise to any right of termination, modification, amendment, cancellation, suspension, revocation or acceleration) under any of the terms, conditions or provisions of any Material Contract or Customer Agreement, (iv) violate any Law applicable to the Company, any of its Subsidiaries or any of their properties or assets or (v) result in the creation of any Lien on any properties or assets of the Company or any of its Subsidiaries, other than Permitted Liens.
SECTION 3.05    Financial Statements. Attached as Schedule 3.05(a) of the Company Disclosure Schedule are true and correct copies of the following financial statements: (a) the audited consolidated balance sheets and the related audited statements of income and cash flows for the fiscal years ended December 31, 2017 and December 31, 2018 (the “Audited Financial Statements”), and (b) the unaudited consolidated balance sheet for the twelve (12) months ended December 31, 2019 and for the two months ended February 29, 2020 and the related statements of income and cash flow of the Company for the twelve (12) month period and two (2) month period ended on such dates (the “Unaudited Financial Statements” and, collectively with the Audited Financial Statements, the “Financial Statements”, and December 31, 2019, the “Most Recent Balance Sheet Date”). Each of the Audited Financial Statements and the Unaudited Financial Statements (i) presents fairly the financial position of the Company and its Subsidiaries and the results of operations of the Company and its Subsidiaries as of the respective dates thereof and for the periods covered thereby in all material respects and (ii) was prepared in accordance with GAAP applied on a consistent basis throughout the periods covered thereby, subject, in the case of Unaudited Financial Statements, to the absence of footnotes and to normal year-end adjustments and other adjustments as noted therein. Since the Most Recent Balance Sheet Date, there have been no material changes in the accounting policies of the Company or its Subsidiaries and no revaluation of any properties or assets of the Company or any of its Subsidiaries. Since December 31, 2016, the Company has not received notice or otherwise had or obtained knowledge of any substantive complaint, allegation, assertion or claim, written or oral, regarding the accounting or auditing practices, or internal procedures or accounting controls, methodologies or methods of the Company, including any written complaint, allegation, assertion or claim that the Company has engaged in any questionable accounting or auditing practice, or regarding any violation of the securities laws.
42


SECTION 3.06    Absence of Undisclosed Liabilities. Except as expressly permitted by this Agreement or set forth on Schedule 3.06 of the Company Disclosure Schedule, neither the Company nor any of its Subsidiaries has any liabilities or obligations, other than (a) contractual liabilities under Contracts disclosed or not required to be disclosed pursuant to this Agreement and not arising as a result of any breach or default of such agreement by the Company or any of its Subsidiaries, (b) liabilities and obligations set forth, reserved against or reflected in the Financial Statements (including the notes thereto), (c) immaterial liabilities and obligations which have arisen after the Most Recent Balance Sheet Date in the ordinary course of business or (d) liabilities and obligations incurred under this Agreement or in connection with the transactions contemplated hereby. Neither the Company nor any of its Subsidiaries is a party to, or has any commitment to become a party to, any joint venture, off balance sheet partnership or any similar contract (including any structured finance, special purpose or limited purpose vehicle or other “off-balance sheet arrangement”).
SECTION 3.07    Absence of Changes; Operations in Ordinary Course. Except as set forth in Schedule 3.07 of the Company Disclosure Schedule, since the Most Recent Balance Sheet Date: (i) the Company has not suffered any material damage, destruction or loss (whether or not covered by insurance); and (ii) there has been no Material Adverse Effect. Except as set forth in Schedule 3.07 of the Company Disclosure Schedule, since the Most Recent Balance Sheet, there has not been any event, act or omission that, if such event, act or omission occurred following the execution of this Agreement and occurred in the absence of the written consent of Parent, would have resulted in a breach of Section 5.01, provided, however, that solely for purposes of this Section 3.07 and Schedule 3.07 of the Company Disclosure Schedule, Company need not disclose any changes that otherwise would be required to be disclosed hereby as a result of the following subsections of Section 5.01Section 5.01(h)(i), (j), (l)(ii), (n), (o) and, solely with respect to the exclusion of disclosure related to entry into new Material Contracts, (q).
SECTION 3.08    Taxes; Tax Matters.
(a)    Each of the Company and each of its Subsidiaries has (i) timely filed or caused to be filed (after taking into account all applicable extensions) all income and other material Tax Returns that are required to be filed and such Tax Returns are true, correct and complete in all material respects and (ii) duly paid or caused to be paid all material Taxes required to be paid by it (whether or not shown on any Tax Return). The unpaid Taxes of the Company and each of its Subsidiaries (A) for taxable periods (or portions thereof) through the Most Recent Balance Sheet Date do not exceed the accruals and reserves for Taxes (excluding accruals and reserves for deferred Taxes established to reflect timing differences between book and Tax income) set forth on the Audited Financial Statements as of the Most Recent Balance Sheet Date and (B) for taxable periods (or portions thereof) to date, will not exceed the reserve as adjusted for the passage of time to date in accordance with GAAP. All unpaid Taxes of the Company and each of its Subsidiaries for all taxable periods (or portions thereof) commencing after the Most Recent Balance Sheet Date arose in the ordinary course of business.
(b)    No deficiencies or proposed adjustments for Taxes have been asserted, proposed or assessed against the Company or any of its Subsidiaries, in writing or, to the knowledge of the Company, otherwise, that have not been paid or otherwise settled.
(c)    There are no Liens for Taxes (other than Permitted Liens) upon the assets of the Company or any of the Company Shares.
43


(d)    Neither the Company nor any of its Subsidiaries (i) is currently the beneficiary of any extension of time within which to file any Tax Return, (ii) has requested any extension of time with respect to any Tax Return, (iii) has executed or filed any power of attorney with any Governmental Authority for any Tax period for which the applicable statute of limitations has not yet expired, or (iv) has filed any waiver of the statute of limitations applicable to the assessment or collection of any Tax which remains open or agreed to extend the period for assessment or collection of any Taxes.
(e)    There are no audits, examinations, investigations or other Legal Proceedings in respect of Taxes (a “Tax Contest”) of the Company or any of its Subsidiaries that are ongoing, pending, threatened or contemplated. Except as listed on Schedule 3.08(e) of the Company Disclosure Schedule, there have been no Tax Contests of the Company or any of its Subsidiaries for any periods after December 31, 2015. The Company has not received from any taxing authority any (i) written notice indicating an intent to open a Tax Contest or (ii) written request for information related to Tax matters.
(f)    Neither the Company nor any of its Subsidiaries is a party to any agreement providing for the allocation, indemnification, or sharing of Taxes (including any advance pricing agreement, closing agreement, or other agreement relating to Taxes with any Governmental Authority), and the Company does not have a contractual or legal obligation to indemnify any other Person with respect to Taxes.
(g)    Neither the Company nor any of its Subsidiaries (i) has been a member of an affiliated group filing a consolidated, combined, joint or unitary Tax Return (other than a group the common parent of which was the Company) or (ii) has any Liability for Taxes of any Person (other than the Company or its Subsidiaries) under Treasury Regulation Section 1.1502-6 (or any similar provision of any state, local or foreign law), other than as a result of being a member of a Relevant Group of which the Company is the parent, or as a transferee or successor, by contract or otherwise.
(h)    Except as listed on Schedule 3.08(h) of the Company Disclosure Schedule, each of the Company and its Subsidiaries has not been notified in writing by any Governmental Authority in a jurisdiction where the Company and its Subsidiaries do not file Tax Returns that the Company or any of its Subsidiaries is or may be subject to Taxation by that jurisdiction. Each of the Company and its Subsidiaries has not commenced any activities in any jurisdiction which will result in an initial filing of Tax Returns with respect to Taxes imposed by a Governmental Authority that it had not previously been required to file in the immediately preceding taxable period.
(i)    No private letter rulings, technical advice memoranda or similar agreement or rulings have been requested, entered into or issued by any taxing authority with respect to the Company or any of its Subsidiaries.
(j)    Except as listed on Schedule 3.08(j) of the Company Disclosure Schedule, the Company and each of its Subsidiaries is not a “foreign person” as that term is used in Treasury Regulations Section 1.1445-2. The Company and each of its Subsidiaries is not, nor has been, a United States real property holding corporation (as defined in Section 897(c)(2) of the Code) during the applicable period specified in Section 897(c)(1)(a) of the Code. None of the Company or any of its Subsidiaries has been a member of a Relevant Group other than a Relevant Group of which the Company is the parent.
44


(k)    Neither the Company nor any of its Subsidiaries own any property of a character the indirect transfer of which pursuant to this Agreement would give rise to any transfer Tax.
(l)    None of the Company or any of its Subsidiaries has participated in any “reportable transaction” as defined in Treasury Regulation Section 1.6011-4(b), nor has acted as a “material advisor” with respect to any reportable transaction (within the meaning of Section 6111 of the Code).
(m)    Neither the Company nor any of its Subsidiaries has constituted either a “distributing corporation” or a “controlled corporation” (within the meaning of Section 355(a)(1)(A) of the Code) in a distribution of stock qualifying for tax-free treatment under Section 355 of the Code in the two (2) years prior to the date hereof or in a distribution that could otherwise constitute part of a “plan” or “series of related transaction” (within the meaning of Section 355(e) of the Code) that includes the transactions contemplated by this Agreement.
(n)    Except as listed on Schedule 3.08(n) of the Company Disclosure Schedule, all material Taxes which the Company or any of its Subsidiaries is required to withhold from amounts owing to any Person have been timely withheld and paid over to the applicable taxing authority (including with respect to amounts paid or owing to any employee, independent contractor, manager, member, creditor or other Person), and the Company and each of its Subsidiaries has complied with all applicable record-keeping, information reporting and backup withholding requirements in connection with amounts paid or owing to any employee, member, manager, creditor, independent contractor or other Person under the Code and the Treasury Regulations issued thereunder (and any similar provision of state, local or foreign Law), including the filing of all Forms W-2 and 1099.
(o)    Except as listed on Schedule 3.08(o) of the Company Disclosure Schedule, the Company and each of its Subsidiaries have collected all sales and use Taxes required to be collected, and have remitted, or will remit on a timely basis, such amounts to the appropriate Governmental Authorities, and have been furnished properly completed exemption certificates and have maintained all such records and supporting documents in the manner required by applicable sales and use Tax Law.
(p)    Except as listed on Schedule 3.08(p) of the Company Disclosure Schedule, neither the Company nor any of its Subsidiaries is required (and will not be required as a result of the Closing of the transactions contemplated by this Agreement) to include any item of income in, or exclude any item of deduction from, taxable income for any taxable period (or portion thereof) ending after the Closing Date as a result of any (i) adjustment pursuant to Section 481 of the Code (or any corresponding or similar provision of state, local, or foreign Laws) or any other change in method of accounting for a taxable period ending on or prior to the Closing Date, (ii) closing agreement as described in Section 7121 of the Code (or any similar provision of any state, local or foreign law), (iii) intercompany transaction or excess loss account described in Treasury Regulations under Section 1502 of the Code (or any similar provision of any state, local or foreign law), (iv) installment sale or open transaction disposition made on or prior to the Closing Date, (v) election under Section 108(i) of the Code (or any similar provision of any state, local or foreign law) or (vi) prepaid amount received or paid on or prior to the Closing Date.
(q)    With respect to any tax year ending on or before the Closing Date, the Company has not (i) filed any Tax Return on which it failed to disclose all positions taken thereon that could give
45


rise to a substantial understatement of income Tax within the meaning of Section 6662 of the Code (or any similar provision of state, local or foreign Laws), (ii) amended any Tax Return, (iii) made, changed or revoked any Tax election, (iv) settled any Tax claim or assessment, (v) surrendered any right to, or filed any claim for, a Tax refund or (vi) omitted to take any action relating to the filing of any Tax Return or the payment of any Tax, or taken any other action that would have the effect of deferring to a Tax period beginning after the Closing Date income economically accrued in a Pre-Closing Tax Period or accelerating a deduction from a Tax period beginning after the Closing Date to a Pre-Closing Tax Period.
(r)    As of the Closing Date, the Company has not taken or agreed to any action, and does not have any reason to believe that any conditions exist, that would reasonably be expected to prevent or impede the Mergers from qualifying as a reorganization within the meaning of Section 368(a) of the Code.
SECTION 3.09    Plans.
(a)    Each material Plan is listed in Schedule 3.09(a) of the Company Disclosure Schedule. With respect to each Plan, the Company has made available to Parent a true and correct copy of (i) each Plan that has been reduced to writing (or summaries of any Plans not reduced to writing) and all amendments thereto; (ii) each trust, insurance or administrative agreement relating to each Plan; (iii) the most recent summary plan description or other written explanation of each Plan provided to participants; (iv) the most recent annual report (Form 5500) filed with the IRS; (v) the most recent financial statements and actuarial or other valuation reports prepared with respect thereto; (vi) the most recent determination or opinion letter, if any, issued by the IRS with respect to any Plan intended to be qualified under Section 401(a) of the Code; and (vii) copies of any 280G calculation prepared (whether or not final) with respect to any employee, director or independent contractor of the Company or its Subsidiaries in connection with the transactions contemplated by this Agreement (together with the underlying documentation on which such calculation is based).
(b)    Each Plan which is intended to be qualified within the meaning of Section 401(a) of the Code is so qualified and has received a favorable determination letter as to its qualification, or if such Plan is preapproved plan, the opinion letter for each such Plan, and nothing has occurred, whether by action or failure to act, that could reasonably be expected to cause the loss of such qualification. Each Plan has been maintained in compliance in all material respects with its terms and, both as to form and in operation, with the requirements of applicable Law (including the requirements of Part 6 of Subtitle B of Title I of ERISA, Section 5000 of the Code, the Health Insurance Portability and Accountability Act, the Patient Protection and Affordable Care Act (“PPACA”). The Company has made available to Parent Forms 1094 or 1095 and underlying documentation demonstrating compliance with PPACA for all applicable years. No excise tax or penalty under PPACA, including Sections 4980D and 4980H of the Code is outstanding, has accrued, or has arisen with respect to any period prior to the Closing, with respect to any Plan. With respect to each Plan that is funded mostly or partially through an insurance policy, neither the Company nor any of its Subsidiaries has any liability in the nature of retroactive rate adjustment, loss sharing arrangement or other actual or contingent liability arising wholly or partially out of events occurring on or before the date of this Agreement or is reasonably expected to have such liability with respect to periods through the Closing Date.
46


(c)    All employer or employee contributions, premiums and expenses due to or in respect of each Plan have been paid in full. None of the Company, any of its Subsidiaries or any ERISA Affiliate has at any time during the six (6) years preceding the date hereof maintained, contributed to or incurred any Liability under, or otherwise has any Liability with respect to, any “multiemployer plan” (as defined in Section 3(37) of ERISA) or any Plan that is subject to Title IV of ERISA or Section 412 of the Code. No Plan provides post-termination welfare benefits with respect to any current or former employee (other than benefit coverage mandated by applicable Law, including coverage provided pursuant to Section 4980B of the Code).
(d)    There are no pending, or to the knowledge of the Company, threatened, Legal Proceedings or claims (other than routine claims for benefits payable under any such Plan) involving a Plan, asset thereof or fiduciaries or parties in interest thereto, and there have been no such Legal Proceedings or non-routine claims since January 1, 2017.
(e)    Except as set forth on Schedule 3.09(e) of the Company Disclosure Schedule, neither the execution and delivery of this Agreement by the Company nor the consummation of the transactions contemplated hereby (whether alone or in connection with any subsequent event(s)) could reasonably be expected to result in (i) the acceleration or creation of any rights of any Person to compensation or benefits, (ii) loan forgiveness or result in an obligation to fund benefits with respect to any Plan or other compensatory arrangement, (iii) acceleration of the time of payment or vesting or increase in the amount of compensation or benefits due, (iv) the limitation or restriction of the right to amend, terminate or transfer the assets of any Plan on or following the Closing Date or (v) any payment or benefit that would constitute an “excess parachute payment” (as such term is defined in Section 280G(b)(1) of the Code) to any current or former employee, director, officer or independent contractor of the Company or any of its Subsidiaries.
SECTION 3.10    Intellectual Property.
(a)    Schedule 3.10(a) of the Company Disclosure Schedule sets forth a complete and accurate list of all Company IP Registrations in each case listing the current owner(s), and in each case other than Domain Names listing, as applicable, (i) the jurisdiction where the application or registration has been registered or filed (ii) the application or registration number, (iii) the filing date, (iv) issuance, registration or grant date, and (v) case status.
(b)    Except as otherwise indicated in Schedule 3.10(b) of the Company Disclosure Schedule, the Company and its Subsidiaries are the sole and exclusive owners of, and have good, exclusive and transferable title to, collectively, all Company IP Registrations, free and clear of any Liens (other than Permitted Liens or Ordinary Course Licenses Out). With respect to each of the Company IP Registrations (i) all necessary registration, maintenance and renewal fees have been paid and required documents and certificates filed with relevant authorities or registrars in the United States or foreign jurisdictions, as the case may be, for the purposes of prosecuting or maintaining such Company IP Registrations, (ii) each such item is currently in compliance with formal legal requirements (including payment of filing, examination and maintenance fees and proofs of use), (iii) each such item is not subject to any unpaid registration, application or maintenance fees or taxes that are due as of the Closing Date, (iv) to the knowledge of the Company, except as identified by a U.S. or non-U.S. patent or trademark office, or international search authority, in an office action, written opinion or search report in the ordinary course of patent prosecution, there are no facts, information, or circumstances, including
47


any information or facts that would constitute prior art, that would adversely affect any pending patent application for any such Company IP Registrations, (v) the Company has not misrepresented, or failed to disclose, any facts or circumstances in any application for any such Company IP Registrations, in a manner that would constitute fraud or a misrepresentation with respect to such application or that would otherwise affect the enforceability of any such Company IP Registrations, and (vi) each is subsisting and, to the knowledge of the Company, valid and enforceable.
(c)    With the exception of publicly available Open Source Materials and any Company IP and Company Technology that could readily be licensed or otherwise obtained from third parties on an off-the-shelf basis, Schedule 3.10(c) of the Company Disclosure Schedule sets forth a complete and accurate list of each item of Company IP and Company Technology that is material to the business of the Company, other than Company IP Registrations, and in each case indicating if such Company IP and Company Technology is owned by the Company or any of its Subsidiaries. The Company and its Subsidiaries are the sole and exclusive owners of, and have good, exclusive and transferable title to, collectively, any and all Company Owned IP and Company Owned Technology, free and clear of any Liens (other than Permitted Liens or Ordinary Course Licenses Out). The Company IP and Company Technology (including Company Data) constitute all Intellectual Property and Technology necessary and sufficient for the Company and its Subsidiaries to conduct their business as currently conducted.
(d)    Except as set forth in Schedule 3.10(d) of the Company Disclosure Schedule, no Legal Proceeding is pending or, to the knowledge of the Company, threatened against or affecting the Company or any of its Subsidiaries nor has any Order been entered against the Company or any of its Subsidiaries, that relates to any Company IP, Company Technology or any Company Product (other than routine U.S. Patent and Trademark Office or foreign patent or trademark office proceedings and decisions associated with patent or trademark prosecution).
(e)    Except as described in Schedule 3.10(e), neither the Company nor any of its Subsidiaries is subject to an obligation to grant licenses, covenants not to sue or similar rights to any Person under any Company Owned IP or Company Owned Technology in connection with or under any policy of any membership or participation in, or contribution to, any Standards Organization. No Patent or application therefor included in the Company Owned IP (A) is, or (B) has been identified by the Company or any of its Subsidiaries or, to the knowledge of the Company, any other Person, as essential to any Standards Organization or any standard promulgated by any Standards Organization.
(f)    Except as set forth in Schedule 3.10(f) of the Company Disclosure Schedule, each of the Company and its Subsidiaries has required each current and former employee, contractor and consultant of the Company and its Subsidiaries who has contributed to the creation or development of any Company Products, or any Intellectual Property or Technology created or developed for or on behalf of the Company or its Subsidiaries, to sign (and each has signed) a valid and enforceable agreement that includes (i) confidentiality obligations in favor of the Company or the applicable Subsidiary, and (ii) an assignment to the Company or the applicable Subsidiary of all right, title and interest in and to such Intellectual Property and Technology created or developed by such Person within the scope of such Person’s employment by or engagement with the Company or the applicable Subsidiary, and (iii) a waiver of any moral rights (to the extent possible under applicable Law) such Person may possess in such Intellectual Property and Technology (collectively, the “Invention Assignment Agreements”). To
48


the knowledge of the Company, no Person who has executed an Invention Assignment Agreement is in default or breach of such Invention Assignment Agreement.
(g)    Schedule 3.10(g) of the Company Disclosure Schedule sets forth a complete and accurate list of all Open Source Materials that are material to the business of the Company, in each case listing (i) the Open Source Materials (e.g., by name of open source package), (ii) the version of Open Source Materials, (iii) the vendor or source of the Open Source Materials, and (iv) where applicable, a description of such Open Source Materials’ use or interaction with the Company Products or Company Owned Technology. All use and distribution of Company Products and Open Source Materials by or through the Company and its Subsidiaries is in compliance in all material respects with all Open Source Licenses applicable thereto, including all copyright notice and attribution requirements. Except with respect to Software as to which the Company owns the copyrights and has licensed out under an Open Source License other than a Copyleft License, neither the Company nor its Subsidiaries has incorporated or embedded any Open Source Materials into, or combined, linked or distributed any Open Source Materials with, any Company Products or otherwise used any Open Source Materials, in each case, in a manner that currently requires or has required the Company Products, any material portion thereof, or any material Company Owned Technology or material Company Owned IP, to (A) in the case of Software, be made available or distributed in a form other than binary (e.g., source code form), (B) be licensed for the purpose of preparing of derivative works, (C) be licensed under terms that allow the Company Products or portions thereof or interfaces therefor to be reverse engineered, reverse assembled or disassembled (other than by operation of Law), or (D) be redistributable at no license fee.
(h)    To the knowledge of the Company with respect to Patents and Trademarks only (but without having conducted any special investigation or patent or trademark search ), the operation of the business of the Company or its Subsidiaries as currently or previously conducted (including the use, importation, export, sale, offering for sale, provision, reproduction, display, performance, modification, licensing, disclosure, support, commercialization, maintenance or other exploitation of Company Products as currently conducted or previously conducted by the Company or its Subsidiaries) does not infringe, misappropriate or violate and has not infringed, violated or misappropriated any Intellectual Property of any Person, or constitute or has constituted unfair competition or trade practices. Neither the Company nor any of its Subsidiaries has received (i) written (or to the knowledge of the Company, unwritten) notice within the last five years from any Person of any claim or threatened claim (A) alleging any infringement, misappropriation, misuse or other violation or unfair competition or trade practices by the Company or any of its Subsidiaries with respect to any Intellectual Property or Technology, (B) alleging that the Company or any of its Subsidiaries must license or obtain a release from any Person or refrain from using any Intellectual Property or Technology, or (C) challenging the validity, enforceability, effectiveness or ownership by the Company or any of its Subsidiaries of any of the Company Owned IP or Company Owned Technology (including any Company IP Registrations), or (ii) a request, recommendation or invitation to license or secure other rights with respect to any Patents.
(i)    To the knowledge of the Company, no Person has infringed, misappropriated, misused or violated, or is infringing, misappropriating, misusing or violating, any Company Owned IP or Company Owned Technology. Neither the Company nor any of its Subsidiaries has made any claim against any Person alleging any infringement, misappropriation, misuse or violation of any Company Owned IP or Company Owned Technology.
49


(j)    Neither this Agreement nor any transactions contemplated hereby will result in, under or pursuant to any Contract to which the Company or any of its Subsidiaries is a party or by which any assets or properties of the Company or any of its Subsidiaries are bound (and no such Contract purports to cause or result in, due to this Agreement or such transactions), any Person being granted (i) rights or access to, or the placement in or release from escrow of, any Company Owned Software source code, or (ii) any license, immunity, authorization, covenant not to sue or other right under or with respect to any Company Owned IP or Company Owned Technology. Neither the Company or any of its Subsidiaries is a party to any Contract that expressly requires the Company or any of its Subsidiaries to cause a Person that acquires the Company or any of its Subsidiaries (“Company Acquirer”) to grant a license to, or covenant not to sue under, any Intellectual Property or Technology owned or controlled by the Company Acquirer (other than any Company IP), other than in each case by operation of Contract terms generally applicable to Affiliates, acquirers, successor and assigns.
(k)    Subject to the receipt of the third party consents set forth on Schedule 6.02(i), immediately following the Second Effective Time, the Surviving Entity will be permitted to exercise all of the Company’s and its Subsidiaries’ rights under Contracts involving material Intellectual Property or material Technology owned by a third party, to the same extent the Company and its Subsidiaries would have been able to had the transactions contemplated hereby not occurred and without being required to pay any additional amounts or consideration other than fees, royalties or payments that the Company or any of its Subsidiaries would otherwise have been required to pay had such transactions not occurred.
(l)    Each of the Company and its Subsidiaries has taken commercially reasonable steps to protect and maintain the confidentiality of, and the rights of the Company and the applicable Subsidiary in, the Company’s and the applicable Subsidiary’s material Confidential Information. To the knowledge of the Company, no current or former employee, contractor or consultant of the Company or any of its Subsidiaries has disclosed, or has permitted any other Person to disclose, any Confidential Information (including with respect to any Company IP) in violation of any such agreement.
(m)    To the knowledge of the Company, all Company Owned Software is and all Company Products are free from any defect or programming, design, or documentation error that would have a material adverse effect on the operation or use of the Company Owned Software or Company Products. The Company has used reasonable efforts to avoid, and to the knowledge of the Company, none of the Company Owned Software or Company Products contains, any “back door,” “drop dead device,” “time bomb,” “Trojan horse,” “virus” or “worm” (as such terms are commonly understood in the software industry).
SECTION 3.11    Material Contracts.
(a)    Schedule 3.11 of the Company Disclosure Schedule contains a list of all Material Contracts, under the applicable subsection(s) (i) through (xxvi) called for by this Section 3.11. For purposes of this Agreement, “Material Contract” shall mean any Contract of the types described below to which the Company or any of its Subsidiaries is a party or by which its respective assets are bound that is currently in effect:
(i)    any Contract relating to Indebtedness of the Company or any of its Subsidiaries;
50


(ii)    any Contract (A) involving aggregate annual payments by the Company or any of its Subsidiaries of more than $250,000, or (B) that by its terms calls for aggregate payment (including any royalties) by the Company or any of its Subsidiaries under such Contract of more than $500,000 over the remaining term of such Contract;
(iii)    any Contract with one of the Top Vendors of the Company and its Subsidiaries required to be listed on Schedule 3.25(a) of the Company Disclosure Schedule;
(iv)    any Contract with one of the Top Customers of the Company and its Subsidiaries required to be listed on Schedule 3.25(a) of the Company Disclosure Schedule;
(v)    each Contract between the Company or any of its Subsidiaries, on the one hand, and any of the Company’s Affiliates (other than its wholly owned Subsidiaries), Equityholders, directors, officers or employees (other than any Plans), on the other hand;
(vi)    each Contract with any employee of the Company or any of its Subsidiaries (other than any Plan) under which such employee is advanced or loaned any funds (other than advancements of expenses to employees in the ordinary course of business);
(vii)     any sale-and-leaseback Contracts of the Company or of any of its Subsidiaries;
(viii)    any equipment lease Contract of the Company or any of its Subsidiaries providing for aggregate rental payments by the Company or any of its Subsidiaries in excess of $500,000, under which any equipment is held or used by the Company or any of its Subsidiaries;
(ix)    any Contract pursuant to which the Company or any of its Subsidiaries guarantees the performance, liabilities or obligations of any other entity;
(x)    any Contract that (A) places any limitation on the Company or any of its Subsidiaries from freely engaging or competing in its current line of business or selling its current line of products or services anywhere in the world, (B) grants to any Person a right of first refusal, a right of first offer or an option to purchase, acquire, sell or dispose of any material assets of the Company or any of its Subsidiaries, (C) contains any non-solicitation, non-hire or similar obligation binding the Company or any of its Subsidiaries or (D) contains a “most favored nation” pricing provisions or exclusive marketing or distribution rights relating to any service, product or territory or pursuant to which the Company or any of its Subsidiaries has agreed to purchase or otherwise obtain any material product or service exclusively or on most favored terms from a single party or sell any product or service exclusively or on most favored terms to a single party;
(xi)    any Contract pursuant to which the Company or any of its Subsidiaries has continuing indemnification, guarantee, “earn-out” or other contingent payment obligations, in each case that could result in payments in excess of $500,000, other than indemnification arrangements included as a standard term or provision in Contracts in the ordinary course of business (A) with customers relating to Company Products, or (B) for the inbound licensing or use on a non-exclusive basis of commercially available off-the-shelf third party Software or cloud services (such as software as a service offerings);
51


(xii)    any executory Contract of the Company or any of its Subsidiaries relating to the acquisition or disposition, directly or indirectly, of Equity Interests of any Person, material assets or any business or division (by way of merger, consolidation, purchase, sale or otherwise);
(xiii)    any Contract with respect to the formation, creation, operation, management or control of a joint venture, partnership, limited liability or other similar agreement or arrangement;
(xiv)    any Contract that obligates the Company or any of its Subsidiaries to make any capital commitment, loan or expenditure in an amount in excess of $500,000;
(xv)    any Plan, including any employment agreement providing for severance or notice of more than thirty (30) days and any other plan, arrangement, or agreement providing for severance, retention, or transaction related payments;
(xvi)    any settlement agreement entered into by the Company or any of its Subsidiaries involving payment by or to the Company or any of its Subsidiaries in excess of $50,000 since December 31, 2017 or that imposes continuing material obligations on the Company or any of its Subsidiaries;
(xvii)    any Contract pursuant to which the Company or any of its Subsidiaries licenses out, or has granted any covenant not to sue, agreement not to assert, release, immunity, assignment, or similar rights with respect to, any Intellectual Property or Company Systems, other than Ordinary Course Licenses Out;
(xviii)    any Contract pursuant to which any material Intellectual Property owned by a third party is exclusively licensed (or similar exclusive rights are granted) to the Company or any of its Subsidiaries;
(xix)    any Contract that includes a co-existence agreement or similar agreement and pursuant to which the Company or any of its Subsidiaries licenses in Intellectual Property owned by another Person, other than (1) non-exclusive licenses for Software or a cloud service that is generally commercially available and not embedded in, integrated or bundled with a Company Product, (2) Open Source Licenses, and (3) Ordinary Course Licenses Out;
(xx)    any Related Party Contract;
(xxi)    all Contracts (other than Plans) that would obligate the Company or any of its Subsidiaries to make any payment in connection with this Agreement or any of the transactions contemplated hereby;
(xxii)    any Contract with a Governmental Authority;
(xxiii)    any Contract that, following the Closing, would bind or purport to bind Parent or any of its Affiliates (excluding the Company and its Subsidiaries); and
52


(xxiv)    any other Contract, whether or not made in the ordinary course of business, the absence of which would have a Material Adverse Effect or that is otherwise material to the Company and not previously disclosed on Schedule 3.11 of the Company Disclosure Schedule.
(b)    The Company has heretofore made available to Parent a true, complete and correct copy of each of the Material Contracts described above, each as in effect on the date hereof, and all amendments and supplements thereto and all waivers thereunder. Each Material Contract is valid and binding on the Company and/or any of its Subsidiaries to the extent the Company and/or such Subsidiary is a party thereto, as applicable, and to the knowledge of the Company, each other party thereto, and is in full force and effect and enforceable in accordance with its terms. Neither the Company, any of its Subsidiaries nor, to the Company’s knowledge, any other party is or is alleged to be in default in any material respect under, or in breach in any material respect or violation of, nor has an event or condition occurred that (with or without notice, lapse of time or both) would constitute such a default by the Company or any of its Subsidiaries, under any such Material Contract.
SECTION 3.12    Compliance with Laws; Permits.
(a)    The Company and its Subsidiaries are conducting and, since January 1, 2017, have conducted their business and operations in compliance in all material respects with all applicable Laws. The Company and its Subsidiaries also have complied, and are now complying, with all Laws otherwise applicable to it or its properties or assets.
(b)    Each of the Company and its Subsidiaries has in effect all permits, licenses, franchises, applications, rights, privileges, approvals, certifications, consents, waivers, concessions, exemptions, Orders, registrations, notices and authorizations from, or filings with, any Governmental Authority (collectively, “Permits”) required by applicable Laws for the Company or any of its Subsidiaries to own, lease or operate its properties and assets and to carry on its business as now conducted, and no default has occurred under any such Permit. All such Permits required by applicable Laws for the Company to conduct its business are valid and in full force and effect. All fees and charges with respect to such Permits as of the date hereof have been paid in full. Schedule 3.12(b) of the Company Disclosure Schedule lists all current Permits that are material to the business of the Company and issued to the Company or any of its Subsidiaries, including the names of the Permits and their respective dates of issuance and expiration, and related jurisdiction of issuance. No event has occurred that, with or without notice or lapse of time or both, would reasonably be expected to result in the revocation, suspension, lapse or limitation of any Permit set forth in Schedule 3.12(b) of the Company Disclosure Schedule.
(c)    None of the Company or any of its Subsidiaries has in the past three (3) years (i) received any written notice or claim from any Governmental Authority asserting that (A) the Company or any of its Subsidiaries (or any of their respective its assets, properties or businesses) is not in compliance with, or regarding any actual or possible default or violation of, any Law or the terms of any Permits (nor, to the Company’s knowledge, does there exist any condition which with the passage of time or the giving of notice or both would result in such non-compliance, default or violation) or (B) any Permit will be suspended, terminated, revoked or modified or cannot be renewed in the ordinary course of business or (ii) been the subject of an external investigation, or conducted an internal investigation, concerning any alleged violation of any Law or Permits by any of the Company or any of its Subsidiaries or any of their respective Representatives (regardless of the outcome of such investigation).
53


(d)    The Company is registered with and is in good standing with the Card Networks and the ACH Network. The Company is and has been since January 1, 2017 in compliance in all material respects with the Rules. There is no investigation, proceeding or disciplinary action, including fines, currently pending or threatened in writing against the Company by a Card Network, an agent of a Card Network, or an operator of an ACH Network.
(e)    The Company is and has been since January 1, 2017 in compliance in all material respects with the applicable requirements of, and, to the extent required by applicable Laws, certified at the appropriate level of, the Payment Card Industry Data Security Standard.
SECTION 3.13    Real Property.
(a)    Neither the Company nor any of its Subsidiaries owns real property or any interest in real property as of the date hereof, nor has any of them ever owned any real property or any interest therein.
(b)    Schedule 3.13(b) of the Company Disclosure Schedule contains a true and complete list of all real property leased, subleased, licensed or otherwise occupied (whether as tenant, subtenant or pursuant to other occupancy arrangements) by the Company or any of its Subsidiaries (collectively, including the improvements thereon, the “Leased Real Property”), including (i) the street address of each parcel of Leased Real Property; (ii) the landlord under the lease, the rental amount currently being paid, and the expiration of the term of such lease or sublease for each leased or subleased property; and (iii) the current use of such property. The Company or one of its Subsidiaries has valid leasehold estates in all Leased Real Property, in each case free and clear of all Liens except for Permitted Liens. The Company has delivered or made available to Parent true, complete and correct copies of any leases or other agreements affecting the Real Property to which the Company or any of its Subsidiaries or their respective assets are bound (each, a “Real Property Lease”). Each Real Property Lease is in full force and effect and is a legal, valid, binding and enforceable obligation of the Company or a Subsidiary of the Company, as the case may be, and, to the knowledge of the Company, of the other party or parties thereto, except as enforceability may be limited by applicable bankruptcy, insolvency, reorganization, moratorium or other similar Laws affecting creditors’ rights generally and general principles of equity (regardless of whether considered in a proceeding at law or in equity). None of the Company or any of its Subsidiaries is in breach in any material respect or default under any Real Property Lease and, to the knowledge of the Company, no other party to any such Real Property Lease is, as of the date hereof, in material breach or default thereunder.
(c)    The Company is not a sublessor or grantor under any sublease or other instrument granting to any other Person any right to the possession, lease, occupancy or enjoyment of any leased Real Property.
(d)    The use and operation of the Real Property in the conduct of the Company’s business do not violate in any material respect any Law, covenant, condition, restriction, easement, license, permit or agreement. No material improvements constituting a part of the Real Property encroach on real property owned or leased by a Person other than the Company. There are no Legal Proceedings pending nor, to the Company’s knowledge, threatened against or affecting the Real Property or any portion thereof or interest therein in the nature or in lieu of condemnation or eminent domain proceedings.
54


SECTION 3.14    Environmental and Safety Matters. Except as set forth on Schedule 3.14 of the Company Disclosure Schedule:
(a)    The Company and each of its Subsidiaries (i) are and have been in compliance in all material respects at all times with all applicable Environmental Laws; (ii) have not received any notice, report or information regarding any Liabilities (whether accrued, absolute, contingent, unliquidated or otherwise), or any corrective, investigatory or remedial obligations, arising under applicable Environmental Laws with respect to the past or present operations or properties of the Company and its Subsidiaries; and (iii) are not affected by any pending or, to the Company’s knowledge, threatened Legal Proceeding under or related to Environmental Law.
(b)    The Company and each of its Subsidiaries have obtained, and are and have been in compliance at all times with all terms and conditions of, all Permits required pursuant to Environmental Laws as related to the Company and its Subsidiaries for the occupation of their premises (owned or leased) and the conduct of their operations. All such Permits are valid, subsisting and in good standing.
(c)    The Company and each of its Subsidiaries have filed, and are and have been in compliance in all material respects at all times with, all disclosures, reporting, and notifications required pursuant to Environmental Laws for the occupation of their premises (owned or leased) and the conduct of their operations.
(d)    None of the following exists at any of the Company’s or its Subsidiaries’ present or past (to the extent existing at the time of the Company’s or such Subsidiary’s occupation thereof, with respect to Leased Real Property) properties in violation of, or under circumstances that could reasonably be expected to result in Liability under, applicable Environmental Laws: (i) Hazardous Materials, including any hazardous or toxic materials, substances, pollutants, contaminants or waste; (ii) asbestos-containing material in any form or condition; (iii) polychlorinated biphenyl-containing materials or equipment; or (iv) above or underground storage tanks.
(e)    The transactions contemplated by this Agreement do not impose any obligations under Environmental Laws for site investigation or cleanup or notification to or consent of any Governmental Authority or other Person.
(f)    To the Company’s knowledge, no facts, events or conditions relating to the past or present properties or operations of the business of the Company or its Subsidiaries will (x) prevent, hinder or limit continued compliance with applicable Environmental Laws, (y) give rise to any corrective, investigatory or remedial obligations on the part of the Surviving Corporation or the Surviving Entity pursuant to applicable Environmental Laws or (z) give rise to any liabilities on the part of the Surviving Corporation or the Surviving Entity (whether accrued, absolute, contingent, unliquidated or otherwise) pursuant to applicable Environmental Laws, including without limitation those liabilities relating to onsite or offsite Hazardous Material releases, personal injury, property damage or natural resources damage.
(g)    Neither the Company nor any of its Subsidiaries have assumed or succeeded (by Contract, operation of law or otherwise) to any Liabilities or obligations of any other Person under Environmental Laws.
55


(h)    The Company has delivered or made available to Parent true, complete and correct copies of all environmental reports, analyses, tests or monitoring commissioned by, or pertaining to, the Company or any of its Subsidiaries, including such information pertaining to any property owned, leased or operated by the Company or any of its Subsidiaries, in each case if any such materials both exist and are in the Company’s possession.
SECTION 3.15    Labor Matters.
(a)    Except as set forth on Schedule 3.15 of the Company Disclosure Schedule, (i) neither the Company nor any of its Subsidiaries is a party to any collective bargaining agreement and no such agreement is under negotiation (ii) no labor union or other collective bargaining group represents any of the Company’s nor any of its Subsidiaries employees, (iii) to the Company’s knowledge, there are no union organizing or decertification activities underway or threatened with respect to the Company’s or any of its Subsidiaries’ employees and no such activities have occurred since January 1, 2017, (iv) no strike, picketing, walk-out, work slowdown, lockout or other material labor dispute is underway or threatened with respect to the Company’s or any of its Subsidiaries’ employees and no such disputes have occurred since January 1, 2017, (v) there is no unfair labor practice charge or complaint before the National Labor Relations Board or any material union grievance pending or, to the Company’s knowledge, threatened against the Company or any of its Subsidiaries.
(b)    Since January 1, 2017, neither the Company nor any of its Subsidiaries has implemented any employee layoffs requiring notice under the Worker Adjustment and Retraining Notification Act (29 USC § 2101 et seq.) or any similar applicable Law (the “WARN Act”), and since January 2017, the Company and its Subsidiaries have been in compliance in all material respects with all applicable Laws respecting labor, employment and employment practices, including, without limitation, all Laws respecting terms and conditions of employment, wage and hour (including the classification of independent contractors, exempt and non-exempt employees and compliant meal and rest periods), immigration (including the verification and correct copies of I-9s for all employees and the proper confirmation of employee visas), employment discrimination, disability rights or benefits, equal opportunity, plant closures and layoffs, workers’ compensation, labor relations, employee leave issues, drug testing, privacy, affirmative action and unemployment insurance.
(c)    Since January 1, 2017, the Company and its Subsidiaries have not been subject to any claim or received any threatened claim in writing for wrongful dismissal, constructive dismissal or any other Legal Proceeding relating to the employment of any of its employees or former employees or its current or former independent contractors. Since January 1, 2017, neither the Company nor any of its Subsidiaries has received any written allegations with respect to claims of discrimination, harassment, retaliation or similar wrongdoing by any officer or employee of or contractor with respect to the Company or any of its Subsidiaries or conducted, or received any requests to conduct, an internal investigation of any officer or employee of or independent contractor to the Company or any of its Subsidiaries regarding such matters.
(d)    All Persons who are or were performing consulting or other services for the Company or any of its Subsidiaries are or were correctly classified under all applicable Laws by the Company or any of its Subsidiaries as either “independent contractors” or “employees,” as the case may be, and neither the Company nor any of its Subsidiaries has any direct or indirect liability with respect to any misclassification of any Person as an independent contractor rather than as an employee, or as an
56


“exempt” employee rather than a “non-exempt” employee (within the meaning of the Fair Labor Standards Act of 1938) and/or any similar Law. Neither the Company nor any of its Subsidiaries has received any notice from any Governmental Authority disputing the classification of any Person classified by the Company or such Subsidiary as an independent contractor.
(e)    Neither the Company nor any of its Subsidiaries has incurred any liability under the WARN Act that remains unsatisfied. Within the last three months, there has not been any plant closing or mass layoff, or term of similar import under any applicable similar Law. All “employment losses” within the meaning of the WARN Act, or term of similar import under any applicable similar Law, within the past two years are set forth on Schedule 3.15(e) to the Company Disclosure Schedule.
(f)    The Company has followed consistent and appropriate procedures to ensure itself that all employees that are required under applicable Law to hold visas and work permits to enable them to work for the Company or any of its Subsidiaries do hold all required visas and permits which, in each case: (i) have been validly issued to the employees; and (ii) are in full force and effect.
SECTION 3.16    Insurance Policies. Schedule 3.16 of the Company Disclosure Schedule sets forth a correct and complete list of each insurance policy carried by the Company or any of its Subsidiaries (specifying, with respect to each policy, the insurer, general amount of coverage, type of insurance, expiration date, and any pending claims thereunder) and the Company has delivered to Parent complete and correct copies of all such insurance policies. All insurance policies maintained by the Company and its Subsidiaries are in full force and effect and provide insurance in such amounts and against such risks as the management of the Company reasonably has determined to be prudent in accordance with industry practices or as is required by Law, and all premiums due and payable thereon have been paid. Neither the Company nor any of its Subsidiaries is in material breach or default of any of the insurance policies, and neither the Company nor any of its Subsidiaries has taken any action or failed to take any action which, with notice or the lapse of time, would constitute such a breach or default or permit termination or modification of any of the insurance policies. The Company has not received any notice of termination or cancellation with respect to any insurance policy that has not been replaced on substantially similar terms prior to the date of such termination or cancellation, nor will any such cancellation or termination result from the consummation of the transactions contemplated hereby.
SECTION 3.17    Legal Proceedings. Except for the matters set forth on Schedule 3.17 of the Company Disclosure Schedule, there is no Legal Proceeding pending or, to the knowledge of the Company, threatened against the Company or any of its Subsidiaries or their respective properties or assets or, to the Company’s knowledge, any of their respective officers or directors before any Governmental Authority, which, if adversely determined, could (a) involve a payment by the Company or any of its Subsidiaries in excess of $500,000, (b) seek injunctive or other non-monetary relief, (c) result in criminal Liability, (d) prevent or hinder or be likely to prevent or hinder the consummation of the transactions contemplated by this Agreement or would call or be likely to call into question the validity of any action taken or to be taken in connection with the transactions contemplated by this Agreement, (e) result or be likely to result in any material impairment to the right or ability of the Company or any of its Subsidiaries to carry on its operations or activities as now conducted, or (f) if adversely determined would reasonably be expected to have a Material Adverse Effect.
57


SECTION 3.18    Privacy and Data Security.
(a)    Each of the Company and its Subsidiaries have, since January 1, 2017 (i) been in compliance in all material respects with all applicable Laws and with their own respective published privacy policies and internal privacy policies relating to privacy, data protection and data security, including with respect to the collection, storage, transmission, transfer (including cross-border transfers), disclosure and use of Personal Data; and (ii) taken commercially reasonable measures to protect against loss, damage, and unauthorized access, use, modification, or other misuse of Personal Data collected, transmitted or stored by the Company or its Subsidiaries. Since January 1, 2017, no Person (including any Governmental Authority) has commenced any Legal Proceeding against the Company or its Subsidiaries with respect to the Company’s alleged loss, damage, or unauthorized access, use, modification, or other misuse of any Personal Data collected, transmitted or stored by the Company or any of its Subsidiaries (or any of their respective employees or contractors), and to the knowledge of the Company, there is no reasonable basis for any such Legal Proceeding.
(b)    None of the Company or its Subsidiaries has experienced any material unauthorized access to, use or misuse of, or other breach of security with respect to (A) any Software or other Company Systems or any Personal Data or other Data or information stored or Processed thereon or thereby; (B) the Confidential Information in the Company’s or its Subsidiaries’ possession, custody or control; (C) the Company Data, in each case, collected, held or otherwise managed by the Company or any of its Subsidiaries; or (D) the Company Data, in each case, collected, transmitted or stored on behalf of the Company or any of its Subsidiaries.
(c)    Since January 1, 2017, the Company and its Subsidiaries have taken reasonable measures for responding, and have complied in all material respects with any obligations relating, to data subject requests for access, rectification, deletion, portability or objections to Processing of Personal Data or other rights under Privacy Laws. To the extent the Company or any of its Subsidiaries have entered into Contracts with any third parties who are Processing Personal Data on behalf of the Company or any of its Subsidiaries, such Contracts obligate any such third parties to comply with all Privacy Laws. To the knowledge of the Company, such third parties are in compliance with such Contracts and all Privacy Laws, except as would not, individually or in the aggregate, be material to the Company and its Subsidiaries, taken as a whole.
(d)    The execution, delivery and performance of this Agreement and the consummation of the transactions contemplated hereby complies (and the disclosure to and use by the Surviving Corporation, the Surviving Entity, and Parent and its Affiliates of such information after the Effective Time will comply) with the Company’s and its Subsidiaries’ applicable privacy policies and in all material respects with all applicable Laws relating to privacy and data security. Since January 1, 2017, the Company and each of its Subsidiaries have made all material disclosures to, and obtained any necessary consents from, users, customers, employees, contractors and other applicable Persons required by applicable Laws related to privacy and data security and have filed any required registrations with the applicable data protection authority.
SECTION 3.19    Company Systems.
(a)    The computer systems, Data processing systems, facilities and services used by or for the Company and its Subsidiaries, including all Software, Technology, networks, communications
58


facilities, platforms, and related systems and services (collectively, “Company Systems”), are reasonably adequate and sufficient for the needs and operations of the Company and its Subsidiaries. The Company and its Subsidiaries have established reasonable physical, technical and administrative measures, policies and procedures, at least consistent with industry standards, to protect (i) its and their Trade Secrets and other Confidential Information, (ii) any Personal Data collected, stored, used, disclosed, transmitted, processed or disposed of by or on behalf of the Company or its Subsidiaries and (iii) the integrity, continuous operation and security of the Company Systems used in its and their businesses (and all Data stored, transmitted, or processed thereby).
(b)    Except to the extent described on Schedule 3.19(b) of the Company Disclosure Schedule, since December 31, 2018, there has been no failure, outage, breakdown or continued substandard performance of any Company Systems that has caused a material disruption or interruption in or to any customer’s use of the Company Systems or the operation of the business of the Company or any of its Subsidiaries. The Company and its Subsidiaries have taken commercially reasonable steps to provide for the remote-site back-up of data and information critical to the Company and its Subsidiaries (including such data and information that is stored on magnetic or optical media in the ordinary course of business) in a commercially reasonable attempt to avoid material disruption or interruption to the business of the Company and its Subsidiaries. The Company and its Subsidiaries have in place industry standard (and, in any event, not less than commercially reasonable) disaster recovery and business continuity plans and procedures.
SECTION 3.20    Export Approvals. The Company and each of its Subsidiaries and each of its and their directors and officers have at all times conducted their export transactions in compliance in all material respects with all trade Laws and no agent, employee, consultant, Representative or other Person acting on behalf of the Company or any of its Subsidiaries has, directly or indirectly, violated any provision of any trade Law. Without limiting the foregoing, the Company and its Subsidiaries have obtained all export licenses, license exceptions and other consents, notices, waivers, approvals, Orders, authorizations, registrations, declarations, classifications and filings with any Governmental Authority required for (i) the export, import and re-export of products, services, software and technologies and (ii) releases of technologies and software to foreign nationals located in the United States and abroad. To the knowledge of the Company, there are no Legal Proceedings, conditions, or circumstances pertaining to the Company’s or its Subsidiaries’ export, re-export or import transactions that may give rise to any future claims from any third party, including any Governmental Authority.
SECTION 3.21    Certain Payments.
(a)    None of the Company, any of its Subsidiaries or any of their respective directors, officers, employees, distributors, independent sales representatives, resellers, intermediaries or agents or any other Person acting on behalf of any such Person have, with respect to the business of the Company or any of its Subsidiaries, directly or indirectly taken any action (i) in furtherance of an offer, payment, promise to pay, authorization or ratification of any gift, bribe, rebate, loan, payoff, kickback, money or anything of value provided to any (A) officer or employee of a Governmental Authority, which for purposes of this provision also includes any instrumentality thereof and any state-owned or state-controlled enterprise, or of a public international organization, (B) holder of public office, candidate for public office, political party or official of a political party or (C) Person acting for or on behalf of any such Governmental Authority or instrumentality thereof (any of the foregoing, a “Government Official”),
59


or any other individual or entity while knowing or having reason to believe that all or any portion of such money or thing of value would be offered, given, or promised, directly or indirectly, to any Government Official, for the purpose of inducing such Government Official to do any act or make any decision in an official capacity, including a decision to fail to perform an official function; to use his or her or its influence with a Governmental Authority in order to affect any act or decision of such Governmental Authority for the purpose of assisting any Person to obtain or retain any business; or to facilitate efforts of any Person to transact business or for any other improper purpose, or (ii) that would cause the Company, its Subsidiaries or any other such Person to be in violation of the U.S. Foreign Corrupt Practices Act of 1977, the U.K. Bribery Act or any applicable anti-corruption or anti-bribery law that implemented the OECD Convention on Combating Bribery of Foreign Public Officials in Business Transactions or any other similar Law applicable to the conduct of business with Governmental Authorities.
(b)    The books, records and accounts of the Company and its Subsidiaries have at all times accurately and fairly reflected, in reasonable detail, the transactions and dispositions of their respective funds and assets. There have never been any false or fictitious entries made in the books, records or accounts of the Company or any of its Subsidiaries relating to any illegal payment or secret or unrecorded fund, and neither the Company nor any of its Subsidiaries has established or maintained a secret or unrecorded fund.
SECTION 3.22    Brokers. Except for Qatalyst Partners LLC, no broker, investment banker, financial advisor or other Person, is entitled to any broker’s, finder’s, financial advisor’s, consultant’s or other similar fee or commission in connection with the transactions contemplated by this Agreement based upon arrangements made by or on behalf of the Company.
SECTION 3.23    Books and Records. The minute books and stock record books of the Company, all of which have been made available to Parent, are complete and correct in all material respects and have been maintained in accordance with sound business practices. The minute books of the Company contain accurate and complete records of all regular and special meetings, and actions taken by written consent of, any of the Stockholders, the board of directors (or similar governing body, as applicable) of the Company and each of its Subsidiaries and any committees thereof, and no meeting, or action taken by written consent, of any such Stockholders, the board of directors (or similar governing body) or committee has been held for which minutes have not been prepared and are not contained in such minute books. At the Closing, all of those books and records will be in the possession of the Company.
SECTION 3.24    Customers and Vendors.
(a)    Schedule 3.24(a) of the Company Disclosure Schedule sets forth (i) the forty (40) largest Customers of the Company for the twelve-month period ending on December 31, 2019 (the “Top Customers”), and (ii) the top ten (10) suppliers (based on expenditures for the twelve (12) months ended December 31, 2019) of services or products to the Company and its Subsidiaries (the “Top Vendors”), and the total purchases by the Company from each such Top Vendor during such period.
(b)    Since December 31, 2019, there has not been any material adverse change in the business relationship of the Company or any of its Subsidiaries with any Top Customer or Top Vendor or any change or development that is reasonably likely to give rise to any such material adverse change,
60


and neither the Company nor any of its Subsidiaries has received any written or oral communication or notice from any such Top Customer or Top Vendor to the effect that, or otherwise has knowledge that, any such Top Customer or Top Vendor (i) has changed, modified, amended or reduced, or is reasonably likely to change, modify, amend or reduce, its business relationship with the Company or any of its Subsidiaries in a manner that is, or is reasonably likely to be, materially adverse to the Company or any of its Subsidiaries, or (ii) will fail to perform, or is reasonably likely to fail to perform, its obligations under any Contract with the Company or any of its Subsidiaries in any manner that is, or is reasonably likely to be, materially adverse to the Company or any of its Subsidiaries.
(c)    The Company has made available to Parent true and complete copies of the standard form of Customer Agreement used by the Company in conducting its business.
(d)    The Company does not provide merchant acquiring services.
SECTION 3.25    Anti-Money Laundering. The Company maintains a written anti-money laundering program (the “AML Program”), a true and complete copy of which has been provided to Parent. The AML Program includes policies, procedures and controls designed to detect, prevent, or report (each as the case may be) acts that could constitute one or more offenses that qualify as money laundering under the Laws of the United States (“Money Laundering Laws”). The AML Program complies in all material respects with all anti-money laundering requirements set forth in the Company’s Contracts with Banks, and since January 1, 2018, the Company has not been notified by any Bank with a Contract with the Company that the AML Program does not comply with the terms of such Contract or any applicable Bank policies and procedures. The Company’s services to Customers under each Customer Agreement are provided in compliance with the requirements of the AML Program.
SECTION 3.26    Independent Investigation; No Other Representations and Warranties. Company and the Equityholders have conducted their own independent investigation, review and analysis of the business, results of operations, prospects, condition (financial or otherwise) or assets of Parent, Merger Sub and Merger Sub II, and acknowledge that they have been provided adequate access to the personnel, properties, assets, premises, books and records, and other documents and data of Parent, Merger Sub and Merger Sub II for such purpose. Company and the Equityholders acknowledge and agree that (a) in making its decision to enter into this Agreement and any Additional Agreements and to consummate the transactions contemplated hereby and thereby, Company and the Equityholders have relied solely upon their own investigation and the express representations and warranties set forth in Article IV of this Agreement (including the related portions of the Parent Disclosure Schedule) and in the Additional Agreements and (b) specifically disclaim that it, he or she is relying upon or has relied upon any other representations or warranties that may have been made by Parent, Merger Sub, Merger Sub II or any other Person, and acknowledges and agrees that Parent has specifically disclaimed and does hereby specifically disclaim any such other representation made by Parent, Merger Sub, Merger Sub II or any other Person, except as expressly set forth in Article IV of this Agreement (including the related portions of the Parent Disclosure Schedule) or in any Additional Agreements. Notwithstanding the foregoing, nothing in this Section 3.26 shall limit the remedies available to Parent, Merger Sub, and Merger Sub II in the event of Fraud. Except for the representations and warranties of the Company contained in this Article III (including the related portions of the Company Disclosure Schedule) or in any Additional Agreement to which the Company is a party, the Company has not made and does not make any other express or implied representation or warranty, either written or oral, on behalf of the Company.
61


ARTICLE IV
REPRESENTATIONS AND WARRANTIES OF
PARENT, MERGER SUB, AND MERGER SUB II
For the purposes of the representations and warranties in this Article IV (other than those in Section 4.02, Section 4.03, and Section 4.04), the term “Parent” shall include the Subsidiaries of Parent (other than Merger Sub and Merger Sub II), unless otherwise noted herein. Except to the extent expressly disclosed in the corresponding section of the Parent Disclosure Schedule, each of Parent, Merger Sub, and Merger Sub II hereby represents and warrants to the Company, as of the date hereof and as of the Closing Date, as follows:
SECTION 4.01    Organization, Good Standing and Qualification. Parent and each of its Subsidiaries is duly organized, validly existing and in good standing (or equivalent status) under the Laws of the jurisdiction of its incorporation or organization and has requisite corporate, partnership, limited liability company or other company (as the case may be) power and authority necessary to own, lease and operate its properties, rights or assets and to carry on its business as now being conducted. Parent and each of its Subsidiaries is duly qualified and/or licensed to do business and is in good standing (or equivalent status) in each jurisdiction in which the nature of its business or the ownership or leasing of its properties, rights or assets makes such qualification or licensing necessary, except in such jurisdictions where the failure to be so duly qualified and/or licensed to do business and in good standing (or equivalent status) would not reasonably be expected to have a Parent Material Adverse Effect. Parent has made available to the Company complete and correct copies of the Parent Existing Charter and all other Organizational Documents of Parent.
SECTION 4.02    Capitalization.
(a)    The authorized capital stock of Parent consists, or will consist, immediately prior to the Closing (after giving effect to the filing of the Parent New Charter), of:
(i)    307,342,666 shares of Parent Preferred Stock, of which 19,687,500 shares have been designated Parent Series A Preferred Stock, 19,687,500 of which are issued and outstanding as of the date hereof, 37,252,051 shares have been designated Parent Series B Preferred Stock, 37,252,051 of which are issued and outstanding as of the date hereof, 2,209,991 shares have been designated Parent Series C Preferred Stock, 2,038,643 of which are issued and outstanding as of the date hereof, 23,411,503 shares have been designated Parent Series D Preferred Stock, 23,411,503 of which are issued and outstanding as of the date hereof, 24,483,290 shares have been designated Parent Series E Preferred Stock, 24,483,290 of which are issued and outstanding as of the date hereof, 63,386,220 shares have been designated Parent Series F Preferred Stock, 63,386,220 of which are issued and outstanding as of the date hereof, 29,096,495 shares have been designated Parent Series G Preferred Stock, 29,096,489 of which are issued and outstanding as of the date hereof, 50,815,616 shares have been designated Parent Series H Preferred Stock, 16,224,534 of which are issued and outstanding as of the date hereof, and 57,000,000 shares have been designated as Parent Series H-1 Preferred Stock, none of which are issued and outstanding as of the date hereof and as of immediately prior to the Closing;
62


(ii)    4,500,000 shares of Parent Redeemable Preferred Stock, of which 4,500,000 shares have been designated Parent Series 1 Preferred Stock, 3,234,000 of which are issued and outstanding as of the date hereof;
(iii)    447,815,616 shares of Parent Common Stock, 38,394,782 shares of which are issued and outstanding as of the date hereof; and
(iv)    5,000,000 shares of Parent Non-Voting Common Stock, 1,380,852 shares of which are issued and outstanding as of the date hereof.
(b)    As of the date hereof, the rights, preferences and privileges of the Parent Preferred Stock are as stated in the Parent Existing Charter. All of the outstanding shares of Parent Preferred Stock and Parent Common Stock have been duly authorized, are fully paid and nonassessable and were issued in compliance with all applicable federal and state securities laws.
(c)    Parent has reserved (i) 88,426,267 shares of Parent Common Stock for issuance pursuant to its Parent 2011 Stock Plan duly adopted by the board of directors of Parent and approved by the holders of outstanding voting stock of Parent (the “Parent 2011 Stock Plan”); and (ii) 35,000 shares of Parent Common Stock for issuance pursuant to the 2012 Zenbanx Stock Plan (the “Parent 2012 Zenbanx Plan”). Of such reserved shares of Parent Common Stock pursuant to the Parent 2011 Stock Plan, 20,052,769 shares have been issued pursuant to restricted stock purchase agreements or the exercise of Parent 2011 Stock Plan options (net of repurchases), options to purchase 34,027,914 shares of Parent Common Stock have been granted and are outstanding (the “Parent 2011 Stock Plan Options”), and 32,957,985 shares of Parent Common Stock remain available for issuance pursuant to the Parent 2011 Stock Plan, in each case as of the date hereof. Of such reserved shares of Parent Common Stock pursuant to the Parent 2012 Zenbanx Plan, options to purchase 30,184 shares of Parent Common Stock have been granted and are outstanding (the “Parent 2012 Zenbanx Plan Options,” and together with the Parent 2011 Stock Plan Options, the “Parent Stock Options”) and 4,816 shares of Parent Common Stock remain available for issuance pursuant to the Parent 2012 Zenbanx Plan, in each case as of the date hereof. All Parent Stock Options have been appropriately authorized by the board of directors of Parent or an appropriate committee thereof, and, if required, approved by stockholders by the necessary number of votes or written consent, including approval of the option exercise price or the methodology for determining the Parent Stock Option exercise price and the substantive option terms. Each Parent Stock Option intended to qualify as an “incentive stock option” under Section 422 of the Code so qualifies, to the maximum extent permitted by the Law. No Parent Stock Option has been retroactively granted, or the exercise price of any Parent Stock Option determined retroactively. No Parent Stock Option or other right to acquire Parent Common Stock or other equity of any Person employed by Parent (A) has an exercise price that is or could be less than the fair market value of a share of the underlying stock as of the date such Parent Stock Option or right was granted as determined in accordance with Section 409A of the Code, (B) had or has any feature providing for the deferral of compensation other than the deferral of recognition of income until the later of (x) exercise or disposition of such Parent Stock Option or right or (y) the time the stock acquired pursuant to the exercise of Parent Stock Option or right first becomes substantially vested, or (C) has been granted with respect to any class of stock of any Person employed by Parent that is not “service recipient stock” (within the meaning of Section 409A of the Code), in the case of (A) in this sentence, that would have, or be reasonably expected to result in, a Parent Material Adverse Effect.
63


(d)    Except for the conversion privileges of the Parent Preferred Stock (other than the Parent Series 1 Preferred Stock), the Parent Non-Voting Common Stock and the Parent Stock Options, and except as contemplated by this Agreement and as set forth in the Parent Investors’ Rights Agreement, there are no outstanding options, warrants (each, a “Parent Warrant”), rights (including conversion or preemptive rights and rights of first refusal or similar rights) or agreements, orally or in writing, for the purchase or acquisition from Parent of any shares of its capital stock.
(e)    Schedule 4.02(e) of the Parent Disclosure Schedule sets forth the name and jurisdiction of organization of each Subsidiary of Parent as of the date hereof. All of the outstanding shares of capital stock of each Subsidiary of Parent that is a corporation have been duly authorized and validly issued and are fully paid and nonassessable, and were not issued in violation of any preemptive rights of any current or former holder of Equity Interests of Parent, or in breach of any Contract to which Parent, any of its Subsidiaries is or was a party. All of the outstanding shares of capital stock and other Equity Interests of each Subsidiary of Parent are owned by Parent, by one or more Subsidiaries of Parent or by Parent and one or more Subsidiaries of Parent, in each case as indicated on Schedule 4.02(e) of the Parent Disclosure Schedule, free and clear of all Liens. Schedule 4.02(e) of the Parent Disclosure Schedule sets forth the name, jurisdiction of organization and Parent’s percentage ownership of any and all Persons (other than Subsidiaries) of which Parent directly or indirectly owns an Equity Interest, or an interest convertible into or exchangeable or exercisable for an Equity Interest. Except for the capital stock and other ownership interests of the Subsidiaries listed in Schedule 4.02(e) of the Parent Disclosure Schedule, Parent does not own, directly or indirectly, any capital stock, interest convertible into or exchangeable or exercisable for an Equity Interest or other Equity Interests in any corporation, partnership, joint venture, limited liability company or other entity.
SECTION 4.03    Authority.
(a)    The board of directors of Parent, by resolutions duly adopted at a meeting, and not subsequently rescinded or modified in any way, has, as of the date hereof (i) determined that this Agreement and the transactions contemplated hereby, including the Mergers, are fair to, and in the best interests of, the stockholders of Parent, and (ii) approved and declared advisable the “agreement of merger” (as such term is used in Section 251 of the DGCL) contained in this Agreement and the transactions contemplated by this Agreement, including the Mergers, in accordance with the DGCL, (iii) if required under the Parent Existing Charter or any Parent Equity Agreement, directed that the “agreement of merger” contained in this Agreement be submitted to the stockholders of Parent for adoption, resolved to recommend that the stockholders of Parent adopt the “agreement of merger” set forth in this Agreement and directed the officers of Parent to solicit the written consent of the stockholders of Parent to such matter.
(b)    Without in any way limiting Section 4.03(a), each of Parent, Merger Sub and Merger Sub II has the corporate power and authority to execute and deliver this Agreement and the Additional Agreements to which each of them is a party and to perform each of their obligations hereunder and thereunder. The board of directors of each of Parent, Merger Sub and Merger Sub II has duly and validly approved this Agreement and the Additional Agreements to which each of them is a party and the performance by each of them of the transactions contemplated hereby and thereby. No other corporate proceedings on the part of Parent, Merger Sub or Merger Sub II are necessary to authorize this Agreement or the Additional Agreements to which either Parent, Merger Sub, or Merger Sub II is a party or to consummate the transactions contemplated hereby or thereby. This Agreement and
64


the Additional Agreements have been (or will be) duly executed and delivered by Parent, Merger Sub, and Merger Sub II and constitute the legal and, assuming this Agreement and the Additional Agreements constitute the valid and binding agreements of the other parties thereto, valid and binding agreements of Parent, Merger Sub, and Merger Sub II, enforceable against Parent, Merger Sub, Merger Sub II in accordance with their terms, except that the enforcement hereof may be limited by (i) bankruptcy, insolvency, reorganization, moratorium or other similar laws now or hereinafter in effect relating to creditors’ rights generally and (ii) general principles of equity (regardless of whether enforceability is considered in a proceeding in equity or at law).
SECTION 4.04    Valid Issuance of Securities. As of the Closing Date, the shares of Series H-1 Preferred Stock issued in accordance with the terms of this Agreement will be duly and validly issued, fully paid and nonassessable and free of restrictions on transfer other than restrictions on transfer under the Parent New Charter, this Agreement or any of the Additional Agreements, applicable state and federal securities laws and liens or encumbrances. Based in part upon the representations of the Company in Article III and subject to the provisions of Section 2.07 and the delivery of Accredited Investor Certifications, the shares of Series H-1 Preferred Stock will be issued in compliance with all applicable federal and state securities laws. Based in part upon the representations of the Company in Article III and subject to the provisions of Section 2.07 and the delivery of Accredited Investor Certifications, the Parent Common Stock issuable upon conversion of the Series H-1 Preferred Stock will be issued in compliance with all applicable federal and state securities laws and will be duly and validly issued, fully paid and nonassessable and free of restrictions on transfer other than restrictions on transfer under the Restated Certificate or any of the Parent Equity Agreements, applicable state and federal securities laws and liens or encumbrances created by or imposed by a holder of such Series H-1 Preferred Stock.
SECTION 4.05    Governmental Consents and Filings. Assuming the accuracy of the representations made by the Company in Article III, and except as provided in Article V, no consent, approval, notice, order or authorization of, or registration, qualification, designation, declaration or filing with, any Governmental Authority or any other federal, state, local or foreign governmental authority is required on the part of the Parent or any of its Subsidiaries or any officer, employee, agent, or representative of the Parent in connection with the consummation of the transactions contemplated by this Agreement or the Additional Agreements, except for filings pursuant to applicable state securities or lending laws, Regulation D of the Securities Act and, if applicable, the Antitrust Laws.
SECTION 4.06    No “Bad Actor” Disqualification. Parent has exercised reasonable care, in accordance with Securities and Exchange Commission (“SEC”) rules and guidance, to determine whether any Covered Person (as defined below) is subject to any of the “bad actor” disqualifications described in Rule 506(d)(1)(i) through (viii) under the Securities Act (“Disqualification Events”). To Parent’s knowledge, no Covered Person is subject to a Disqualification Event, except for a Disqualification Event covered by Rule 506(d)(2) or (d)(3) under the Securities Act. Parent has complied, to the extent applicable, with any disclosure obligations under Rule 506(e) under the Securities Act. “Covered Persons” are those persons specified in Rule 506(d)(1) under the Securities Act, including Parent; any predecessor or affiliate of Parent; any director, executive officer, other officer participating in the offering, general partner or managing member of Parent; any beneficial owner of 20% or more of Parent’s outstanding voting equity securities, calculated on the basis of voting power; any promoter (as defined in Rule 405 under the Securities Act) connected with Parent in any capacity at the time of the issuance of the Stock Consideration; and any person that has been or will be paid (directly or
65


indirectly) remuneration for solicitation of purchasers in connection with the issuance of the Stock Consideration (a “Solicitor”), any general partner or managing member of any Solicitor, and any director, executive officer or other officer participating in the offering of any Solicitor or general partner or managing member of any such Solicitor.
SECTION 4.07    Litigation. There is no Legal Proceeding pending or, to Parent’s knowledge, currently threatened as of the date hereof (a) against Parent that questions the validity of Parent’s Organizational Documents or this Agreement or the Additional Agreements, or the right of Parent to enter into them, or to consummate the transactions contemplated hereby or thereby or (b) against Parent or its properties that (i) involves claims for damages that are or could aggregate to an amount in excess of $500,000, (ii) seeks to enjoin or restrict the business of Parent or material aspects of it, (iii) involves the capital stock of Parent, (iv) asserts the violation, infringement or misappropriation of the Parent IP, (v) relates to the prior employment of any employees or consultants of Parent or their alleged use of any confidential or proprietary information, technology or Intellectual Property, or (vi) without limiting the generality of the foregoing, could subject to Parent or any of its officers, directors or employees, directly or indirectly, to any action, fine, penalty, finding, suspension, revocation, directive or settlement involving any Governmental Authority in any way related to Parent’s business, operations, undertakings or agreements. Neither Parent nor, to Parent’s knowledge, any of its officers, directors, or employees is a party or is named as subject to the provisions of any order, writ, injunction, suspension, revocation, judgment or decree of any court or Government Authority in any way related to Parent’s business, operations, undertakings or agreements. As of the date of the Agreement, there is no action, suit, proceeding, material dispute or investigation by Parent which Parent intends to initiate.
SECTION 4.08    Parent IP.
(a)    To the knowledge of Parent, with respect to Patents and Trademarks only (but without having conducted any special investigation or patent or trademark search), Parent and each of its Subsidiaries, respectively, owns or possesses sufficient legal rights to all Intellectual Property necessary for its business without any conflict with, or infringement, misappropriation or violation of, the rights of others. There are no outstanding options, licenses, or agreements of any kind relating to the foregoing, nor is Parent bound by or a party to any options, licenses or agreements of any kind with respect to the Intellectual Property of any other person or entity, other than with respect to commercially available software products under standard end-user object code license agreements. Parent has not received any communications alleging that Parent has infringed or violated or, by conducting its business, would infringe or violate any of Intellectual Property of any other person or entity. To the knowledge of Parent, no Parent employee is obligated under any Contract (including licenses, covenants, instruments or commitments of any nature) or other agreement, or subject to any judgment, decree or order of any court or administrative agency, that would interfere with the use of such employee’s best efforts to promote the interest of Parent or that would conflict with Parent’s business. Neither the execution or delivery of this Agreement, nor the carrying on of Parent’s business by the employees of Parent, nor the conduct of Parent’s business as proposed, will, to the knowledge of Parent, conflict with or result in a breach of the terms, conditions, or provisions of, or constitute a default under, any Contract, license, covenant, commitment, agreement or instrument under which any such employee is now obligated. The conduct of Parent’s business does not make use of any inventions of any of its employees (or persons it currently intends to hire) made prior to their employment by Parent that are not assigned or licensed to Parent.
66


(b)    Parent has taken reasonable measures to maintain the confidentiality and value of all trade secrets and confidential information, including confidential information of third parties in Parent’s possession or control, used or held for use in connection with the operation of Parent’s business as now conducted or presently proposed to be conducted. No material confidential information, trade secrets or other proprietary information of Parent have been disclosed by Parent to (or to the knowledge of Parent accessed by) any third party except pursuant to a valid and appropriate non-disclosure and/or license agreement (containing appropriate confidentiality obligations) that to Parent’s knowledge has not been breached.
(c)    The computer systems, Data processing systems, facilities and services used by or for Parent and its Subsidiaries, including all Software, Technology, networks, communications facilities, platforms, and related systems and services (collectively, “Parent Systems”), are reasonably adequate and sufficient for the needs and operations of the business of Parent. Parent has taken reasonable measures to preserve and maintain the performance, continuous operation, security and integrity of Parent Systems and all Software, information and Parent Data. Parent has taken commercially reasonable steps to provide for the remote site back up of Parent Data and information critical to Parent (including such data and information that is stored on magnetic or optical media in the ordinary course of business) in a commercially reasonable attempt to avoid material disruption or interruption to the business of Parent. During the two (2) year period prior to the date of this Agreement, there has been no unauthorized access to or use of any such Parent Systems (or any unauthorized access to, use or disclosure of Software, information or Parent Data collected, held or managed by the Parent). With respect to any protected financial information or Personal Data, Parent has complied in all material respects with all applicable Laws including Privacy Laws and all internal and posted policies relating to the collection, use, transmission, transfer (including cross-border transfer), disclosure, protection, security, or confidentiality of such information or Personal Data. To Parent’s knowledge, the material, proprietary Parent Software does not incorporate or interact with any “open source” or similar Software in any manner that would require Parent to license, distribute or offer to make available its proprietary source code in connection with the licensing, distribution or conveyance of such Software.
SECTION 4.09    Compliance with Other Instruments and Law. Parent is not in violation or default (i) of any provisions of Parent’s Organizational Documents, (ii) of any judgment, order, writ, or decree to which it is subject, (iii) in any material respect under any note, indenture, mortgage, lease, agreement, Contract or purchase order to which it is a party or by which it is bound or (iv) in any material respect of any Law applicable to Parent. The execution, delivery and performance of this Agreement and the Additional Agreements and the consummation of the transactions contemplated hereby or thereby will not result in (i) any violation or be in conflict with any provision of any Organizational Document of Parent, Merger Sub, or Merger Sub II, or (ii) result in a breach of, or constitute, with or without the passage of time and giving of notice, a default (or give rise to any right of termination, modification, amendment, cancellation, suspension, revocation or acceleration) under any terms, conditions or provisions of any instrument, judgment, order, writ, decree, Law or Contract to which Parent or any of its Subsidiaries is a party or an event which results in the creation of any Lien upon any assets of Parent.
SECTION 4.10    Agreements; Actions.
(a)    Other than (i) standard employee benefits generally made available to all employees, (ii) standard director and officer indemnification agreements approved by the board of
67


directors of Parent, and (iii) the purchase of shares of Parent’s capital stock and the issuance of options to purchase shares of the Parent Common Stock, in each instance, approved by the board of directors of Parent, there are no agreements, understandings or proposed transactions between Parent and any of its officers, directors, affiliates, or any affiliate thereof.
(b)    Except for this Agreement and the Additional Agreements, there are no agreements, understandings, instruments, Contracts or proposed transactions to which Parent is a party or by which it is bound and entered into on or after January 1, 2019 that involve (i) obligations (contingent or otherwise) of, or payments to, Parent in excess of $300,000, in each case, other than loans made in the ordinary course of business, (ii) the license or granting of rights of any Parent IP to or from Parent (other than non-exclusive licenses for off-the-shelf software), or (iii) the grant of rights to manufacture, produce, assemble, license, market, or sell its products to any other person or affect Parent’s exclusive right to develop, manufacture, assemble, distribute, market or sell its products.
(c)    Parent has not (i) declared or paid any dividends, or authorized or made any distribution upon or with respect to any class or series of its capital stock, (ii) since January 1, 2019 incurred any indebtedness for money borrowed or incurred any other liabilities individually in excess of $500,000, (iii) since January 1, 2019 made any loans or advances to any person, other than ordinary advances for travel expenses or loans otherwise made in the ordinary course of business, or (iv) since January 1, 2019 sold, exchanged or otherwise disposed of any of its assets or rights, other than the sale of its inventory in the ordinary course of business.
(d)    For the purposes of subsections (b) and (c) above, all indebtedness, liabilities, agreements, understandings, instruments, Contracts and proposed transactions involving the same person or entity (including persons or entities Parent has reason to believe are affiliated therewith) shall be aggregated for the purpose of meeting the individual minimum dollar amounts of such subsections.
SECTION 4.11    No Conflict of Interest. Parent is not indebted, directly or indirectly, to any of its officers or directors or to any members of their respective immediate families, in any amount whatsoever other than in connection with expenses or advances of expenses incurred in the ordinary course of business or relocation expenses of employees. None of Parent’s officers or directors, or any members of their respective immediate families, are, directly or indirectly, indebted to Parent (other than in connection with purchases of Parent’s stock) or, to Parent’s knowledge, have any direct or indirect ownership interest in any firm or corporation with which Parent is affiliated or with which Parent has a business relationship, or any firm or corporation which competes with Parent except that officers, directors and/or holders of capital stock of Parent may own stock in (but not exceeding two percent of the outstanding capital stock of) any publicly traded company that may compete with Parent. To Parent’s knowledge, other than with respect to employment agreements or indemnification agreements in substantially the form provided to the Company or their counsel, none of Parent’s officers or directors or any members of their immediate families are, directly or indirectly, interested in any material Contract with Parent. Parent is not a guarantor or indemnitor of any indebtedness of any other person, firm or corporation.
SECTION 4.12    Rights of Registration and Voting Rights. Except as provided in the Parent Investors’ Rights Agreement and the Parent Warrants, Parent is not under any obligation to register under the Securities Act any of its currently outstanding securities or any securities issuable upon exercise or conversion of its currently outstanding securities. To Parent’s knowledge, except as
68


contemplated in the Parent Voting Agreement, no holder of capital stock of Parent has entered into any agreements with respect to the voting of capital shares of Parent.
SECTION 4.13    Title to Property and Assets. Parent owns its property, rights and assets free and clear of all Liens, except for statutory liens for the payment of current taxes that are not yet delinquent and encumbrances and liens that arise in the ordinary course of business and do not materially impair Parent’s ownership or use of such property or assets. With respect to the property, rights and assets it leases or licenses, as of the date hereof, Parent is in compliance in all material respects with such leases and licenses and, to its knowledge, holds a valid leasehold or licensed interest free of any Liens other than to the lessors or licensors of such property, rights or assets.
SECTION 4.14    Financial Statements. Parent has made available to the Company true and correct copies of the following financial statements: (a) the audited consolidated balance sheets and the related audited statements of income and cash flows for the fiscal years ended December 31, 2017 and December 31, 2018 (the “Parent Audited Financial Statements”), and (b) the unaudited consolidated balance sheet for the twelve (12) months ended December 31, 2019 and for the two months ended February 29, 2020 and the related statements of income and cash flow of Parent for the twelve (12) month period and two (2) month period ended on such dates (the “Parent Unaudited Financial Statements” and, collectively with the Audited Financial Statements, the “Parent Financial Statements”, and December 31, 2019, the “Most Recent Parent Balance Sheet Date”). Each of the Parent Audited Financial Statements and the Parent Unaudited Financial Statements (i) presents fairly the financial position of Parent and its Subsidiaries and the results of operations of Parent and its Subsidiaries as of the respective dates thereof and for the periods covered thereby in all material respects and (ii) was prepared in accordance with GAAP applied on a consistent basis throughout the periods covered thereby, subject, in the case of the Parent Unaudited Financial Statements, to the absence of footnotes and to normal year-end adjustments and other adjustments as noted therein. Since the Most Recent Parent Balance Sheet Date through the date hereof, there have been no material changes in the accounting policies of Parent or its Subsidiaries and no revaluation of any properties or assets of Parent or any of its Subsidiaries. Since December 31, 2016, Parent has not received notice or otherwise had or obtained knowledge of any material complaint, allegation, assertion or claim, written or oral, regarding the accounting or auditing practices, or internal procedures or accounting controls, methodologies or methods of Parent, including any written complaint, allegation, assertion or claim that Parent has engaged in any questionable accounting or auditing practice, or regarding any violation of the securities laws.
SECTION 4.15    Absence of Undisclosed Liabilities. Except as expressly permitted by this Agreement or set forth on Schedule 4.15 of the Parent Disclosure Schedule, neither Parent nor any of its Subsidiaries has any liabilities or obligations of any nature (whether accrued, absolute, contingent or otherwise), other than (a) liabilities incurred in the ordinary course of business subsequent to the Most Recent Parent Balance Sheet Date and (b) obligations under Contracts and commitments incurred in the ordinary course of business and not arising as a result of any breach or default of such Contract, which, in both cases, individually or in the aggregate are not material to the financial condition or operating results of the Company.
SECTION 4.16    Changes. Except as set forth in Schedule 4.16 of the Parent Disclosure Schedule, since the Most Recent Parent Balance Sheet Date there has not been any material adverse change in the assets, liabilities, financial condition or operating results of Parent from that
69


reflected in the Parent Financial Statements, except changes in the ordinary course of business that have not caused, in the aggregate, a Parent Material Adverse Effect.
SECTION 4.17    Employee Benefit Plans. Schedule 4.17 of the Parent Disclosure Schedule sets forth all employee benefit plans maintained, established or sponsored by Parent, or in or to which Parent participates or contributes, which are subject to the Employee Retirement Income Security Act of 1974, as amended. Parent has no material liabilities existing under or in connection with any such employee benefit plan and each such employee benefit plan has been established and administered in all material respects in accordance with its terms, and in material compliance with the applicable provisions of Laws except where failure to be in compliance would not, either individually or in the aggregate, reasonably be expected to result in a Parent Material Adverse Effect.
SECTION 4.18    Tax Matters; Tax Returns, Payments and Elections.
(a)    As of the Closing Date, Parent has not taken or agreed to take any action, and does not have any reason to believe that any conditions exist with respect to Parent that would reasonably be expected to prevent or impede the Mergers from qualifying as a reorganization within the meaning of Section 368(a) of the Code. Neither Parent nor any member of a Relevant Group has any plan or intention to reacquire any of the shares of Series H-1 Preferred Stock (except as may be reacquired in the course of Parent’s regular historic reacquisitions of Parent Series H-1 Preferred Stock). Parent plans to continue the historic business of the Company in a manner consistent with the provisions of Treasury Regulation Section 1.368-1(d). Merger Sub II has at all times since formation been wholly owned by Parent and treated as a disregarded entity, and no election has or will be made to treat Merger Sub II as an association taxable as a corporation, for federal, state or local income tax purposes.
(b)    Except as set forth in Schedule 4.18 to the Parent Disclosure Schedule, Parent has filed all income and other material Tax Returns as required by Tax Law. These Tax Returns are true and correct in all material respects except to the extent that a reserve has been reflected on the Parent Financial Statements in accordance with GAAP. Parent has paid all material Taxes and other assessments due, except those contested by it in good faith that are listed in the Parent Disclosure Schedule and except to the extent that a reserve has been reflected on the Parent Financial Statements in accordance with GAAP. The provision for Taxes of Parent as shown in the Parent Financial Statements is adequate for Taxes due or accrued as of the date thereof. Parent has not elected pursuant to the Code, to be treated as a Subchapter S corporation pursuant to Section 1362(a) of the Code, nor has it made any other elections pursuant to the Code (other than elections that relate solely to methods of accounting, depreciation or amortization) that could have a Parent Material Adverse Effect. Except as set forth on Section 4.18(b) of the Parent Disclosure Schedule, Parent has not had any tax deficiency proposed or assessed against it for any period after December 31, 2015 that remains unpaid, and none of Parent’s federal income Tax Returns and none of its state income or franchise tax or sales or use tax returns for any period after December 31, 2015 is currently under audit by Governmental Authorities. Parent has withheld or collected from each payment made to each of its employees, independent contractors, creditors, stockholders and other third parties the amount of all Taxes (including, but not limited to, federal income taxes, Federal Insurance Contribution Act taxes and Federal Unemployment Tax Act taxes) required to be withheld or collected therefrom, and has paid the same to the proper tax receiving officers or authorized depositories.
70


SECTION 4.19    Confidential Information and Invention Assignment Agreements. Each employee, consultant and officer of Parent has executed a written agreement with Parent regarding confidentiality, proprietary information and ownership of Parent IP substantially in the form or forms made available to the Company or their counsel. Parent is not aware that any of its employees, consultants or officers is in violation thereof.
SECTION 4.20    Governmental Authorizations. Parent and each of its Subsidiaries, officers, agents, representatives and employees: possesses, holds and has all franchises, consents, permits, licenses, approvals, bonds, deposits, authorizations, registrations, accreditations, certificates and similar authority required to be obtained or secured from any Governmental Authority in connection with the business and operations of Parent or such Subsidiary, as applicable, and the activities on behalf of Parent or such Subsidiary, as applicable, of any officer, employee, agent or representatives of any of them, which failure to hold or obtain would result in, or be reasonably expected to result in, a Parent Material Adverse Effect (collectively, “Governmental Authorizations”). Parent, Messrs. Anthony Noto and Robert Lavet and Ms. Michelle Gill, and to Parent’s knowledge, its other officers, agents, representatives and employees are not in default in any material respect under any of such Governmental Authorizations. The execution, delivery and performance of this Agreement and Additional Agreements and the consummation of the transactions contemplated herein and therein will not result in a violation of or be in conflict with or result in the suspension, revocation, impairment, limitation or forfeiture or nonrenewal of any Governmental Authorization applicable to Parent or any employee, agent, officer or representative of Parent.
SECTION 4.21    Severance Arrangement. Parent has not entered into any severance arrangements since January 1, 2019 with any employee that provides for a cash payment in excess of $75,000; provided, that Parent has entered into arrangements with service providers providing for acceleration of vesting of restricted stock or options issued to employees in connection with or following a change of control.
SECTION 4.22    Employment Agreements. The employment of each officer and employee of Parent is terminable at the will of Parent. To its knowledge, Parent has complied in all material respects with all applicable state and federal equal employment opportunity Laws and with other applicable Laws related to employment.
SECTION 4.23    Compliance with Applicable Laws.
(a)    Parent and each of its Subsidiaries, officers, agents, representatives and employees has made or provided all declarations, notices, filings, statements and responses to Governmental Authorities necessary to conduct business and engage in activities on behalf of Parent in compliance with Laws in each jurisdiction where Parent and each Subsidiary conducts business or maintains any branch or business location. Parent and each of its Subsidiaries, officers, representatives, agents and employees (i) is in compliance with the terms, limitations, requirements and conditions of all such Governmental Authorizations, and (ii) are conducting and have conducted business and engaged in activities on behalf of Parent or such Subsidiary, as applicable, including, without limitation, solicitation, marketing, offering, closing, funding, transfer and sale of any consumer loans or consumer credit transactions, in each case in compliance with all applicable Laws, including without limitation Privacy Laws, in all material respects. All Governmental Authorizations are valid, in existence and in full force and effect and Parent, any Subsidiary or any of its officers, agents, representatives or employees have
71


received no notice nor been made aware of any circumstances that could be expected to impair, limit or cause any delay, modification, revocation or suspension of any such Governmental Authorization or give rise to the foregoing. Parent and each of its Subsidiaries has timely filed all reports, registrations, documents, filings statements and submissions, together with any amendments thereto, that are required to be filed with any Governmental Authority, and paid any fees due in connection therewith.
(b)    The operations of Parent and its Subsidiaries have been conducted at all times in material compliance with applicable financial recordkeeping and reporting requirements of the Money Laundering Laws. None of Parent, any of its Subsidiaries or, to the knowledge of Parent, any director, officer, agent, employee or affiliate of Parent or any of its Subsidiaries is currently subject to any U.S. sanctions administered by the Office of Foreign Assets Control of the U.S. Department of the Treasury (“OFAC”); and Parent or any of its Subsidiaries will not, directly or indirectly, use the funds of Parent or any Subsidiary to finance any activity of, or otherwise engage in a transaction with, any person currently subject to any U.S. sanctions administered by OFAC, unless such action is permitted by a general or specific license issued by OFAC.
(c)    Neither Parent nor any of its Subsidiaries has received any notice of proceedings relating to the revocation or material modification of any Governmental Authorization, nor does Parent or any of its Subsidiaries have any information, directly or indirectly, that indicates or would reasonably indicate that it is or may be subject to any actual or threatened actions, proceedings, investigations or inquiries of any Governmental Authority (other than inspections or examinations in an ordinary course) with respect to its business activities in any jurisdiction where it conducts business, or any actual or possible violations of Laws.
(d)    Each of Parent and its Subsidiaries has developed and implemented, and enforces, and at all times will continue to implement and enforce, written policies and procedures that are reasonably designed to assure compliance with state and federal Laws that apply to the Money Laundering Laws and OFAC requirements.
SECTION 4.24    Compliance with Parent Credit Facility, Parent Warehouse Facilities and Parent Securitization Documents. Except for the Parent Credit Facility and the Parent Warehouse Facilities, Parent has no outstanding indebtedness for borrowed money. Neither Parent nor any applicable Subsidiary is or has at any time been in default under the Parent Credit Facility that has not been remedied to the satisfaction of the administrative agent or the lenders under the Parent Credit Facility, or under any Parent Warehouse Facility that has not been remedied to the satisfaction of lenders or credit providers under the Parent Warehouse Facilities. No administrative agent or lender under the Parent Credit Facility has declined to fund or otherwise declined any borrowing request or request to issue, amend, renew or extend any letter of credit thereunder, and no lender or credit provider under the Parent Warehouse Facilities has declined to fund or otherwise declined any material number of credit transactions of Parent or any Subsidiary thereunder. Neither Parent nor any Subsidiary has been required to repurchase any loan originated by Parent (each, an “Underlying Loan”) by reason of noncompliance with the eligibility criteria under a Parent Securitization Document or for any other reason, nor has received notice of any such required repurchase, in each case other than in the ordinary course of business in accordance with the terms of such Underlying Loan and not attributable to any such noncompliance. Parent’s loan origination processes and procedures comply in all material respects with applicable Laws and with the requirements of the Parent Warehouse Facilities.
72


SECTION 4.25    Investment Company. Parent is not an investment company within the meaning of the Investment Company Act of 1940, as amended.
SECTION 4.26    Shell Company Status. Parent is not, and has never been, an issuer identified in Rule 144(i)(1) promulgated under the Securities Act.
SECTION 4.27    Section 83(b) Elections. To Parent’s knowledge, all individuals who have purchased unvested shares of the Parent Common Stock have timely filed elections under Section 83(b) of the Code and any analogous provisions of applicable state tax laws.
SECTION 4.28    No Claims for Breach of Representation or Warranty. As of the date hereof, Parent has not received any claims for indemnification from any current or former holder of the Parent Preferred Stock due to (i) the inaccuracy in or breach by Parent of any of its representations or warranties or (ii) the non-performance and/or breach by Parent of any of its covenants, in each case contained in any agreement for the purchase and sale of any series of the Parent Preferred Stock.
SECTION 4.29    Brokers. Except for Goldman Sachs & Co. LLC and Citigroup Global Markets Inc., no broker, investment banker, financial advisor or other Person, is entitled to any broker’s, finder’s, financial advisor’s, consultant’s or other similar fee or commission in connection with the transactions contemplated by this Agreement based upon arrangements made by or on behalf of Parent.
SECTION 4.30    Independent Investigation; No Other Representations or Warranties. Parent has conducted its own independent investigation, review and analysis of the business, results of operations, prospects, condition (financial or otherwise) or assets of the Company, and acknowledges that it has been provided adequate access to the personnel, properties, assets, premises, books and records, and other documents and data of the Company for such purpose. Parent acknowledges and agrees that (a) in making its decision to enter into this Agreement and any Additional Agreements and to consummate the transactions contemplated hereby and thereby, Parent has relied solely upon its own investigation and the express representations and warranties set forth in Article III of this Agreement (including the related portions of the Company Disclosure Schedule) and in the Additional Agreements and (b) specifically disclaims that it is relying upon or has relied upon any other representations or warranties that may have been made by the Company, the Equityholders or any other Person, and acknowledges and agrees that the Company has specifically disclaimed and does hereby specifically disclaim any such other representation made by the Company, the Equityholders or any other Person, except as expressly set forth in Article III of this Agreement (including the related portions of the Company Disclosure Schedule) or in any Additional Agreements. Notwithstanding the foregoing, nothing in this Section 4.33 shall limit the remedies available to the Company in the event of Fraud. Except for the representations and warranties of Parent, Merger Sub or Merger Sub II contained in this Article IV (including the related portions of the Parent Disclosure Schedule) or in any Additional Agreement to which Parent, Merger Sub or Merger Sub II, as applicable, is a party, Parent has not made and does not make any other express or implied representation or warranty, either written or oral, on behalf of Parent, Merger Sub or Merger Sub II.
73


ARTICLE V
COVENANTS
SECTION 5.01    Conduct of Business. Except (i) as set forth in Schedule 5.01, (ii) as required by Law or Contract, (iii) as required or contemplated by this Agreement or (iv) with the prior written consent of Parent, during the period from the date hereof to the earlier of the Closing and the date on which this Agreement is terminated in accordance with Article VIII, (x) the Company shall, and shall cause each of its Subsidiaries to, use commercially reasonable efforts to (A) conduct its business in the ordinary course of business; (B) preserve intact its present business organization in all material respects; (C) preserve in all material respects its and their relationships with their respective sponsor financial institutions and payment processors; (D) maintain its existing operating and business expenses (including capital expenditures and marketing expenditures) within $1,000,000 of Adjusted Operating Budget, unless determined otherwise with the written consent of Parent, which consent shall not be unreasonably withheld, conditioned or delayed; and (E) keep available the services of its present senior officers and key employees; and (y) the Company shall not, and shall not permit any of its Subsidiaries to:
(a)    amend or otherwise change its certificate of incorporation, by-laws or such other Organizational Documents of the Company or any of its Subsidiaries;
(b)    issue, reissue, sell or pledge, or authorize or propose the issuance, reissuance, sale or pledge of, shares of capital stock or other Equity Interests or any securities convertible into shares of capital stock or other Equity Interests (other than upon exercise of Options granted under the Plans outstanding on the date hereof) of the Company or any of its Subsidiaries (except for transactions among the Company and its direct or indirect wholly owned Subsidiaries or among the Company’s direct or indirect wholly owned Subsidiaries), or grant or enter into any rights, warrants, options, agreements or commitments with respect to the issuance of such capital stock or convertible securities;
(c)    grant, confer or award, any Options, convertible securities, convertible securities, restricted stock or other rights to acquire any of its or its Subsidiaries’ capital stock or other Equity Interests, whether settled in cash, Company Shares or other Equity Interests;
(d)    declare, set aside or pay any dividend or other distribution of assets, whether in cash, stock or other Equity Interests or property or any combination thereof, in respect of any Equity Interests, in each case, other than dividends and distributions by a Subsidiary of the Company to the Company or a wholly owned Subsidiary of the Company or the payment of the Liquidation Preference to holders of the Company Preferred Stock;
(e)    adjust, split, combine, redeem, repurchase, subdivide or reclassify any of its Equity Interests, as the case may be, including any option, warrant or right relating thereto;
(f)    directly or indirectly sell, lease, license, sell and leaseback, abandon, allow to lapse, mortgage or otherwise encumber or subject to any Lien or otherwise dispose in whole or in part of any of its material properties, assets or rights (including any material Company Owned IP) or any interest therein, except, in each case, (i) sales, pledges, dispositions, transfers, abandonments, leases, licenses, lapses, expirations, or encumbrances required to be effected prior to the Effective Time
74


pursuant to existing Contracts that are not material to the Company and its Subsidiaries, taken as a whole, and (ii) Ordinary Course Licenses Out;
(g)    fail to maintain, or allow to lapse, or abandon, including by failure to pay the required fees in any jurisdiction, any material Company IP Registrations or any Permits;
(h)    (i) create, incur, assume, guarantee or otherwise become liable for, or cancel, forgive, prepay, amend or modify the terms of or refinance, any Indebtedness or Obligations related thereto, (ii) make any loans, advances or capital contributions to, or investments in, any other Person, other than (A) pursuant to inter-company arrangements among or between the Company and one or more of its wholly-owned Subsidiaries or among or between its wholly-owned Subsidiaries and (B) pursuant to agreements in effect prior to the execution of this Agreement that are Material Contracts set forth on Schedule 3.12 of the Company Disclosure Schedule, or (iii) cause or otherwise permit the aggregate Indebtedness described in clauses (a) through (g) of the definition of Indebtedness of the Company and its Subsidiaries, as determined in accordance with GAAP, to exceed the aggregate amount of Indebtedness described in clauses (a) through (g) of the definition of Indebtedness of the Company and its Subsidiaries as of January 31, 2020 as set forth in Section 3.06(b)(ii) hereof;
(i)    change its fiscal year, or any of its financial or Tax accounting methods, principles or practices, except insofar as may have been required by a change in GAAP or applicable Law;
(j)    except to the extent required under any written Plan as existing on or prior to December 1, 2019, (i) grant, enter into, amend, supplement or terminate any Contract related to employment, severance, termination or other Contract addressing any such matters or Plan (or any plan, agreement, program, policy, trust, fund or other arrangement that would be a Plan if it were in existence as of the date of this Agreement), (ii) increase the compensation or benefits, or accelerate the vesting of any compensation or benefits, of any current or former employee, independent contractor, officer or director of the Company or any of its Subsidiaries, other than increases in base salary in the ordinary course of business consistent with past practice with respect to employees with a base salary less than $250,000, (iii) hire any employee with an annual base salary greater than $250,000 or, except with respect to employees with a base salary less than $250,000, promote, any employee (except that Parent shall reasonably consult with the Company in good faith with respect to granting or withholding its consent with respect to any hiring and promotion matters); (iv) terminate any employee, other than for “cause” in the ordinary course of business consistent with the Company’s policies, (v) grant any Equity Interests (including any Equity Interest-based compensation), including any Options, (vi) grant any severance, bonus, retention, change in control or similar benefits (other than Change in Control Payments set forth on Schedule 5.01(j) that have been or will be paid in full by the Company prior to the Closing), or (vii) with respect to any of the preceding clauses (i) through (iv), communicate any intention to take such action;
(k)    enter into, adopt, amend or terminate any collective bargaining agreement;
(l)    directly or indirectly acquire or agree to acquire (i) by merging or consolidating with, purchasing a substantial equity interest in or a substantial portion of the assets of, making an investment in or loan or capital contribution to or in any other manner, any corporation, partnership, limited liability company, association or other business organization or division thereof or (ii) any assets,
75


except, in each case, for (1) capital expenditures which shall be subject to the limitations of clause (n) below and (2) purchases of marketable securities by or on behalf of the Company or its Subsidiaries for cash management purposes in the ordinary course of business consistent with the Company’s investment management policy, and except in the case of clause (ii), acquisitions of inventory, products or services in the ordinary course of business;
(m)    acquire or agree to acquire, directly or indirectly, in a single transaction or a series of related transactions, whether by merging or consolidating with, or by purchasing all or substantially all of the assets or equity securities of, or by any other manner, any Person;
(n)    other than in accordance with the Company’s capital expenditure budget made available to Parent, make or agree to make any capital expenditure or expenditures that would exceed such budget, individually or in the aggregate by more than ten percent (10.0%), or make any gift or gratuitous payment;
(o)    other than in accordance with the Company’s marketing expenditure budget made available to Parent, make or agree to make any marketing expenditure or expenditures that in the aggregate exceed the Company’s marketing and expenditure budget by more than ten percent (10.0%);
(p)    settle or compromise any material liability for Taxes or surrender any material claim for a refund of Taxes; file any amended material Tax Return or claim for a material Tax refund; make, revoke or modify any material Tax election, or change the entity classification of any Subsidiary for U.S. federal tax purposes; file any material Tax Return other than in the ordinary course of business and on a basis consistent with past practice that would materially and adversely affect its Tax liability; consent to any extension or waiver of the limitation period applicable to any claim or assessment in respect of a material amount of Taxes; grant any power of attorney with respect to Taxes; enter into any Tax Sharing Agreement or any closing agreement or other similar agreement; or change any method of accounting for Tax purposes;
(q)    enter into any Contract that would be a Material Contract if in effect on the date hereof (other than Ordinary Course Licenses Out or other customer Contracts entered into in the ordinary course of business), amend, cancel or terminate any Material Contract (or waive or assign any material right thereunder), other than renewals of existing Material Contracts in the ordinary course of business upon expiration thereof; provided, however, that such exceptions in this Section 5.01(q) shall not apply to the Material Contracts specified on Schedule 5.01(q) to this Agreement (the “Specified Contracts”) which, for the avoidance of doubt, may not be amended, modified, changed, cancelled or terminated in any respects;
(r)    amend any privacy policies or the operation or security of any material Company Systems used in the business of the Company and its Subsidiaries, except in each case, in the ordinary course of business consistent with past practice or as may have been required by a change in applicable Law;
(s)    commence any Legal Proceeding (other than a Legal Proceeding as a result of a Legal Proceeding commenced against the Company or any of its Subsidiaries), or pay, discharge, settle, compromise or satisfy any Legal Proceeding (including pending or threatened Legal Proceedings) other than any such payment, discharge, settlement, compromise or satisfaction of a claim solely for money
76


damages (and without imposition of any injunctive relief or other obligations) in an amount not to exceed $100,000 individually or $500,000 in the aggregate for all such payments, discharges, settlements, compromises or satisfactions;
(t)    enter into any Contract with any Affiliate, other than Contracts (i) between or among the Company and one or more of its Subsidiaries or (ii) between or among its Subsidiaries;
(u)    enter into any Related Party Contract; make any purchase of goods or services from, or enter into other transactions with any Equityholder or their respective Related Parties; or create any Lien over any asset of the Company or any of its Subsidiaries in favor of any Equityholder or their respective Related Parties;
(v)    permit the Company or any of its Subsidiaries to dissolve, wind-up or liquidate; or
(w)    enter into any agreement or otherwise agree, resolve or commit (in writing or otherwise) to have the Company or any of its Subsidiaries to take any of the foregoing actions.
SECTION 5.02    Control of Operations. Nothing contained in this Agreement shall give each of Parent, Merger Sub, or Merger Sub II, directly or indirectly, the right to control or direct the operations of the Company or any of its Subsidiaries prior to the Effective Time. Prior to the Effective Time, the Company and its Subsidiaries shall exercise, consistent with the terms and conditions of this Agreement, complete control and supervision over their respective operations.
SECTION 5.03    Commercially Reasonable Efforts; Cooperation. From and after the date hereof, and through the earlier of the Closing and the date on which this Agreement is terminated in accordance with Article VIII, each of the parties hereto (other than the Stockholders’ Representative) shall, and the Company shall cause each of its Subsidiaries to, use its respective commercially reasonable efforts (unless, with respect to any action, another standard of performance is expressly provided for herein) to take, or cause to be taken all actions, and to do, or cause to be done all things, necessary, proper or advisable under applicable Laws (in addition to the obligations set forth in the first sentence of Section 5.05(c)) to consummate and make effective the transactions contemplated by this Agreement as promptly as practicable, including satisfaction, but not waiver, of the conditions to Closing set forth in Article VI, including using commercially reasonable efforts to accomplish the following: (i) the obtaining of all other necessary consents, approvals or waivers from any third Persons, (ii) the defending of any lawsuits or other Legal Proceedings, whether judicial or administrative, challenging this Agreement or the consummation of the transactions contemplated hereby, including the Mergers, performed or consummated by such party in accordance with the terms of this Agreement, including seeking to have any stay or temporary restraining order entered by any court or other Governmental Authority vacated or reversed and (iii) the execution and delivery of any additional instruments reasonably necessary to consummate the Mergers and any other transactions to be performed or consummated by such party in accordance with the terms of this Agreement and to carry out fully the purposes of this Agreement.
SECTION 5.04    Consents. Without limiting the generality of Section 5.03 hereof, each of the parties hereto (other than the Stockholders’ Representative) shall use their commercially reasonable efforts to obtain all Consents of all Governmental Authorities and other Persons as may be necessary in connection with the consummation of the transactions contemplated by this Agreement
77


prior to the Closing, including as necessary for the Surviving Corporation and the Surviving Entity to continue the business of the Company and its Subsidiaries in the ordinary course of business consistent with the Company’s past practice and in compliance with all applicable Laws following the Closing and consummation of the Mergers. Notwithstanding the foregoing, and except to the extent otherwise provided herein, none of Parent, Merger Sub, Merger Sub II, the Company, any of their respective Subsidiaries or any holder of the Company Shares shall have any obligation to agree to amend or modify any Contract, sell any asset, or to pay any consideration to any third Person (other than filing fees payable to Governmental Authorities or fees expressly required to be paid by the party hereto (or its Subsidiaries) that is party to such a Contract in the event of a notice or request for review, consideration or grant of a consent to an assignment, merger or other change of control or the occurrence of such an event) for the purpose of obtaining any such Consent. Each of the parties hereto (other than the Stockholders’ Representative) shall timely make or cause to be made all filings and submissions under Laws and regulations applicable to such party as may be required for the consummation of the transactions contemplated by this Agreement. Each of the parties hereto (other than the Stockholders’ Representative) shall timely make or cause to be made all filings and submissions under Laws and regulations applicable to such party as may be required for the consummation of the transactions contemplated by this Agreement, and shall be responsible for any related cost, fee or expense it incurs in connection therewith, except to the extent otherwise provided in Section 5.05.
SECTION 5.05    Antitrust Notifications and Other Regulatory Approvals.
(a)    Each of the Company, Parent, Merger Sub and Merger Sub II shall cooperate with each other and shall use their respective best efforts to prepare, file and not withdraw (i) required Notification and Report Forms under the HSR Act and the rules and regulations promulgated thereunder with the FTC and the DOJ, and (ii) notifications, filings, registrations, submissions or other materials required or necessary to obtain those consents of Governmental Authorities listed on Schedule 5.05(a) (the “Required Consents”), in each case, as soon as practicable following the date of this Agreement and in the case of clause (i), no later than the tenth (10th) Business Day following the date hereof. All filings made in connection with the foregoing sentence shall be made in substantial compliance with the requirements of applicable Antitrust Laws, including the HSR Act. Each of the Company, Parent, Merger Sub, and Merger Sub II shall make, and Parent shall cause its Affiliates to make, such other filings and submissions as are necessary, if any, in other jurisdictions in order to comply with all applicable Antitrust Laws and shall promptly provide any supplemental information or documentation requested by any Governmental Authority relating thereto. Each of Parent and the Company shall bear 50% of all costs, expenses and fees incurred or payable to any other Person in connection with complying with Section 5.05(a)(i), including filing fees under the Antitrust Laws, while all costs, expenses and fees incurred or payable to any other Person in connection with any other Required Consents pursuant to Section 5.05(a)(ii) shall be borne by the party hereto incurring such cost, fee or expense. Subject to the Confidentiality Agreement and applicable Laws, the parties hereto (other than the Stockholders’ Representative) shall, and Parent shall cause its Affiliates to, coordinate and cooperate fully and promptly with each other in exchanging such information and providing such assistance as the other parties may reasonably request in connection with the foregoing and in seeking early termination of any applicable waiting periods, including those under the Antitrust Laws.
(b)    To the extent not prohibited by applicable Law, each party hereto (other than the Stockholders’ Representative) shall promptly notify and furnish the other parties hereto such necessary information and reasonable assistance as the other party hereto may reasonably request in connection
78


with the preparation of any required governmental filings or submissions and will cooperate in responding to any inquiry from a Governmental Authority, including (i) furnishing the other party copies of any filing such party or any of its Affiliates submits to any Governmental Authority; (ii) furnishing to the other party copies of any correspondence or communication between it or any of its Affiliates or any of their respective Representatives, on the one hand, and any Governmental Authority, on the other hand, in each case relating to the subject matter of this Section 5.05 or the transactions contemplated by this Agreement (and, in the case of any oral communication, a summary of such communication) and shall consult with and permit the other parties to review in advance any proposed filing and any written or oral communication or correspondence by such party to any Governmental Authority relating to the subject matter of this Section 5.05 or the transactions contemplated by this Agreement, and shall consider in good faith the views of such party in connection with any proposed filing and any written or oral communication or correspondence to any Governmental Authority, including the FTC and the DOJ, relating to the subject matter of this Section 5.05 or the transactions contemplated by this Agreement; and (iii) giving the other party the opportunity to attend and participate in any substantive meetings or discussions with any Governmental Authority, to the extent not prohibited by such Governmental Authority; provided, however, that to the extent any of the documents or information provided pursuant to this Section 5.05 are commercially or competitively sensitive, the Company, Parent, Merger Sub, or Merger Sub II, as the case may be, may satisfy its obligations by providing such documents or information to the other party’s outside counsel, with the understanding and agreement that such counsel shall not share such documents and information with its client; provided, further, that materials may also be redacted (x) to remove references concerning the valuation of the Company, (y) as necessary to comply with contractual arrangements, and (z) as necessary to address reasonable attorney-client or other privilege or confidentiality concerns, to the extent that that such attorney-client or other privilege or confidentiality concerns are not governed by a common interest privilege or doctrine. No party hereto shall agree to, or permit any of its Affiliates or any of its or their respective Representatives to, participate in any meeting or discussion with any Governmental Authority in respect of any filings, investigation, inquiry or any other matter contemplated by this Section 5.05 or any transaction contemplated by this Agreement unless it consults with the other parties in advance and, to the extent permitted by such Governmental Authority, gives the other parties the opportunity to attend and participate in such meeting or discussion.
(c)    Notwithstanding anything in this Agreement to the contrary, Parent and the Company shall use their reasonable best efforts to obtain any consents, clearances or approvals required under or in connection with the HSR Act, the Sherman Act, as amended, the Clayton Act, as amended, the Federal Trade Commission Act, as amended, and any other applicable antitrust or competition law, regulation or decree designed or intended to prohibit, restrict or regulate actions or transactions having the purpose or effect of monopolization, restraint of trade or harm to competition (collectively, the “Antitrust Laws”), and to enable all waiting periods under any Antitrust Law to expire, and to avoid or eliminate each and every impediment under any Antitrust Law asserted by any Governmental Authority, in each case, to cause the Mergers and the other transactions contemplated hereby to occur as promptly as practicable following the date of this Agreement and, in any event, prior to the Termination Date (as it may be extended pursuant to Section 8.01(b)). Further, and for the avoidance of doubt, Parent will use its reasonable best efforts to ensure that (x) no requirement for any non-action by, or consent or approval of, any Governmental Authority with respect to any Antitrust Laws, (y) no decree, judgment, injunction, temporary restraining Order or any other Order in any Legal Proceeding with respect to any Antitrust Laws, and (z) no other matter relating to any Antitrust Laws would preclude consummation of the Mergers by the Termination Date; provided, that Parent, the Company and/or their respective
79


Subsidiaries shall not be required to take or agree to take any action to consummate a sale, divestiture or disposition of, or hold separate (through the establishment of a trust or otherwise), any assets, properties or businesses of Parent, the Company or any of their respective Subsidiaries. Notwithstanding anything to the contrary, nothing in this Section 5.05 or elsewhere in this Agreement shall require Parent to take or agree to take any action with respect to Parent or any of its Affiliates (including, after the Closing, the Surviving Entity), including selling, divesting, conveying, holding separate, or otherwise limiting its freedom of action with respect to any assets, rights, products, licenses, businesses, operations, or interest therein, of any such Affiliates (including, after the Closing, the Company and its Subsidiaries).
(d)    From the date hereof through the date (i) of termination of the required waiting periods under the Antitrust Laws and (ii) on which the Required Consents are obtained, no party hereto shall knowingly take any action that would reasonably be expected to hinder or delay, as applicable, the obtaining of clearance or the expiration of the required waiting periods under the Antitrust Laws, or the obtaining of the Required Consents from the applicable Governmental Authorities.
(e)    The parties hereto acknowledge and agree that the obligations set forth in this Section 5.05 shall be in addition to, and not in limitation of the generality of, the matters set forth in Section 5.03 and Section 5.04.
SECTION 5.06    Access to Information.
(a)    Subject to the terms of the Confidentiality Agreement and applicable Laws, during the period from the execution and delivery of this Agreement by the parties hereto through the earlier of the Closing and the date on which this Agreement is terminated in accordance with Article VIII, the Company shall permit, and shall cause its Subsidiaries to permit, Parent and its advisors, accountants, attorneys and authorized Representatives to have reasonable access, in a manner not disruptive to the ordinary course operations of the business of the Company and its Subsidiaries, during normal business hours and upon reasonable notice, to the offices, facilities, assets, properties, management-level employees and books and records of the Company and its Subsidiaries, and shall furnish, or cause to be furnished, to Parent, such financial, tax and operating data and other information with respect to such entities and their respective offices, facilities, assets, properties, employees, businesses and operations as Parent shall from time to time reasonably request; provided, however, any such access shall be conducted in such a manner as not to interfere unreasonably with the operation of the Company’s business and shall be at the sole expense of Parent. If requested by Parent, the Company shall, after consultation with Parent, introduce Parent to Top Customers and Top Vendors of the Company and its Subsidiaries for the purpose of facilitating the post-Closing integration of the Company and the Subsidiaries and their businesses into that of Parent. All access and investigation pursuant to this Section 5.06 shall be conducted at Parent’s expense. Notwithstanding anything to the contrary contained herein or otherwise, neither the Company nor any of its Subsidiaries shall be required to provide access to or to disclose information where such access or disclosure would, in the reasonable judgment of the Company, be expected to (i) jeopardize the attorney-client privilege, work-product protection or other immunity or protection from disclosure of the Company or its Subsidiaries, (ii) contravene any Law, any Contract entered into prior to the date hereof or any other obligation of confidentiality, or (iii) result in the disclosure of competitively sensitive information; provided that the Company or its Subsidiaries, as applicable, will attempt in good faith to make such alternative arrangements as may be reasonably necessary to provide the relevant information in a way that would not risk waiver of such privilege, immunity or protection or contravene such Law or Contract or result in such disclosure. The Company
80


shall have the right to have one or more of its Representatives present at all times during any visits, examinations, discussions or contacts contemplated by this Section 5.06.
(b)    The Company shall provide to Parent the audited consolidated balance sheets and the related audited statements of income and cash flows for the fiscal year ended December 31, 2019 (the “2019 Audited Financial Statements”) no later than five (5) days following the delivery of the independent audit report for the 2019 Audited Financial Statements to the Company Board (if delivered prior to the Closing). No later than thirty (30) days following the end of each calendar month prior to the Closing, the Company shall provide to Parent the unaudited consolidated balance sheet as of the end of the most recently completed calendar month and the related statements of income and cash flow of the Company for the period from the beginning of the Company’s then-current fiscal year until the end of such month.
(c)    Parent shall, and shall cause the Surviving Entity to (in each case for so long as controlled by Parent after the Effective Time), preserve and keep the records held by them and the Subsidiaries of the Surviving Entity relating to the respective businesses of the Company and its Subsidiaries prior to the Effective Time for a period of seven (7) years from the Closing Date (or longer if required by applicable Law) and shall, subject to applicable Law, make such records (or copies) and reasonably appropriate personnel available, during normal business hours and upon reasonable advance notice, as may be reasonably required by any holder of Company Shares in connection with any insurance claims by, Legal Proceeding or Tax audits against, governmental investigations of, or compliance with legal requirements by, any holder of Company Shares or any of their respective Affiliates; provided, however, any such access shall be conducted in such a manner as not to interfere unreasonably with the operation of the business and shall be at the sole expense of the requesting Person.
(d)    Without in any way limiting the foregoing, the Company agrees to provide to Parent or its Representatives upon request information related to any Person who is a holder of Company Shares, or the beneficial owners or trustees of any such Person that is not an individual, in order for Parent to consider whether such Person is an “accredited investor” as that term is defined in Rule 501 of Regulation D promulgated under the Securities Act, and if such information is not in the possession of or otherwise available to the Company, to request such information from the applicable Person.
(e)    Subject to the terms of the Confidentiality Agreement and applicable Laws, during the period from the execution and delivery of this Agreement by the parties hereto through the earlier of the Closing and the date on which this Agreement is terminated in accordance with Article VIII, Parent shall permit, and shall cause its Subsidiaries to permit, the Company and its advisors, accountants, attorneys and authorized Representatives to have reasonable access, in a manner not disruptive to the ordinary course operations of the business of Parent and its Subsidiaries, during normal business hours and upon reasonable notice, to the offices, facilities, assets, properties, management-level employees and books and records of Parent and its Subsidiaries, and shall furnish, or cause to be furnished, to the Company, such financial, tax and operating data and other information with respect to such entities and their respective offices, facilities, assets, properties, employees, businesses and operations as the Company shall from time to time reasonably request; provided, however, any such access shall be conducted in such a manner as not to interfere unreasonably with the operation of Parent’s and its Subsidiaries’ business and shall be at the sole expense of the Company. All access and investigation pursuant to this Section 5.06(e) shall be conducted at the Company’s expense.
81


Notwithstanding anything to the contrary contained herein or otherwise, neither Parent nor any of its Subsidiaries shall be required to provide access to or to disclose information where such access or disclosure would, in the reasonable judgment of Parent, be expected to (i) jeopardize the attorney-client privilege, work-product protection or other immunity or protection from disclosure of Parent or its Subsidiaries, (ii) contravene any Law, any Contract entered into prior to the date hereof or any other obligation of confidentiality, or (iii) result in the disclosure of competitively sensitive information; provided that Parent or its Subsidiaries, as applicable, will attempt in good faith to make such alternative arrangements as may be reasonably necessary to provide the relevant information in a way that would not risk waiver of such privilege, immunity or protection or contravene such Law or Contract or result in such disclosure. Parent shall have the right to have one or more of its Representatives present at all times during any visits, examinations, discussions or contacts contemplated by this Section 5.06.
(f)    The Company and Parent hereby agree that Section 9 of the Confidentiality Agreement is hereby amended and restated in its entirety to read as follows, effective upon the date of this Agreement: “The parties hereto agree that this Agreement shall remain in effect until the earlier of (a) December 30, 2022 or (b) the Closing Date (as such term is defined in any Agreement and Plan of Merger to which they are both party).”
(g)    The parties hereto agree that the terms of the Confidentiality Agreement are incorporated by reference herein and shall continue in full force and effect in accordance with its terms until the Closing, provided, however that to the extent of any conflict between the provisions of this Agreement and the Confidentiality Agreement (including in respect of Section 9 of the Confidentiality Agreement), this Agreement shall control. If this Agreement is, for any reason, terminated prior to the Closing, the Confidentiality Agreement and the provisions of Section 5.06(f) shall nonetheless continue in full force and effect consistent with the terms of the Confidentiality Agreement as amended thereby.
SECTION 5.07    Public Statements. Except as required by applicable Law or the rules and regulations of any applicable stock exchange, in which event the parties hereto shall consult with each other in advance and provide the non-disclosing parties a reasonable opportunity to review and comment thereon to the extent not prohibited by applicable Law, no press release or other public announcement, statement or comment relating to the transactions contemplated by this Agreement shall be issued, made or permitted to be issued or made by any party to this Agreement or any of its Affiliates or Representatives without the prior written consent of the other parties hereto; provided, however, that (i) Parent or any holder of Company Shares or any Affiliate thereof may disclose (A) the transactions contemplated by this Agreement to their investors and (B) the consummation of the transactions contemplated hereby upon the Closing (but not, without the consent of the other parties hereto, price terms or the name of such other parties) on their websites and otherwise in the ordinary course of business and (ii) the Company and Parent may disclose the transactions contemplated hereby to their respective employees; provided that, in each case, such communication is consistent with prior communications of the Company previously agreed to by Parent and the Company. Notwithstanding anything in this Agreement or the Confidentiality Agreement to the contrary, following Closing, the Stockholders’ Representative shall be permitted to: (x) after the public announcement of the Mergers, publicly announce that it has been engaged to serve as the Stockholders’ Representative in connection with the Mergers as long as such announcement does not disclose any of the other terms of the Mergers or the other transactions contemplated herein; and (ii) disclose information as required by law or to employees, advisors, agents or consultants of the Stockholders’ Representative and to the Equityholders,
82


in each case who have a need to know such information, provided that such persons are subject to confidentiality obligations with respect thereto.
SECTION 5.08    Indemnification of Directors and Officers.
(a)    Parent, Merger Sub, and Merger Sub II agree that all rights to exculpation, indemnification and advancement of expenses for acts or omissions occurring prior to the Effective Time, whether asserted or claimed prior to, at or after the Effective Time (including in respect of any matters arising in connection with this Agreement and the transactions contemplated hereby), now existing in favor of the current or former directors, officers, or employees, as the case may be (each, a “D&O Indemnified Party”), of the Company or its Subsidiaries as provided in their respective certificate of incorporation, by-laws, or other equivalent governing documents or in any agreement shall survive the Mergers and shall continue in full force and effect. For a period of at least six (6) years after the Effective Time, Parent shall (and Parent shall cause the Surviving Entity to) indemnify, defend and hold harmless, and advance expenses to D&O Indemnified Parties with respect to all acts or omissions by them in their capacities as such at any time prior to the Effective Time (including any matters arising in connection with this Agreement or the transactions contemplated hereby), to the fullest extent that both (i) the Company or its Subsidiaries would be permitted by applicable Law and (ii) required by the Organizational Documents of the Company or its Subsidiaries, as applicable, as in effect on the date of this Agreement.
(b)    Prior to the Closing, the Company shall obtain “tail” insurance policies with a claims period of at least six (6) years from the Effective Time with at least the same coverage and amount and containing terms and conditions that are not less advantageous to the directors and officers of the Company as the Company’s existing policies with respect to claims arising out of or relating to events which occurred before or at the Effective Time (including in connection with the transactions contemplated by this Agreement) (the “D&O Tail Policy”). The cost of the D&O Tail Policy shall be borne by the Company. During the term of the D&O Tail Policy, Parent shall not (and shall cause the Surviving Entity not to) take any action following the Closing to cause the D&O Tail Policy to be cancelled or any provision therein to be amended or waived; provided, that none of Parent or the Surviving Entity (the “D&O Indemnifying Parties”) or any Affiliate thereof shall be obligated to pay any premiums or other amounts in respect of such D&O Tail Policy.
(c)    The obligations of the D&O Indemnifying Parties under this Section 5.08 shall survive the consummation of the Mergers and shall not be terminated or modified in such a manner as to adversely affect any D&O Indemnified Party to whom this Section 5.08 applies without the consent of such affected D&O Indemnified Party (it being expressly agreed that the D&O Indemnified Parties to whom this Section 5.08 applies shall be third party beneficiaries of this Section 5.08, each of whom may enforce the provisions of this Section 5.08).
(d)    In the event any D&O Indemnifying Party or any of their respective successors or assigns (i) consolidates with or merges into any other Person and shall not be the continuing or surviving corporation or entity in such consolidation or merger or (ii) transfers all or substantially all of its properties and assets to any Person, then, and in either such case, proper provision shall be made so that the successors and assigns of the D&O Indemnifying Parties, as the case may be, shall assume all of the obligations set forth in this Section 5.08. The agreements and covenants contained herein shall not be deemed to be exclusive of any other rights to which any Indemnified Party is entitled, whether pursuant
83


to Law, Contract or otherwise. Nothing in this Agreement is intended to, shall be construed to or shall release, waive or impair any rights to directors’ and officers’ insurance claims under any policy that is or has been in existence with respect to the Company or its officers, directors and employees, it being understood and agreed that the indemnification provided for in this Section 5.08 is not prior to, or in substitution for, any such claims under any such policies.
SECTION 5.09    Employee Benefits.
(a)    During the period commencing at the Closing Date and ending on the first (1st) anniversary of the Closing Date, Parent shall, or shall cause the Surviving Entity to provide (i) each continuing employee of the Company or its Subsidiaries with base salary or wage rate and annual target bonus opportunity at least equal to the base salary or wage rate and annual target bonus opportunity in effect with respect to such employee as of immediately prior to the Closing Date and (ii) continuing employees with substantially comparable other employee benefits (excluding equity, equity-based compensation, benefits under the Company 401(k) Plan, defined benefit pension or retiree benefits but including vacation time, health, welfare and fringe benefits) in the aggregate as those provided to employees of the Company and its Subsidiaries immediately prior to the Closing Date.
(b)    Without limiting Section 5.09(a), during the one (1) year period commencing at the Closing Date, Parent shall cause the Surviving Entity to provide to each continuing employee of the Company or its Subsidiaries who experiences a termination of employment without cause, and who is not covered by an individual agreement providing for severance, cash severance benefits at least equivalent to the severance benefits such employee who would be entitled to upon such termination of employment under the severance policies of the Company and its Subsidiaries immediately prior to the Closing Date.
(c)    From and after the Closing, Parent shall, or shall cause the Surviving Entity to, continue to honor, pay, perform and satisfy any and all liabilities, obligations and responsibilities to, or in respect of, each employee and officer of the Company and its Subsidiaries, and each former employee and officer of the Company and its Subsidiaries, as of the Closing arising under the terms of, or in connection with, any Plan disclosed in Schedule 5.09(c) in accordance with the terms thereof (including terms permitting the termination or amendment thereof).
(d)    For purposes of eligibility, vesting, benefit accrual (other than benefit accrual under a defined benefit pension plan or retiree medical plan) and entitlement to benefits, including the determination of the level of vacation and severance pay benefits under the benefit and compensation plans, programs, agreements and arrangements of Parent, the Surviving Entity or any of their respective subsidiaries in which continuing employees are eligible to participate following the Closing (the “Parent Plans”), Parent and the Surviving Entity shall credit each such employee with his or her years of service with the Company, its Subsidiaries and any predecessor entities, to the same extent as such employee was entitled to credit for such service immediately prior to the Closing under any similar Plan, except where such crediting would result in duplication of benefits. Parent Plans shall not deny employees coverage on the basis of pre-existing conditions to the extent such conditions were waived or satisfied under similar Plans immediately prior to the Closing and shall credit such employees for any deductibles and out-of-pocket expenses paid prior to the Closing Date in the plan year containing the Closing Date in satisfying any deductibles and out-of-pocket expenses in such plan year.
84


(e)    The parties hereto acknowledge and agree that all provisions contained in this Section 5.09 with respect to employees of the Company and its Subsidiaries are included for the sole benefit of the respective parties hereto and shall not create any right (i) in any other Person, including any employee, former employee or any participant or any beneficiary thereof in any Plan or Parent Plan, or (ii) to continued employment with the Company, any of its Subsidiaries, Parent or the Surviving Entity. After the Effective Time, nothing contained in this Section 5.09 is intended to be or shall be considered to be an amendment or adoption of any plan, program, agreement, arrangement or policy of the Company, any of its Subsidiaries, Parent or the Surviving Entity nor shall it interfere with Parent’s, the Surviving Entity’s or any of the Surviving Entity’s Subsidiaries’ right to amend, modify or terminate any Plan or Parent Plan (subject to the foregoing provisions of this Section 5.09) or to terminate the employment of any employee of the Company or its Subsidiaries for any reason; provided that the Surviving Entity and its Subsidiaries shall be subject to the provisions of Section 5.09(b).
(f)    Unless Parent and the Company mutually agree that no 280G Stockholder Vote is necessary, as soon as reasonably practicable following the date hereof, but in no event later than five (5) days prior to the Closing Date, the Company will submit to a stockholder vote (in compliance with Section 280G(b)(5)(B) of the Code and the regulations thereunder) the right of any individual who is or could reasonably be expected to be, as of the Closing Date, a “disqualified individual” (as defined in Section 280G(c) of the Code) to receive payments and benefits that could be deemed a “parachute payment” (as defined in Section 280G(b)(2) of the Code), in a manner reasonably designed to cause the payments and benefits that would otherwise constitute a “parachute payment” to be exempt from the definition of “parachute payment” by reason of the exemption provided under Section 280G(b)(5)(B) of the Code (the “280G Stockholder Vote”). Prior to soliciting such 280G Stockholder Vote, Parent shall have a reasonable period of time to review and comment on all calculations, waivers, consents, disclosures, and other documents prepared in connection with the actions described in this Section 5.09(f), which comments the Company shall consider in good faith.
SECTION 5.10    Termination of Related Party Contracts and Plans.
(a)    All Related Party Contracts, other than (a) the Contracts listed on Schedule5.10, (b) Contracts referred to in Section 3.11(a)(xx) or Section 5.08 and (c) Contracts solely between the Company and one or more of its Subsidiaries or between or among its Subsidiaries and referred to in Section 3.11(a)(v), shall be terminated as of the Closing Date, and all obligations and liabilities thereunder shall have been satisfied (except to the extent that any such agreement contains provisions which provide for the survival of such provisions following the termination of such agreement and are set forth on Schedule 5.10(a), in which case such provisions shall survive such termination in accordance with their respective terms), including all Change in Control Payments related thereto. Without in any way limiting the foregoing, the Company covenants and agrees that (i) any promissory notes that are Related Contracts or other promissory notes, loans or Contracts pursuant to which any current or former employees or other Representatives of the Company or any of its Subsidiaries or other current or former holders of any Options at any time owe or owed any amounts to the Company or any of its Subsidiaries (“Equityholder Loans”) shall have been paid or otherwise satisfied in full in accordance with their terms prior to the Closing Date consistent with applicable law and (ii) any expenses or other amounts advanced or otherwise loaned by the Company or any of its Subsidiaries to any Related Party repaid to the Company in full, in each case prior to the Closing Date and with written evidence thereof reasonably satisfactory to Parent delivered to Parent prior to such date.
85


(b)    Prior to the Closing Date, the Company shall terminate: (i) the Company 401(k) Plan; and (ii) any other Plan requested by Parent at least five (5) Business Days prior to the Closing Date, unless, in the case of clause (a), Parent, in its sole and absolute discretion, provides the Company with written notice not to so terminate the 401(k) Plan at least three Business Days prior to the Closing Date. Any termination of the 401(k) Plan must be reflected in resolutions of the Company’s board of directors entered into and effective no later than the day before the Closing Date, and the termination of any other Company Plans must be on the timing specified by Parent. The Company shall deliver to Parent, prior to the Closing Date, evidence that the resolutions have been adopted and the foregoing actions have been taken (the form and substance of which resolutions shall be subject to prior review and approval of Parent at least three (3) Business Days (or such shorter period as applies between Parent’s notice of termination of a Plan and the Closing Date)) before action is taken).
SECTION 5.11    Closing Conditions. From the date hereof until the Closing, each party hereto (other than the Stockholders’ Representative) shall use its commercially reasonable efforts to take such actions as are necessary to expeditiously satisfy the closing conditions set forth in Article VI hereof that are within the control of such party or its controlled Affiliates.
SECTION 5.12    Tax Matters.
(a)    Subject to this Section 5.12, Parent and the Company shall file, or cause to be filed, all federal, state, and local Tax Returns required to be filed by them or its respective Subsidiaries on or before the date such returns are due (including any extensions) and shall pay or cause to be paid all Taxes shown to be due on such Tax Returns on or before the date such payment is due. All agreements or arrangements the principal purpose of which is Tax sharing or allocation among the Company and its Subsidiaries shall be terminated as of the Effective Time.
(b)    All transfer, documentary, sales, use, real property, stamp, registration and other similar Taxes, fees and costs (including any associated penalties and interest) (“Transfer Taxes”) incurred in connection with the Mergers, if any, shall be borne fifty percent (50%) by Parent and fifty percent (50%) by the Equityholders. Parent and the Stockholders’ Representative shall cooperate to prepare, and the Person(s) required to do so under applicable Law shall file, all necessary Tax Returns and other documentation with respect to any such Transfer Taxes. In the case of Taxes attributable to an entity treated for Tax purposes as a partnership or a controlled foreign corporation (within the meaning of Section 957(a) of the Code or a comparable provision of Law) in which the Company or any of its Subsidiaries holds (with due regard to Section 958 of the Code) an interest as of the Closing Date, the Equityholders shall bear the portion of such Taxes that would have been due if the taxable year of such partnership or controlled foreign corporation ended on the Closing Date, without regard to any contrary provision of Law.
(c)    Without the prior written consent of the Stockholders’ Representative (which shall not be unreasonably withheld or delayed), Parent, the Company, and their respective Affiliates shall not, with respect to any Pre-Closing Tax Period, make, change or rescind any Tax election, claim a refund, amend any Tax Return or take any position on any Tax Return, take any action, or enter into any other transaction, in each case that would have the effect of increasing the Tax liability the Company in respect of any Pre-Closing Tax Period or portion thereof, to the extent any of the foregoing would reasonably be expected to result in a Tax liability on the part of any Equityholder or any current or
86


former employee of the Company or any of its Subsidiaries or to give rise to an indemnity obligation or other liability on the party of any Equityholder.
(d)    Parent shall prepare and timely file, or cause to be prepared and timely filed, all Tax Returns required to be filed by the Company or any of its Subsidiaries after the Closing Date with respect to a Pre-Closing Tax Period. Any such Tax Return shall be prepared in a manner consistent with past practice (unless otherwise required by law) and shall be submitted by Parent to the Stockholders’ Representative (together with schedules, statements and, to the extent requested by the Stockholders’ Representative, supporting documentation) at least 30 days prior to the due date (including extensions) of such Tax Return. Parent shall in good faith make any changes reasonably requested by the Stockholders’ Representative that relate to a Pre-Closing Tax Period, which for the avoidance of doubt shall not include changes inconsistent with law or that result in material incremental Tax liability borne by Parent.
(e)    In the case of Taxes that are payable with respect to a taxable period that begins before and ends after the Closing Date, the portion of any such Taxes that are treated as attributable to a Pre-Closing Tax Period for purposes of this Agreement shall be:
(i)    in the case of Taxes (A) based upon, or related to, income, receipts, profits, wages, capital or net worth, (B) imposed in connection with the sale, transfer or assignment of property, or (C) required to be withheld, deemed equal to the amount which would be payable if the taxable year ended with the Closing Date; and
(ii)    in the case of other Taxes, deemed to be the amount of such Taxes for the entire period multiplied by a fraction the numerator of which is the number of days in the period ending on the Closing Date and the denominator of which is the number of days in the entire period.
(f)    Parent agrees to give written notice to the Stockholders’ Representative of the receipt of any written notice by the Company, Parent or any of their Affiliates which involves the assertion of any claim, or the commencement of any action, involving Taxes that are attributable to any Pre-Closing Tax Period or portion thereof (a “Tax Claim”). Notwithstanding anything in Section 7.03 to the contrary, Parent shall control the contest or resolution of any such Tax Claim; provided, however, that Parent shall obtain the prior written consent of the Stockholders’ Representative (which consent shall not be unreasonably withheld, conditioned or delayed) before entering into any settlement of any such Tax Claim or ceasing to defend such claim, if such settlement or cessation would give rise to an indemnity obligation or other liability on the party of any Equityholder; and, provided further, that the Stockholders’ Representative shall be entitled to participate and consult in the defense of such Tax Claim and to employ counsel of its choice for such purpose, the fees and expenses of which separate counsel shall be borne solely by the Stockholders’ Representative (on behalf of the Equityholders).
(g)    The Stockholders’ Representative, the Company and Parent shall provide each other with such cooperation and information as either of them reasonably may request of the others in filing any Tax Return or in connection with any audit or other proceeding in respect of Taxes of the Company or any of its Subsidiaries. Such cooperation and information shall include providing copies of relevant Tax Returns or portions thereof, together with accompanying schedules, related work papers and documents relating to rulings or other determinations by tax authorities. Each of the Stockholders’
87


Representative, the Company and Parent shall retain all Tax Returns, schedules and work papers, records and other documents in its possession relating to Tax matters of the Company for any taxable period beginning before the Closing Date until the expiration of the statute of limitations of the taxable periods to which such Tax Returns and other documents relate, without regard to extensions except to the extent notified by any of the other parties in writing of such extensions for the respective Tax periods. Prior to transferring, destroying or discarding any Tax Returns, schedules and work papers, records and other documents in its possession relating to Tax matters of the Company for any taxable period beginning before the Closing Date, the Stockholders’ Representative, the Company or Parent (as the case may be) shall provide the other parties with reasonable written notice and offer the other parties the opportunity to take custody of such materials.
SECTION 5.13    Stockholder Consent.
(a)    The Company shall use its commercially reasonable efforts to obtain, within twenty (20) Business Days following the execution and delivery of this Agreement, the Stockholder Consent pursuant to written consents of the Stockholders with respect to which the execution of a Support Agreement is a requirement of Section 6.02(j) in the form attached hereto as Exhibit I. The materials submitted to the Stockholders in connection with the Stockholder Consent shall include the Company Board Recommendation. Promptly following receipt of the Stockholder Consent, the Company shall deliver a copy of such Stockholder Consent to Parent.
(b)    Promptly following, but in no event more than five (5) Business Days after, receipt of the Stockholder Consent, the Company shall prepare and mail a notice (the “Stockholder Notice”) to every Stockholder that did not execute the Stockholder Consent. The Stockholder Notice shall (i) be a statement to the effect that the Company Board unanimously determined that the Mergers are advisable in accordance with Section 251(b) of the DGCL and in the best interests of the Stockholders and unanimously approved and adopted this Agreement, the Mergers and the other transactions contemplated hereby, (ii) provide the Stockholders to whom it is sent with notice of the actions taken in the Stockholder Consent, including the approval and adoption of this Agreement, the Mergers and the other transactions contemplated hereby in accordance with Section 228(e) of the DGCL and the bylaws of the Company and (iii) notify such Stockholders of their dissent and appraisal rights pursuant to Section 262 of the DGCL. The Stockholder Notice shall include therewith a copy of Section 262 of Delaware Law and all such other information as Parent shall reasonably request, and shall be sufficient in form and substance to start the twenty (20) day period during which a Stockholder must demand appraisal of such Stockholder’s Common Stock as contemplated by Section 262(d)(2) of the DGCL. All materials submitted to the Stockholders in accordance with this Section shall be subject to Parent’s advance review and reasonable approval.
In addition, as the Stockholder Consent is executed by additional Stockholders, the Company shall promptly deliver additional copies of the Stockholder Consent to Parent reflecting such additional Stockholders as signatories thereto.
SECTION 5.14    Termination of Equity Agreements. The Company shall take all action necessary to terminate the Equity Agreements at, or immediately prior to, the Closing.
SECTION 5.15    Exclusivity.
88


(a)    Until the earlier of the termination of this Agreement or the consummation of the Closing, the Company shall not, and shall not authorize or permit any of its Affiliates or any of its or their Representatives to, directly or indirectly, (i) encourage, solicit, initiate, facilitate or continue inquiries regarding an Acquisition Proposal; (ii) enter into discussions or negotiations with, or provide any information to, any Person concerning a possible Acquisition Proposal; (iii) enter into any agreements or other instruments (whether or not binding) regarding an Acquisition Proposal; or (iv) furnish any material nonpublic information with respect to, assist or participate in, or facilitate in any other manner, any effort or attempt by any Person to do or seek to do anything prohibited for the Company in this Section 5.15. The Company shall immediately cease and cause to be terminated, and shall cause its Affiliates and all of its and their respective Representatives to immediately cease and cause to be terminated, all existing discussions or negotiations with any Persons conducted heretofore with respect to, or that could lead to, an Acquisition Proposal. For purposes hereof, “Acquisition Proposal” shall mean any inquiry, proposal or offer from any Person (other than Parent or any of its Affiliates) concerning (A) a merger, consolidation, liquidation, recapitalization, share exchange or other business combination transaction involving the Company; (B) the issuance or acquisition of shares of capital stock or other equity securities of the Company; or (C) the sale, lease, exchange or other disposition of any significant portion of the Company’s properties or assets. The Company also shall, and shall cause its controlled Affiliates to, and each such foregoing Person shall cause its respective Representatives to, promptly (x) notify any party with which such discussions or negotiations were being held of such termination described above; and (y) request in writing that all Persons to whom nonpublic information concerning the Company or any of its Subsidiaries has been distributed on or prior to the date of this Agreement return or destroy such information to the Company as soon as possible.
(b)    In addition to the other obligations under this Section 5.15, the Company shall promptly (and in any event within two (2) Business Days after receipt thereof by the Company or its Representatives) advise Parent orally and in writing of any Acquisition Proposal, any request for information with respect to any Acquisition Proposal, or any inquiry with respect to or which could reasonably be expected to result in an Acquisition Proposal, and the identity of the Person making the same.
(c)    The Company agrees that the rights and remedies for noncompliance with this Section 5.15 shall include having such provision specifically enforced by any court having equity jurisdiction, it being acknowledged and agreed that any such breach or threatened breach shall cause irreparable injury to Parent and that money damages would not provide an adequate remedy to Parent.
SECTION 5.16    Advice of Changes.
(a)    From time to time prior to the Closing, the Company shall have the right (but not the obligation) to supplement or amend the Company Disclosure Schedule hereto with respect to any matter hereafter arising or of which it becomes aware after the date hereof (each a “Company Schedule Supplement”). Any disclosure in any such Company Schedule Supplement shall not be deemed to have cured any inaccuracy in or breach of any representation or warranty contained in this Agreement, including for purposes of the indemnification or termination rights contained in this Agreement or of determining whether or not the conditions set forth in Section 6.02(a) have been satisfied; provided, however, that if Parent has the right to, but does not elect to, terminate this Agreement within five (5) Business Days of its receipt of such Company Schedule Supplement, then Parent and each other
89


Acquirer Indemnified Party shall be deemed to have irrevocably waived any right to terminate this Agreement with respect to such matter and, further, shall have irrevocably waived any of their rights to indemnification under with respect to such matter (other than pursuant to Section 7.02(a)).
(b)    From time to time prior to the Closing, Parent shall have the right (but not the obligation) to supplement or amend the Parent Disclosure Schedule hereto with respect to any matter hereafter arising or of which it becomes aware after the date hereof (each a “Parent Schedule Supplement”). Any disclosure in any such Parent Schedule Supplement shall not be deemed to have cured any inaccuracy in or breach of any representation or warranty contained in this Agreement, including for purposes of the indemnification or termination rights contained in this Agreement or of determining whether or not the conditions set forth in Section 6.03(a) have been satisfied; provided, however, that if the Company has the right to, but does not elect to, terminate this Agreement within five (5) Business Days of its receipt of such Parent Schedule Supplement, then the Company, the Equityholders, and each of their respective representatives, successors and assigns shall be deemed to have irrevocably waived any right to terminate this Agreement with respect to such matter.
(c)    Without in any way limiting the foregoing provisions of this Section 5.16, in connection with its delivery of the Spreadsheet no later than five (5) Business Days prior to the Effective Time, the Company shall deliver to Parent at such time a supplement or amendment to the Capitalization Schedule and Schedule 3.03(c) to the Company Disclosure Schedule, as applicable (the “Capitalization Update”), solely for purposes of reflecting thereon the occurrence of any of the following events between the date of this Agreement and the Effective Time: (i) the conversion of any Company Preferred Stock to Company Common Stock in accordance with the Company’s Organizational Documents and in connection with the payment of the Liquidation Preference contemplated by Section 6.02(l), (ii) the exercise or cancellation (or change to the exercisability or vesting) of any Option and the issuance of any Company Shares in connection therewith, (iii) the surrender or cancellation of any Company Shares or any other Equity Interests of the Company in satisfaction of any Equityholder Loans, (iv) as expressly described in Schedule 5.01 hereto or (v) as expressly described in a Company Schedule Supplement that does not result in the termination of this Agreement. Such Capitalization Update shall be deemed to be a Company Schedule Supplement and shall be deemed to amend or supplement the Company Disclosure Schedule solely for such purposes of reflecting the occurrence of any of the preceding events between the date of this Agreement and the Effective Time.
SECTION 5.17    Merger Sub, Surviving Corporation and Merger Sub II. Parent shall take all actions necessary to cause Merger Sub, the Surviving Corporation and any of its Subsidiaries, and Merger Sub II to perform their obligations under this Agreement and to consummate the Mergers on the terms and conditions set forth in this Agreement.
SECTION 5.18    Tax Opinions.
(a)    The Company shall use its commercially reasonable efforts to obtain a tax opinion from its counsel, addressed to the Company with respect to the transaction, dated the Closing Date, to the effect that the Mergers should be treated as a reorganization within the meaning of Section 368(a) of the Code and the Treasury Regulations promulgated thereunder (subject to typical qualifications and assumptions for opinions of such kind), with such commercially reasonable efforts of Company to include, for avoidance of doubt, Company’s payment of fees and expenses of its counsel in connection therewith as Transaction Expenses. In order to facilitate the issuance of such tax opinion, prior to
90


Closing, Parent and the Company shall provide Company’s counsel with certified officer’s tax representation letters containing the representations and certifications setting forth factual representations reasonably requested by the issuer of the tax opinion and on which such tax opinion will be based.
(b)    Parent shall use its commercially reasonable efforts to obtain a tax opinion from its counsel, addressed to Parent with respect to the transaction, dated the Closing Date, to the effect that the Mergers should be treated as a reorganization within the meaning of Section 368(a) of the Code and the Treasury Regulations promulgated thereunder (subject to typical qualifications and assumptions for opinions of such kind), with such commercially reasonable efforts of Parent to include, for avoidance of doubt, Parent’s payment of fees and expenses of its counsel in connection therewith. In order to facilitate the issuance of such tax opinion, prior to Closing, Parent and the Company shall provide Parent’s counsel with certified officer’s tax representation letters containing the representations and certifications setting forth factual representations reasonably requested by the issuer of the tax opinion and on which such tax opinion will be based.
SECTION 5.19    Conduct of Parent Business. Except (i) as set forth in Schedule 5.24, (ii) as required by Law or Contract, (iii) as required or contemplated by this Agreement or (iv) with the prior written consent of the Company, during the period from the date hereof to the earlier of the Closing and the date on which this Agreement is terminated in accordance with Article VIII, (x) Parent shall, and shall cause each of its Subsidiaries to, use commercially reasonable efforts to (A) conduct its business in the ordinary course of business, (B) preserve intact its present business organization in all material respects, and (C) keep available the services of its present senior officers and key employees.
SECTION 5.20    R&W Policy. Parent shall use commercially reasonable efforts to satisfy any conditions set forth in the Binder Agreement, in each case, in accordance with the applicable terms thereof and by the applicable time deadlines set forth therein, in each case, to the extent necessary for the insurer to issue the R&W Policy, and to cause the coverage under such R&W Policy to become effective as of the Closing. Parent will promptly provide the Stockholders’ Representative with a true and correct copy of the final R&W Policy once issued. From and after the date of this Agreement until the termination of this Agreement in accordance with its terms or, if the Closing is consummated, continuing through the six (6)-year term of such R&W Policy, Parent covenants and agrees that it will not amend, terminate, or knowingly waive or modify any provision of the R&W Policy, in each case in a manner that would reduce the coverage provided to Parent under the R&W Policy as of the Closing. 50% of the R&W Policy Premium shall be borne by Parent.
SECTION 5.21    Data Room. No later than three (3) Business Days after the date hereof, the Company shall deliver to Parent a USB drive containing a complete and accurate copy of the electronic data room maintained in connection with the transactions contemplated by this Agreement in the form such data room existed as of the date hereof. Prior to the Closing, the Company shall make arrangements to have delivered to Buyer no later than three (3) Business Days after the Closing Date a USB drive containing complete and accurate copy of the electronic data room maintained in connection with the transactions contemplated by this Agreement in the form such data room existed as of the Closing Date.
91


ARTICLE VI
CONDITIONS TO CLOSING
SECTION 6.01    Mutual Conditions to the Obligations of the Parties. The respective obligations of each party hereto to consummate the transactions contemplated by this Agreement are subject to the satisfaction or, to the extent permitted by Law, waiver in writing by the Company and Parent at or prior to the Closing of each of the following conditions:
(a)    No Injunctions or Legal Prohibitions. No temporary restraining Order, preliminary or permanent injunction or other judgment or Order issued by any court of competent jurisdiction or other statute, Law, rule, ruling, decree, regulation, legal restraint or prohibition enacted, promulgated, issued, entered, amended or enforced by any Governmental Authority of competent jurisdiction (collectively, “Restraints”) which has the effect of preventing, restraining, enjoining, rendering illegal or otherwise prohibiting the consummation of the transactions contemplated by this Agreement shall be in effect.
(b)    Antitrust Laws. All applicable waiting periods (or any extensions thereof) applicable to the First Merger under the Antitrust Laws shall have expired or early termination thereof shall have been granted.
(c)    R&W Policy. The Binder Agreement shall be in full force and effect immediately as of the Closing and shall be valid, binding and enforceable in accordance with its terms.
SECTION 6.02    Conditions to the Obligations of Parent, Merger Sub, and Merger Sub II. The obligations of Parent, Merger Sub, and Merger Sub II to consummate the Mergers and the other transactions contemplated by this Agreement are, in addition to the conditions set forth in Section 6.01, further subject to the satisfaction or, to the extent permitted by Law, waiver by Parent in writing at or prior to the Closing, of each of the following conditions:
(a)    Representations and Warranties.
(i)    Except as provided for in Section 6.02(a)(ii), the representations and warranties of the Company and any Stockholder set forth in this Agreement (as modified by the Company Disclosure Schedule) or any Additional Agreement shall be true and correct in all respects (in the case of any representation or warranty qualified by materiality or Material Adverse Effect) or in all material respects (in the case of any representation or warranty not qualified by materiality or Material Adverse Effect) as of the date of this Agreement and as of the Closing Date as though made on and as of such date (except to the extent that any such representation and warranty expressly speaks as of an earlier date, in which case such representation and warranty shall only be true and correct as of such earlier date).
(ii)    The representations and warranties of the Company set forth in the first sentence of Section 3.01 (Organization); Section 3.02 (Capitalization); Section 3.03 (Authority); Section 3.05 (Financial Statements); and Section 3.22 (Brokers) shall be true and correct as of the Closing Date as though made on and as of such date (except to the extent that any such representation and warranty expressly speaks as of an earlier date, in which case such representation and warranty shall be true and correct as of such earlier date).
92


(b)    Performance. The Company and any applicable Stockholder shall have performed and complied, in all material respects, with all agreements, covenants and obligations required by this Agreement or any of the Additional Agreement to be performed or complied with by the Company or such Stockholder on or prior to the Closing Date.
(c)    Officer’s Certificate. The Company shall have delivered to Parent a certificate, dated as of the Closing Date, executed by a duly authorized officer of the Company, certifying the satisfaction of the conditions set forth in Section 6.02(a) and Section 6.02(b).
(d)    Secretary’s Certificate. The Company shall have delivered to Parent a certificate of the Secretary or an Assistant Secretary (or equivalent officer) of the Company certifying (i) that (A) attached thereto are true and complete copies of (1) all resolutions adopted by the Company’s board of directors authorizing the Company’s execution, delivery and performance of this Agreement and the Additional Agreements to which it is a party and the consummation of the transactions contemplated hereby and thereby and (2) resolutions of the Stockholders approving the Mergers and adopting this Agreement, and (B) all such resolutions are in full force and effect and are all the resolutions adopted in connection with the transactions contemplated hereby and thereby; (ii) the names and signatures of the officers of the Company authorized to sign this Agreement, the Additional Agreements to which it is a party and the other documents to be delivered hereunder and thereunder; and (iii) that attached thereto is true and complete copy of a good standing certificate (or its equivalent) from the secretary of state or similar Governmental Authority of the jurisdiction under the Laws in which the Company is organized as of a date within five (5) Business Days of the Closing Date.
(e)    Tax Certificate. Immediately prior to Closing, the Company shall have delivered to Parent a certificate, substantially in the form provided for in Sections 1.1445-2(c)(3) and 1.897-2(h) of the Treasury Regulations, establishing that the Company Common Stock is not a “United States real property interest” within the meaning of Section 897(c)(1)(A)(ii) of the Code.
(f)    Absence of a Material Adverse Effect. Since the date hereof, there shall not have occurred any fact, circumstance, development, event or change that has had or would reasonably be expected to have, individually or in the aggregate, a Material Adverse Effect.
(g)    Escrow Agreement. Parent and Merger Sub shall have received an executed counterpart to the Escrow Agreement, signed by the Company and the Stockholders’ Representative.
(h)    Stockholder Consent. The Stockholder Consent shall have been executed and delivered to Parent and reflect the consent of Stockholders holding Company Shares representing at least ninety percent (90%) of the outstanding Company Shares (determined on an as-converted, as-exercised, Company Common Stock-equivalent basis) and all of the Company Preferred Stock.
(i)    Third Party Consents and Approvals. All third party consents referred to on Schedule 6.02(i) shall have been obtained on terms reasonably satisfactory to Parent, with copies thereof delivered to Parent.
(j)    Support Agreements. The Company shall have obtained and delivered to Parent Support Agreements substantially in the form of Exhibit A from (i) each Stockholder that as of the date hereof owned beneficially or of record greater than 50,000 or more Company Shares in the aggregate, individually or collectively with any Affiliates of such Stockholder, and (ii) no less than 80% of the
93


aggregate number of Stockholders that as of the date hereof owned beneficially or of record at least 20,000 but less than 50,001 Company Shares, but that is not a Stockholder or Affiliate thereof described in subsection (i) of this subsection (j) (the Stockholders described in (i) and (ii), collectively, the “Key Stockholders”).
(k)    Key Employees. At least six of the Key Employees including Clay Wilkes shall not have terminated, and shall not have provided notice of their intent to terminate, employment with the Company or their Employment Agreements.
(l)    Liquidation Preference. The Company shall have paid the Liquidation Preference in full to each holder of Preferred Stock, and provided reasonable evidence of such payments reasonably satisfactory to Parent.
(m)    Option Assumption. The Company and each holder of an Option shall have executed and delivered an Option Cancellation and Assumption Agreement in the form attached as Exhibit J hereto (each, an “Option Cancellation Agreement”) providing for the partial cancellation and/or partial assumption of such Option. In addition, the Company and its board of directors (or any applicable committee thereof) shall have adopted any resolutions necessary to allow for such cancellation of Options or the assumption of Options, as applicable, as contemplated by Section 2.08 under the applicable Company Option Plan(s) (in lieu of any other treatment of the applicable Options contemplated by the applicable Option Plans as in effect on the date hereof) upon the consummation of the transactions as contemplated by this Agreement, and provided Parent with evidence thereof reasonably satisfactory to Parent, including a copy of such resolutions certified by the Secretary or Assistant Secretary of the Company.
(n)    Termination of Certain Contracts. The Contracts to which the Company or an its Subsidiaries are a party listed on Schedule 6.02(n) shall have been terminated in accordance with their terms, and without any further Liability to the Company or its Subsidiaries, with evidence of such terminations and satisfaction of Liability reasonably satisfactory to Parent delivered to Parent, including as to any Equityholder Loans.
(o)    Dissenting Shares. No more than five percent (5%) of the issued and outstanding shares of Company Common Stock shall be Dissenting Shares.
(p)    Payments Administration Agreement. Parent and Merger Sub shall have received an executed counterpart to the Payments Administration Agreement, signed by the Paying Agent and the Stockholders’ Representative.
(q)    Spreadsheet. The Company shall have delivered to Parent and the Paying Agent (with a copy to the Stockholders’ Representative) no less than five (5) Business Days prior to the Closing Date a spreadsheet in the form attached hereto as Schedule 6.02(q) that accurately sets forth all of the following information (in addition to the other required data and information specified therein) (the “Spreadsheet”): (i) the names of all the Equityholders and their respective addresses and email addresses (to the extent available), the number of Company Shares, Participating Options and Assumed Options held by such Persons, as applicable; (ii) the Company’s good faith estimate of the Closing Net Working Capital, Closing Indebtedness, unpaid Transaction Expenses and the aggregate amount of Closing Cash, each as determined in accordance with GAAP applied on a consistent basis with the
94


application thereof to the most recent Audited Financial Statements and calculated as of immediately prior to the Effective Time, which estimate shall include a balance sheet together with each other component of the Cash Merger Consideration and an estimate of the Cash Merger Consideration (such estimate, the “Effective Time Cash Merger Consideration”), calculated as of the Effective Time (the “Adjustment Time”), (iii) the total number of shares of Parent Series H-1 Preferred Stock, the original principal amount of the Seller Note allocated to such Equityholder (if any) and the total Fractional Cash Amount, in each case, to which such Equityholder is entitled pursuant to Section 2.07(a) and/or Section 2.08, as applicable; (iv) an indication as to whether (A) the Company has received from the applicable Equityholder and delivered to Parent an Accredited Investor Certification for such Equityholder, (B) Parent has indicated to the Company that it reasonably believes, in the exercise of its sole discretion based on information available to it, that such Equityholder is an “accredited investor” as that term is defined in Rule 501 of Regulation D promulgated under the Securities Act, or (C) that Company has neither indication described in (A) or (B) that the Equityholder is an Accredited Stockholder, (v) such Equityholder’s Pro Rata Share and, as applicable, Stockholder Escrow Pro Rata Shares, Stockholder Pro Rata Share, Note Pro Rata Share and Optionholder Pro Rata Share; and (vi) such other instructions or information as is necessary or reasonably requested by Parent or the Paying Agent with respect to the payments to be made to the Equityholders. Such Spreadsheet shall be accompanied by the Capitalization Update.
(r)    Accredited Investor Certifications. The Company shall have requested (with a copy for completion) and used commercially reasonable efforts to secure delivery of Accredited Investor Certifications from all Equityholders who the Company or any of its Key Employees reasonably believe (or that Parent indicates that it reasonably believes) to be an Accredited Investor and caused all Accredited Investor Certifications that it has obtained as a result of such efforts or otherwise to be delivered to Parent no less than two (2) Business Days prior to the Closing Date.
(s)    Tax Opinion. Parent shall have received a tax opinion from its counsel, dated the Closing Date, to the effect that the Mergers should be treated as a reorganization within the meaning of Section 368(a) of the Code and the Treasury Regulations promulgated thereunder (subject to typical qualifications and assumptions for opinions of such kind); provided, however, that if Parent’s counsel has not delivered such tax opinion, this condition also may be satisfied if the Company’s counsel elects in its sole discretion to deliver such an opinion to Parent (and in such event, all references in this Agreement to cooperation with Parent’s legal counsel and the execution and delivery or provision of tax representation letters and certificates to Parent’s legal counsel shall be interpreted as referring to cooperation with, and the execution and delivery or provision of such letters and certificates to, the Company’s counsel).
SECTION 6.03    Conditions to the Obligations of the Company. The obligation of the Company to consummate the transactions contemplated by this Agreement is, in addition to the conditions set forth in Section 6.01, further subject to the satisfaction or, to the extent permitted by Law, waiver by the Company in writing at or prior to the Closing of each of the following conditions:
(a)    Representations and Warranties of Parent, Merger Sub and Merger Sub II. The representations and warranties of Parent, Merger Sub, and Merger Sub II contained in this Agreement (as modified by the Parent Disclosure Schedule) or in any Additional Agreement shall be true and correct in all respects (in the case of any representation or warranty qualified by materiality or Parent Material Adverse Effect) or in all material respects (in the case of any representation or warranty not
95


qualified by materiality or Parent Material Adverse Effect) as of the date of this Agreement and as of the Closing Date as though made on and as of such date (except to the extent that any such representation and warranty expressly speaks as of an earlier date, in which case such representation and warranty shall only be true and correct as of such earlier date).
(b)    Performance. Parent, Merger Sub, and Merger Sub II shall have performed and complied, in all material respects, with all agreements, covenants and obligations required by this Agreement or any of the Additional Agreement to be performed or complied with by Parent, Merger Sub, or Merger Sub II, as the case may be, on or prior to the Closing Date.
(c)    Officer’s Certificate. Parent, Merger Sub, and Merger Sub II shall have delivered to the Company a certificate, dated as of the Closing Date, executed by a duly authorized officer of each of Parent, Merger Sub, and Merger Sub II, certifying to the satisfaction of the conditions set forth in Section 6.03(a) and Section 6.03(b) hereof.
(d)    Reservation of Shares. Prior to the Closing, Parent shall have authorized the issuance of shares of Parent Series H-1 Preferred Stock as contemplated pursuant to this Agreement.
(e)    Secretary’s Certificate. Parent shall have delivered to the Company a certificate of the Secretary or an Assistant Secretary (or equivalent officer) of Parent certifying (i) that (A) attached thereto are true and complete copies of (1) all resolutions adopted by Parent’s board of directors authorizing Parent’s execution, delivery and performance of this Agreement and the Additional Agreements to which it is a party and the consummation of the transactions contemplated hereby and thereby and (2) resolutions of Parent’s preferred or common stockholders approving the Mergers and adopting this Agreement, and (B) all such resolutions are in full force and effect and are all the resolutions adopted in connection with the transactions contemplated hereby and thereby; (ii) the names and signatures of the officers of Parent authorized to sign this Agreement, the Additional Agreements to which it is a party and the other documents to be delivered hereunder and thereunder; (iii) that attached thereto are true and complete copies of the Amended and Restated Certificate of Incorporation and bylaws as in effect as of the Closing Date; and (iv) that attached thereto is a true and correct copy of a good standing certificate (or its equivalent) from the secretary of state or similar Governmental Authority of the jurisdiction under the Laws in which Parent is organized as of a date within five (5) Business Days of the Closing Date.
(f)    Escrow Agreement. The Company shall have received an executed counterpart to the Escrow Agreement, signed by each party other than the Company.
(g)    Amendment to Parent Equity Agreements. Parent shall have provided evidence reasonably satisfactory to the Company that the Parent Equity Agreements shall have been validly amended by an Omnibus Amendment to Preferred Stock Financing Agreements in substantially the form attached hereto as Exhibit L (the “Omnibus Amendment”) to provide for the appointment of Clay Wilkes on the board of directors of Parent and so that each Accredited Stockholder shall have the opportunity to become a party to each Parent Equity Agreement by executing and delivering a counterpart signature page thereto to Parent.
96


(h)    Board of Directors. Clay Wilkes shall be appointed to the board of directors of Parent and Parent shall have entered into an indemnification agreement with Clay Wilkes on Parent’s standard form.
(i)    Parent New Charter. Parent shall have filed the Parent New Charter with the Secretary of State of the State of Delaware on or prior to the Closing, which shall continue to be in full force and effect as of the Closing.
(j)    Tax Opinion. The Company shall have received a tax opinion from its counsel, dated the Closing Date, to the effect that the Mergers should be treated as a reorganization within the meaning of Section 368(a) of the Code and the Treasury Regulations promulgated thereunder (subject to typical qualifications and assumptions for opinions of such kind); provided, however, that if the Company’s counsel has not delivered such tax opinion, this condition also may be satisfied if Parent’s counsel elects in its sole discretion to deliver such an opinion to the Company (and in such event, all references in this Agreement to cooperation with Company’s legal counsel and the execution and delivery or provision of tax representation letters and certificates to the Company’s legal counsel shall be interpreted as referring to cooperation with, and the execution and delivery or provision of such letters and certificates to, Parent’s counsel).
(k)    Seller Note. The Company shall have received an executed counterpart to the Seller Note in the amount indicated in the Spreadsheet, signed by Parent.
(l)    Absence of a Parent Material Adverse Effect. Since the date hereof, there shall not have occurred any fact, circumstance, development, event or change that has had or would reasonably be expected to have, individually or in the aggregate, a Parent Material Adverse Effect.
ARTICLE VII
SURVIVAL; INDEMNIFICATION
SECTION 7.01    Survival. The representations and warranties of the Company, Parent, Merger Sub and Merger Sub II contained in this Agreement shall survive the Closing until 11:59 p.m. U.S. Mountain Time on the date that is twelve (12) months after the Closing Date (the “Expiration Date”). All of the covenants in this Agreement requiring performance after the Closing shall survive in accordance with their respective terms. It is the express intent of the parties that, if the applicable survival period for an item as contemplated by this Section 7.01 is shorter than the statute of limitations that would otherwise have been applicable to such item, then, by contract, the applicable statute of limitations with respect to such item shall be reduced to the shortened survival period contemplated hereby. The parties further acknowledge that the time periods set forth in this Section 7.01 for the assertion of claims under this Agreement are the result of arms’-length negotiation among the parties and that they intend for the time periods to be enforced as agreed by the parties.
No party hereto nor any of the Equityholders shall have any liability whatsoever with respect to any such representations or warranties unless a claim is made hereunder in writing (and, in the case of a claim pursuant to this Article VII, as contemplated by Section 7.03) prior to the Expiration Date, in which case such representation or warranty shall survive as to such claim until such claim has been finally resolved. Notwithstanding anything to the contrary contained in this Agreement, none of the
97


time limitations set forth in this Article VII shall apply in the case of Fraud or to any action for specific performance, injunctive relief or other equitable remedy to which any Person shall be entitled pursuant to Section 9.13.
SECTION 7.02    Indemnification in Favor of Parent. Subject to the provisions of this Article VII, after the Closing, the Equityholders, shall severally and not jointly, in accordance with their Pro Rata Shares, save, defend, indemnify and hold harmless Parent, Merger Sub, Merger Sub II, the Surviving Corporation, the Surviving Entity, the respective Subsidiaries of each of the Surviving Corporation and the Surviving Entity, and the respective representatives, successors and assigns of each of the foregoing (the “Acquirer Indemnified Parties”) from and against any and all Losses arising out of or relating to:
(a)    any breach or inaccuracy of any representation or warranty made by the Company or any Equityholder contained in Article III of this Agreement or any Support Agreement, Letter of Transmittal or Option Cancellation Agreement; provided, however, that each Equityholder shall be solely responsible to the Acquirer Indemnified Parties for Losses to the extent resulting from such Equityholder’s breach of any representation or warranty made by such Equityholder in his, her or its applicable Support Agreement, Letter of Transmittal or Option Cancellation Agreement;
(b)    any nonfulfillment or breach of any covenant or agreement by the Company or any Equityholder contained in this Agreement or any Additional Agreement delivered pursuant hereto; provided, however, that each Equityholder shall be solely responsible to the Acquirer Indemnified Parties for Losses to the extent resulting from such Equityholder’s breach of any covenant or agreement made by such Equityholder in an Additional Agreement to which such Equityholder is a party;
(c)    any claim made by any Equityholder or any other Person relating to any calculation related to the allocation or payment of the Merger Consideration or other payment; provided that each Equityholder shall be solely responsible for any error in any calculation resulting in an erroneous allocation or payment in favor of such Equityholder;
(d)    any amounts paid to the holders of Dissenting Shares, including any interest required to be paid thereon, that are in excess of what such holders would have received hereunder had such holders not been holders of Dissenting Shares;
(e)    any Equityholder Loans, the exercise of any Options or issuance of any Company Shares at any time pursuant to or in connection with any such Equityholder Loan, including with respect to the making, issuance, amendment, modification, cancellation, redemption, exchange, termination or repayment of any such Equityholder Loan, Option or Company Shares in connection therewith or the Tax withholding (or lack thereof) of any amounts paid or payable to a current or former employee of the Company at any time;
(f)    the Class Action, the October Incident or the CFPB Disclosure, as each such term is defined in the Company Disclosure Schedule; or
(g)    any claim made by Qatalyst Partners LLC, any Equityholder or any other Person relating to the Deferred Transaction Fee.
98


SECTION 7.03    Indemnification Claim Procedure; Third Party Claims.
(a)    If any party entitled to receive indemnification under this Article VII (hereinafter an “Indemnified Party”) becomes aware that it has suffered or may suffer a Loss (other than with respect to a Third Party Claim) for which indemnification is available under this Article VII, the Indemnified Party shall promptly notify the party required to provide indemnification (hereinafter an “Indemnifying Party”) in writing of such claim; provided, however, that no failure or delay on the part of the Indemnified Party in notifying the Indemnifying Party shall relieve the Indemnifying Party from any obligation hereunder unless (and then solely to the extent that) the Indemnifying Party is actually and materially prejudiced thereby as evidenced by the forfeiture of rights or defenses by reason of such failure or delay. Such written notice shall describe the basis upon which indemnity is being sought, shall include a reference to the provisions of this Agreement in respect of which such Loss shall have occurred, shall include copies of material written evidence thereof (to the extent permitted and reasonably available to provide to the Indemnifying Party at the time such prompt notice is to be given) and shall indicate an initial estimated amount, if reasonably practicable based on information available to it, of the Losses that have been or may be sustained by the Indemnified Party. The Indemnifying Party shall have 30 days after its receipt of such notice to respond in writing to such claim. During such 30-day period, the Indemnified Party shall allow the Indemnifying Party and its professional advisors to investigate the matter or circumstance alleged to give rise to such claim, and whether and to what extent any amount is payable in respect of such claim and the Indemnified Party shall assist the Indemnifying Party’s investigation by giving such information and assistance as the Indemnifying Party or any of its professional advisors may reasonably request. If the Indemnifying Party does not so respond within such 30-day period, the Indemnifying Party shall be deemed to have rejected such claim, in which case any remaining dispute regarding the Indemnified Party’s entitlement to indemnification in connection with such claim shall be resolved by any legally available means consistent with the provisions of Section 9.09 herein or as otherwise agreed in writing between or among the parties and any of the Equityholders.
(b)    If an Indemnified Party is entitled to indemnification provided for under this Agreement in respect of, arising out of or involving a claim under this Article VII made by any Person against the Indemnified Party (a “Third Party Claim”), such Indemnified Party shall give the Indemnifying Party from whom indemnification with respect to such Third Party Claim is sought prompt written notice of such Third Party Claim; provided, however, that no failure or delay on the part of the Indemnified Party in notifying the Indemnifying Party shall relieve the Indemnifying Party from any obligation hereunder unless (and then solely to the extent that) the Indemnifying Party is actually and materially prejudiced thereby as evidenced by the forfeiture of rights or defenses by reason of such failure or delay. Such notice by the Indemnified Party shall describe the Third Party Claim in reasonable detail, shall include copies of material written evidence thereof (to the extent permitted and reasonably available to provide to the Indemnifying Party at the time such prompt notice is to be given) and shall indicate the estimated amount, if reasonably practicable, of the Loss that has been or may be sustained by the Indemnified Party. The Indemnifying Party shall have the right to participate in, or, upon written notice to the Indemnified Party within fifteen (15) calendar days of receipt of notice from the Indemnified Party of the commencement of such Third Party Claim, to assume the defense thereof at the expense of the Indemnifying Party with counsel selected by the Indemnifying Party and reasonably satisfactory to the Indemnified Party, provided, however, that Equityholders as Indemnifying Parties shall not have the right to defend or direct the defense of any such Third Party Claim that (x) is asserted directly by or on behalf of a Person that is a supplier, Customer or other customer of the Company, (y) seeks an injunction or other equitable relief against any of the Indemnified Parties or (z) relates to or
99


arises in connection with any Legal Proceeding brought by a Governmental Authority, and provided, further, that in its notice electing to assume the defense, the applicable Indemnifying Parties agree to assume all Liabilities related to such Third Party Claim (including any and all Liabilities resulting from any settlement of such claim) and acknowledges its responsibility therefor under this Agreement. In the event that the Indemnifying Party assumes the defense of any Third Party Claim, subject to Section 7.03(c), it shall have the right to take such action as it reasonably deems necessary to avoid, dispute, defend, appeal or make counterclaims pertaining to any such Third Party Claim on behalf of the Indemnified Party. The Indemnified Party shall have the right to participate in the defense of any Third Party Claim with counsel selected by it subject to the Indemnifying Party’s right to control the defense thereof. The fees and disbursements of such counsel shall be at the expense of the Indemnified Party, provided, however, that if in the reasonable opinion of counsel to the Indemnified Party, (A) there are legal defenses available to an Indemnified Party that are different from or additional to those available to the Indemnifying Party, or (B) there exists a conflict of interest between the Indemnifying Party and the Indemnified Party, the Indemnifying Party shall be liable for the reasonable fees and expenses of counsel to the Indemnified Party in each jurisdiction for which the Indemnified Party determines counsel is required. If the Indemnifying Party elects not to compromise or defend such Third Party Claim, fails to promptly notify the Indemnified Party in writing of its election to defend as provided in this Section, or fails to diligently prosecute the defense of such Third Party Claim, the Indemnified Party may, subject to Section 7.03(c), pay, compromise and defend such Third Party Claim and seek indemnification for any and all Losses based upon, arising from or relating to such Third Party Claim. Indemnifying Party and Indemnified Party shall cooperate with each other in all reasonable respects in connection with the defense of any Third Party Claim.
(c)    Settlement of Third Party Claims. Notwithstanding any other provision of this Agreement, the Indemnifying Party shall not enter into any settlement of any Third Party Claim without the prior written consent of the Indemnified Party, except as provided in this Section 7.03(c). If a firm offer is made to settle a Third Party Claim without leading to Liability or any other obligation on the part of the Indemnified Party and provides, in customary form, for the unconditional release of each Indemnified Party from all Liabilities and obligations in connection with such Third Party Claim and the Indemnifying Party desires to accept and agree to such offer, then Indemnifying Party shall give written notice to that effect to the Indemnified Party. If the Indemnified Party fails to consent to such firm offer within ten (10) days after its receipt of such notice, the Indemnified Party may continue to contest or defend such Third Party Claim and in such event, the maximum liability of the Indemnifying Party as to such Third Party Claim shall not exceed the amount of such settlement offer, together with any and all indemnifiable costs and expenses of the Indemnified Party incurred prior to the expiration of such period. If the Indemnified Party fails to consent to such firm offer and also fails to assume defense of such Third Party Claim, the Indemnifying Party may settle the Third Party Claim upon the terms set forth in such firm offer to settle such Third Party Claim. If the Indemnified Party has assumed the defense pursuant to Section 7.03(b), it shall not agree to any settlement without the written consent of the Indemnifying Party, which consent shall not be unreasonably withheld, conditioned or delayed.
(d)    Notwithstanding anything to the contrary contained herein, to the extent the procedures in this Section 7.03 or elsewhere in this Agreement are in conflict with the procedures in the R&W Policy with regard to matters such as notice, control, settlement or defense of claims in a manner that would impair the ability of any Acquirer Indemnified Party to comply with its obligations under the R&W Policy, the procedures in the R&W Policy shall control, but this Section 7.03(d) shall not relieve the Indemnified Party from its obligations under Section 7.03 to give notice to the Indemnifying Party.
100


SECTION 7.04    R&W Policy and Escrow.
(a)    For any and all indemnification claims under Section 7.02(a), the Acquirer Indemnified Party shall initially pursue such indemnification amounts under the R&W Policy, but only if and to the extent that the R&W Policy covers such indemnification (for the avoidance of doubt and notwithstanding anything to the contrary, after giving effect to any exclusion, retention, deductible, coverage limitation or other term or condition of the R&W Policy) and a claim under the R&W Policy in respect hereof has not been denied. For any and all indemnification claims under Section 7.02(b), Section 7.02(c), Section 7.02(d), Section 7.02(e) and Section 7.02(f) and all indemnification claims under Section 7.02(a) that are either not covered by the R&W Policy (for the avoidance of doubt and notwithstanding anything to the contrary, after giving effect to any exclusion, retention, deductible, coverage limitation or other term or condition of the R&W Policy) or that have been denied by the insurance provider of the R&W Policy or any underwriting or other representative of such insurance provider, the Acquirer Indemnified Party shall seek to collect such indemnification amounts from the Escrow Amount (to the extent of shares from time to time remaining therein) pursuant to the terms of the Escrow Agreement. Except with respect to Stockholder Excluded Claims, from and after the Closing Date the Acquirer Indemnified Parties’ sole and exclusive recourse for claims against the Equityholders under Section 7.02(a) of this Agreement shall be against (i) the R&W Policy pursuant to the terms of the R&W Policy, and/or (ii) the Escrow Amount, until the Escrow Amount is reduced to no shares of Parent Series H-1 Preferred Stock, with the value of any Parent Series H-1 Preferred Stock used to satisfy such liability being equal to the Parent Stock Price; provided, however, that nothing in this Agreement shall be deemed a waiver by any party of any right to specific performance, injunctive relief or other equitable remedy to which any Person shall be entitled pursuant to Section 9.13. Subject to any subrogation rights under the R&W Policy for Fraud, for any claims by the Acquirer Indemnified Parties for indemnification (1) pursuant to Section 7.02(b), (2) pursuant to Section 7.02(c), (3) pursuant to Section 7.02(g) or (4) for Fraud by the Company or an Equityholder (collectively, the “Stockholder Excluded Claims”), if such Stockholder Excluded Claims are not fully satisfied by the R&W Policy (including, for the avoidance of doubt and notwithstanding anything to the contrary, because coverage is not available under such policy due to any exclusion, retention, deductible coverage limitation or other term or condition of the R&W Policy, or a claim for coverage under such policy has been denied) and the Escrow Amount, then the Acquirer Indemnified Parties shall be entitled to seek recourse directly from the Equityholders on a several, but not joint, basis in accordance with their Pro Rata Shares (subject to the provisos to each of Sections 7.02(a), 7.02(b) and 7.02(c)) with respect to the amount of any such Stockholder Excluded Claim in excess of the amounts recovered from the R&W Policy and the Escrow Amount, provided that, except in the case of Fraud by such Equityholder and indemnification claims under Section 7.02(g), each such Equityholder’s aggregate liability under this Agreement for such Stockholder Excluded Claims shall not exceed the Merger Consideration actually paid to such Equityholder, with the order of recovery against such Equityholder for such Stockholder Excluded Claims being (A) first, against any Stock Consideration held by such Equityholder until the number or amount of shares of Parent Series H-1 Preferred Stock held by such Equityholder has been reduced to no shares of Parent Series H-1 Preferred Stock, (B) second, against any portion of the Seller Note allocated to such Equityholder and (C) finally, directly against such Equityholder.
(b)    In accordance with the terms of the Escrow Agreement, the Escrow Account shall terminate twelve (12) months following the Closing (the “Escrow Termination Date”), upon which the Escrow Agent shall release as promptly as practicable, pursuant to a written direction jointly executed by Parent and the Stockholders’ Representative and delivered to the Escrow Agent, the remaining shares
101


in the Escrow Account, if any (the “Residual Shares”), and, subject to Section 2.14(c)(i), Parent and the Stockholders’ Representative shall cooperate to ensure that the Residual Shares so released are as promptly as practicable delivered to, and/or registered in Parent’s stock records in the name of, the Stockholders in accordance with their respective Stockholder Escrow Pro Rata Shares (reduced with respect to any Stockholder by any shares previously released from the Escrow Account in connection with claims against such Stockholder); provided, however, that any shares held in the Escrow Account as of the Escrow Termination Date necessary to satisfy any unsatisfied or unresolved claims for Losses that were made prior to the Escrow Termination Date shall remain in the Escrow Account until such claims have been finally resolved, at which point any remaining Residual Shares not required to satisfy such claims shall be released as set forth above. The parties shall treat the shares held in the Escrow Account for all Tax reporting purposes as being owned by the Equityholders, and the Equityholders shall be entitled to all voting rights attributable to such shares and all dividends that may be declared with respect to such shares prior to the Escrow Termination Date; provided that in the event of the issuance of shares as a result of a stock split, stock dividend, combination of shares or similar recapitalization with respect to shares of Parent H-1 Preferred Stock that becomes effective prior to the termination of the Escrow Agreement, the additional shares so issued (if any) with respect to any shares held in the Escrow Account shall be added to, and deemed a part of, the shares held in the Escrow Account.
(c)    Promptly following request by the other such party, each of Parent and Stockholders’ Representative shall join with such requesting party to execute and deliver to the Escrow Agent a joint written direction providing for the disbursement from the Escrow Account of any shares required to be disbursed therefrom pursuant to this Agreement.
SECTION 7.05    Limits on Indemnification. Notwithstanding anything to the contrary contained in this Agreement:
(a)    No Indemnified Party may make a claim for indemnification under Section 7.02(a) for breach by the Indemnifying Party of a particular representation or warranty that occurs or is identified after the expiration of the Expiration Date.
(b)    Except with respect to Stockholder Excluded Claims and breaches of the representations and warranties provided for in the first sentence of Section 3.01 (Organization), Section 3.02 (Capitalization), Section 3.03 (Authority) and Section 3.22 (Brokers) (collectively, the “Company Fundamental Representations”), no Indemnifying Party shall be liable to an Indemnified Party for indemnification for representations or warranties under Section 7.02(a) until the aggregate amount of all indemnification obligations for Losses for such representations or warranties under Section 7.02(a) exceeds $6,000,000 (the “Deductible”), in which event the Indemnifying Parties shall be required to pay or be liable for all Losses in excess of the Deductible.
(c)    The aggregate amount of all Losses for which the Indemnifying Parties shall be liable pursuant to Section 7.02(a) (other than with respect to Fraud and breaches of the Company Fundamental Representations), shall not exceed $6,000,000, which shall be distributed solely from the Escrow Amount. The aggregate amount of all Losses for which the Indemnifying Parties shall be liable pursuant to Section 7.02(a) (other than with respect to Fraud), Section 7.02(d), Section 7.02(e) and Section 7.02(f), shall not exceed the Escrow Amount, which shall be distributed solely from the Escrow Amount. Except for claims against an Indemnifying Party arising from such Indemnifying Party’s own
102


Fraud or pursuant to Section 7.02(g), (i) the aggregate amount of all Losses for which the Indemnifying Parties shall be liable for claims arising from Fraud, pursuant to Section 7.02(b) or Section 7.02(c) shall not exceed the Merger Consideration, and (ii) subject to the provisos in each of Section 7.02(a), Section 7.02(b) and Section 7.02(c), no Indemnifying Party shall be liable for more than such Indemnifying Party’s Pro Rata Share of any such Losses.
(d)    For purposes of calculating the amount of Losses incurred by an Indemnified Party for purposes of this Agreement, such amount shall be reduced by: (i) the amount of any insurance benefits and proceeds actually paid to such Indemnified Party, or any Affiliate of any such party, in respect of such Losses net of any related deductible amounts and (ii) the amount of any indemnification, contribution or other similar payment actually recovered by the Indemnified Party from any other Person with respect to such Losses. No Indemnified Person shall have any obligation to seek, obtain or pursue any insurance, indemnification, contribution or other payment referred to in this Section 7.05(d) (other than with respect to the R&W Policy, but only to the extent coverage is available under the R&W Policy, after giving effect to any exclusion, retention, deductible coverage limitation or other term or condition of the R&W Policy, and no claim for coverage under the R&W Policy has been denied).
(e)    In no event shall any Indemnifying Party be liable to any Indemnified Party for any punitive or exemplary damages; except that any Indemnifying Party shall be liable for any such damages that become payable by any Indemnified Party to any third party.
(f)    Any inaccuracy in or breach of any representation or warranty, as well as the amount of Losses arising from a breach of any representation and warranty, shall be determined without regard to any materiality, Material Adverse Effect or other similar qualification contained in or otherwise applicable to such representation or warranty.
(g)    Notwithstanding anything to the contrary in this Article VII, in no event shall an Indemnified Party be entitled to duplicative recovery of the same extent of its Losses (or the same portion thereof) under both (i) Section 7.02(a) and (ii) Section 7.02(b) through Section 7.02(g) or under both (x) this Article VII and (y) Section 2.10 (to the extent such Losses are actually reflected as liabilities in the Closing Indebtedness, Closing Net Working Capital or unpaid Transaction Expenses, as finally determined pursuant to Section 2.10).
SECTION 7.06    Exclusive Remedy. Except (i) as provided in Section 2.16 and (ii) with respect to claims against an Indemnifying Party arising from such Indemnifying Party’s own Fraud, the parties agree that from and after the Closing Date, the exclusive remedies of the parties for any Losses based upon, arising out of or otherwise in respect of the matters set forth in this Agreement or breaches of representations or warranties in any Support Agreement, Letter of Transmittal or Option Cancellation Agreement are the indemnification obligations of the parties set forth in this Article VII, and, subject to the foregoing exceptions, each party hereby waives, to the fullest extent permitted under Law, any and all rights, claims and causes of action for any breach of any representation, warranty, covenant, agreement or obligation set forth herein or for any breach of any representation or warranty set forth in any Support Agreement, Letter of Transmittal or Option Cancellation Agreement it may have against any of the parties hereto under or based upon any Law; provided, however, that nothing in this Agreement shall be deemed a waiver by any party of any right to specific performance, injunctive relief or other equitable remedy to which such Person shall be entitled pursuant to Section 9.13. Notwithstanding anything in this Agreement to the contrary, this Section 7.06 shall not apply to Section
103


2.15, which shall be enforceable by the Stockholders’ Representative in its entirety against the Equityholders, and shall not prevent any Equityholder or its representatives, successors and assigns (or the Stockholders’ Representative on their behalf) from bringing a claim against Parent for any breach of this Agreement.
SECTION 7.07    Effect of Investigation. The representations, warranties and covenants of the Indemnifying Party, and the Indemnified Party’s right to indemnification with respect thereto, shall not be affected or deemed waived by reason of any investigation made by or on behalf of the Indemnified Party (including by any of its Representatives) or by reason of the fact that the Indemnified Party or any of its Representatives knew or should have known that any such representation or warranty is, was or might be inaccurate, or by reason of the Indemnified Party’s waiver of any condition set forth in Section 6.02 or Section 6.03, as the case may be.
ARTICLE VIII
TERMINATION
SECTION 8.01    Termination. Notwithstanding anything contained in this Agreement to the contrary, this Agreement may be terminated and the transactions contemplated hereby may be abandoned at any time prior to the Closing, as follows:
(a)    by mutual written agreement of each of the Company and Parent;
(b)    by either Parent or the Company at any time after 5:00 p.m. (U.S. Pacific Time) on July 5, 2020 (the “Termination Date”), if the Mergers shall not have been consummated on or prior to such date; provided, however, that Parent or the Company, as applicable, shall not have the right to terminate this Agreement pursuant to this Section 8.01(b) if such party’s failure to fulfill in any material respect any of its covenants or agreements set forth in this Agreement has been the proximate cause of or primarily contributed to the failure of the Closing to occur prior to the Termination Date; provided, further, that if on such Termination Date, the conditions set forth in Section 6.01(a) or Section 6.01(b) (in each case, solely as related to Antitrust Laws) have not been satisfied, then the Termination Date shall automatically be extended for thirty (30) days, provided, further, that if, at the end of such thirty (30) day period, the conditions set forth in Section 6.01(a) or Section 6.01(b) (in each case solely as related to Antitrust Laws) continue not to have been satisfied, then the Termination Date may be extended for an additional thirty (30) days by either of Parent or the Company upon notice to the other party, provided, further, that if, at the end of such additional thirty (30) day period, the conditions set forth in Section 6.01(a) or Section 6.01(b) (in each case solely as related to Antitrust Laws) continue not to have been satisfied, then the Termination Date may be extended only by mutual agreement of Parent and the Company;
(c)    by the Company, on the one hand, or by Parent, on the other hand, if, prior to the Effective Time, any Restraint or Law of the type set forth in Section 6.01(a) permanently preventing, restraining, enjoining, rendering illegal or otherwise prohibiting the consummation of the transactions contemplated by this Agreement shall have become final and non-appealable; provided, however, that the party seeking to terminate this Agreement pursuant to this Section 8.01(c) shall have used its commercially reasonable efforts as required by this Agreement to remove such Restraint or Law; provided, further, that the right to terminate this Agreement under this Section 8.01(c) shall not be
104


available to a party if the issuance of such Restraint or Law or taking of such action was primarily due to the failure of such party, and in the case of Parent, including the failure of Merger Sub or Merger Sub II, to perform any of its obligations under this Agreement;
(d)    by Parent, if any representation or warranty of the Company set forth in Article III shall be or shall have become inaccurate or the Company shall have breached or failed to perform any of its covenants or other agreements set forth in this Agreement, which inaccuracy, breach or failure to perform (i) if it occurred or was continuing to occur on the Closing Date, would give rise to the failure of any of the conditions set forth in Section 6.02(b) or Section 6.02(b), and (ii) by its nature, cannot be cured by the Company by the Termination Date or, if such inaccuracy, breach or failure to perform is capable of being cured by the Termination Date, the Company shall not have cured such inaccuracy, breach or failure to perform prior to the earlier of (A) the Termination Date and (B) the date that is thirty (30) days following receipt by the Company of notice in writing from Parent specifying the nature of such inaccuracy, breach or failure to perform in reasonable detail and requesting that it be cured; provided that Parent shall not have the right to terminate this Agreement pursuant to this Section 8.01(d) if, at the time such termination would otherwise take effect in accordance with the foregoing, either Parent, Merger Sub, or Merger Sub II is in material breach of this Agreement;
(e)    by the Company, if any representation or warranty of Parent, Merger Sub, or Merger Sub II set forth in Article IV shall be or shall have become inaccurate or Parent, Merger Sub, or Merger Sub II shall have breached or failed to perform any of their respective covenants or other agreements set forth in this Agreement, which inaccuracy, breach or failure to perform (i) if it occurred or was continuing to occur on the Closing Date, would give rise to the failure of any of the conditions set forth in Section 6.03(a) or Section 6.03(b), and (ii) by its nature, cannot be cured by Parent, Merger Sub, or Merger Sub II by the Termination Date or, if such inaccuracy, breach or failure to perform is capable of being cured by the Termination Date, Parent, Merger Sub, or Merger Sub II, as the case may be, shall not have cured such inaccuracy, breach or failure to perform prior to the earlier of (A) the Termination Date and (B) the date that is thirty (30) days following receipt by Parent of notice in writing from the Company specifying the nature of such inaccuracy, breach or failure to perform in reasonable detail and requesting that it be cured; provided that the Company shall not have the right to terminate this Agreement pursuant to this Section 8.01(e) if, at the time such termination would otherwise take effect in accordance with the foregoing, the Company is in material breach of this Agreement;
(f)    by Parent, if the closing condition set forth in Section 6.02(h) (Stockholder Consent) shall not have been satisfied within thirty (30) Business Days following the execution and delivery of this Agreement;
The party desiring to terminate this Agreement pursuant to any of clauses (b), (c), (d), (e) or (f) of this Section 8.01 shall give written notice of such termination to the other party in accordance with Section 9.01 specifying the provision or provisions hereof pursuant to which such termination is effected.
SECTION 8.02    Effect of Termination; Etc.
(a)    In the event of the termination of this Agreement in accordance with Section 8.01, written notice thereof shall be given to the other party or parties, specifying the provisions hereof pursuant to which such termination is made, and this Agreement shall thereafter become null and void of
105


no effect and all rights and obligations of any party hereto shall cease, and there shall be no liability on the part of Parent, Merger Sub, Merger Sub II, or the Company or their respective directors, officers and Affiliates hereunder, and the transactions contemplated hereby shall be abandoned, except that (i) this Section 8.02, Section 2.15(b), Section 5.07, Article IX and the Confidentiality Agreement shall survive termination of this Agreement and remain valid and binding obligations of each of the parties and (ii) nothing herein shall relieve any party hereto from any liability or damages arising out of, resulting from or in connection with any Fraud or Intentional Breach occurring with respect to any of such party’s representations, warranties, covenants or other agreements set forth in this Agreement occurring prior to termination, in which case the aggrieved party shall be entitled to all rights and remedies available at law or in equity.
(b)    The parties hereto acknowledge that the agreements contained in this Section 8.02 are an integral part of the transactions contemplated by this Agreement and that, without these agreements, the parties would not enter into this Agreement.
(c)    If this Agreement is terminated pursuant to Section 8.01 hereof, all confidential information received by the parties shall be treated in accordance with the Confidentiality Agreement.
ARTICLE IX
MISCELLANEOUS
SECTION 9.01    Notices. All notices, requests, consents, claims, demands, waivers and other communications hereunder shall be deemed to have been duly given upon receipt if in writing and if served by personal delivery upon the Person for whom it is intended, by prepaid national overnight courier service (with signed confirmation of receipt), or by confirmed electronic mail (provided that, in the case of electronic mail, such confirmation is not automated); provided that the email is promptly followed by a confirmation copy delivered by registered or certified mail or by a national courier service, to the Person at the address set forth below, or such other address as may be designated in writing hereafter, in the same manner, by such Person:
To the Company (if prior to the Closing):
Galileo Financial Technologies, Inc.
6510 South Millrock Dr.
Suite 300
Salt Lake City, UT 84121
Attention:    Clay Wilkes
Email:
with a copy (which shall not constitute notice) to:
Dorsey & Whitney LLP
111 South Main Street, Suite 2100
Salt Lake City, UT 84111
Attention:    Nolan S. Taylor
Email:    Taylor.Nolan@dorsey.com
106


To any of the Equityholders (after the Closing) or the Stockholders’ Representative:
Shareholder Representative Services LLC
950 17th Street, Suite 1400
Denver, CO 80202
Attention:    Managing Director
Email:
with a copy (which shall not constitute notice) to:
Dorsey & Whitney LLP
111 South Main Street, Suite 2100
Salt Lake City, UT 84111
Attention:    Nolan S. Taylor
Email:    Taylor.Nolan@dorsey.com
To Parent, Merger Sub, Merger Sub II, the Surviving Corporation, or the Surviving Entity:
Social Finance, Inc.
234 1st Street
San Francisco, CA 94105
Attention:    Anthony Noto
email:
with a copy (which shall not constitute notice) to:
Social Finance, Inc.
10701 Parkridge Blvd., Suite 120
Reston, VA 20191
Attention:    Robert S. Lavet, Esq.
E-mail:
Wilmer Cutler Pickering Hale and Dorr LLP
1875 Pennsylvania Avenue, NW
Washington, DC 20006
Attention:    Stephanie Evans
Email:    Stephanie.Evans@wilmerhale.com
with a copy (which shall not constitute Any such notification shall be deemed delivered (i) upon receipt, if delivered personally, (ii) on the next Business Day, if sent by national courier service for next Business Day delivery, or (iii) the Business Day received, if sent by facsimile, electronic mail or any other permitted method (provided that any notice received by facsimile transmission, electronic mail or otherwise at the addressee’s location on any non-Business Day or any Business Day after 5:00 p.m. (addressee’s local time) shall be deemed to have been received at 9:00 a.m. (addressee’s local time) on the next Business Day); provided that notice of any change to the address or any of the other details specified in or pursuant to this Section 9.01 shall not be deemed to have been received until, and shall be deemed to have been received upon, the later of the date specified in such notice or the date that is two
107


(2) Business Days after such notice would otherwise be deemed to have been received pursuant to this Section 9.01. Rejection or other refusal to accept or the inability to deliver because of changed address of which no notice was given shall be deemed to be receipt of the notice as of the date of such rejection, refusal or inability to deliver.
SECTION 9.02    Amendment; Waiver, Etc. Any provision of this Agreement may be amended, modified, supplemented or waived if, and only if, such amendment, modification, supplement or waiver is in writing and signed, in the case of an amendment, modification or supplement, by Parent, Merger Sub, Merger Sub II and the Company (or, following the Closing, their applicable successors) and the Stockholders’ Representative, or in the case of a waiver, by the party or parties against whom the waiver is to be effective. No failure or delay by any party in exercising any right, power or privilege hereunder shall operate as a waiver thereof nor shall any single or partial exercise thereof preclude any other or further exercise thereof or the exercise of any other right, power or privilege. The second, third and fourth sentences of Section 2.14(e), this sentence of Section 9.02 and Section 9.08 (and any provision of this Agreement to the extent an amendment, modification, supplement or waiver of such provision would modify the substance of such Sections) may not be amended, modified, supplemented or waived in a manner that is adverse in any respect to Qatalyst Partners LLC without either (a) payment of the Deferred Transaction Fee prior to such action or (b) the prior written consent of Qatalyst Partners LLC.
SECTION 9.03    Assignment. No party hereto may assign any of its rights or obligations under this Agreement without the prior written consent of the other parties hereto and any attempt to assign this Agreement without such consent shall be void and of no effect, except that Parent Merger Sub, or Merger Sub II may assign, in its sole discretion, any of or all its rights, interests and obligations under this Agreement to any wholly-owned U.S. corporate Subsidiary of Parent, but no such assignment shall relieve Parent, Merger Sub, or Merger Sub II of any of their obligations hereunder.
SECTION 9.04    Expenses. Except as otherwise provided in this Agreement, each of the Company, Parent, Merger Sub, and Merger Sub II shall bear its own expenses incurred in connection with the negotiation and execution of this Agreement and each other agreement, document and instrument contemplated by this Agreement and the consummation of the transactions contemplated hereby and thereby.
SECTION 9.05    Entire Agreement. This Agreement (including the exhibits, schedules, annexes and appendices hereto) constitutes, together with the Confidentiality Agreement, the Company Disclosure Schedule and the Parent Disclosure Schedule, the entire agreement, and supersedes all other prior agreements and understandings, both written and oral, among the parties, or any of them, with respect to the subject matter hereof.
SECTION 9.06    Severability. If any term, provision, covenant or restriction of this Agreement or the application of any such term or provision to any Person or circumstance is held by a court of competent jurisdiction or other authority to be invalid, void, illegal or incapable of being enforced by any rule of Law or public policy, all other conditions, covenants, restrictions and provisions of this Agreement shall nevertheless remain in full force and effect so long as the economic or legal substance of the transactions contemplated by this Agreement is not affected in any manner materially adverse to any party hereto. Upon such determination that any term or other provision is invalid, void, illegal or incapable of being enforced, the parties hereto shall negotiate in good faith to modify this
108


Agreement so as to effect the original intent of the parties hereto as closely as possible in a mutually acceptable manner in order that the transactions contemplated by this Agreement be consummated as originally contemplated to the fullest extent possible.
SECTION 9.07    Fulfillment of Obligations. Any obligation of any party under this Agreement, which obligation is performed, satisfied or fulfilled by an Affiliate of such party, shall be deemed to have been performed, satisfied or fulfilled by such party.
SECTION 9.08    Parties in Interest. This Agreement shall inure to the benefit of, be binding upon and enforceable against the parties hereto and their respective successors and permitted assigns. Nothing in this Agreement is intended to confer upon any Person other than the Equityholders party to Support Agreements, Parent, Merger Sub, Merger Sub II, the Company, its Subsidiaries or their successors or permitted assigns, any rights or remedies under or by reason of this Agreement, except that (a) the D&O Indemnified Parties (including the successors, assigns, heirs, executors, administrators and personal representatives of such D&O Indemnified Parties) shall be express third party beneficiaries of, and shall be entitled to rely on, the provisions of Section 5.08, and (b) Qatalyst Partners LLC shall be an express third party beneficiary of, shall be entitled to rely on and shall be entitled to directly enforce, the provisions of Section 2.14(e).
SECTION 9.09    Governing Law; Jurisdiction; Waiver of Jury Trial.
(a)    This Agreement and all Legal Proceedings (whether based on contract, tort or otherwise) arising out of or relating to this Agreement or the actions of Parent, Merger Sub, Merger Sub II, or the Company in the negotiation, administration, performance and enforcement thereof, shall be governed by and construed in accordance with the laws of the State of Delaware, without giving effect to any choice or conflict of law provision or rule (whether of the State of Delaware or any other jurisdiction) that would cause the application of the laws of any jurisdiction other than the State of Delaware. Each of the parties hereto irrevocably agrees that any Legal Proceeding with respect to this Agreement and the rights and obligations arising hereunder, or for recognition and enforcement of any judgment in respect of this Agreement and the rights and obligations arising hereunder brought by another party hereto or its successors or assigns, shall be brought and determined exclusively in the Delaware Court of Chancery in New Castle County and any state appellate court therefrom within the State of Delaware (or, if the Delaware Court of Chancery declines to accept jurisdiction over a particular matter, any federal court within the State of Delaware). Each of the parties hereto hereby irrevocably submits with regard to any such action or proceeding for itself and in respect of its property, generally and unconditionally, to the personal jurisdiction of the aforesaid courts and agrees that it will not bring any action relating to this Agreement or any of the transactions in any court other than the aforesaid courts. Each of the parties hereto hereby irrevocably waives, and agrees not to assert, by way of motion, as a defense, counterclaim or otherwise, in any action or proceeding with respect to this Agreement, (i) any claim that it is not personally subject to the jurisdiction of the above named courts, (ii) any claim that it or its property is exempt or immune from jurisdiction of any such court or from any legal process commenced in such courts (whether through service of notice, attachment prior to judgment, attachment in aid of execution of judgment, execution of judgment or otherwise) and (iii) to the fullest extent permitted by the applicable Law, any claim that (A) the suit, action or proceeding in such court is brought in an inconvenient forum, (B) the venue of such suit, action or proceeding is improper or (C) this Agreement, or the subject matter hereof, may not be enforced in or by such courts. The parties hereto further agree that any final and nonappealable judgment against any of them in any action, suit or
109


proceeding described in this Section 9.09 shall be conclusive and may be enforced in any other jurisdiction within or outside the United States by suit on judgment, a certified copy of which shall be conclusive evidence of the fact and amount of such judgment.
(b)    EACH PARTY HERETO ACKNOWLEDGES AND AGREES THAT ANY CONTROVERSY WHICH MAY ARISE UNDER OR RELATE TO THIS AGREEMENT IS LIKELY TO INVOLVE COMPLICATED AND DIFFICULT ISSUES, AND THEREFORE EACH SUCH PARTY HEREBY IRREVOCABLY AND UNCONDITIONALLY WAIVES ANY RIGHT SUCH PARTY MAY HAVE TO A TRIAL BY JURY IN RESPECT OF ANY LITIGATION DIRECTLY OR INDIRECTLY ARISING OUT OF OR RELATING TO THIS AGREEMENT, OR THE BREACH, TERMINATION OR VALIDITY OF THIS AGREEMENT, OR THE TRANSACTIONS CONTEMPLATED BY THIS AGREEMENT. EACH PARTY HERETO CERTIFIES AND ACKNOWLEDGES THAT (i) NO REPRESENTATIVE, AGENT OR ATTORNEY OF ANY OTHER PARTY HERETO HAS REPRESENTED, EXPRESSLY OR OTHERWISE, THAT SUCH OTHER PARTY WOULD NOT, IN THE EVENT OF LITIGATION, SEEK TO ENFORCE THE FOREGOING WAIVER, (ii) EACH SUCH PARTY UNDERSTANDS AND HAS CONSIDERED THE IMPLICATIONS OF THIS WAIVER, (III) EACH SUCH PARTY MAKES THIS WAIVER VOLUNTARILY, AND (IV) EACH SUCH PARTY HAS BEEN INDUCED TO ENTER INTO THIS AGREEMENT BY, AMONG OTHER THINGS, THE MUTUAL WAIVERS AND CERTIFICATIONS IN THIS SECTION 9.09(B).
(c)    Each party hereto irrevocably consents to the service of process outside the territorial jurisdiction of the courts referred to in Section 9.09(a) in any such action or proceeding by mailing copies thereof by registered or certified United States mail, postage prepaid, return receipt requested, to its address as specified in or pursuant to Section 9.01. However, the foregoing shall not limit the right of a party to effect service of process on the other party by any other legally available method.
SECTION 9.10    Counterparts; Etc. This Agreement may be executed in one or more counterparts, each of which shall be deemed an original, and all of which shall constitute one and the same agreement, and shall become effective when one or more counterparts have been signed by each of the parties hereto and delivered to the other parties. Delivery of an executed counterpart of a signature page to this Agreement by facsimile, email in “portable document format” (“.pdf”) form, or by other electronic means intended to preserve the original graphic and pictorial appearance of a document, will have the same effect as physical delivery of the paper document bearing the original signature.
SECTION 9.11    Headings, Etc. The provision of the Table of Contents, the division of this Agreement into Articles, Sections and other subdivisions and the insertion of headings are for convenience of reading only and shall not affect or be utilized in construing or interpreting this Agreement. All references in this Agreement to any Article, Section, subsection or clause are to the corresponding Article, Section, subsection or clause of this Agreement, unless otherwise specified.
SECTION 9.12    Further Assurances. Subject to the terms and conditions of this Agreement, from time to time, at the request of any party hereto and, except as otherwise set forth herein, at the expense of the party so requesting (in the case of the Stockholders’ Representative, on behalf of the Equityholders), each other party hereto shall execute and deliver to such requesting party such
110


documents and take such other action as such requesting party may reasonably request in order to consummate the transactions contemplated hereby.
SECTION 9.13    Remedies. The parties hereto understand and agree that the provisions of this Agreement are uniquely related to the desire of the parties and their respective Affiliates to consummate the transactions contemplated hereby, that the transactions contemplated hereby represent a unique business opportunity at a unique time for each of the parties hereto and their respective Affiliates and further agree that irreparable damage would occur in the event that any provision of this Agreement were not performed in accordance with its terms and further agree that, although monetary damages may be available for the breach of such covenants and undertakings, monetary damages would be an inadequate remedy therefor. Accordingly, each party hereto agrees, on behalf of itself and its Affiliates, that, in the event of any breach or threatened breach by the Company, on the one hand, or Parent, Merger Sub, or Merger Sub II, on the other hand, of any provision of this Agreement, the Company, on the one hand, or Parent, Merger Sub, or Merger Sub II, on the other hand, shall be entitled to an injunction or injunctions, specific performance and other equitable relief to prevent or restrain breaches or threatened breaches of this Agreement, and to specifically enforce the terms and provisions of this Agreement. Any party seeking an injunction or injunctions to prevent breaches of this Agreement or to enforce specifically the terms and provisions of this Agreement shall not be required to provide, furnish or post any bond or other security in connection with or as a condition to obtaining any such Order or injunction, and each party hereto hereby irrevocably waives any right it may have to require the provision, furnishing or posting of any such bond or other security. In the event that any Legal Proceeding should be brought in equity to enforce the provisions of this Agreement, no party shall allege, and each party hereto hereby waives the defense, that there is an adequate remedy at law.
SECTION 9.14    Knowledge. For purpose of this Agreement, (i) “knowledge” of the Company (or “the Company’s knowledge” or similar references) means the actual knowledge after due inquiry of each Person named on Schedule 9.14(i) to this Agreement, and (ii) “knowledge” of Parent, Merger Sub, or Merger Sub II means the actual knowledge after due inquiry of each Person named on Schedule 9.14(ii) to this Agreement.
SECTION 9.15    Interpretation. The words “hereof”, “herein”, “hereto”, “hereunder” and “hereinafter” and words of similar import, when used in this Agreement, shall refer to this Agreement as a whole and not to any particular provision of this Agreement, unless the context otherwise requires. The terms defined in the singular shall have a comparable meaning when used in the plural, and vice versa. The term “dollars” and character “$” shall mean United States dollars. The term “including” shall mean including, without limitation, and the words “include” and “includes” shall have corresponding meanings and such words shall not be construed to limit any general statement that they follow to the specific or similar items or matters immediately following them. The term “or” is not exclusive, unless the context otherwise requires. The exhibits, the Company Disclosure Schedule, the Parent Disclosure Schedule and the other schedules to this Agreement are hereby incorporated herein and made a part hereof and are an integral part of this Agreement. Any capitalized terms used in the Company Disclosure Schedule, the Parent Disclosure Schedule or any other exhibit or schedule hereto but not otherwise defined therein shall be defined as set forth in this Agreement. Any reference in this Agreement to gender shall include all genders and the neuter. The parties hereto have participated jointly in the negotiation and drafting of this Agreement and, in the event an ambiguity or question of intent or interpretation arises, this Agreement shall be construed as jointly drafted by the parties hereto and no
111


presumption or burden of proof shall arise favoring or disfavoring any party by virtue of the authorship of any provision of this Agreement. Any agreement, instrument, Law or statute defined or referred to herein or any agreement or instrument that is referred to herein means such agreement, instrument, or statute as from time to time amended, modified or supplemented, including (in the case of agreements or instruments) by waiver of consent and (in the case of statutes) by succession or comparable successor statutes and references to all attachments thereto, instruments incorporated therein and any rules or regulations promulgated thereunder (provided that for purposes of any representations and warranties contained in this Agreement that are made as of a specific date or dates, references to any statute shall be deemed to refer to such statute, as amended, and to any rules or regulations promulgated thereunder, in each case, as of such date). Any agreement or instrument referred to herein shall include reference to all exhibits, schedules and other documents or agreements attached thereto. Neither the specification of any dollar amount in any representation or warranty contained in this Agreement nor the inclusion of any specific item in the Company Disclosure Schedule or the Parent Disclosure Schedule is intended to imply that such amount, or higher or lower amounts, or the item so included or other items, are or are not material, and no party shall use the fact of setting forth of any such amount or the inclusion of any such item in any dispute or controversy between the parties as to whether any obligation, item or matter not described herein or included in the Company Disclosure Schedule or the Parent Disclosure Schedule is or is not material for purposes of this Agreement. All references to any documents or other materials or information having been “provided to Parent” or “made available to Parent” or substantially similar references shall refer to any such documents or other materials or information posted, retained and thereby made available prior to the date hereof in the Project El Cap data room established by Dorsey & Whitney LLP and hosted by Box, Inc. All references to any documents or other materials or information having been “provided to Company” or “made available to Company” or substantially similar references shall refer to any such documents or other materials or information posted, retained and thereby made prior to the date hereof in the data room established by Parent and hosted by Intralinks, Inc.
SECTION 9.16    Legal Representation.
(a)    Each of Parent, Merger Sub, and Merger Sub II agrees and acknowledges that Dorsey & Whitney LLP (“Dorsey”) has represented the Company in connection with the transactions provided for in this Agreement and the Additional Agreements. Parent (on its behalf and on behalf of its Affiliates) further agrees that, notwithstanding anything in this Agreement to the contrary, as to all communications among any of Dorsey and the Company (including any of its managers, stockholders, members, officers or employees) that relate exclusively to this Agreement or the transactions contemplated hereby, the attorney-client privilege and the expectation of client confidence belongs to the Company and shall be controlled by the Company and shall not pass to or be claimed by Parent, Merger Sub, or Merger Sub II or any of their respective Affiliates. Notwithstanding anything to the contrary contained herein, in the event that after the Closing a dispute arises between Parent, Merger Sub, or Merger Sub II or any of their respective agents or Affiliates and a Person other than the Company, or any of its agents or Affiliates, then Parent, Merger Sub, or Merger Sub II or any of their respective agents or Affiliates, as applicable, may assert the attorney-client privilege to prevent disclosure of confidential communications to or from Dorsey.
(b)    Each of the parties hereto acknowledges and agrees, on its own behalf and on behalf of its directors, managers, members, partners, officers, employees, and Affiliates that only the Company is the client of Dorsey. After the Closing, it is possible that Dorsey will represent the
112


Company and its Affiliates including the Equityholders (individually and collectively, the “Sellers”) or the Stockholders’ Representative in connection with the transactions contemplated herein or in the Escrow Agreement and any claims made thereunder pursuant to this Agreement or the Escrow Agreement. Parent, Merger Sub, and Merger Sub II hereby agree that Dorsey may represent the Sellers or the Stockholders’ Representative in the future in connection with issues that may arise under this Agreement or the Escrow Agreement, the administration of the escrow fund and any claims that may be made thereunder pursuant to this Agreement or the Escrow Agreement. Each of the parties hereto consents thereto, and waives any conflict of interest arising therefrom, and each such party shall cause any Affiliate thereof to consent to waive any conflict of interest arising from such representation. Each of the parties hereto acknowledges that such consent and waiver is voluntary, that it has been carefully considered, and that the parties have consulted with counsel or have been advised they should do so in connection with this waiver.
[SIGNATURE PAGES FOLLOW]
113


IN WITNESS WHEREOF, the undersigned parties hereto have caused this Agreement and Plan of Merger and Reorganization to be executed as of the date first written above.
SOCIAL FINANCE, INC.
By: /s/ Anthony Noto
Name: Anthony Noto
Title: CEO
SFI ACQUISITION CO., INC.
By: /s/ Christopher Lapointe
Name: Christopher Lapointe
Title: President
SFI FINANCIAL TECHNOLOGIES LLC
By: /s/ Christopher Lapointe
Name: Christopher Lapointe
Title: President
GALILEO FINANCIAL TECHNOLOGIES, INC.
By: /s/ Clay Wilkes
Name: Clay Wilkes
Title: Chief Executive Officer



Acknowledged and agreed solely in its capacity as STOCKHOLDERS’ REPRESENTATIVE:
SHAREHOLDER REPRESENTATIVE SERVICES LLC, solely in its capacity as the Stockholders’ Representative
By: /s/ Kip Wallen
Name: Kip Wallen
Title: Director



EXHIBIT A
AGREED FORM
CONFIDENTIAL
SUPPORT AGREEMENT
This Support Agreement (this “Agreement”), is made as of this [●] day of [●], 2020, between Social Finance, Inc., a Delaware corporation (“Parent”),[ and] the undersigned stockholder of Galileo Financial Technologies, Inc., a Delaware corporation (the “Company”), identified on the signature page hereto in the undersigned’s capacity as a stockholder of the Company (the “Stockholder”)[, and Clayton Wilkes (the “Beneficial Owner”)].
WHEREAS, Parent, SFI Acquisition Co., Inc., a Delaware corporation and direct subsidiary of Parent (“Merger Sub”), SFI Financial Technologies LLC, a Delaware limited liability company and direct subsidiary of Parent (“Merger Sub II”), the Company and Shareholder Representative Services, LLC (“SRS”), solely in its capacity as the representative, agent and attorney-in-fact of the Equityholders (as defined therein) (the “Stockholders’ Representative”) have entered into an Agreement and Plan of Merger and Reorganization, dated as of April 6, 2020 (the “Merger Agreement”), pursuant to which, among other things, Merger Sub will merge with and into the Company (the “First Merger”), with the Company being the surviving corporation of the First Merger (the Company, in its capacity as the surviving corporation of the First Merger, is thereafter sometimes referred to as the “Surviving Corporation”); and (b) immediately following the First Merger and as part of the same integrated transaction as the First Merger, the Surviving Corporation will merge with and into Merger Sub II (the “Second Merger” and, together with the First Merger, the “Mergers”), whereupon the separate existence of the Surviving Corporation shall cease and Merger Sub II shall continue as the surviving entity (Merger Sub II, in its capacity as the surviving entity of the Second Merger, is thereafter sometimes referred to as the “Surviving Entity”) and each share of Company Common Stock and Company Preferred Stock outstanding as of immediately prior to the Effective Time will be exchanged for the right to receive the applicable Merger Consideration, in each case subject to and in accordance with the terms of the Merger Agreement; and
WHEREAS, the Stockholder owns, or possesses the sole right to vote or direct the voting of, the number of shares of Company Common Stock and/or Company Preferred Stock set forth on the signature page hereto (the “Covered Shares”); and
WHEREAS, the Stockholder owns, or possesses the power to dispose of or to direct the disposition of, the Covered Shares; and
WHEREAS, if so indicated on the signature page hereto, the Stockholder has the right, prior to the Effective Time, to acquire pursuant to the exercise of the Options issued and outstanding pursuant to the 2001 Option Plan or the 2011 Option Plan (collectively, the “Company Stock Plans”), the number of shares of the Company Common Stock set forth on such signature page; and
WHEREAS, as a material inducement for Parent, Merger Sub and Merger Sub II to enter into the Merger Agreement and consummate the transactions contemplated thereby, the Stockholder [and the Beneficial Owner, who, through his ownership of all of the membership interests of the Stockholder, is the beneficial owner of the Covered Shares,] [has] [have] agreed to enter into this Agreement.
NOW, THEREFORE, in consideration of the foregoing and the covenants and agreements set forth herein and in the Merger Agreement, and intending to be legally bound hereby, the parties agree as follows:
1.    Representations and Warranties of the Stockholder[ and the Beneficial Owner]. [Each of the Beneficial Owner and] [T][t]he Stockholder represents, warrants and covenants to Parent, Merger Sub, Merger Sub II, the Surviving Entity, and the Surviving Corporation as of the date hereof and at all times until the Effective Time as follows:



(a)    That the Stockholder is now, and at all times until the Effective Time will be, the sole and exclusive owner, of record and beneficially, or possesses and will possess the sole right to vote or direct the voting of all of the Covered Shares, and possesses and will possess the sole power to dispose of or direct the disposition of all of Covered Shares. Other than the Covered Shares and the Options set forth on the signature page hereto, the Stockholder does not own any shares of Company Common Stock, Company Preferred Stock, Options or any other interests in, options to purchase or rights to subscribe for or otherwise acquire any securities of the Company and has no interest in or voting rights with respect to any securities of the Company.
(b)    The Stockholder has, and through the Effective Time will continue to have, the sole right and power to vote and dispose of, or to direct the voting and disposition of all of the Covered Shares.
(c)    If the Stockholder is an individual, the Stockholder has the legal capacity to execute this Agreement, or, if the Stockholder is not an individual, the Stockholder is duly organized and validly existing under the applicable laws of its state of organization.
(d)    The Stockholder[ and the Beneficial Owner] has full right, power and authority to enter into, deliver and perform its, his or her obligations under this Agreement and to consummate the transactions contemplated by this Agreement, the Merger Agreement and all of the other documents and agreements required to be delivered in connection therewith to which the Stockholder[ or the Beneficial Owner, as applicable,] is a party.
(d)    The Covered Shares are (and will be) free and clear of all liens, security interests, mortgages, pledges, charges or similar encumbrances (collectively, “Liens”) other than such as exist under applicable securities laws or as shall be terminated in connection with the consummation of the Merger.
(e)    This Agreement has been duly executed and delivered by the Stockholder[ and the Beneficial Owner], and constitutes the legal, valid and binding obligation of the Stockholder[ and the Beneficial Owner], and is enforceable in accordance with its terms, except as such enforceability may be limited by applicable bankruptcy, insolvency, fraudulent conveyance or similar Laws affecting the enforcement of creditors’ rights generally and subject to general principles of equity (regardless of whether enforcement is sought in a proceeding at law or in equity).
(f)    The execution, delivery and performance of this Agreement by the Stockholder[ and the Beneficial Owner] does not, and the consummation by the Stockholder[ and the Beneficial Owner] of the transactions contemplated by this Agreement will not, (i) result in a violation or breach of, contravene or conflict with, constitute a default under, or give rise to any right to declare a default (or an event which, with the giving of due notice or lapse of time or both, would become a default) or to exercise any remedy under, accelerate the maturity or performance of or payment under, or cancel, terminate or modify (with or without due notice or lapse of time or both) any agreement or commitment to which the Stockholder[ or the Beneficial Owner] is a party, (ii) violate any Law or any judgment, decree, order, regulation or rule of any court or other Governmental Authority applicable to the Stockholder[ or the Beneficial Owner], including any legal proceedings currently pending against the Stockholder[ or the Beneficial Owner], (iii) result in the creation of any Liens on any of the assets or properties of the Stockholder[ or the Beneficial Owner], (iv) require the consent of any person or entity which has not been obtained, or (v) if the Stockholder is an entity, violate any provision of the organizational documents of the Stockholder.
(g)    [Neither the Beneficial Owner nor] [T][t]he Stockholder [is][are] [not] required to give any notice to, make any filing or registration with, or obtain any authorization, waiver, license, consent, or approval of any Governmental Authority or third party in connection with the execution and delivery of this Agreement by the Stockholder[ and the Beneficial Owner], the performance by the Stockholder[ and the
2


Beneficial Owner] of his, her or its obligations under this Agreement or the consummation by the Stockholder[ and the Beneficial Owner] of the transactions contemplated by this Agreement or the Merger Agreement.
(h)    If the Stockholder is a natural person, then, unless Exhibit A is completed as set forth in the following sentence, either (i) the Stockholder is not married or (ii) the consent of the Stockholder’s spouse is not required for the execution, delivery and performance by the Stockholder of this Agreement. If the Stockholder is married, and any of the Covered Shares of the Stockholder constitute community property or otherwise need spousal or other approval for this Agreement to be legal, valid and binding, a spousal consent substantially in the form attached as Exhibit A hereto has been duly executed and delivered by the Stockholder’s spouse and, assuming the due authorization, execution and delivery hereof by Parent, is enforceable against the Stockholder’s spouse in accordance with its terms.
(i)    The Stockholder[ and the Beneficial Owner] has been advised to seek legal, financial and tax advice prior to signing this Agreement and has had an opportunity to review with the Stockholder’s[ and the Beneficial Owner’s] tax, financial and legal advisors the consequences of the Mergers and the transactions contemplated by the Merger Agreement and this Agreement. The Stockholder[ and the Beneficial Owner] has read and understands the Merger Agreement and this Agreement and executes this Agreement freely and voluntarily.
(j)    The Stockholder[ and the Beneficial Owner] understand[s] and acknowledge[s] that Parent, Merger Sub and Merger Sub II are entering into the Merger Agreement in reliance upon the Stockholder’s[ and the Beneficial Owner’s] execution, delivery and performance of this Agreement. Parent shall be entitled to rely on the description of the Covered Shares set forth on the signature page hereto and in no event shall Parent, Merger Sub, Merger Sub II, the Surviving Entity, the Surviving Corporation, and the respective representatives, successors and assigns of each of the foregoing in their capacity as such (each, an “Acquirer Indemnified Party” and collectively, the “Acquirer Indemnified Parties”) be liable to the Stockholder therefor or responsible for any inaccuracy therein.
(k)    If the Stockholder is receiving Parent Series H-1 Preferred Stock in connection with the Mergers, the Stockholder represents and warrants that it, he or she (i) is an “accredited investor” as such term is defined in Rule 501 of Regulation D promulgated under the Securities Act of 1933, as amended (the “Securities Act”), (ii) understands that the shares of Parent Series H-1 Preferred Stock are “restricted securities” and have not been registered under the Securities Act or any applicable state securities law and is acquiring the Parent Series H-1 Preferred Stock for his, her or its own account for investment purposes only and not with a view to or for distributing or reselling such Securities or any part thereof, (iii) has no present intention of distributing any of such Parent Series H-1 Preferred Stock and has no arrangement or understanding with any other persons regarding the distribution of such Parent Series H-1 Preferred Stock. The Stockholder does not have any agreement or understanding, directly or indirectly, with any Person to distribute any of the Parent Common Stock.
(l)    As of the date hereof, there is no Legal Proceeding pending against, or, to the knowledge of the Stockholder[ or the Beneficial Owner], threatened against the Stockholder[ or the Beneficial Owner] or any of the Stockholder’s[ or the Beneficial Owner’s] properties or assets (including, without limitation, any Covered Shares or Options beneficially owned by the Stockholder[ or the Beneficial Owner]) that could reasonably be expected to prevent or materially delay or impair the consummation by the Stockholder[ or the Beneficial Owner] of the transactions contemplated by this Agreement or the Merger Agreement or otherwise materially impair the Stockholder’s[ or the Beneficial Owner’s] ability to perform its obligations hereunder or thereunder. In the event that any such Legal Proceeding is pending or threatened against the Stockholder[ or the Beneficial Owner] at any time following the date hereof, the Stockholder[ or the Beneficial Owner, as applicable,] shall promptly notify Parent thereof.
3


(m)    [The Beneficial Owner is now, and at all times until the Effective Time will be, the sole and exclusive owner, of record and beneficially, or possesses and will possess the sole right to vote or direct the voting of, all of the membership or other equity interests in the Stockholder. The Beneficial Owner has the legal capacity to execute this Agreement.]
2.    Covenants of the Stockholder.
(a)    [Each of the Beneficial Owner and] [T][t]he Stockholder agree[s] that the Stockholder shall vote, or cause to be voted, in person or by proxy, or by written consent, as applicable, the Covered Shares (i) in favor of the Merger Agreement and the transactions contemplated thereby, and any other matter that could reasonably be expected to facilitate the Merger until this Agreement terminates as provided in Section 2(d), (ii) against any proposal or action that is intended, or could reasonably be expected to, impede, interfere with, delay, postpone, discourage or adversely affect the Merger or any other transactions contemplated by the Merger Agreement, (iii) against any action or agreement that could reasonably be expected to result in a breach of any representation, warranty, covenant or obligation of the Company in connection with any agreement entered into by the Company or in connection with the Merger Agreement or that could reasonably be expected to preclude fulfillment of a condition precedent under the Merger Agreement or the Company’s obligation to consummate the Merger, and (iv) against any Acquisition Proposal. Until the Effective Time, in the event that any meeting of the stockholders of the Company is held with respect to any of the foregoing (and at every adjournment or postponement thereof), the Stockholder shall, or shall cause the holder of record of the Covered Shares on any applicable record date to, appear at such meeting or otherwise cause the Covered Shares to be counted as present thereat for purposes of establishing a quorum and to be voted as required herein or respond to the request by the Company for written consent, as applicable.
(b)    The Stockholder agrees that until the termination of this Agreement as provided in Section 2(d), that the Stockholder shall not, without the prior written consent of Parent, directly or indirectly, sell, transfer, hypothecate, grant a security interest in (after the date hereof), tender or permit the tender into any tender or exchange offer, or otherwise dispose of or encumber, enter into any voting agreement in respect of, or otherwise grant to any Person any right to vote or direct the voting of any of the Covered Shares or any options to acquire the Company Common Stock issued and outstanding pursuant to the Company Stock Plans except as contemplated by the Merger Agreement. Notwithstanding the foregoing, in the case of any transfer by operation of law, this Agreement shall be binding upon and inure to the transferee.
(c)    [Each of the Beneficial Owner and] [T][t]he Stockholder agrees that until the termination of this Agreement as provided in Section 2(d),[ each of the Beneficial Owner and] the Stockholder shall not, and shall not authorize or permit any of its Affiliates or any of its or their Representatives to, directly or indirectly, (i) encourage, solicit, initiate, facilitate or continue inquiries regarding an Acquisition Proposal; (ii) enter into discussions or negotiations with, or provide any information to, any Person concerning a possible Acquisition Proposal; (iii) enter into any agreements or other instruments (whether or not binding) regarding an Acquisition Proposal; or (iv) furnish any material nonpublic information with respect to, assist or participate in, or facilitate in any other manner, any effort or attempt by any Person to do or seek to do anything prohibited in this Section 2(c). [Each of the Beneficial Owner and] [T][t]he Stockholder shall immediately cease and cause to be terminated, and shall cause its and their respective Affiliates and all of its and their respective Representatives to immediately cease and cause to be terminated, all existing discussions or negotiations with any Persons conducted heretofore with respect to, or that could lead to, an Acquisition Proposal. [ Each of the Beneficial Owner and] The Stockholder also shall, and shall cause its Affiliates to, and each such foregoing Person shall cause its respective Representatives to, promptly notify any party with which such discussions or negotiations were being held of such termination described above.
4


(d)    This Agreement, other than the provisions of Sections 5 through and including Section 23 hereof, shall terminate upon the earlier to occur of: (i) the termination of the Merger Agreement in accordance with its terms or (ii) the Effective Time. The provisions of Sections 5 through and including Section 23 shall terminate only upon the termination of the Merger Agreement in accordance with its terms prior to the Closing.
(e)    The Stockholder hereby forever waives and agrees not to exercise any appraisal rights or dissenters’ rights, including without limitation pursuant to Section 262 of the DGCL, in respect of the Stockholder’s Covered Shares that may arise in connection with the Mergers or any other transactions contemplated by the Merger Agreement.
(f)    The Stockholder hereby agrees not to commence or participate in, and to take all actions necessary to opt out of any class in any class action with respect to, any claim, derivative or otherwise, against the Company, Parent, Merger Sub, Merger Sub II or any of their respective successors, directors or officers relating to the negotiation, execution or delivery of this Agreement or the Merger Agreement or the consummation of the Mergers or the other transactions contemplated thereby, including any such claim (i) challenging the validity of, or seeking to enjoin or delay the operation of, any provision of this Agreement or the Merger Agreement or (ii) alleging a breach of any duty of the Company’s Board of Directors in connection with the Merger Agreement, this Agreement or the transactions contemplated thereby or hereby, but excluding any such claim brought on behalf of the Stockholder to enforce the terms of the Merger Agreement.
(g)    [Each of the Beneficial Owner and] [T][t]he Stockholder shall promptly notify Parent of any development occurring after the date hereof that causes, or that would reasonably be expected to cause, any breach of any of the representations, warranties and covenants of the Stockholder[ and the Beneficial Owner] set forth in Section 1 hereof and this Section 2.
3.    Additional Shares and Options. Notwithstanding anything to the contrary contained herein, this Agreement shall apply to all shares of the Company Common Stock and the Company Preferred Stock which the Stockholder[ or the Beneficial Owner] currently has the sole right and power to vote and/or dispose of, or to direct the voting or disposition of, and all such shares of the Company Common Stock and the Company Preferred Stock which the Stockholder[ or the Beneficial Owner] may hereafter acquire, and all Options which the Stockholder[ or the Beneficial Owner] may currently own or hereafter acquire.
4.    Options and Notice of Option Exercise Limitation. Stockholder agrees that Stockholder shall not deliver any notice of exercise of any Option within five (5) Business Days prior to the Effective Time nor, except to the extent pursuant to or otherwise in connection with a notice of exercise delivered prior to the date that is five (5) Business Days prior to the Effective Time, exercise or attempt to exercise any Option within five (5) Business Days prior to the Effective Time, except for the exercise of the Options that by their terms will expire if not exercised and in such case any shares of the Company Common Stock received upon such exercise shall be subject to the terms of this Agreement.
5.    Merger Agreement; Independent Investigation; Defined Terms.
(a)    The Stockholder acknowledges and agrees that the Stockholder has received and reviewed the Merger Agreement, and the Stockholder fully understands and agrees to the terms and conditions thereof. The Stockholder further acknowledges and agrees that the Stockholder is an Equityholder, as defined in the Merger Agreement. The Stockholder understands that by executing this Agreement, the Stockholder hereby agrees to be bound by (and entitled to the benefits of) all of the terms, conditions, rights, duties, and obligations of a Stockholder and an Equityholder under the Merger Agreement as if it, he or she were a signatory and direct party thereto. Such obligations include, without limitation, (i) the obligation to pay, or to direct Parent
5


to pay on the Stockholder’s behalf, the Stockholder’s Note Pro Rata Share of the Deferred Transaction Fee to Qatalyst Partners LLC pursuant to Section 2.14(e) of the Merger Agreement, (ii) to appoint and indemnify, defend and hold harmless the Stockholders’ Representative pursuant to and in accordance with Section 2.15 of the Merger Agreement and (iii) the indemnification provisions and other obligations and limitations in Article VII of the Merger Agreement, which are also referenced generally in Section 6 below.
(b)    The Stockholder further acknowledges, consistent with Section 3.26 of the Merger Agreement, that it, he or she has conducted its, his or her own independent investigation, review and analysis of the business, results of operations, prospects, condition (financial or otherwise) or assets of Parent, Merger Sub and Merger Sub II, and acknowledges that it, he or she has been provided adequate access to the personnel, properties, assets, premises, books and records, and other documents and data of Parent, Merger Sub and Merger Sub II for such purpose. The Stockholder (i) acknowledges and agrees that in making its, his or her decision to enter into this Agreement and to consummate the transactions contemplated hereby and by the Merger Agreement, the Stockholder has relied solely upon its, his or her own investigation and the express representations and warranties of the Parent, Merger Sub and Merger Sub II set forth in Article IV of the Merger Agreement (including the related portions of the Parent Disclosure Schedule) and (ii) specifically disclaims that it, he or she is relying upon or has relied upon any other representations or warranties that may have been made by the Parent, Merger Sub, Merger Sub II or any other Person, and acknowledges and agrees that Parent has specifically disclaimed and does hereby specifically disclaim any such other representation made by Parent, Merger Sub, Merger Sub II or any other Person, except as expressly set forth in Article IV of the Merger Agreement (including the related portions of the Parent Disclosure Schedule).
(c)    Capitalized terms used and not defined herein but that are defined in the Merger Agreement shall have the respective meanings ascribed to them in the Merger Agreement.
6.    Indemnification and Escrow. Without limiting the generality of Section 5(a) of this Agreement, the Stockholder acknowledges and agrees that the Equityholders, including the Stockholder, shall indemnify and hold harmless the Acquirer Indemnified Parties from Losses for which the Acquirer Indemnified Parties are entitled to indemnification under Section 7.02 of the Merger Agreement, subject to the conditions and limitations set forth in Article VII of the Merger Agreement. Consistent with the foregoing, the Stockholder (a) acknowledges and consents to the terms, conditions and limitations of the indemnification and escrow provisions provided for in the Merger Agreement and the Escrow Agreement, and (b) acknowledges and agrees that such indemnification provisions require, among other things, that the Stockholder, save, defend, indemnify and hold harmless the Acquirer Indemnified Parties pursuant to Section 7.02 thereof as and to the extent set forth in Article VII of the Merger Agreement.
7.    Release and Covenant Not to Sue.
(a)    Effective as of, from, and after the Effective Time,[ each of the Beneficial Owner and] the Stockholder, on behalf of itself and, as applicable, its present and former parents, Subsidiaries, Affiliates, officers, directors, managers, equityholders, members, family members, employees, beneficiaries, heirs, successors, assigns, and any other Person claiming by, through or under any of the foregoing (collectively, “Stockholder Releasors”) hereby absolutely, unconditionally and irrevocably releases, waives and forever discharges the Company and each of the Acquirer Indemnified Parties of and from any and all actions, causes of action, suits, losses, liabilities, rights, debts, dues, sums of money, accounts, reckonings, obligations, costs, expenses, liens, bonds, bills, specialties, covenants, contracts, controversies, agreements, promises, variances, trespasses, damages, judgments, extents, executions, claims, and demands, of every kind and nature whatsoever, whether now known or unknown, foreseen or unforeseen, matured or unmatured, suspected or unsuspected, in law, admiralty or equity, which any of such Stockholder Releasors ever had, now have, or hereafter can, shall, or may have against the Company and its Subsidiaries prior to the Effective Time for, upon, or by reason of any matter, cause, or thing related to such Stockholder Releasors’ capacity as a[ direct
6


or indirect] stockholder of the Company and arising out of or related to acts, events, circumstances, conditions or omissions occurring at or prior to the Effective Time (collectively, “Released Claims”); provided, however, that nothing contained in the foregoing shall operate to release any (A) indemnification rights granted to[ the Beneficial Owner or] the Stockholder in its capacity as a director or officer of the Company (and solely in and to the extent of such capacity, and which shall not entitle the undersigned to indemnification in respect of any indemnification owed by the undersigned in the undersigned’s capacity as an Equityholder to Acquirer Indemnified Parties pursuant to Section 7.02 of the Merger Agreement) under the Delaware General Corporation Law or the provisions of the Company’s Organizational Documents; (B) rights granted to[ the Beneficial Owner or] the Stockholder pursuant to this Agreement, the Merger Agreement or any agreement, instrument, certificate or document delivered pursuant to the Merger Agreement; and (C) if[ the Beneficial Owner or] the Stockholder is or was an employee or consultant of the Company or any of its Subsidiaries, any claim for the payment or receipt of accrued but unpaid wages, salaries or other cash compensation or benefits to the extent already due and excluding any unpaid vacation or PTO that follows the Company’s or its Subsidiaries carryforward rules, in each case solely to the extent related to[ the Beneficial Owner’s or] the Stockholder’s employment or consulting relationship with the Company or any of its Subsidiaries. This release is intended to be a complete and general release with respect to the Released Claims being released herein, subject to the limitations set forth in the preceding sentence, and specifically includes claims that are known, unknown, fixed, contingent or conditional, including any breach of fiduciary duty, or claims arising under the Securities Act of 1933, as amended, or any other federal, state, blue sky or local law dealing with any securities.
Subject to the reservation of rights and the limitation of the scope of the claims released herein,[ each of the Beneficial Owner and] the Stockholder for itself and for the other Stockholder Releasors expressly acknowledges that with respect to the release of known or unknown Released Claims being released herein, each Stockholder Releasor is aware that it may hereafter discover facts in addition to or different from those which it now knows or believes to be true with respect to the subject matter herein, and the releases herein are binding and effective notwithstanding the discovery or existence of any such additional or different facts.
(b)    [EACH OF THE BENEFICIAL OWNER AND] THE STOCKHOLDER ACKNOWLEDGE[S] THAT THE STOCKHOLDER [AND THE BENEFICIAL OWNER, AS APPLICABLE,] [HAS][HAVE] BEEN ADVISED BY LEGAL COUNSEL AND IS FAMILIAR WITH THE PROVISIONS OF CALIFORNIA CIVIL CODE SECTION 1542, WHICH PROVIDES AS FOLLOWS:
“A GENERAL RELEASE DOES NOT EXTEND TO CLAIMS THAT THE CREDITOR OR RELEASING PARTY DOES NOT KNOW OR SUSPECT TO EXIST IN HIS OR HER FAVOR AT THE TIME OF EXECUTING THE RELEASE AND THAT, IF KNOWN BY HIM OR HER, WOULD HAVE MATERIALLY AFFECTED HIS OR HER SETTLEMENT WITH THE DEBTOR OR RELEASED PARTY.”
Each Stockholder Releasor acknowledges and agrees that California Civil Code Section 1542, and any similar provision in any other jurisdiction, if they exist, are designed to protect a party from waiving claims which it does not know exist or may exist. Nonetheless, each Stockholder Releasor agrees that the waiver of California Civil Code Section 1542 and any similar provision in any other jurisdiction is a material portion of the releases intended herein, and it therefore intends to waive all protection provided by California Civil Code Section 1542 and any other similar provision in any other jurisdiction with respect to the Released Claims being released herein. EACH STOCKHOLDER RELEASOR FURTHER ACKNOWLEDGES AND AGREES THAT IT IS AWARE THAT IT MAY HEREAFTER DISCOVER CLAIMS OR FACTS IN ADDITION TO OR DIFFERENT FROM THOSE IT NOW KNOWS OR BELIEVES TO BE TRUE WITH RESPECT TO THE MATTERS RELEASED HEREIN. NEVERTHELESS, SUBJECT TO THE RESERVATION OF RIGHTS AND THE LIMITATION OF SCOPE OF THE CLAIMS RELEASED HEREIN, IT INTENDS
7


TO FULLY, FINALLY AND FOREVER RELEASE ALL SUCH MATTERS. IN FURTHERANCE OF SUCH INTENTION, THE RELEASES GIVEN HEREIN SHALL BE AND REMAIN IN EFFECT AS FULL AND COMPLETE GENERAL RELEASES OF ALL SUCH MATTERS, NOTWITHSTANDING THE DISCOVERY OR EXISTENCE OF ANY ADDITIONAL OR DIFFERENT CLAIMS OR FACTS RELATIVE THERETO.
(c)    [Each of the Beneficial Owner and] [T][t]he Stockholder represents and warrants to Parent, Merger Sub, Merger Sub II, the Surviving Entity, and the Surviving Corporation that (i) no Stockholder Releasor has assigned any Released Claim or possible Released Claim against the Company or any Acquirer Indemnified Party, and (ii) each Stockholder Releasor has consulted with counsel with respect to the execution and delivery of this Agreement and has been fully apprised of the consequences of this Section 7.
(d)    [Each of the Beneficial Owner and] [T][t]he Stockholder, on behalf of itself and the Stockholder Releasors, hereby absolutely, unconditionally and irrevocably, covenants and agrees that it will not sue or otherwise bring, initiate or participate in any Legal Proceeding (at law, in equity, in any regulatory proceeding or otherwise) against the Company or any Acquirer Indemnified Party on the basis of any Released Claim.
8.    Non-Solicitation.
(a)    Commencing on the date hereof and until the three (3)1 year anniversary of the Closing Date,[ each of the Beneficial Owner and] the Stockholder agrees that it shall not, and shall cause its Affiliates not to, without prior written consent of Parent, directly or indirectly, (i) solicit, induce or encourage any of the employees of the Company, the Surviving Entity or any of their respective Subsidiaries [listed in Exhibit B]2 (each, a “Restricted Person”) to leave his or her employment or (ii) hire, employ or otherwise similarly engage any such Restricted Person; provided, however, that the foregoing clause (i) shall not apply to any Restricted Person who responds to general advertisement or a general solicitation not specifically directed at such Restricted Person and the foregoing clauses (i) and (ii) shall not apply to any Restricted Person whose employment is terminated by the Company or any of its Subsidiaries; provided, further, that if the Stockholder is a venture capital or other investment fund, the term “Affiliates” as used in this Section 8 shall not include any reference to any portfolio company of the Stockholder or its Affiliates so long as the Stockholder does not direct such portfolio company to engage in such solicitation.
(b)    Each of Parent[, the Beneficial Owner] and the Stockholder agrees that the duration and scope of the non-solicitation provision set forth in this Section 8 are reasonable and necessary to protect the legitimate interests of Parent. In the event that any court of competent jurisdiction determines that the duration or the restrictions, or both, are unreasonable and that such provision is to that extent unenforceable, Parent[, the Beneficial Owner] and the Stockholder agree that the provision shall remain in full force and effect to the maximum extent for the greatest time period and scope that would not render it unenforceable. Parent[, the Beneficial Owner] and the Stockholder intend that this non-solicitation provision shall be deemed to be a series of separate covenants, one for each and every Restricted Person. [Each of the Beneficial Owner and] [T][t]he Stockholder agrees that damages are an inadequate remedy for any breach of this provision and that Parent shall, whether or not it is pursuing any potential remedies at Law, be entitled to equitable relief in the form of preliminary and permanent injunctions without bond or other security upon any actual or threatened breach of this non-solicitation provision.
(c)    [Each of the Beneficial Owner and] [T][t]he Stockholder acknowledges that his or her ownership of Covered Shares represents a substantial interest in the Company and the Stockholder intends
1     NTD: To be set at two years solely in the Support Agreement to be executed by Accel.
2     NTD: Key Employees to be included solely in Support Agreement to be executed by Accel..
8


to transfer to Parent the goodwill reflected in the Covered Shares owned by the Stockholder. [Each of the Beneficial Owner and] [T][t]he Stockholder further acknowledges that Parent would not enter into this Agreement but for the restrictions in this Section 8.
(d)    If[ the Beneficial Owner or] the Stockholder violates the terms of this Section 8,[ the Beneficial Owner and] the Stockholder shall continue to be bound by the restrictions set forth herein until a total period of three (3) years has expired, excluding any periods of violation of this Section 8.3
9.    [Non-Competition.4
(a)    During the period commencing on the Closing Date and until the three (3) year anniversary of the Closing Date,[ each of the Beneficial Owner and] the Stockholder shall not (other than, as applicable, in his or her capacity as an employee of Parent, the Surviving Entity or any of their respective Subsidiaries), directly or indirectly, whether as a partner, officer, director, employee, stockholder, joint venture, member, investor (other than as the passive holder of not more than one percent (1%) of the total outstanding stock of a publicly-held company or any stock of Parent) or otherwise:
(i)    engage in, participate in, assist, operate, encourage, establish, develop or otherwise facilitate any business that is competitive with the business of the Company, the Surviving Entity or any of their respective Subsidiaries as such business has been conducted or had on the Closing Date been planned to be conducted by the Company or any of its Subsidiaries, where such business has been conducted (the “Restricted Territory”); or
(ii)     contact, solicit, or attempt to contact or solicit any individual or entity that is a client, customer or account, or is then contemplated or in discussions to be a client, customer or account, of the Company or any of its Subsidiaries on the Closing Date, or had been a client, customer or account of the Company or any of its Subsidiaries within a period of two (2) years prior to the Closing Date, for the purpose of diverting or taking away the business or patronage of such client, customer or account from the Company, the Surviving Entity or any of their respective Subsidiaries.
(b)    Each of Parent[, the Beneficial Owner] and the Stockholder agrees that the duration and geographic scope of the non-competition provision set forth in this Section 9 are reasonable and necessary to protect the legitimate interests of Parent. In the event that any court of competent jurisdiction determines that the duration or the geographic scope, or both, are unreasonable and that such provision is to that extent unenforceable, Parent[, the Beneficial Owner] and the Stockholder agree that the provision shall remain in full force and effect to the maximum extent for the greatest time period and in the greatest area that would not render it unenforceable. Parent[, the Beneficial Owner] and the Stockholder intend that this non- competition provision shall be deemed to be a series of separate covenants, one for each and every county or other political subdivision of each and every state or other area of the Restricted Territory. [Each of the Beneficial Owner and] [T][t]he Stockholder agrees that damages are an inadequate remedy for any breach of this provision and that Parent shall, whether or not it is pursuing any potential remedies at Law, be entitled to equitable relief in the form of preliminary and permanent injunctions without bond or other security upon any actual or threatened breach of this non-competition provision.
(c)    [Each of the Beneficial Owner and] [T][t]he Stockholder acknowledges that his or her ownership of Covered Shares represents a substantial interest in the Company and the Stockholder intends to transfer to Parent the goodwill reflected in the Covered Shares owned by the Stockholder. [Each of the
3     NTD:Subclause (d) to be removed from the Support Agreement to be executed by Accel.
4     NTD: Only applicable to Foundation Capital L.L.C. and Clay Wilkes.
9


Beneficial Owner and] [T][t]he Stockholder further acknowledges that Parent would not enter into this Agreement but for the restrictions in this Section 9.
(d)    If[ the Beneficial Owner or] the Stockholder violates the terms of this Section 9, the Stockholder shall continue to be bound by the restrictions set forth herein until a total period of three (3) years has expired, excluding any periods of violation of this Section 9.]
10.    Stockholders’ Representative. Without limiting the generality of Section 5(a) of this Agreement, the Stockholder hereby absolutely, unconditionally and irrevocably, covenants and agrees that the Stockholders’ Representative is irrevocably appointed to act as the representative, agent and attorney-in-fact for the Stockholder in its capacity as an Equityholder for all purposes under the Merger Agreement, the Escrow Agreement and the Payments Administration Agreement, and any agreement or instrument entered into or delivered in connection with the Mergers (including with respect to all post-Closing matters requiring any action or decision by the Stockholder). Without limiting the generality of the foregoing, the Stockholders’ Representative shall be the exclusive representative, agent and attorney-in-fact for and on behalf of the Stockholder, with full power and authority to exercise any other rights to: (i) execute and deliver all documents necessary or desirable to carry out the intent of the Merger Agreement, the Escrow Agreement and any other Additional Agreements, (ii) serve as the named party with respect to any such claims on behalf of the Stockholder under the Merger Agreement, (iii) give and receive on behalf of the Stockholder any and all notices and documents from or to the Stockholder thereunder or under the Merger Agreement and any Additional Agreement, (iv) grant any consent, approval or waiver on behalf of the Stockholder under the Merger Agreement and any Additional Agreement, (v) pay amounts therefrom in connection with the Merger Agreement and enforcement of rights thereunder, and (vi) make all other elections or decisions contemplated by the Merger Agreement and any Additional Agreement on behalf of the Stockholder. The Stockholder does hereby give and grant unto the Stockholders’ Representative the power and authority to do and perform each such act and thing whatsoever that the Stockholder may or is required to do pursuant to the Merger Agreement and all Additional Agreements, and to amend, modify or supplement any of the foregoing in the Stockholder’s name, place and stead, as if the Stockholder had personally done such act. The death, incapacity, dissolution, liquidation, insolvency or bankruptcy of the Stockholder shall not terminate such appointment or the authority and agency of the Stockholders’ Representative. The power-of-attorney granted hereunder is coupled with an interest and is irrevocable.
11.    Paying Agent. Without limiting the generality of Section 5(a) of this Agreement, the Stockholder hereby absolutely, unconditionally and irrevocably, covenants and agrees that the Paying Agent is entitled to exercise its rights and fulfill its obligations as and to the extent set forth in the Merger Agreement and the Payments Administration Agreement, and that no Acquirer Indemnified Party shall be liable to the Stockholder for, or responsible for, any act or omission taken by the Paying Agent, including any failure by the Paying Agent to properly conduct the exchange and payment procedures set forth in Section 2.14 of the Merger Agreement or to properly distribute the Merger Consideration pursuant to such exchange procedures.
12.    Additional Agreements. The Stockholder agrees to execute, at or prior to the Closing, one or more joinders in a form reasonably satisfactory to Parent pursuant to which the Stockholder will become party to the Parent Equity Agreements, as amended in each case by the Omnibus Amendment. The Stockholder acknowledges and agrees that prior to its receipt of the Merger Consideration in exchange for the Covered Shares, the Stockholder shall execute and deliver to the Company the Letter of Transmittal in the form attached to Merger Agreement as Exhibit F thereto (along with delivery of its Certificates or a lost certificate affidavit and other items as contemplated by Section 2.14 of the Merger Agreement and an Accredited Investor Questionnaire in the form attached thereto). [The Beneficial Owner agrees that any violation or breach of this Agreement by the Stockholder shall be deemed to be a violation or breach by the Beneficial Owner and Parent shall be entitled to pursue any remedy available hereunder against both the Beneficial Owner and the Stockholder, or either of them, in its discretion.]
10


13.    Confidentiality. From and after the date hereof, the[ each of the Beneficial Owner and] Stockholder shall, and shall cause its, his or her Affiliates and their respective Representatives to whom any Confidential Information (as hereinafter defined) was provided to, hold in confidence and not use for any purpose (other than, as applicable, in his or her capacity as an employee of Parent, the Surviving Entity or their respective Subsidiaries) any and all confidential and proprietary information, whether in written, verbal, graphic or other form, concerning any of the Company, its Subsidiaries, Parent, its Subsidiaries or the Merger Agreement or the transactions contemplated thereby (collectively, “Confidential Information”), except that[each of the Beneficial Owner and] the Stockholder shall have no obligation under this Section 13 with respect to any Confidential Information that as of the date hereof is, or after the date hereof becomes, generally available to the public other than through a breach of this Section 13 by the Stockholder[ or the Beneficial Owner] or any of its Affiliates or any of their respective Representatives. Notwithstanding the foregoing, the[each of the Beneficial Owner and] Stockholder may disclose Confidential Information, without violating the obligations of this Agreement, (A) solely to the extent necessary to enforce or defend any claim under the Merger Agreement or related agreements entered into in connection with the transaction contemplated thereby, or to enforce related rights not otherwise waived under this Agreement, but only to the extent deemed reasonably necessary by the Stockholder[ or the Beneficial Owner], upon the advice of legal counsel, to enforce or defend such claim; (B) to a financial advisor, attorney, or accountant who is subject to an obligation of confidence and non-use with respect to the Confidential Information for the purpose of obtaining advice or services from such party; or (C) if the Stockholder[ or the Beneficial Owner] is a venture capital or other investment firm, to its limited partners or other investors or potential investors if such disclosure is of financial or other information related to the performance or character of the Stockholder’s[ or the Beneficial Owner’s] investments and such Confidential Information relates to the Mergers and not to other Confidential Information, provided that, in each instance, the same are obligated to maintain the confidentiality of the information provided. [Each of the Beneficial Owner and] [T][t]he Stockholder shall, and shall cause its Affiliates and their respective Representatives to, take the same degree of care to protect the Confidential Information that such Person uses to protect such Person’s own confidential and proprietary information of a similar nature, but in no event less than a commercially reasonable degree of care. Notwithstanding the foregoing,[ each of the Beneficial Owner and] the Stockholder shall not be in breach of this Section 13 as a result of any disclosure of Confidential Information to the extent such disclosure is required by applicable Law or that is requested or required by any Governmental Authority or under any subpoena, civil investigative demand or other similar process, provided that[ the Beneficial Owner and] the Stockholder, shall promptly notify Parent, if allowed under applicable Law, of the existence, terms and circumstances surrounding such requested or compelled disclosure, and shall cooperate with Parent (at Parent’s sole expense) in connection with any of Parent’s efforts to prevent or limit the scope of such disclosure. If such disclosure cannot successfully be prevented or limited, the[each of the Beneficial Owner and] Stockholder may disclose without liability that portion of the Confidential Information that[each of the Beneficial Owner and] the Stockholder has been advised by its legal counsel is required to be disclosed.
14.    Governing Law; Service of Process.
(a)    This Agreement and any Legal Proceedings (whether based on contract, tort or otherwise) arising out of or relating to this Agreement or the actions of Parent,[ the Beneficial Owner,] the Stockholder, Merger Sub, Merger Sub II or the Company in the negotiation, administration, performance and enforcement thereof, shall be governed by and construed in accordance with the laws of the State of Delaware, without giving effect to any choice or conflict of law provision or rule (whether of the State of Delaware or any other jurisdiction) that would cause the application of the laws of any jurisdiction other than the State of Delaware. Each of the parties hereto irrevocably agrees that any Legal Proceeding with respect to this Agreement and the rights and obligations arising hereunder, or for recognition and enforcement of any judgment in respect of this Agreement and the rights and obligations arising hereunder brought by another party hereto or its successors or assigns, shall be brought and determined exclusively in the Delaware Court of Chancery in New
11


Castle County and any state appellate court therefrom within the State of Delaware (or, if the Delaware Court of Chancery declines to accept jurisdiction over a particular matter, any federal court within the State of Delaware). Each of the parties hereto hereby irrevocably submits with regard to any such action or proceeding for itself and in respect of its property, generally and unconditionally, to the personal jurisdiction of the aforesaid courts and agrees that it will not bring any action relating to this Agreement or any of the transactions in any court other than the aforesaid courts. Each of the parties hereto hereby irrevocably waives, and agrees not to assert, by way of motion, as a defense, counterclaim or otherwise, in any action or proceeding with respect to this Agreement, (i) any claim that it is not personally subject to the jurisdiction of the above named courts, (ii) any claim that it or its property is exempt or immune from jurisdiction of any such court or from any legal process commenced in such courts (whether through service of notice, attachment prior to judgment, attachment in aid of execution of judgment, execution of judgment or otherwise) and (iii) to the fullest extent permitted by the applicable Law, any claim that (A) the suit, action or proceeding in such court is brought in an inconvenient forum, (B) the venue of such suit, action or proceeding is improper or (C) this Agreement, or the subject matter hereof, may not be enforced in or by such courts. The parties hereto further agree that any final and nonappealable judgment against any of them in any action, suit or proceeding described in this Section 14(a) shall be conclusive and may be enforced in any other jurisdiction within or outside the United States by suit on judgment, a certified copy of which shall be conclusive evidence of the fact and amount of such judgment.
(b)    Each party hereto irrevocably consents to the service of process outside the territorial jurisdiction of the courts referred to in Section 14(a) in any such action or proceeding by mailing copies thereof by registered or certified United States mail, postage prepaid, return receipt requested, to its address as specified pursuant to Section 23. However, the foregoing shall not limit the right of a party to effect service of process on the other party by any other legally available method.
15.    Specific Performance. [Each of the Beneficial Owner and] [T][t]he Stockholder acknowledges and agrees that the failure of the Stockholder[ or the Beneficial Owner, as applicable,] to perform and comply with the provisions of this Agreement in strict accordance with the terms hereof may cause irreparable harm to Parent, for which there may be no adequate remedy at law. Parent shall be entitled, in addition to any other remedies or rights which it may have, to seek specific performance of this Agreement, without the posting of any bond, if the Stockholder[ or the Beneficial Owner] shall fail or refuse to perform the Stockholder’s[ or the Beneficial Owner’s] obligations hereunder.
16.    WAIVER OF JURY TRIAL. EACH PARTY HERETO ACKNOWLEDGES AND AGREES THAT ANY CONTROVERSY WHICH MAY ARISE UNDER OR RELATE TO THIS AGREEMENT IS LIKELY TO INVOLVE COMPLICATED AND DIFFICULT ISSUES, AND THEREFORE EACH SUCH PARTY HEREBY IRREVOCABLY AND UNCONDITIONALLY WAIVES ANY RIGHT SUCH PARTY MAY HAVE TO A TRIAL BY JURY IN RESPECT OF ANY LITIGATION DIRECTLY OR INDIRECTLY ARISING OUT OF OR RELATING TO THIS AGREEMENT, OR THE BREACH, TERMINATION OR VALIDITY OF THIS AGREEMENT, OR THE TRANSACTIONS CONTEMPLATED BY THIS AGREEMENT. EACH PARTY HERETO CERTIFIES AND ACKNOWLEDGES THAT (I) NO REPRESENTATIVE, AGENT OR ATTORNEY OF ANY OTHER PARTY HERETO HAS REPRESENTED, EXPRESSLY OR OTHERWISE, THAT SUCH OTHER PARTY WOULD NOT, IN THE EVENT OF LITIGATION, SEEK TO ENFORCE THE FOREGOING WAIVER, (II) EACH SUCH PARTY UNDERSTANDS AND HAS CONSIDERED THE IMPLICATIONS OF THIS WAIVER, (III) EACH SUCH PARTY MAKES THIS WAIVER VOLUNTARILY, AND (IV) EACH SUCH PARTY HAS BEEN INDUCED TO ENTER INTO THIS AGREEMENT BY, AMONG OTHER THINGS, THE MUTUAL WAIVERS AND CERTIFICATIONS IN THIS SECTION 16.
17.    Assignment; Successors. This Agreement may not be assigned by the Stockholder[ or the Beneficial Owner] (including by operation of law, by merger or otherwise) without the prior written consent of Parent
12


and any purported assignment in violation of this Agreement shall be void. Subject to the immediately preceding sentence, the provisions of this Agreement shall be binding upon, and shall inure to the benefit of, the parties hereto and their respective successors, assigns, heirs and personal representatives.
18.    Scope of Agreement. The parties hereto acknowledge and agree that this Agreement shall not confer upon Parent any right or ability to acquire the shares of Company Common Stock or Company Preferred Stock other than in connection with the Merger and pursuant to the Merger Agreement. The parties hereto acknowledge and agree that this Agreement does not constitute an agreement or understanding of the Stockholder[ or the Beneficial Owner] in the Stockholder’s[ or the Beneficial Owner’s] capacity as a director or officer of the Company, but only in the Stockholder’s[ or the Beneficial Owner’s] capacity as a holder of shares of Company Common Stock, Company Preferred Stock or Company Stock Options.
19.    Severability. Any invalidity, illegality or unenforceability of any provision of this Agreement in any jurisdiction shall not invalidate or render illegal or unenforceable the remaining provisions hereof in such jurisdiction and shall not invalidate or render illegal or unenforceable such provision in any other jurisdiction
20.    Amendment, Waiver. This Agreement may not be amended except by an instrument in writing signed on behalf of each of the parties hereto which expressly states its intention to amend this Agreement. No provision of this Agreement may be waived, except by an instrument in writing, executed by the waiving party, expressly indicating an intention to effect a waiver. No failure or delay by any party in exercising any right, power or privilege hereunder shall operate as a waiver thereof nor shall any single or partial exercise thereof preclude any other or further exercise thereof or the exercise of any other right, power or privilege.
21.    Further Assurances. [Each of the Beneficial Owner and] [T][t]he Stockholder will execute and deliver, or cause to be executed and delivered, all further documents and instruments and use its reasonable best efforts to take, or cause to be taken, all actions and to do, or cause to be done, all things necessary, proper or advisable under applicable Laws and regulations, to perform its obligations under this Agreement.
22.    Counterparts. This Agreement may be executed in one or more counterparts, each of which shall be an original, and all of which together shall constitute one and the same instrument. Delivery of an executed counterpart of a signature page of this Agreement by facsimile or other electronic transmission shall be effective as delivery of a manually executed original counterpart of this Agreement.
23.    Notices. All notices and other communications hereunder shall be in writing and shall be deemed to have been duly given upon receipt if in writing and if served by personal delivery upon the Person for whom it is intended, by prepaid national overnight courier service (with signed confirmation of receipt), or by confirmed electronic mail (provided that, in the case of electronic mail, such confirmation is not automated); provided that the email is promptly followed by a confirmation copy delivered by registered or certified mail or by a national courier service, to the Person at the address set forth below, or such other address as may be designated in writing hereafter, in the same manner, by such Person; and provided further that the notice or other communication is sent to the address, facsimile number or email address set forth (i) if to Parent, to the address or e-mail address set forth in Section 9.01 of the Merger Agreement and (ii) if to[ the Beneficial Owner or] the Stockholder, to[ the Beneficial Owner’s or] the Stockholder’s address or e-mail address set forth on a signature page hereto, or to such other address or e-mail address as such party may hereafter specify for the purpose by notice to each other party hereto.
24.    Entire Agreement. This Agreement, together with applicable provisions of the Merger Agreement referenced herein, the Letter of Transmittal, the exhibits hereto and thereto, and the other documents and certificates delivered pursuant hereto and thereto, constitute the entire agreement, and supersede all prior agreements and understandings, both written and oral, among the parties with respect to the subject matter of this Agreement.
13


[Signature page follows]
14


IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be executed as of the date first above written.
SOCIAL FINANCE, INC.
By:
Name:
Title:
[Signature Page to Support Agreement]


STOCKHOLDER
Name:
By:
Name:
Title:
Address:
E-mail:
[BENEFICIAL OWNER
Name:
By:
Name:
Title:
Address:
E-mail:]
Shares of Company Common Stock as to which the Stockholder has sole:
Voting Power: ________________
Dispositive Power: ________________
Shares of Company Preferred Stock as to which the Stockholder has sole:
Voting Power: ________________
Dispositive Power: ________________
Options held by the Stockholder: ____________________
[Signature Page to Support Agreement]


EXHIBIT D
AGREED FORM
FORM OF SELLER NOTE
SELLER SUBORDINATED NOTE
THIS NOTE HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED. IT MAY NOT BE SOLD OR TRANSFERRED IN THE ABSENCE OF REGISTRATION OR AN EXEMPTION THEREFROM UNDER SAID ACT.
[________],[______] (the “Issue Date”)
U.S. $250,000,000
SOCIAL FINANCE, INC., a Delaware corporation (“Payor”), for value received, promises to pay to the person or persons identified on Schedule I hereto (each, a “Payee” or, collectively, “Payees”) the principal amount set forth opposite its name on Schedule I together with accrued interest thereon, calculated and payable as set forth below (together with any PIK Notes (defined below) issued pursuant to Section 1.1 below, the “Note”). The principal and interest on this Note is payable in lawful money of the United States of America in immediately available funds at such place in the United States as Payee may from time to time designate in writing to Payor.
This Note is made pursuant to that certain Agreement and Plan of Merger and Reorganization (the “Merger Agreement”), dated April 6, 2020 by and among Payor, SFI Acquisition Co., Inc., a newly formed corporation organized under the laws of the State of Delaware and a direct wholly owned subsidiary of Payor, SFI Financial Technologies LLC, a newly formed corporation limited liability company organized under the laws of the State of Delaware and a direct wholly owned subsidiary of Payor, Galileo Financial Technologies, Inc., a corporation organized under the laws of the Delaware (the “Target”), and Shareholder Representative Services LLC, a Colorado limited liability company, solely in its capacity as the representative, agent and attorney-in-fact of the Target’s equity holders. This Note is the “Seller Note” referred to in the Merger Agreement. Payee is receiving this Note pursuant to the Merger Agreement. All capitalized terms used herein and not defined herein shall have the meanings assigned to such terms in the Merger Agreement.
1.    Payment of Principal and Interest
1.1.    Calculation and Payment of Interest. Interest on the principal balance of this Note outstanding from time to time until paid in full in cash shall accrue at the rate equal to the Applicable Rate per annum, computed on the basis of a 365 or 366-day year, as appropriate, for the actual number of days elapsed, commencing on the date hereof (and on the date of issuance with respect to any PIK Note). “Applicable Rate” shall mean (A) 10.0% prior to the occurrence of any Event of Default (as defined below) hereunder and, (B) 15.0% after the occurrence and during the continuance of an Event of Default; provided, however, that if this Note is voluntarily prepaid in full in cash on or before the date that is six (6) months from the date hereof, “Applicable Rate” shall mean 0%. Interest shall be payable quarterly in arrears, beginning on the last day of the first calendar quarter following the Issue Date and on the last day of each calendar quarter thereafter; provided that after the occurrence and during the continuance of any Event of Default, interest shall be payable monthly in arrears, beginning on the last day of the first month following the applicable Event of Default and on the last date of each month thereafter (each, an “Interest Payment Date”) until paid in full, and shall be made either (i) by the deemed issuance of a promissory note in a principal amount equal to interest accrued but not otherwise paid (by the issuance of a PIK Note or otherwise) on the principal



amount hereof through and including such Interest Payment Date and otherwise having such terms and provisions that are the same as the terms and provisions of this Note (each such promissory note a “PIK Note”), and Payor shall be deemed to have issued a PIK Note for any such interest and shall not be obligated to actually deliver any such PIK Note or (ii) by increasing the principal amount of this Note by the amount of such cash interest (such payment of interest, whether made under subclause (i) or (ii), the “Interest”). For the avoidance of doubt, if the “Applicable Rate” shall mean 0% as a result of a qualifying prepayment pursuant to this Section 1.1, all PIK Notes will (and any interest accrued on such PIK Notes) will be equal to $0.
1.2.    Payment on Maturity Date. The principal balance of, and any accrued and unpaid interest on, this Note (including, for the avoidance of doubt, the principal balance of and any accrued and unpaid interest on any PIK Note) shall be payable in cash on [________], 20215 (the “Maturity Date”).
1.3.    Prepayment. Payor may, at its option at any time, without premium or penalty, prepay all or any portion of this Note. Any prepayment of this Note shall be applied as follows: first, to payment of accrued interest; and second, to payment of principal. Upon any partial prepayment, at the request either of Majority Payees or Payor, this Note shall be surrendered to Payor in exchange for a substitute note, which shall set forth the revised principal amount but otherwise be identical to this Note. In the event that this Note is prepaid in its entirety, this Note shall be surrendered to Payor for cancellation as a condition to any such prepayment.
1.4.    Payment Only on Business Days; Payments Free and Clear. Any payment hereunder which, but for this Section 1.4, would be payable on a day which is not a Business Day, shall instead be due and payable on the Business Day next following such date for payment. All payments hereunder shall be made free and clear of any deduction, withholding or offset and in immediately available funds, except to the extent otherwise required by applicable law.
1.5.    Tax Reporting. Payor agrees that none of the Interest accrued or payable pursuant to the Note shall be reported as “original issue discount” as defined in the Code, and, accordingly, no IRS Forms 1099-OID shall be issued in connection therewith and that the Note is not a “below-market loan” described in Code Section 7872; provided, however, that Payor shall be entitled to issue IRS Forms 1099-INT with respect to the portion of any cash payment on the Note that represents interest for federal income tax purposes actually paid in cash on the Maturity Date for the year in which such Interest is paid.
1.6.    Method of Payment. The Payor and each Payee agree that payment on this Note shall be made in accordance with Section 2.14(e) of the Merger Agreement, and that pursuant thereto all amounts owing hereunder shall be paid to the Paying Agent (as defined in the Merger Agreement) or its designee for further payment to (i) the Equityholders (as defined in the Merger Agreement) in proportion to their applicable Note Pro Rata Shares (as defined in the Merger Agreement) and (ii) to Qatalyst Partners LLC (“Qatalyst”) for the Deferred Transaction Fee (as defined in the Merger Agreement). No Person that is not a party to this Note (including, without limitation, the Paying Agent and Qatalyst) shall be a third party beneficiary of this Note, and each Payee agrees that in the event of any Losses (as defined in the Merger Agreement) arising out of the payment on this Note in accordance with this Section 1.6, the Payor shall be indemnified for such Losses in accordance with 7.02(g) of the Merger Agreement.
2.    Events of Default; Acceleration.
2.1.    The following shall constitute “Events of Default” under this Note:
5 NTD: To be dated 12 months after the Issue Date.
2


2.1.1.    failure by Payor to make any payment required under this Note when the same becomes due and payable (whether at maturity, by acceleration or otherwise);
2.1.2.    a Change in Control occurs;
2.1.3.    Payor voluntarily liquidates;
2.1.4.    Payor pursuant to or within the meaning of any Bankruptcy Law: (a) commences a voluntary case or proceeding; (b) consents to the entry of an order for relief against it in an involuntary case or proceeding; (c) consents to the appointment of a Custodian of it or for all or substantially all of its property; (d) makes a general assignment for the benefit of its creditors; or (e) admits in writing that it is generally unable to pay its debts as they become due; or
2.1.5.    a court of competent jurisdiction enters an order or decree (that remains unstayed and in effect for thirty (30) days) under any Bankruptcy Law that: (a) is for relief against the Payor in an involuntary case or proceeding; (b) appoints a Custodian of the Payor or for all or substantially all of Payor’s property; or (c) orders the liquidation of Payor.
2.2.    Acceleration.
If an Event of Default specified in Section 2.1.1 or 2.1.2 shall have occurred and be continuing and any Senior Indebtedness shall then be outstanding, subject to the provisions of Section 3 hereof, the Majority Payees may, at their option, by notice in writing to Payor and to the agents under the Senior Indebtedness Documents (the “Acceleration Notice”), declare the entire principal amount of this Note and the interest accrued thereon to be due and payable; provided, however, in the event (i) an event of default has occurred and remains continuing under the Senior Indebtedness Documents and (ii) the holders of such Senior Indebtedness thereunder provide notice to Majority Payees within five Business Days of receipt of the Acceleration Notice that they are electing to block Payees’ right to receive payment hereunder due to the exercise of such holders’ remedies under such Senior Indebtedness Documents (a “Blockage Notice”), Payor shall not pay and no Payee shall not receive any payment on account of this Note (other than Permitted Non-Blockable Payments) prior to the earlier of (i) the cure or waiver of such event of default under such Senior Indebtedness Documents, (ii) the payment in full of the Senior Indebtedness under such Senior Indebtedness Documents, (iii) subject to Section 3, the date on which Payor becomes involved in a Proceeding, (iv) subject to Section 3, acceleration of the Senior Indebtedness under such Senior Indebtedness Documents and (v) the date that is 180 days from the date such Blockage Notice was received by Payee (the “Standstill Period”). Upon the expiration of the Standstill Period, and subject to Section 3, any Payee may take any enforcement action against Payor including the commencement by such Payee of any legal proceedings or actions against or with respect to Payor to facilitate to collect or enforce all or any part of the claims by such Payee against Payor and to the obligations of Payor hereunder.
2.2.1.    If an Event of Default specified in Section 2.1.1 or 2.1.2 shall have occurred and be continuing and no Senior Indebtedness shall then be outstanding, the Majority Payees may, at their option, declare the entire principal balance of this Note and the accrued and unpaid interest thereon to be due and payable upon the date which is five Business Days after the date of delivery by Payee to Payor of a written notice of acceleration, and upon any such declaration the same shall become due and payable at such time.
3


2.2.2.    If any Event of Default occurs other than the Events of Default specified in 2.1.1 and 2.1.2, the principal balance of this Note and the accrued and unpaid interest thereon shall become due and payable immediately without any declaration or other act on the part of the Majority Payees and without presentment, demand, protest or other notice or action of any kind, all of which are hereby expressly waived.
2.2.3.    If any Event of Default shall have occurred and be continuing, subject to the provisions of Section 3 hereof, the Majority Payees may proceed to protect and enforce their rights either by suit in equity or by action at law, or both, whether for specific performance of any provision of this Note or in aid of the exercise of any power granted to any Payee under this Note.
3.    Subordination.
3.1.    Note Subordinated to Senior Indebtedness. To the extent and in the manner hereinafter set forth in this Section 3, the indebtedness represented by this Note and the payment of the principal of and the interest on this Note and any claim for rescission of the purchase of this Note, and any claim which is the equivalent of or substitute for principal of or interest on this Note, for damages arising from the purchase of this Note or for reimbursement or contribution on account of such a claim, and all other payments with respect to or on account of this Note (collectively, the “Subordinated Debt”) are hereby expressly made subordinate and subject in right of payment to the prior payment in full in cash of all Senior Indebtedness then outstanding. This Section 3 constitutes a continuing offer to all Persons who become holders of, or continue to hold, Senior Indebtedness, each of whom is an obligee hereunder and is entitled to enforce such holder’s rights hereunder, subject to the provisions hereof, without any act or notice of acceptance hereof or reliance hereon. For purposes of this Section 3, Senior Indebtedness shall not be deemed to have been paid and shall be deemed to be outstanding in full until the termination of all commitments or other obligations by any holder thereof and unless all such holders shall have received payment in full in cash of all obligations under or in respect of Senior Indebtedness (including, without limitation, post-petition interest, if any).
3.2.    Dissolution; Liquidation; Bankruptcy; Acceleration. In the event of (i) any insolvency or bankruptcy case or other Proceeding, or any receivership, liquidation, reorganization or other similar proceeding in connection therewith, relative to the Payor or any of its assets, or (ii) any liquidation, dissolution or other winding up of the Payor, whether voluntary or involuntary or whether or not involving insolvency or bankruptcy, or (iii) any assignment for the benefit of creditors or any other marshalling of assets or liabilities of the Payor, or (iv) the acceleration of the Senior Indebtedness by reason of the occurrence of a default or an event of default thereunder:
3.2.1.    The holders of all Senior Indebtedness shall first be entitled to receive payment in full in cash of all Senior Indebtedness before any direct or indirect payment may be made for or on account of payments under or in respect of the Subordinated Debt (other than distributions or payments of Permitted Subordinated Securities and Permitted Non-Blockable Payments), whether in cash, property or securities of any kind;
3.2.2.    Any payment or distribution of any kind or character, whether in cash, property or securities (including any payment or distribution that may be payable by reason of any other indebtedness of Payor being subordinated to payment of the Subordinated Debt, but excluding any payments or distributions of Permitted Subordinated Securities and Permitted Non-Blockable Payments), to which Payee would be entitled except for the provisions of this Section 3, shall be paid by the liquidating trustee or agent or other person making such payment or distribution, whether a trustee in bankruptcy, a receiver or liquidating trustee or
4


other trustee or agent, directly to the holders of Senior Indebtedness or their representative or representatives, or to the trustee or trustees under any indenture or other agreement under which any of such Senior Indebtedness may have been issued for application (in the case of cash) to, or as collateral (in the case of non-cash property or securities) for the payment or prepayment of Senior Indebtedness, to the extent necessary to make payment in full of all Senior Indebtedness remaining unpaid, after giving effect to any concurrent payment or distribution to the holders of such Senior Indebtedness;
3.2.3.    Each Payee retains the power and the right to execute, verify, deliver and file any proofs of claim in respect of the Subordinated Debt in connection with any Proceeding; provided, that it hereby irrevocably authorizes, empowers and appoints the holders of Senior Indebtedness its agent and attorney-in-fact to execute, verify, deliver and file such proofs of claim (but not vote) upon the failure of such Payee promptly to do so prior to 10 days before the expiration of the time to file any such proof of claim; provided, further, that the holders of Senior Indebtedness shall have no obligation to execute, verify, deliver, and/or file any such proof of claim.
3.2.4.    Payee shall duly and promptly take such action as the holders of Senior Indebtedness may reasonably request to execute and deliver to the holders of Senior Indebtedness such powers of attorney, assignments, or other instruments as the holders of Senior Indebtedness may request in order to enable the holders of Senior Indebtedness to enforce any and all claims with respect to, and any security interests and other liens securing payment of, the amounts owing under the Subordinated Debt; provided, however, in not event shall a Payee be prohibited from (i) filing any necessary responsive or defensive pleadings (including any compulsory counterclaims) in opposition to any motion, claim, adversary proceeding or other pleading made by any Person objecting to or otherwise seeking the disallowance of the claims of any Payee, (ii) taking any action necessary to prevent the running of any applicable statute of limitations or similar restrictions on claims, (iii) taking any action to seek and obtain specific performance or injunctive relief to compel Payor to comply with (or not violate or breach) any obligation under this Note so long as such action is not accompanied by a claim for monetary damages, (iv) voting on any plan of reorganization or make any other filings or motions that are, in each case, expressly permitted under the terms of this Note or delivering notices of default or reservation of rights or any notice of any Payee to Payor and (v) demanding payment for Permitted Non-Blockable Payments; provided, that the taking of any additional action with respect to the collection or enforcement of such demand shall be subject to the terms of this Note and only permitted if expressly permitted by this Note without giving effect to this clause (v). Notwithstanding any of the foregoing, each Payee hereby agrees that it will not take any action that would hinder any exercise of remedies undertaken by any holders of Senior Indebtedness in respect of any rights under the Senior Indebtedness Documents.
3.2.5.    In the event that, any payment or distribution of any kind or character, whether in cash, property or securities (including any payment or distribution that may be payable by reason of any other indebtedness of Payor being subordinated to payment of the Subordinated Debt, but excluding payments or distributions of Permitted Subordinated Securities and Permitted Non-Blockable Payments), shall be received by Payee for or on account of or in respect of the Subordinated Debt in contravention of this Section 3.2 before all Senior Indebtedness is paid in full in cash, such payment or distribution shall be received and held in trust for, and shall be paid over (in the same form as so received, to the extent practicable, and with any necessary endorsement) to the holders of the Senior Indebtedness remaining unpaid or their representative or representatives, or to the trustee or trustees under any such indenture or
5


agreement under which any Senior Indebtedness may have been issued, for application (in the case of cash) to, or as collateral (in the case of non-cash property or securities) for the payment or prepayment of Senior Indebtedness, until all Senior Indebtedness shall have been paid in full in cash, after giving effect to any concurrent payment or distribution to the holders of such Senior Indebtedness.
3.3.    Subrogation. Upon the final payment in full in cash of all Senior Indebtedness, Payee shall be subrogated to the rights of the holders of Senior Indebtedness to receive payments or distributions of cash, property or securities of Payor applicable to the Senior Indebtedness until the principal of and interest on and all other amounts payable under the Subordinated Debt shall be paid in full in cash, and for the purposes of such subrogation, no payments or distributions to the holders of the Senior Indebtedness of any cash, property or securities to which Payee would be entitled except for the provisions of this Section 3 and no payment pursuant to the provisions of this Section 3 to the holders of Senior Indebtedness by Payee shall, as between Payor, its creditors other than holders of Senior Indebtedness, and Payee, be deemed to be a payment by Payor to or on account of the Senior Indebtedness. It is understood that the provisions of this Section 3 are and are intended solely for the purpose of defining the relative rights of Payee, on the one hand, and the holders of the Senior Indebtedness, on the other hand.
3.4.    Obligations of Payor Unconditional. Nothing contained in this Section 3 or elsewhere in this Note is intended to or shall impair, as among Payor, its creditors (other than the holders of Senior Indebtedness) and Payee, the obligation of Payor, which is absolute and unconditional, to pay to Payee the principal of and interest on and all other amounts due under this Note in accordance with its terms, or is intended to or shall affect the relative rights of Payee and creditors of Payor (other than the holders of the Senior Indebtedness), nor shall anything herein prevent Payee from exercising all remedies otherwise permitted by applicable law upon default under this Note, subject to the provisions of this Section 3 and to the rights of holders of Senior Indebtedness to receive distributions and payments otherwise payable to Payee.
3.5.    Reliance on Judicial Order or Certificate of Liquidating Agent. Upon any payment or distribution of assets of Payor referred to in this Section 3, Payee shall be entitled to rely upon any order or decree made by any court of competent jurisdiction in which bankruptcy, dissolution, winding-up, liquidation or reorganization proceedings are pending, or a certificate of the receiver, trustee in bankruptcy, liquidating trustee, agent or other person making such payment or distribution, delivered to Payee, for the purpose of ascertaining the persons entitled to participate in such distribution, the holders of the Senior Indebtedness and other indebtedness of Payor, the amount thereof or payable thereon, the amount or amounts paid or distributed thereon and all other facts pertinent thereto or to Section 3 of this Note.
3.6.    Subordination Rights Not Impaired by Acts or Omissions of Payor or Holders of Senior Indebtedness. No right of any present or future holders of any Senior Indebtedness to enforce subordination as provided herein will at any time in any way be prejudiced or impaired by any act or failure to act on the part of Payor or by any act or failure to act by any such holder, or by any act, failure to act or noncompliance by Payor, the holders of Senior Indebtedness or their respective agents with the terms of this Note, regardless of any knowledge thereof which any such holder or Payor may have or otherwise be charged with. No amendment, waiver or other modification of this Note shall in any way adversely affect the rights of the holders of any Senior Indebtedness under this Section 3 unless such holders of Senior Indebtedness consent in writing to such amendment, waiver or modification. The provisions of this Section 3 are intended for the benefit of and shall be enforceable directly by the holders of the Senior Indebtedness.
3.7.    Further Assurances. Payee and Payor each will, at Payor’s expense and at any time and from time to time, promptly execute and deliver all further instruments and documents, and take all further action, that may be necessary or desirable, or that the holders of Senior Indebtedness may request, in order to
6


protect any right or interest granted or purported to be granted hereby or to enable the holders of Senior Indebtedness to exercise and enforce their rights and remedies hereunder.
3.8.    Agreements in Respect of Subordinated Debt. Payor agrees that it will not make any payment for or on account of or in respect of this Note, or take any other action, in contravention of the provisions of this Section 3.
3.9.    Obligations Hereunder Not Affected. All rights and interests of the holders of Senior Indebtedness hereunder, and all agreements and obligations of Payee and Payor under this Section 3, shall remain in full force and effect irrespective of: (i) any lack of validity or enforceability of any present or future guaranty of the Credit Agreement or any other Senior Indebtedness Document; (ii) any change in the time, manner or place of payment of, or in any other term of, all or any of the Senior Indebtedness, or any other amendment or waiver of or any consent to any departure from the Credit Agreement or any successor agreement or any other Senior Indebtedness Document, including, without limitation, any increase in the Senior Indebtedness resulting from the extension of additional credit to Payor or any of its subsidiaries or otherwise; (iii) any taking, exchange, release or non-perfection of any other collateral, or any taking, release, amendment or waiver of or consent to departure from any guaranty, for all or any of the Senior Indebtedness; (iv) any manner of application of collateral, or proceeds thereof, to all or any of the Senior Indebtedness, or any manner of sale or other disposition of any collateral for all or any of the Senior Indebtedness or any other assets of Payor or any of its subsidiaries; (v) any change, restructuring or termination of the corporate structure or existence of Payor or any of its subsidiaries; or (vi) any other circumstance which might otherwise constitute a defense available to, or a discharge of, Payor or a subordinated creditor. The provisions of this Section 3 shall continue to be effective or be reinstated, as the case may be, if at any time any payment of any of the Senior Indebtedness is rescinded or must otherwise be returned by the holders of Senior Indebtedness upon the insolvency, bankruptcy or reorganization of Payor or otherwise, all as though such payment had not been made.
3.10.    Waiver. Payee hereby waives promptness, diligence and notice of acceptance with respect to any of the Senior Indebtedness and this Section 3 and any requirement that the holders of Senior Indebtedness protect, secure, perfect or insure any security interest or lien on any property subject thereto or exhaust any right or take any action against Payor or any other person or entity or any collateral.
3.11.    No Waiver; Remedies. No failure on the part of the holders of Senior Indebtedness to exercise, and no delay in exercising, any right hereunder shall operate as a waiver thereof; nor shall any single or partial exercise of any right hereunder preclude any other or further exercise thereof or the exercise of any other right. The remedies herein provided are cumulative and not exclusive of any remedies provided by law.
3.12.    Continuing Agreement; Assignments Under Senior Indebtedness Agreements. The provisions of this Section 3 constitute a continuing agreement and shall (i) remain in full force and effect until the earlier of (x) the date the obligations under this Note are satisfied in full in accordance with this Section 3 and (y) the date that is one hundred eighty (180) days or such shorter period as the holders of a majority of the Senior Indebtedness may agree after the indefeasible payment in full in cash of the Senior Indebtedness, (ii) be binding upon Payee, Payor and their respective successors and assigns, and (iii) inure to the benefit of, and be enforceable by, the holders of Senior Indebtedness and their successors, transferees and assigns. Without limiting the generality of the foregoing clause (iii), the holders of Senior Indebtedness may assign or otherwise transfer all or any portion of their rights and obligations under the Senior Credit Agreement or any other Senior Indebtedness Document, as applicable, to any other Person, and such other Person shall thereupon become vested with all the rights in respect thereof granted to the holders of Senior Indebtedness herein or otherwise.
7


4.    Certain Definitions.
Affiliate” means, with respect to a specified Person, another Person that directly, or indirectly through one or more intermediaries, Controls or is Controlled by or is under common Control with the Person specified.
Affiliated Persons” means, with respect to any specified Person, (i) any Affiliate of such Person and (ii) any Person Controlled by such Person or its Affiliate or the holdings of which are for the primary benefit of any such Persons.
Bankruptcy Law” means Title 11, U.S. Code or any similar federal or state law for the relief of debtors.
Business Day” means each day other than Saturdays, Sundays and days when commercial banks are authorized or required by law to be closed for business in San Francisco, California or New York, New York.
Change in Control” means (i) prior to an IPO, the failure by Permitted Holders to beneficially own at least 50.1% of the aggregate voting power of the Payor’s equity interests on a fully diluted basis; provided that any such failure shall not constitute a Change in Control if (x) such failure was due to a bona fide equity financing transaction for, or recapitalization of, the Payor and (y) a Change of Control under clause (ii) would not have occurred if such failure was following an IPO; or (ii) after an IPO, the acquisition of ownership, directly or indirectly, beneficially or of record, by any Person or group (within the meaning of the Securities Exchange Act and the rules of the Securities and Exchange Commission thereunder) other than the Permitted Holders, of more than 35% of the aggregate voting power of the Public Company’s equity interests on a fully diluted basis. The consummation of an IPO shall not constitute a Change in Control.
Code” means the Internal Revenue Code of 1986, as amended.
Control” means the possession, directly or indirectly, of the power to direct or cause the direction of the management or policies of a Person, whether through the ability to exercise voting power, by contract or otherwise. “Controlling” and “Controlled” have meanings correlative thereto.
Credit Agreement” means the Revolving Credit Agreement first dated as of September 27, 2018 by and among Payor, as the borrower, Goldman Sachs Bank USA, as the Administrative Agent, and the other lenders from time to time party thereto, as the same may be amended, amended and restated, supplemented or otherwise modified from time to time.
Custodian” means any receiver, trustee, assignee, liquidator, sequestrator or similar office under any Bankruptcy Law.
Equity Interests” means shares of capital stock, partnership interests, membership interests in a limited liability company, beneficial interests in a trust or other equity ownership interests in a Person, and any warrants, options or other rights entitling the holder thereof to purchase or acquire any such equity interest.
Event of Default” means any of the occurrences specified under Section 2.1 of this Note.
Indebtedness” with respect to any Person means, at any time, without duplication, (i) its liabilities for borrowed money, including, without limitation, liabilities under warehouse or similar
8


facilities, (ii) all its liabilities in respect of letters of credit or instruments serving a similar function issued or accepted for its account by bank, and other financial institutions (whether or not representing obligations for borrowed money), (iii) all obligations of such Person under any swap, cap, collar or similar arrangement providing for protection against fluctuations in interest rates, currency exchange rates or commodities prices and (iv) any guaranty of such Person with respect to liabilities of a type described in any of clauses (i) through (iii) hereof. For the avoidance of doubt, the term “Indebtedness” does not include trade payables of such Person.
IPO” means a bona fide underwritten sale to the public or a direct listing on a public exchange of the Public Company pursuant to a registration statement (other than on Form S-8 or any other form relating to securities issuable under any benefit plan of the Payor or any of its subsidiaries, as the case may be) that is declared effective by the Securities and Exchange Commission.
Majority Payees” means one or more Payees entitled to a majority of the aggregate principal amount then owing under this Note.
Permitted Holders” means (i) equity holders of the Payor as of the Issue Date, (ii) each of the respective Affiliated Persons of the Person referred to in clause (i), (ii) any group (within the meaning of the Securities Exchange Act and the rules of the Securities and Exchange Commission thereunder) Controlled by any Person or Persons referred to in clauses (i) or (ii), and (iii) any acquiror of Payor that, in connection with a transaction constituting a Change of Control, agrees to assume (or will automatically assume by way of merger) the obligations of the Payor under this Note.
"Permitted Non-Blockable Payments" shall mean non-cash payments of interest with respect to the Subordinated Debt due and payable on a non-accelerated basis in accordance with Section 1.1. hereof.
"Permitted Subordinated Securities" shall mean any debt or equity securities of Payor or any other Person that are distributed to any Payee in respect of the Subordinated Debt (whether pursuant to a confirmed plan of reorganization or adjustment or otherwise) and that (a) are subordinated in right of payment to the Senior Indebtedness (or any debt or equity securities issued in substitution of all or any portion of the Senior Indebtedness) to at least the same extent as the Subordinated Debt is subordinated to the Senior Indebtedness, (b) do not have the benefit of any obligation of any Person (whether as issuer, guarantor or otherwise) unless the Senior Indebtedness has a senior benefit of the obligation of such Person and (c) do not have any terms, and are not subject to or entitled to the benefit of any agreement or instrument that has terms, that are more burdensome to the issuer of or other obligor on such debt or equity securities than are the terms of the Senior Indebtedness.
Person” means any individual, corporation, partnership, limited liability company, joint venture, association, joint-stock company, trust, unincorporated organization or government or any agency or political subdivision thereof.
"Proceeding" shall mean any voluntary or involuntary insolvency, bankruptcy, receivership, custodianship, liquidation, dissolution, reorganization, assignment for the benefit of creditors, appointment of a custodian, receiver, trustee or other officer with similar powers or any other proceeding for the liquidation, dissolution or other winding up of a Person.
Public Company” means, after the IPO, the Person that shall have issued equity interests pursuant to such IPO (such person being either the Payor or any direct parent company of the Payor).
9


Qualified Equity Interests” means Equity Interests other than Subordinated Equity Interests.
Senior Indebtedness” means all payment obligations (whether now outstanding or hereafter incurred) of the Payor in respect of (i) Indebtedness incurred pursuant to the Credit Agreement and all other Indebtedness of the Payor (including, without limitation, in respect of any guaranty of any Indebtedness of any of its subsidiaries) other than any Indebtedness that by its terms is expressly subordinated to this Note, (ii) any Indebtedness incurred to refinance, replace or otherwise restructure all or any part of any Indebtedness described in clause (i) above or this clause (ii) whether by the same or any other agent, lender, debtholder or group of lenders or debtholders, including any new facility entered into after the termination of any debt facility, whether or not contemporaneous, (iii) interest (including default interest) and premium on the outstanding Indebtedness referred to in clauses (i) or (ii) above, (iv) the fees and commissions (including commitment, agency and letter of credit fees and commissions) payable pursuant to the Senior Indebtedness Documents, (v) all other payment obligations (including costs, expenses, penalties, indemnifications, damages, liabilities or otherwise on the Payor or any of its subsidiaries) owing under or arising pursuant to the Senior Indebtedness Documents not of the type described in clauses (i) through (iv) above, and (vi) post-petition interest on the Indebtedness referred to in clauses (i) through (v) above accruing subsequent to the commencement of a proceeding under the Bankruptcy Law (whether or not such interest is allowed as a claim in such proceeding). For the avoidance of doubt, Subordinated Debt shall not be considered Senior Indebtedness hereunder.
Senior Indebtedness Documents” means (i) the Credit Agreement, (ii) each other agreement instrument or agreement evidencing or governing the Indebtedness referred to in clause (i) of the definition of Senior Indebtedness, and (iii) any other note, agreement, indenture, mortgage, guaranty, pledge, security agreement or instrument evidencing or securing the obligations incurred under the agreements referenced in clauses (i) and (ii) above or pursuant to which such obligations are incurred, in each case as such agreement or document may be amended, amended and restated, supplemented or otherwise modified from time to time, including without limitation any agreement or document extending the maturity of, increasing the aggregate commitments under, or refinancing, replacing or otherwise restructuring all or any part of Indebtedness under such agreement or document or any replacement or successor agreement or document and whether by the same or any other agent, lender or group of lenders.
Subordinated Equity Interests” means any Equity Interest issued after the date hereof which, by its terms (or by the terms of any security or other Equity Interests into which it is convertible or for which it is exchangeable), or upon the happening of any event or condition (i) matures or is mandatorily redeemable (other than solely for Qualified Equity Interests) pursuant to a sinking fund obligation or otherwise, (ii) is redeemable at the option of the holder thereof (other than solely for Qualified Equity Interests), in whole or in part, or (iii) is or becomes convertible into or exchangeable for Indebtedness or any other Equity Interests that would constitute Subordinated Equity Interests, in each case, prior to the date that is 91 days after the Maturity Date applicable at the time of issuance thereof, except, in the case of clauses (i) and (ii), if as a result of a change in control, fundamental change or asset sale, so long as any rights of the holders thereof upon the occurrence of such a change in control, fundamental change or asset sale event are subject to the prior payment in full of the principal of and interest under this Note.
5.    Subordinated Equity Interests. Payor hereby covenants and agrees to not issue any Subordinated Equity Interests.
6.    Miscellaneous.
6.1.    Section Headings. The section headings contained in this Note are for reference purposes only and shall not affect the meaning or interpretation of this Note.
10


6.2.    Amendment and Waiver. Subject to Section 5.10 hereof, no provision of this Note may be amended or waived except pursuant to an agreement or agreements in writing entered into by the Majority Payees and Payor and, with respect to amendments to Section 3 hereof or any other amendment that would adversely affect the rights of the holders of Senior Indebtedness (unless there is no Senior Indebtedness outstanding and no commitments outstanding under the Credit Agreement and/or any other Senior Indebtedness Document), the holders of all adversely impacted Senior Indebtedness. No failure or delay in exercising any right, power or privilege hereunder shall imply or otherwise operate as a waiver of any rights of Payee, nor shall any single or partial exercise thereof preclude any other or future exercise thereof or the exercise of any other right, power or privilege.
6.3.    Successors, Assigns and Transferors. This Note may not be assigned or transferred by Payee to any competitor, customer or supplier of Payor or any of its subsidiaries. Subject to the foregoing, this note may be assigned or transferred by Payee with the consent of the Payor provided that any such transfer complies with all applicable federal and state securities laws; provided that no such consent of the Payor shall be required if an Event of Default has occurred and is continuing. Subject to the foregoing, the obligations of Payor and Payee under this Note shall be binding upon, and inure to the benefit of, and be enforceable by, Payor and Payee, and their respective successors and permitted assigns, whether or not so expressed.
6.4.    Governing Law. This Note shall be governed by, and construed in accordance with, the laws of the State of New York without giving effect to any conflicts of laws principles thereof that would otherwise require the application of the law of any other jurisdiction. Any proceeding to enforce, interpret, challenge the validity of, or recover for the breach of any provision of, this Note shall be filed exclusively in the United States District Court for the Southern District of New York or the state courts located in the State of New York, and the parties hereto expressly consent to the exclusive jurisdiction of such courts and expressly waive any and all objections to personal jurisdiction, service of process or venue in connection therewith. Final judgment in any action, suit or proceeding shall be conclusive and may be enforced in any other jurisdiction by suit on the judgment. Payor hereby acknowledges that this Note constitutes an instrument for the payment of money, and consents and agrees that the Majority Payees, at their sole option, in the event of a dispute in the payment of any moneys due hereunder, shall have the right to bring a motion- action under New York CPLR Section 3213. Nothing in this Section 5.4 shall affect the right of the Majority Payees to (i) commence legal proceedings or otherwise sue Payor in any other court having jurisdiction over Payor or (ii) serve process upon Payor in any manner authorized by the laws of any such jurisdiction.
6.5.    Lost, Stolen, Destroyed or Mutilated Note. Upon receipt of evidence reasonably satisfactory to Payor of the loss, theft, destruction or mutilation of this Note and of indemnity arrangements reasonably satisfactory to Payor from or on behalf of the holder of this Note, and upon surrender or cancellation of this Note if mutilated, Payor shall make and deliver a new note of like tenor in lieu of such lost, stolen, destroyed or mutilated Note, at Payee’s expense.
6.6.    Waiver of Presentment, Etc. Except as otherwise provided herein, presentment, demand, protest, notice of dishonor and all other demands and notices are hereby expressly waived by Payor.
6.7.    Usury. Nothing contained in this Note shall be deemed to establish or require the payment of a rate of interest in excess of the maximum rate legally enforceable. If the rate of interest called for under this Note at any time exceeds the maximum rate legally enforceable, the rate of interest required to be paid hereunder shall be automatically reduced to the maximum rate legally enforceable. If such interest rate is so reduced and thereafter the maximum rate legally enforceable is increased, the rate of interest required to
11


be paid hereunder shall be automatically increased to the lesser of the maximum rate legally enforceable and the rate otherwise provided for in this Note.
6.8.    Notices. Any notice, request, instruction or other document to be given hereunder by either party to the other shall be in writing and shall be deemed given when received and shall be (i) delivered personally or (ii) mailed by certified mail, postage prepaid, return receipt requested or (iii) delivered by FedEx or a similar overnight courier or (iv) sent via email with return receipt requested, as follows:
If to a Payor, addressed to:
Social Finance, Inc.
234 1st Street
San Francisco, CA 94105
Attention: Chief Financial Officer
Email: MGill@sofi.org
with a copy to:
WilmerHale
1875 Pennsylvania Avenue, NW Washington, DC 20006
Attention: Stephanie Evans
Email: Stephanie.Evans@wilmerhale.com
If to Payee, addressed to:
The address set forth on Schedule I
Or, in each case, to such other place and with such other copies as either party may designate as to itself by written notice to the other party.
In the event that any notice under this Note is required to be made on or as of a day which is not a Business Day, then such notice shall not be required to be made until the first day thereafter which is a Business Day.
6.9.    Representations and Warranties of Payor. Payor hereby represents and warrants to Payee that: (a) Payor is duly organized, validly existing and in good standing under the laws of the State of Delaware; (b) Payor has duly authorized, executed and delivered this Note; and (c) this Note constitutes a legally valid and binding obligation of Payor, enforceable against Payor in accordance with its terms, subject to the effects of bankruptcy, insolvency, reorganization, moratorium or other similar laws now or hereafter in effect relating to or affecting the rights or remedies of creditors and the effect of general principles of equity, whether enforcement is considered in a proceeding in equity or at law, and the discretion of the court before which any proceeding therefor may be brought.
6.10.    Fees. Payor agrees to pay all reasonable and documented out-of-pocket costs and expenses (including reasonable and documented out-of-pocket attorney’s fees and expenses) incurred or paid by Payee in enforcing collection of the Note.
[signature pages follow]
12


IN WITNESS WHEREOF, Payor has executed and delivered this Note as of the date hereinabove first written.
SOCIAL FINANCE, INC.
By:
Name:
Title:
Accepted and Agreed to:
[Payee]
By:
Name:
Title:
[Signature Page to Promissory Note]


EXHIBIT J
AGREED FORM
CONFIDENTIAL
OPTION CANCELLATION AND ASSUMPTION AGREEMENT
This Option Cancellation and Assumption Agreement (this “Agreement”) dated [l], 2020 is made by and between Galileo Financial Technologies, Inc., a Delaware corporation (the “Company”), and the undersigned (“Optionholder”).
WHEREAS, Optionholder has previously been granted an option or options to purchase shares of the common stock, $0.00001 par value per share (“Common Stock”), of the Company (the “Shares”) pursuant to the Company’s 2011 Option Plan (the “Company Option Plan”), as set forth on Exhibit A attached hereto (each an “Option” and collectively, the “Options”);
WHEREAS, the Company’s Board of Directors has unanimously approved, and the stockholders of the Company have adopted and approved, an Agreement and Plan of Merger and Reorganization (as may be amended, modified or supplemented and in effect from time to time, the “Merger Agreement”), by and among Social Finance, Inc., a Delaware corporation (“Parent”), SFI Acquisition Co., Inc., a Delaware corporation and direct subsidiary of Parent (“Merger Sub”), SFI Financial Technologies LLC, a Delaware limited liability company and direct subsidiary of Parent (“Merger Sub II”), the Company, and Shareholder Representative Services LLC, a Colorado limited liability company (“SRS”), solely in its capacity as the representative, agent and attorney-in-fact of the Equityholders (the “Stockholders’ Representative”), pursuant to which, among other things, Merger Sub will merge with and into the Company (the “First Merger”), with the Company being the surviving corporation of the First Merger (the Company, in its capacity as the surviving corporation of the First Merger, is sometimes referred to as the “Surviving Corporation”); and immediately following the First Merger and as part of the same integrated transaction as the First Merger, the Surviving Corporation will merge with and into Merger Sub II (the “Second Merger” and, together with the First Merger, the “Mergers”);
WHEREAS, the parties hereto are entering into this Agreement to confirm Optionholder’s understanding of, and agreement with, the treatment of the Options in connection with the Mergers, which treatment, the parties hereto agree, may be effected without Optionholder’s consent in accordance with the terms of the Company Option Plan, and to have Optionholder covenant to certain other matters in connection therewith as set forth herein.
NOW, THEREFORE, in consideration of the premises and the respective covenants and agreements contained herein, and other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the parties hereto, intending to be legally bound, hereby acknowledge and agree to the following:
1.    Defined Terms. Capitalized terms used but not defined herein shall have the meanings set forth in the Merger Agreement.
2.    Effect of Merger. Upon the Effective Time of the First Merger, each Option held by Optionholder that is outstanding and unexercised as of the Effective Time: (a) to the extent such Option is listed as a Participating Option on Exhibit A (each, a “Participating Option”), shall terminate and be cancelled and shall thereafter no longer be exercisable, but shall entitle Optionholder to receive from Parent or the Surviving Corporation in settlement of each such



Participating Option, (i) cash in an amount equal to the product of (A) the Non-Stock Per Share Cash Consideration minus the exercise price per share of such Participating Option, multiplied by (B) the number of Shares subject to such Participating Option, and (ii) an original principal amount of the Seller Note in an amount equal to the product of (C) the Non-Stock Per Share Note Amount multiplied by (D) the number of Shares subject to such Participating Option, in each case less applicable tax withholding; and (b) whether vested or unvested and whether exercisable or not exercisable, shall, to the extent such Option is listed as an Assumed Option on Exhibit A (each, an “Assumed Option”), by virtue of the First Merger, be assumed by Parent and shall cease to represent a right to acquire shares of Company Common Stock and shall be converted into an option to purchase a number of shares of Parent Common Stock in an amount, at an exercise price and subject to such terms and conditions as provided in the Merger Agreement and any other written agreement between the Optionholder and the Company and/or Parent.
3.    Optionholder Agreements and Acknowledgements.
(a)    By signing and submitting this Agreement, Optionholder hereby represents, warrants, covenants and agrees as follows:
(i)    (A) Optionholder has the legal capacity to execute this Agreement; (B) Optionholder has the full legal right, power and authority to (i) execute and deliver this Agreement and perform its obligations hereunder, (ii) submit the Options listed on Exhibit A for cancellation or assumption, as applicable, in accordance with the terms hereof, and (iii) consummate the transactions contemplated by this Agreement, the Merger Agreement and all of the other documents and agreements required to be delivered in connection therewith to which Optionholder is a party; (C) this Agreement has been duly executed and delivered by Optionholder, and constitutes a legal, valid and binding obligation of Optionholder, enforceable against Optionholder in accordance with its terms, except as such enforceability may be limited by applicable bankruptcy, insolvency, fraudulent conveyance or similar Laws affecting the enforcement of creditors’ rights generally and subject to general principles of equity (regardless of whether enforcement is sought in a proceeding at law or in equity); (D) Optionholder is the sole and exclusive owner of the Options set forth on Exhibit A, of record and beneficially, free and clear of any Liens (other than Liens under the Securities Act and applicable state securities Laws or as shall be terminated in connection with the consummation of the Merger); (E) neither the execution and delivery of this Agreement by Optionholder nor the performance by Optionholder of Optionholder’s obligations hereunder, nor the consummation of the transactions contemplated hereby will: (i) violate or breach, be in conflict with or contravene, or constitute a default (or an event which, with notice or lapse of time or both, would constitute a default) under any agreement or commitment to which Optionholder is a party or that is binding on Optionholder; (ii) violate any Law or any judgment, decree, order, regulation or rule of any court or other Governmental Body applicable to Optionholder, including any legal proceedings currently pending against Optionholder; or (iii) result in the creation of any Liens on any of the assets or properties of Optionholder; (F) Optionholder is not required to give any notice to, make any filing or registration with, or obtain any authorization, waiver, license, consent, or approval of any Governmental Authority or third party in connection with the execution and delivery of this Agreement



by the undersigned, the performance by the undersigned of Optionholder’s obligations under this Agreement or the consummation by the undersigned of the transactions contemplated by this Agreement or the Merger Agreement which has not been given or obtained, as applicable; (G) as of the date hereof, there is no Legal Proceeding pending against, or, to the knowledge of Optionholder, threatened against such Optionholder or any of Optionholder’s properties or assets (including, without limitation, any Options) that could reasonably be expected to prevent or materially delay or impair the consummation by Optionholder of the transactions contemplated by this Agreement or the Merger Agreement or otherwise materially impair Optionholder’s ability to perform Optionholder’s obligations hereunder or thereunder; and (H) Optionholder has been advised to seek legal, financial and tax advice prior to signing this Agreement and has had an opportunity to review with the undersigned’s tax, financial and legal advisors the consequences of the grant, vesting and exercise of any options to acquire Company Common Stock at any time held by the Optionholder, the ownership (beneficial or otherwise) and disposition of any shares of Company Common Stock by the Optionholder at any time, the Mergers and the transactions undertaken prior to and in connection therewith, and the transactions contemplated by the Merger Agreement and this Agreement.
(ii)    that (A) Exhibit A attached hereto correctly and completely reflects any and all Options granted to Optionholder that are outstanding as of the date of this Agreement and the correct exercise price for each such Option, in each case, as of immediately prior to the First Merger, and correctly indicates whether all or a portion of each Option is a Participating Option or an Assumed Option, (B) if applicable, any other options for Common Stock of the Company granted to Optionholder not listed on Exhibit A have been exercised or forfeited, and Optionholder has no further rights with respect thereto, (C) Optionholder is the only legal and beneficial owner of all legal and equitable rights and claims of any kind with respect to the Options, (D) Optionholder has not assigned, pledged, or contracted to assign or pledge any such rights or claims, and (E) the Options and any shares of Company Common Stock issuable thereunder are free and clear of all Liens other than Liens under the Securities Act and applicable state securities Laws;
(iii)    that Optionholder will, upon request, execute and deliver any additional documents reasonably deemed appropriate or necessary by Parent in connection with the cancellation or assumption, as applicable, of the Options hereunder;
(iv)    that all authority conferred or agreed to be conferred by Optionholder in this Agreement shall be binding upon Optionholder’s successors, assigns, heirs, executors, administrators and legal representatives and shall not be affected by, and shall survive, Optionholder’s death, incapacity, dissolution or liquidation;
(v)    that the delivery of this Agreement, including the agreement not to exercise the Options, is irrevocable;
(vi)    that Optionholder irrevocably appoints the Company as Optionholder’s true and lawful agent and attorney-in-fact, to effect the cancellation (and



payment) or the assumption, as applicable, pursuant to the Merger Agreement and the instructions hereto;
(vii)    that Optionholder hereby (A) irrevocably constitutes and appoints Shareholder Representative Services LLC, a Colorado limited liability company, as Stockholders’ Representative and as Optionholder’s true and lawful attorney in fact and agent to take all actions described in the Merger Agreement, including with respect to the Representative Expense Amount on Optionholder’s behalf, (B) agrees that this power of attorney is irrevocable and coupled with an interest, may be delegated by the Stockholders’ Representative and shall survive Optionholder’s death or incapacity, (C) authorizes the Stockholders’ Representative to act for Optionholder in Optionholder’s name, place and stead, in any and all capacities in order to perform every act and thing required or permitted to be done by the Stockholder’s Representative pursuant to the terms of the Merger Agreement to the fullest extent that Optionholder might or could do in person and in accordance with Section 2.15 of the Merger Agreement;
(viii)    that Optionholder hereby, solely with respect to each Participating Option held by Optionholder, joins in and adopts, and agrees to comply with and to be bound by, all provisions applicable to holders of Participating Options as an Equityholder under the Merger Agreement, as if Optionholder is a party to the Merger Agreement, including, without limitation, Optionholder’s obligation to pay its Pro Rata Share of the Deferred Transaction Fee to Qatalyst Partners LLC pursuant to Section 2.14(e) of the Merger Agreement and the indemnification obligations, covenants and agreements provided in Article VII of the Merger Agreement;
(ix)    that effective as of, from, and after the Effective Time, Optionholder, on behalf of itself and, as applicable, its present and former parents, subsidiaries, Affiliates, employees, officers, directors, shareholders, members, family members, beneficiaries, heirs, successors, assigns and any other Person claiming by, through or under any of the foregoing (collectively, “Optionholder Releasors”) hereby absolutely, unconditionally and irrevocably releases, waives and forever discharges the Company and each of the Acquirer Indemnified Parties (collectively, the “Released Parties”) of and from any and all actions, causes of action, suits, losses, liabilities, rights, debts, dues, sums of money, accounts, reckonings, obligations, costs, expenses, liens, bonds, bills, specialties, covenants, contracts, controversies, agreements, promises, variances, trespasses, damages, judgments, extents, executions, claims, tax consequences and demands, of every kind and nature whatsoever, whether now known or unknown, foreseen or unforeseen, matured or unmatured, suspected or unsuspected, in law, admiralty or equity, which any of such Optionholder Releasors ever had, now have, or hereafter can, shall, or may have against the Company and its Subsidiaries prior to the Effective Time for, upon, or by reason of any matter, cause, or thing related to such Optionholder Releasors’ capacity as an optionholder of the Company and/ or owner (beneficial or otherwise) of shares of Company Common Stock and arising out of or related to acts, events, circumstances, conditions or omissions occurring at or prior to the Effective Time (collectively, “Released Claims”); provided, however, that nothing contained in the foregoing shall operate to release any (A) indemnification rights granted to Optionholder



in its capacity as a director or officer of the Company (and solely in and to the extent of such capacity, and which shall not entitle the undersigned to indemnification in respect of any indemnification owed by the undersigned in the undersigned’s capacity as an Equityholder to Acquirer Indemnified Parties pursuant to Section 7.02 of the Merger Agreement) under the Delaware General Corporation Law or the provisions of the Company’s Organizational Documents; (B) rights granted to Optionholder pursuant to this Agreement, the Merger Agreement or any agreement, instrument, certificate or document delivered pursuant to the Merger Agreement; (C) any claim that cannot be released as a matter of law, including with respect to workers’ compensation, unemployment, or reimbursement under Cal. Lab. Code 2802; and (D) if Optionholder is or was an employee or consultant of the Company or any of its Subsidiaries, any claim for the payment or receipt of accrued but unpaid wages, salaries or other cash compensation or benefits to the extent already due and excluding any unpaid vacation or PTO that follows the Company’s or its Subsidiaries carryforward rules, in each case solely to the extent related to the Stockholder’s employment or consulting relationship with the Company or any of its Subsidiaries; provided, further, that this release is intended to be a complete and general release with respect to the Released Claims being released herein, subject to the limitations set forth in the preceding sentence, and specifically includes claims that are known, unknown, fixed, contingent or conditional, including any breach of fiduciary duty, or claims arising under the Securities Act of 1933, as amended, or any other federal, state, blue sky or local law dealing with any securities;
(x)    that Optionholder’s right to receive cash payments or options to acquire shares of Parent Common Stock, as applicable, as set forth in the Merger Agreement, subject to the limitations, terms and conditions specified in the Merger Agreement and any other written agreement between the Optionholder and the Company and/or the Parent, in exchange for the Options held by Optionholder, shall constitute Optionholder’s sole and exclusive right against the Releasees in respect of such Options and/or any contract, agreement or instrument with the Company pertaining thereto or Optionholder’s status as a holder of Options;
(xi)    that Optionholder hereby expressly waives any and all provisions, rights and benefits conferred by §1542 of the California Civil Code (or any similar, comparable or equivalent provision or law), which section provides:
A GENERAL RELEASE DOES NOT EXTEND TO CLAIMS THAT THE CREDITOR OR RELEASING PARTY DOES NOT KNOW OR SUSPECT TO EXIST IN HIS OR HER FAVOR AT THE TIME OF EXECUTING THE RELEASE AND THAT, IF KNOWN BY HIM OR HER, WOULD HAVE MATERIALLY AFFECTED HIS OR HER SETTLEMENT WITH THE DEBTOR OR RELEASED PARTY.
(xii)    that Optionholder’s Optionholder Pro Rata Share of the Representative Expense Amount or any payment made to Equityholders under Section 2.10(b) of the Merger Agreement will not be paid to Optionholder until and unless such amounts are required to be disbursed to Optionholder in accordance with the Merger



Agreement, which may result in a reduction in the amount of consideration payable to Optionholder;
(xiii)    that payments made under the Seller Note will be reduced by the portion of the transaction fee payable to Qatalyst Partners LLC by the Company upon any payment of the Seller Note in accordance with the terms of the Company’s engagement letter with Qatalyst Partners LLC;
(xiv)    that (A) Optionholder understands that the treatment of the Options contemplated by this Agreement and the Merger Agreement may be effected without Optionholder’s consent consistent with the terms of the Company Option Plan pursuant to which the Options were granted, (B) Optionholder fully understands Optionholder’s rights to discuss all aspects of this Agreement, the Merger Agreement and any other written agreement between Optionholder and the Company and/or Parent with Optionholder’s private attorneys, (C) Optionholder has carefully read and fully understands all of the terms of this Agreement and the Merger Agreement and any other written agreement between Optionholder and the Company and/or Parent, (D) Optionholder has not transferred or assigned any rights or claims that Optionholder is hereby purporting to release herein, (E) Optionholder is voluntarily, and with proper and full authority, executing this Agreement and Agreement and any other written agreement between Optionholder and the Company and/or Parent (F) Optionholder has had a reasonable period of time to consider the provisions of this Agreement and any other written agreement between Optionholder and the Company and/or Parent, and has considered them carefully before executing this Agreement;
(xv)    that pursuant to the Merger Agreement, the Company shall be entitled to deduct and withhold from the consideration otherwise payable to Optionholder pursuant to the Merger Agreement such amounts as the Company is required to deduct and withhold under the applicable federal, state, local and foreign law, including, without limitation, the Internal Revenue Code of 1986, with respect to the making of such payments; and
(xvi)    that (A) nothing in this Agreement may be construed to prohibit Optionholder from filing a charge with, reporting possible violations to, or participating or cooperating with any governmental agency or entity, including but not limited to the Equal Employment Opportunity Commission, the Financial Industry Regulatory Authority, the Department of Justice, the Securities and Exchange Commission, Congress, or any agency Inspector General, or making other disclosures that are protected under the whistleblower, anti-discrimination or anti-retaliation provisions of applicable federal, state or local law or regulation; provided, however, that Optionholder may not disclose information of the Released Parties that is protected by the attorney-client privilege, except as otherwise required by law; (B) if Optionholder participates in any claim for discrimination, harassment, interference with leave rights or retaliation that can be released in the manner set forth in this Agreement, Optionholder hereby waives Optionholder’s right to secure any monetary awards or damages; and (C) Optionholder does not need the prior authorization



of the Company to make any such reports or disclosures and is not required to notify the Company that it has made such reports or disclosure.
4.    Termination. This Agreement shall terminate automatically upon termination of the Merger Agreement in accordance with its terms.
5.    Miscellaneous.
(a)    Further Actions. Each party, at the reasonable request of the other party, agrees to execute and deliver such other instruments and do and perform such other acts and things as may be reasonably necessary or desirable for effecting the transactions contemplated by this Agreement.
(b)    Waivers. No action taken pursuant to this Agreement, including any investigation by or on behalf of any party hereto, nor any failure or delay on the part of any party hereto in the exercise or failing or delaying in the exercise of its rights of any right hereunder, shall be deemed to constitute a waiver by the party taking such action of compliance by any other party with or of any representations, warranties, covenants or agreements contained in this Agreement. The waiver by any party hereto of a breach of any provision hereunder shall not operate or be construed as a waiver of any prior or subsequent breach of the same or any other provision hereunder.
(c)    Counterparts. This Agreement may be executed in one or more counterparts, all of which shall be considered one and the same agreement. This Agreement shall become effective when one or more counterparts have been signed by each of the parties and delivered to the other parties, it being understood that all parties need not sign the same counterpart. Delivery of an executed counterpart of a signature page of this Agreement by facsimile or other electronic transmission shall be effective as delivery of a manually executed original counterpart of this Agreement.
(d)    Governing Law; Jurisdiction. This Agreement and the respective rights and obligations of the parties under this Agreement shall be governed by, and shall be determined under, the internal laws of the State of Delaware applicable to contracts between residents of the State of Delaware to be performed solely in the State of Delaware, i.e., without regard to choice of law principles. Any action involving this Agreement shall be brought and maintained solely in Delaware Court of Chancery in New Castle County and any state appellate court therefrom within the State of Delaware (or, if the Delaware Court of Chancery declines to accept jurisdiction over a particular matter, any federal court within the State of Delaware). Each of the parties hereto irrevocably consents to the exclusive jurisdiction and venue of the aforesaid courts in connection with any matter based upon or arising out of this Agreement or the matters contemplated herein, irrevocably consents to the service of process outside the territorial jurisdiction of the courts referred to in this Section 5(d) in any such action or proceeding by mailing copies thereof by registered or certified United States mail, postage prepaid, return receipt requested, to its address as specified pursuant to Section 5(f), and covenants not to assert or plead any objection which they might otherwise have to such jurisdiction, venue and such process.



(e)    Waiver of Jury Trial. EACH PARTY HERETO ACKNOWLEDGES AND AGREES THAT ANY CONTROVERSY WHICH MAY ARISE UNDER THIS AGREEMENT IS LIKELY TO INVOLVE COMPLICATED AND DIFFICULT ISSUES, AND THEREFORE EACH SUCH PARTY HEREBY IRREVOCABLY AND UNCONDITIONALLY WAIVES ANY RIGHT SUCH PARTY MAY HAVE TO A TRIAL BY JURY IN RESPECT OF ANY LITIGATION DIRECTLY OR INDIRECTLY ARISING OUT OF OR RELATING TO THIS AGREEMENT, OR THE TRANSACTIONS CONTEMPLATED BY THIS AGREEMENT. EACH PARTY CERTIFIES AND ACKNOWLEDGES THAT (I) NO REPRESENTATIVE, AGENT OR ATTORNEY OF ANY OTHER PARTY HAS REPRESENTED, EXPRESSLY OR OTHERWISE, THAT SUCH OTHER PARTY WOULD NOT, IN THE EVENT OF LITIGATION, SEEK TO ENFORCE THE FOREGOING WAIVER, (II) EACH PARTY UNDERSTANDS AND HAS CONSIDERED THE IMPLICATIONS OF THIS WAIVER, (III) EACH PARTY MAKES THIS WAIVER VOLUNTARILY AND (IV) EACH PARTY HAS BEEN INDUCED TO ENTER INTO THIS AGREEMENT BY, AMONG OTHER THINGS, THE MUTUAL WAIVERS AND CERTIFICATIONS IN THIS SECTION 5(e).
(f)    Notices. Any notices or other communications required or permitted under this Agreement shall be sufficiently given if in writing and (i) hand delivered, including delivery by courier services, or (ii) sent by certified mail, return receipt requested, postage prepaid addressed to the recipient at the address stated below, or to such other address as the party concerned may substitute by written notice to the other. All notices hand delivered shall be deemed received on the day of delivery. All notices forwarded by mail shall be deemed received on the date two (2) days (excluding Saturdays, Sundays and legal holidays when the U.S. mail is not delivered) immediately following date of deposit in the U.S. mail; provided, however, the return receipt indicating the date upon which the notice is received shall be prima facie evidence that such notice was received on the date of the return receipt. Addresses may be changed by giving notice of such change in the manner provided herein. Unless and until such written notice is received, the last address given shall be deemed to continue in effect for all purposes.
If to the Company, to:
Galileo Financial Technologies, Inc.
6510 South Millrock Dr.
Suite 300
Salt Lake City, UT 84121
Attention: General Counsel
Email: CTrujillo@galileo-ft.com
with a copy to (which copy shall not constitute notice):
Dorsey & Whitney LLP
111 South Main Street, Suite 2100
Salt Lake City, Utah, 84111
Attention: Nolan S. Taylor
Email: Taylor.Nolan@dorsey.com



If to Optionholder, to the address set forth on the signature page hereto, or to such other addresses as any such party may designate in writing in accordance with this Section 5(f).
(g)    Entire Agreement; Assignment. Unless otherwise specified herein (including with respect to any other agreement entered into between Optionholder and the Company and/or Parent), this Agreement and the Merger Agreement (i) contain the entire agreement and understanding between the parties with respect to the subject matter herein identified and merge and integrate any and all previous and contemporaneous implied agreements (in fact or law), between or among the parties concerning such matters, and (ii) shall not be assigned by operation of law or otherwise. This Agreement may be amended by the parties hereto only by execution of an instrument in writing signed on behalf of the party against whom enforcement is sought.
(h)    Parties in Interest. This Agreement shall be binding upon and inure solely to the benefit of each party hereto and their respective permitted successors and assigns. Nothing in this Agreement, express or implied, is intended to or shall confer upon any other Person any rights, benefits or remedies of any nature whatsoever under or by reason of this Agreement; provided that, Parent, Merger Sub and Merger Sub II shall be express third party beneficiaries under this Agreement and shall be entitled to enforce directly any of the provisions hereof.
(i)    Severability. If any provision of this Agreement or portion of this Agreement is found to be wholly or partially invalid, illegal or unenforceable in any judicial proceeding, then such provision shall be deemed to be modified or restricted to the extent and in the manner necessary to render the same valid and enforceable, or shall be deemed excised from this Agreement, as the case may require, and this Agreement shall be construed and enforced to the maximum extent permitted by law, as if such provision had been originally incorporated in this Agreement as so modified or restricted, or as if such provision had not been originally incorporated in this Agreement, as the case may be.
(j)    Rules of Construction. The parties hereto agree that they have been represented by counsel during the negotiation, preparation and execution of this Agreement and, therefore, waive the application of any law, regulation, holding or rule of construction providing that ambiguities in an agreement or other document will be construed against the party drafting such agreement or document.
(k)    Fees and Expenses. Whether or not the Mergers are consummated, all costs and expenses incurred in connection with this Agreement and the transactions contemplated hereby shall be paid by the party incurring such costs and expenses.
[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK]



IN WITNESS WHEREOF, the parties have executed this Agreement as of the date first written above.
OPTIONHOLDER
By:
Name:
Name and address to which notices shall be sent to Optionholder prior to Effective Time (please print):
(Name)
(Street)
(City) (State) (Zip)
GALILEO FINANCIAL TECHNOLOGIES, INC.
By:
Name:
Title:

Exhibit 10.12
CERTAIN CONFIDENTIAL PORTIONS OF THIS EXHIBIT HAVE BEEN OMITTED
AND REPLACED WITH “[***]”. SUCH IDENTIFIED INFORMATION HAS BEEN
EXCLUDED FROM THIS EXHIBIT BECAUSE IT IS (I) NOT MATERIAL AND
(II) IS THE TYPE THAT THE REGISTRANT TREATS AS PRIVATE OR CONFIDENTIAL.

Execution Version
STADIUM COMPLEX CORNERSTONE NAMING RIGHTS AND SPONSORSHIP AGREEMENT
by and between
STADCO LA, LLC
and
SOCIAL FINANCE, INC.
September 14, 2019


TABLE OF CONTENTS
Page
1.
DEFINITIONS
2
2.
TERM
7
(a)
Term
7
(b)
[***]
8
(c)
No Continued Use Upon Expiration or Termination
8
(d)
[***]
8
3.
ASSETS
8
(a)
Naming Rights Assets
8
(b)
Team Assets
9
(c)
Stadium Logos; Signage, Displays, and other Collateral
9
(d)
Stadium Name; References; Restriction on Sponsorship of Other Venues
10
(e)
Stadium Name Changes
10
(f)
Unavailable Assets
13
(g)
No Pass-Throughs
13
(h)
Rights Reserved
13
(i)
[***]
13
(j)
Annual Review Meeting
13
4.
CATEGORY PROTECTION AND CERTAIN OTHER RIGHTS
14
(a)
Category Protection
14
(b)
Exclusive Category
14
(c)
Exceptions and Limitations to Scope of Exclusive Category
14
(d)
Exceptions to Category Protection and Other Rights
15
(e)
Prominence
17
(f)
No Rights to Any Additional Teams
17
(g)
Ambush Marketing
17
5.
FEES
17
(a)
Sponsorship Fees
17
-i-

TABLE OF CONTENTS
(continued)
Page
(b)
Payment Schedule for Sponsorship Fees
17
(c)
Playoff Fees
19
(d)
Taxes; Fees and Commissions; Wire Transfer
19
(e)
Interest on Late Payments
19
(f)
Costs and Expenses
19
6.
DEFAULT AND REMEDIES
21
(a)
Default by Naming Rights Partner
21
(b)
Rights and Remedies of StadCo
21
(c)
Default by StadCo
21
(d)
Rights and Remedies of Naming Rights Partner
22
(e)
Special Termination Rights
22
(f)
Effect of Termination
22
7.
LATE COMPLETION OR FAILURE TO COMPLETE
22
8.
FORCE MAJEURE; EMINENT DOMAIN; CASUALTY; CHANGES TO NFL RULES
23
(a)
Effect of Force Majeure
23
(b)
Total Condemnation of Stadium
23
(c)
Partial Condemnation of Stadium
23
(d)
Casualty
23
(e)
Changes in NFL Rules
24
9.
LOST GAMES FROM FORCE MAJEURE EVENTS, CASUALTY EVENTS, AND WORK STOPPAGE; RELOCATION OF TEAMS
24
(a)
Remedies for Lost Games
24
(b)
Relocation of Teams
25
10.
INTELLECTUAL PROPERTY
25
(a)
Ownership of Naming Rights Partner Marks
25
(b)
Registration and Protection of Stadium Marks
25
-ii-

TABLE OF CONTENTS
(continued)
Page
(c)
Licenses to StadCo
25
(d)
Merchandising
26
(e)
Licenses to Naming Rights Partner
26
(f)
Uses of Marks
27
(g)
Limitations on Licenses; Quality Control
27
(h)
Stadium Website
27
(i)
Stadium Social Media and Mobile Application
28
(j)
Rights of NFL Entities
28
(k)
Inventory Run-Out
28
(l)
Notification of Infringement
29
(m)
Approval of Use of Marks
29
(n)
Players and Coaches
30
(o)
No Contests without Approval
30
(p)
Restrictions
31
(q)
Compliance with Law
31
11.
CONFIDENTIALITY
31
12.
REPRESENTATIONS, WARRANTIES, AND COVENANTS
31
(a)
By StadCo
31
(b)
By Naming Rights Partner
32
13.
INDEMNIFICATION AND INSURANCE
33
(a)
Indemnification by Naming Rights Partner
33
(b)
Indemnification by StadCo
34
(c)
Indemnification Process
34
(d)
Insurance
35
14.
LIMITATION OF DAMAGES
36
15.
ARBITRATION
37
-iii-

TABLE OF CONTENTS
(continued)
Page
(a)
Disputes Subject to Arbitration
37
(b)
Arbitration Award
37
(c)
Injunctive Relief
37
16.
APPRAISAL
37
(a) Appraisal Process for [***] 37
(b)
Appraisal Process for [***]
38
(c)
Selection and Determination of Appraiser
38
(d)
Appraisal Costs
38
(e)
Disputes Regarding Appraisal
38
17. MISCELLANEOUS PROVISIONS 38
(a)
Relationship of Parties
38
(b)
Third Party Beneficiaries
39
(c)
Sponsorship Revenues
39
(d)
Subject and Subordinate
39
(e)
Waiver
39
(f)
Notices
39
(g)
Severability
40
(h)
Assignment by StadCo
40
(i)
Assignment by Naming Rights Partner
41
(j)
Media Releases
41
(k)
Headings
41
(l)
Survival
41
(m)
Entire Agreement
41
(n)
Governing Law; Venue
42
(o)
Amendments/Modification
42
(p)
Counterparts
42
-iv-

TABLE OF CONTENTS
(continued)
Page
(q)
Exculpation
42
(r)
No Inferences
42
(s)
Waiver of Jury Trial
42
(t)
General Interpretive Principles
42
(u)
Further Assurances
43
(v)
Time is of the Essence
43
(w)
Expenses
43
(x)
No Team or Stadium Event Representations, Warranties, or Covenants
43
(y)
No Consultants
43
SCHEDULE 1    Depiction of the Stadium Plazas
SCHEDULE 2    Naming Rights Assets
SCHEDULE 3    Team Assets
SCHEDULE 4    Naming Rights Partner Marks
SCHEDULE 5    Stadium Marks (including Stadium Logos)
SCHEDULE 6    Team Marks
EXHIBIT A    Naming Rights Partner Signage Plan
-v-


STADIUM COMPLEX CORNERSTONE NAMING RIGHTS AND SPONSORSHIP AGREEMENT
This Stadium Complex Cornerstone Naming Rights and Sponsorship Agreement (this “Agreement”) is made and entered into as of September 14, 2019 (the “Effective Date”) by and between (i) Social Finance, Inc., a Delaware corporation (“Naming Rights Partner”), and (ii) Stadco LA, LLC, a Delaware limited liability company (“StadCo”). Naming Rights Partner and StadCo are referred to in this Agreement individually as a “Party” and collectively as the “Parties.”
Recitals
A.    StadCo is constructing and, once completed, will own and operate a (i) multi-purpose sports and entertainment stadium in Inglewood, California (the “Stadium”), which will, among other things, serve as the home stadium for the National Football League (“NFL”) member clubs known as the Los Angeles Rams and the Los Angeles Chargers (each, a “Team” and, collectively, the “Teams”), and (ii) plaza areas adjacent to the Stadium as depicted on Schedule 1 (the “Stadium Plazas” and, together with the Stadium, the “Stadium Complex”).
B.    The Stadium Complex will be (i) under a common roof with an approximately 5,500-seat flex performance venue (the “Performance Venue”) and (ii) adjacent to an entertainment district, which is anticipated to include office space, retail space, residential space, and open space (including open space dedicated for public use), as well as hotel and dining options (the “District”).
C.    StadCo has entered into license agreements with the Teams whereby StadCo has the right to include certain rights and benefits of the Teams as part of this Agreement and to bind the Teams to honor the duties and obligations of StadCo as they relate to the Teams pursuant to this Agreement.
D.    Naming Rights Partner desires to become, and StadCo desires that Naming Rights Partner becomes, the naming rights partner of the Stadium Complex entitled to receive certain rights and assets associated with the Stadium Complex set forth on Schedule 2 (collectively, the “Naming Rights Assets”), subject to the terms and conditions of this Agreement.
E.    Naming Rights Partner desires to receive from StadCo, and StadCo desires to grant to Naming Rights Partner, the cornerstone sponsorship rights and assets associated with the Teams set forth on Schedule 3 (the “Team Assets” and, collectively with the Naming Rights Assets, the “Assets”), subject to the terms and conditions of this Agreement.
Agreement
Therefore, in consideration of the mutual covenants set forth herein, the sufficiency of which is hereby acknowledged, and intending to be legally bound hereby, the Parties hereby agree as follows:



1.    Definitions.
Affiliate” means, with respect to any Person, any other Person that directly or indirectly, through one or more intermediaries, Controls, is Controlled by, or is under common Control with such Person, except that for purposes of this Agreement, SoftBank Group Corp. shall not be considered an Affiliate of Naming Rights Partner.
Agreement” has the meaning set forth in the introductory paragraph.
“[***]”.
“[***].
“[***].
Appraisal Request” has the meaning set forth in Section 16(a).
Appraiser” has the meaning set forth in Section 16(a).
“[***].
Asset(s)” has the meaning set forth in Recital E.
Asset Costs” has the meaning set forth in Section 5(f)(iii).
Assign” has the meaning set forth in Section 17(h)(i).
Assignment” has the meaning set forth in Section 17(h)(i).
“[***].
Casualty Event” has the meaning set forth in Section 8(d)(i).
Champions Plaza” has the meaning set forth in Section 3(a).
Claim” has the meaning set forth in Section 13(c).
Contract Year” means the Initial Contract Year and each subsequent twelve (12) month period, each beginning on April 1st and ending on the immediately following March 31st[***].
Control” means the possession, directly or indirectly, of the power to direct or cause the direction of the management and policies of a Person, whether through ownership of voting securities, by contract, or otherwise. Ownership of more than fifty percent (50%) of the beneficial and voting interests of any Person shall be conclusive evidence that control exists. “Controlling” and “Controlled” have meanings correlative thereto.
“[***].
“[***].
2


Dispute” has the meaning set forth in Section 15(a).
District” has the meaning set forth in Recital B.
District Sponsorship Agreement” means the District Cornerstone Sponsorship Agreement entered into between Naming Rights Partner and HP DistrictCo LA, LLC dated as of the Effective Date.
Effective Date” has the meaning set forth in the introductory paragraph.
“[***].
Exclusive Category” has the meaning set forth in Section 4(b), subject to the exceptions and limitations set forth in Sections 4(c) and 4(d).
Expiration Date” has the meaning set forth in Section 2(a).
Fees” has the meaning set forth in Section 5(c).
“[***].
Finance Counterparty” has the meaning set forth in Section 17(h)(iii).
Financing” has the meaning set forth in Section 17(h)(iii).
Force Majeure Event” means, with respect to either Party, an event or condition that is caused by facts and circumstances that are beyond the reasonable control of such Party, which wholly or partially prevents or delays the performance of any of the duties, responsibilities, or obligations (except for the payment of money) of such Party, including the enactment, imposition, or modification of any Law that occurs after the Effective Date and that prohibits or materially impedes the performance of the obligations of the Parties under this Agreement; confiscation, seizure, or condemnation by any governmental authority; act or the failure to act of any governmental authority; compliance with any order or regulation of any governmental authority; war or war-like action (whether actual, pending, or expected and whether de jure or de facto); arrest or other restraint of government (civil or military); blockade or embargo; insurrection, civil disturbance, riot, or national emergency; epidemic or national health emergency; act of God, fire, landslide, lightning, earthquake, hurricane, storm, flood, drought, wash-out, or explosions; nuclear reaction or radiation or radioactive contamination; act of terrorism or sabotage; strike or other labor trouble (but excluding a Work Stoppage); failure of a utility provider; or interruption of or delay in transportation.
“[***].
Indemnified Person” has the meaning set forth in Section 13(c).
Indemnifying Person” has the meaning set forth in Section 13(c).
Initial Contract Year” means the period beginning on the Stadium Opening Date and ending on the immediately following March 31st.
3


JAMS” means JAMS, Inc.
Law” means any federal, state, local, or foreign constitution, treaty, law, statute, ordinance, rule, code, regulation, order, writ, decree, injunction, judgment, stay, or restraining order, or any judgment, opinion, decree, or ruling of any governmental authority, in each case whether currently in effect or subsequently enacted or amended, that may affect the respective rights or obligations of the Parties set forth in this Agreement.
“[***].
Limited Exclusivity Events” has the meaning set forth in Section 4(d)(ii).
Loss” has the meaning set forth in Section 13(a).
“[***].
Marks” means, collectively, the Stadium Marks, Team Marks, and Naming Rights Partner Marks.
Major Event” has the meaning set forth in Section 4(d)(v).
Mobile Application” has the meaning set forth in Section 10(i)(ii).
Name Change Notice” has the meaning set forth in Section 3(e)(ii).
“[***].
Naming Rights Assets” has the meaning set forth in Recital D.
Naming Rights Partner” has the meaning set forth in the introductory paragraph.
Naming Rights Partner Default” has the meaning set forth in Section 6(a).
Naming Rights Partner Indemnified Party” and “Naming Rights Partner Indemnified Parties” have the respective meanings set forth in Section 13(b).
Naming Rights Partner Marks” means those trademarks and service marks set forth in Schedule 4 (as may be amended from time to time).
Naming Rights Partner Signage Plan” means the signage plan for the Stadium Complex attached to this Agreement as Exhibit A.
“[***].
NFL” has the meaning set forth in Recital A.
NFL Commissioner” means the Office of the Commissioner of the NFL established pursuant to the NFL Constitution.
4


NFL Constitution” means the Constitution and Bylaws of the National Football League as in effect from time to time.
NFL Entities” means the NFL; [***]; any successor or future entity that is directly or indirectly jointly owned or Controlled by all or substantially all of the NFL member clubs under the NFL Constitution; and each and all of their respective past, present, and future Affiliates, subsidiaries, successors, and assigns.
NFL Management Council” means the association formed by the member clubs of the NFL to act as the representative of such member clubs in the conduct of collective bargaining and other player relations activities of mutual interest to such member clubs.
NFL Rules” means the NFL Constitution and the Articles of Association and Bylaws of the NFL Management Council, including any amendments to either such document and any interpretations of either such document issued from time to time by the NFL Commissioner; all operative NFL or NFL Management Council resolutions; any existing or future agreements entered into by the NFL or the NFL Management Council, including any television agreements or any collective bargaining or other labor agreements (including any NFL player salary guarantees and pension fund agreements); any agreements made in settlement of any litigation against the NFL, the NFL Management Council, or the NFL member clubs (including litigation against such clubs, or agreements made by such clubs, jointly or collectively); and such other rules, standards, bulletins, guidelines, directives, decisions, or policies as the NFL, the NFL Management Council, or the NFL Commissioner may issue from time to time.
No-Signage Event” has the meaning set forth in Section 4(d)(iv).
“[***].
Objection Notice” has the meaning set forth in Section 3(e)(ii).
Obscure” means to cover, obscure, block, or temporarily or permanently remove, or otherwise take any action primarily intended to obstruct or otherwise alter the view of signage.
Olympics” or “Olympic Games” means the events which comprise the Olympics sponsored by the International Olympics Committee, International Paralympic Committee, or their respective successor organizations.
Other Sponsorship Agreement” means either the District Sponsorship Agreement or the Performance Venue Sponsorship Agreement.
“[***].
Parties” and “Party” have the meanings set forth in the introductory paragraph.
Performance Venue” has the meaning set forth in Recital B.
5


Performance Venue Sponsorship Agreement” means the Performance Venue Cornerstone Sponsorship Agreement entered into between Naming Rights Partner and Performance Company LA, LLC dated as of the Effective Date.
Permitted Name Change” has the meaning set forth in Section 3(e)(i).
Person” means any natural person, corporation, partnership, limited partnership, limited liability company, estate, trust, joint venture, association, governmental entity, or other form of entity or business organization.
“[***].
“[***].
Social Media Accounts” has the meaning set forth in Section 10(i)(i).
“[***].
Sponsorship Fees” has the meaning set forth in Section 5(a).
StadCo” has the meaning set forth in the introductory paragraph.
StadCo Additional Insureds” has the meaning set forth in Section 13(d)(i).
StadCo Default” has the meaning set forth in Section 6(c).
StadCo Indemnified Party” and “StadCo Indemnified Parties” have the respective meanings set forth in Section 13(a).
Stadium” has the meaning set forth in Recital A.
Stadium Complex” has the meaning set forth in Recital A.
Stadium Domain Name” has the meaning set forth in Section 10(h).
Stadium Logos” has the meaning set forth in Section 3(c)(i).
Stadium Marks” means the Stadium Name, the Stadium Logos, and those trademarks and service marks set forth in Schedule 5 (as may be amended from time to time), none of which shall contain or incorporate (i) the Team Marks or (ii) any color schemes which are confusingly similar to those associated with the Team Marks or otherwise are intended to be similar to the color schemes (e.g., if the Team Mark color scheme is yellow, blue, and white, the Stadium Marks cannot include a color scheme that is also yellow, blue, and white, even if a different shade of yellow, blue, and white).
Stadium Name” has the meaning set forth in Section 3(d)(i).
Stadium Name Change Fee” has the meaning set forth in Section 3(e)(vi).
6


Stadium Opening Date” means the date on which the Stadium is first open for its first event.
Stadium Plazas” has the meaning set forth in Recital A.
Stadium Website” has the meaning set forth in Section 10(h).
Style Guide” has the meaning set forth in Section 10(m)(i).
Substitute Asset” means a substitute promotional or advertising right or benefit having promotional value not less than that of the applicable undelivered Asset.
“[***].
Team” and “Teams” have the respective meanings set forth in Recital A.
Team Assets” has the meaning set forth in Recital E.
Team Marks” means those trademarks and service marks set forth in Schedule 6 (as may be amended from time to time).
Team NFL Home Game” means with respect to each Team, [***] game played at the Stadium.
Term” has the meaning set forth in Section 2(a).
“[***].
Territory” means the territory established from time to time by the NFL as the home marketing area of each of the Teams.
USPTO” means the United States Patent and Trademark Office.
Venue” has the meaning set forth in Section 3(d)(iii).
“[***].
Work Stoppage” means the occurrence of a strike, work stoppage, lockout, or other suspension or cancellation of NFL play arising out of or as a result of a labor dispute involving NFL players or NFL referees.
2.    Term.
(a)    Term. This Agreement shall commence on the Effective Date and shall expire at 11:59 pm Pacific Time on the last day of the twentieth (20th) Contract Year (such date, the “Expiration Date”), unless extended or earlier terminated or reduced in accordance with the terms of this Agreement (the “Term”).
7


(b)    Termination of any Other Sponsorship Agreement. Notwithstanding anything to the contrary in this Agreement, this Agreement shall automatically and immediately terminate, without any further action by or notice to either Party, upon any termination of any Other Sponsorship Agreement in accordance with its terms. In such event, the termination of this Agreement shall become effective at the same time that the termination of such Other Sponsorship Agreement becomes effective, and neither Party shall have any further obligation to the other Party or rights under this Agreement other than those that survive termination in accordance with this Agreement, provided, however, that nothing in this Section 2(b) shall limit a Party’s rights and remedies at law and in equity in case of a termination of this Agreement or any Other Sponsorship Agreement.

(c)    No Continued Use Upon Expiration or Termination. Immediately following the Expiration Date or earlier termination of this Agreement in accordance with the terms of this Agreement (but subject to each Party’s legal rights and remedies to dispute an early termination of this Agreement), (i) the licenses granted in Section 10 will automatically terminate and (ii) StadCo shall be free to rename the Stadium Complex. Following the Expiration Date or earlier termination of this Agreement in accordance with the terms of this Agreement, subject to any permitted historical uses pursuant to Section 10(c) and inventory run-out uses pursuant to Section 10(k), StadCo shall (i) cease all use of the Stadium Marks and Naming Rights Partner Marks as soon as reasonably practicable, (ii) no longer refer to the Stadium Complex by the Stadium Name in its advertising or promotional materials or any other communications, and (iii) use good faith efforts to notify parties contracting with StadCo not to use the Stadium Name; provided that StadCo shall have a period of twelve (12) months after the expiration or termination of this Agreement to remove any references to, or displays of, the Stadium Marks and Naming Rights Partner Marks on the signs or advertisements on and in the Stadium Complex provided for under this Agreement. Upon the expiration or termination of this Agreement, subject to any permitted historical uses pursuant to Section 10(c) and inventory run-out uses pursuant to Section 10(k), Naming Rights Partner and its Affiliates shall cease all use of the Team Marks and the Stadium Marks and shall no longer refer to the Stadium Complex by the Stadium Name.
(d)    [***].
3.    Assets.
(a)    Naming Rights Assets. During the Term, subject to the terms and conditions of this Agreement, StadCo grants to Naming Rights Partner the rights with respect to the Naming Rights Assets as set forth on Schedule 2. After consultation with Naming Rights Partner, StadCo will use its commercially reasonable efforts to implement the Naming Rights Assets, and will diligently work to have the Naming Rights Assets implemented as soon as possible. StadCo acknowledges and agrees that its obligation to have the Naming Rights Assets implemented as soon as possible shall include, without limitation, the obligation to work with Naming Rights Partner to promote Naming Rights Partner as the naming rights partner of the Stadium Complex during the period between the Effective Date and the Stadium Opening Date. For the avoidance of doubt, Naming Rights Partner acknowledges and agrees that the Naming Rights Assets do not extend to, or prevent StadCo from granting to any other Person, the right to name and brand areas or elements that are part of or within the Stadium Complex, including without limitation,
8


all or any part of the Stadium Plazas (including the plaza currently contemplated as “Champions Plaza”), premium seating areas, corners, clubs, lounges, concourses, gates and entrances, unless the right to name or brand such areas or elements are expressly within the scope of the Naming Rights Assets.
(b)    Team Assets. Commencing on the Stadium Opening Date and continuing throughout the Term, subject to the terms and conditions of this Agreement, StadCo grants to Naming Rights Partner the rights with respect to the Team Assets as set forth on Schedule 3, and after consultation with Naming Rights Partner, StadCo will use its commercially reasonable efforts to implement the Team Assets, and will diligently work to have the Team Assets implemented as soon as possible during such period.
(c)    Stadium Logos; Signage, Displays, and other Collateral.
(i)    The logos for the Stadium Complex, incorporating the Stadium Name, including the style and color, are identified and set forth on Schedule 5 (the “Stadium Logos”). The Parties acknowledge that the Stadium Logos set forth on Schedule 5 are interim Stadium Logos. The Parties shall have thirty (30) days from the Effective Date to mutually agree upon revised Stadium Logos, and for avoidance of doubt, any such changes or supplements to the interim Stadium Logos set forth on Schedule 5 within such thirty (30) day period shall not constitute a change in the Stadium Logos as provided in Section 3(c)(ii). If the Parties do not agree upon revised Stadium Logos within such thirty (30) day period, then the interim Stadium Logos set forth on Schedule 5 shall constitute the Stadium Logos for purposes of this Agreement except as otherwise agreed upon by the Parties. Any signage, displays, and other Assets and all associated collateral shall be subject to StadCo’s prior written approval as provided in Sections 10(e) and 10(m), and to any required approvals of, or limitations imposed by, governmental authorities (including as may be set forth in, or imposed pursuant to, any development or other agreement with the City of Inglewood or any other governmental authority) or the NFL Entities. StadCo will obtain the consent or approval of any governmental authority that is required for its performance under this Agreement. Any and all uses of the Stadium Logos or Stadium Marks and/or the Naming Rights Partner Marks in connection with signage, displays, and other Assets and all associated collateral shall be subject to the approval process set forth in Section 10(m). If the Parties approve a new stylized version(s) of the Stadium Logos pursuant to Section 3(d) or a new Stadium Name pursuant to Section 3(e), then the Parties shall work together to develop a new Stadium Logos to the extent necessary to reflect the new Stadium Name or the new stylized version(s) of the Stadium Logos, as the case may be, and to effect a smooth transition with respect thereto. Except as set forth in Section 4, StadCo’s rights to cover, obscure, or temporarily remove any of Naming Rights Partner’s signage provided for in this Agreement shall be governed by Sections 4(d)(i), 4(d)(iv), and 4(d)(v). StadCo shall [***].
(ii)    If Naming Rights Partner wishes to change certain stylized elements of (A) the Stadium Name (without changing the Stadium Name itself) or (B) Naming Rights Partner’s corporate logo incorporated into the Stadium Logos (without changing Naming Rights Partner’s trade name that is incorporated into the Stadium Logos), then Naming Rights Partner shall notify StadCo of the proposed change. StadCo shall have the right to approve or disapprove of such proposed change, which approval shall not be unreasonably withheld, conditioned, or delayed by StadCo; provided, however, that it shall be reasonable for StadCo to withhold
9


approval (1) if such proposed change includes any color or shade that StadCo deems to be unacceptable, (2) if such proposed change violates NFL Rules, or (3) on the basis of any of clauses (A) through (J) of Section 3(e)(i) with respect to such proposed change. Naming Rights Partner shall bear all costs and expenses associated with changes to the Stadium Name and Stadium Logos requested pursuant to this Section 3(c)(ii), including without limitation the costs and expenses described in clauses (a) through (d) of Section 3(e)(v).
(iii)    If StadCo wishes to change certain stylized elements of (A) the Stadium Name (without changing the Stadium Name itself) or (B) the Stadium Logos (without changing Naming Rights Partner’s corporate logo incorporated into the Stadium Logos), then StadCo shall notify Naming Rights Partner of the proposed change. Naming Rights Partner shall have the right to approve or disapprove of such proposed change, which approval shall not be unreasonably withheld, conditioned, or delayed by Naming Rights Partner. StadCo shall bear all costs and expenses associated with changes to the Stadium Name and Stadium Logos requested pursuant to this Section 3(c)(iii), including without limitation the costs and expenses described in clauses (a) through (d) of Section 3(e)(v).
(d)    Stadium Name; References; Restriction on Sponsorship of Other Venues.
(i)    The name of the Stadium Complex will be “SoFi Stadium” (the “Stadium Name”), subject to changes in the Stadium Name strictly in accordance with Section 3(e). From and after the Effective Date, StadCo and the Teams shall: (A) [***]; (B) [***]; (C) [***]; provided that StadCo will not be in breach of this Agreement if [***]; (D) [***]; and (E) [***], and in connection therewith, StadCo acknowledges that Naming Rights Partner [***]and that [***], as described in such clauses (B) through (E) is of extreme importance to Naming Rights Partner, and consequently, StadCo will take such reasonable steps as are necessary and appropriate in order to achieve such result. StadCo further agrees, [***].
(ii)    StadCo acknowledges and agrees that [***] except as provided below. In addition, StadCo agrees that no Stadium Marks will incorporate [***] or any references to [***]. StadCo may [***], provided that [***]. In addition, StadCo may [***]
(iii)    Naming Rights Partner covenants and agrees that, during the Term, Naming Rights Partner shall not, other than pursuant to this Agreement, acquire the naming rights to, serve as the naming rights partner of, or otherwise permit its corporate name or any Naming Rights Partner Mark to be included in the name of any sports, music, or other entertainment venue, including without limitation, any stadiums, arenas, theaters, fields, or any complex comprised of any of the foregoing (each, a “Venue”) located [***]; provided, however, that [***]; provided, further, that Naming Rights Partner will not be in breach of this Agreement if [***], so long as [***].
(e)    Stadium Name Changes.
(i)    If, from time to time, either (1) [***], or (2) [***], Naming Rights Partner changes its corporate name and no longer uses the “SoFi” of “Social Finance” name in connection with its business, or conducts the services in the Exclusive Category through a name other than “SoFi”, then Naming Rights Partner may propose another Stadium Name by serving
10


written notice upon StadCo, which notice shall contain (x) the reason for, or cause of, such change, and (y) the proposed new Stadium Name. The new Stadium Name shall be subject to the reasonable prior written approval of StadCo, which shall not be unreasonably withheld, conditioned, or delayed; provided that it shall be deemed reasonable to withhold, condition, delay, or deny such consent if such successor is not, or the name to which the Stadium Name would be changed is not the name of, (I) [***], or (II) [***] (a “Permitted Name Change”). For purposes of this Section 3(e), the standard for reasonable approval shall mean that StadCo may deny approval if the proposed Stadium Name is not a Permitted Name Change or (A) would violate any Law or NFL Rule; (B) is offensive, discriminatory against a protected class, offensive to the sensibilities of the community at large, or associates the Stadium Complex with any Person, product, or service that is detrimental to the reputation of StadCo or either Team; (C) would reasonably cause embarrassment to StadCo or either Team (such as names containing slang, barbarisms, or profanity) or is otherwise inconsistent with StadCo’s or either Team’s reputation or wholesome, family-oriented image; (D) is related to any business or enterprise that might reasonably be deemed to be immoral; (E) contains any overt or publicly offensive political reference; (F) relates or refers to any sexually oriented subject matter, business, or enterprise; (G) is inconsistent with names that are appropriate for a first-class NFL stadium, (H) would involve a brand change such that SoFi (or the existing brand incorporated into the Stadium Name at the time) would no longer be used in the Stadium Name, (I) would conflict with an existing sponsor of the Teams or the Stadium, and the Parties are unable to agree, after using good faith efforts, to develop a work-around for such new Stadium Name, and (J) is a name not primarily associated with products or services in the Exclusive Category.
(ii)    If Naming Rights Partner desires to change the name of the Stadium Complex as the result of a Permitted Name Change, Naming Rights Partner shall provide at least one hundred twenty (120) days’ prior written notice to StadCo of the desired name change (the “Name Change Notice”), and, if StadCo believes that such proposed name is not a Permitted Name Change or falls within any of the categories described in Section 3(e)(i), it shall have thirty (30) days from the receipt of the Name Change Notice to object by delivering to Naming Rights Partner a written objection (the “Objection Notice”) to any proposed name, on the basis that such name change is not a Permitted Name Change or on the basis of clauses (A) through (J) of Section 3(e)(i). If StadCo delivers an Objection Notice to Naming Rights Partner within such thirty (30) day period, Naming Rights Partner shall not be permitted to change the name of the Stadium Complex to the name identified in the Name Change Notice. Any dispute regarding the reasonableness of StadCo withholding approval to a new Stadium Name pursuant to this Section 3(e) shall first be submitted to the dispute resolution procedure pursuant to Section 15(a).
(iii)    Notwithstanding Section 3(e)(i), (A) Naming Rights Partner shall not have the right to change the name of the Stadium Complex during the NFL season (including from the first pre-season game of the season through and including the Super Bowl) or within the ninety (90) day period preceding any scheduled Olympic Games event or FIFA World Cup match at the Stadium, and (B) on and after the date that is twenty-four (24) months before the Expiration Date, Naming Rights Partner may not change the name of the Stadium Complex for any reason, without the prior written consent of StadCo.
(iv)    Upon any such change in the Stadium Name, StadCo shall (A) [***]; (B) [***]; (C) [***]; provided that StadCo will not be in breach of this Agreement if [***];
11


(D) [***]; and (E) [***], and in connection therewith, StadCo acknowledges that Naming Rights Partner [***] and [***], as described in such clauses (B) through (E) is of extreme importance to Naming Rights Partner, and consequently, StadCo will [***]. For the purposes of this Section 3(e)(iv) StadCo shall be deemed to have used “commercially reasonable efforts” if it delivers an initial written notice promptly following public announcement of the name change with an additional written notice to the same parties within ninety (90) days following the initial notice.
(v)    If there is any change to the Stadium Name for any reason, including as the result of a Permitted Name Change, Naming Rights Partner shall bear all associated costs and expenses in connection with such change, including attorneys’ fees, other professionals’ fees, and all other costs and expenses relating to signage, promotion, branding, advertising, and marketing (and everywhere else the Stadium Marks, Stadium Name or Stadium Logos appears) and obtaining required consents and approvals associated with such change, including to replace, modify, reprogram, reproduce, or otherwise change or decommission signage; banners; building elements; wall and floor coverings; printed, electronic, and video materials; publications; video graphics and materials; staff and concessionaire uniforms; supplies; and all other materials and Assets regardless of format that need to be changed to effect the renaming and rebranding of the Stadium Complex with the new Stadium Name. Without limiting the generality of the foregoing, Naming Rights Partner shall bear all costs and expenses associated with (a) creating and developing the new Stadium Name, Stadium Logos, and Stadium Marks; (b) producing and installing the new Stadium Name, Stadium Logos, and Stadium Marks on all elements of the Stadium Complex that bear the Stadium Name, Stadium Logos, and/or the Stadium Marks; (c) reprinting current publications and other written materials bearing the Stadium Name, Stadium Logos, and/or the Stadium Marks to include the new Stadium Name, Stadium Logos, and/or the Stadium Marks; and (d) creating and producing signage, print, and other advertising copy to replace the former Stadium Name, Stadium Logos, and/or the Stadium Marks. The Parties shall cooperate in good faith with respect to the transition from the existing Stadium Name, Stadium Logos, and/or the Stadium Marks to the new Stadium Name, Stadium Logos, and/or the Stadium Marks, including notifying StadCo’s and both Teams’ advertisers, licensees, sponsors, and media partners of the change and minimizing the disruption to the operation of the Stadium Complex during Stadium Complex events. For avoidance of doubt, the Parties acknowledge and agree that StadCo shall use commercially reasonable efforts to cause governmental authorities or agencies to update signs to the new Stadium Name references on any highway or roadway in the vicinity of the Stadium Complex and update signs with any other continued use of the prior Stadium Name or Stadium Logos.
(vi)    In the event that Naming Rights Partner changes the Stadium Name during the Term, then Naming Rights Partner agrees to pay StadCo, in addition to the payments otherwise due under Section 5, an additional fee in an amount equal to [***] ([***]) (the “Stadium Name Change Fee”); provided, however, that no Stadium Name Change Fee shall be due [***]. Naming Rights Partner’s payment of the Stadium Name Change Fee shall not in any way limit any condition, requirement, or limitation with respect to change of the Stadium Name set forth in this Section 3(e), including without limitation clauses (A) through (J) of Section 3(e)(i), and Naming Rights Partner’s obligation to bear all costs and expenses in connection with the change of the Stadium Name as set forth in Section 3(e)(iv).
12


(f)    Unavailable Assets. The Parties hereby acknowledge and agree that certain Assets may become unavailable during the Term. If any individual Asset becomes unavailable, StadCo shall promptly notify Naming Rights Partner in writing, and Naming Rights Partner and StadCo shall consult regarding Substitute Assets therefor for a period of up to thirty (30) days, except that (i) no Substitute Assets will be provided in connection with Sections 4(c) or 4(d), (ii) if an Asset becomes unavailable due to a Force Majeure Event, the provisions of Section 8(a) or Section 9, as applicable, shall instead apply, (iii) if an Asset becomes unavailable as the result of a Casualty Event, the provisions of Section 8(d) or Section 9, as applicable, shall instead apply, (iv) if an Asset becomes unavailable as the result of any amendment, modification, supplement, or other change in any NFL Rules, the provision of Section 8(e) shall instead apply, and (v) if an Asset becomes unavailable due to a Work Stoppage, the provisions of Section 9 shall instead apply. If, [***].
(g)    No Pass-Throughs. All rights granted to Naming Rights Partner pursuant to this Agreement are only granted to Naming Rights Partner with respect to Naming Rights Partner’s products and services within the Exclusive Category, and Naming Rights Partner may not assign or “pass through” to any of its partners or Affiliates, or any other third party, including Naming Rights Partner’s distributors or customers, any of the rights or Assets granted to Naming Rights Partner pursuant to this Agreement without the prior written consent of StadCo, which shall not be unreasonably withheld. Notwithstanding the prior sentence, StadCo agrees that nothing in this Section 3(g) shall prevent or impair Naming Rights Partner from (i) [***], or (ii) [***], except as otherwise may be required pursuant to [***].
(h)    Rights Reserved. Except for the rights, benefits, and privileges expressly granted to Naming Rights Partner under this Agreement, all other rights, benefits, and privileges relating to the Stadium Complex, the Teams, and StadCo are expressly reserved by StadCo. Any rights, benefits, and privileges not expressly granted exclusively to Naming Rights Partner under this Agreement may be sold or licensed to other Persons.
(i)    [***].
(j)    Annual Review Meeting. Commencing with the Initial Contract Year and continuing throughout the Term, within [***] after the completion of each Contract Year, the Parties shall meet in person at a location mutually agreed upon by the Parties to discuss and review the following:
(i)    [***]; and
(ii)    if requested by Naming Rights Partner [***], any advertising, sponsorship, or promotional benefits or opportunities with respect to the Stadium Complex or Teams that are expected to become available during the upcoming Contract Year that are of a nature that can be provided to Naming Rights Partner and, if Naming Rights Partner expresses interest in such advertising, sponsorship, or promotional opportunities, the Parties shall enter into good faith discussions regarding Naming Rights Partner’s acquisition of such advertising, sponsorship, or promotional benefits for additional consideration or as a substitute for other benefits or Assets to be provided hereunder; provided that nothing herein shall restrict or limit StadCo or the Teams
13


from offering such advertising, sponsorship, or promotional benefits to other Persons subject to the terms of this Agreement or at other times during a Contract Year.
4.    Category Protection and Certain Other Rights.
(a)    Category Protection. Subject to the exclusions, exceptions, limitations and restrictions set forth in Sections 4(c) and 4(d), StadCo shall not (i) promote, and shall not grant to any third party any license to use, the Stadium Marks or Stadium Designations during the Term, or the Team Marks or Team Designations during the period commencing on the first day of the Initial Contract Year and continuing throughout the Term to advertise or promote, any product or service within the Exclusive Category other than Naming Rights Partner’s products or services in the Exclusive Category, or (ii) [***]. Naming Rights Partner shall not use the Stadium Name, Stadium Logos, any Stadium Mark, any Team Mark, or any Designation for any purpose other than to (A) advertise or promote its products and services within the Exclusive Category, (B) advertise or promote its sponsorship of the Stadium Complex or the Teams, or (C) to enjoy those rights and benefits provided herein in each case subject to the terms of this Agreement (including the restrictions set forth in Section 4(c), and StadCo’s approval rights in Sections 3(c) and 10(m)).
(b)    Exclusive Category. The term “Exclusive Category” means the business of banking [***], lending [***], debit and credit cards [***] taking consumer deposits, and financial services [***]. Periodically during the Term, the Parties shall discuss in good faith the potential inclusion in, or exclusion from, the Exclusive Category of [***]and other new products or services that may properly be included in, or excluded from, the Exclusive Category.
(c)    Exceptions and Limitations to Scope of Exclusive Category.
(i)    Naming Rights Partner’s category protection rights pursuant to Section 4(a) are non-exclusive with respect to [***], and StadCo and each Team and their respective Affiliates are permitted to promote, and to grant to any third party any license to use the Stadium Name, Stadium Logos, Stadium Marks or Team Marks to advertise or promote, [***], provided, however, that StadCo acknowledges and agrees that any promotion by a sponsor in this category must, [***]. For the avoidance of doubt, the promotion of a sponsor’s corporate name or trade name that contains words or phrases such as [***] that clearly identify the sponsor as a provider of [***] will not be considered [***].
(ii)    Naming Rights Partner’s category protection rights pursuant to Section 4(a) shall not prohibit or otherwise restrict StadCo or the Teams or any of their respective Affiliates from entering into a sponsorship arrangement pursuant to which the Stadium Name, Stadium Logos, Stadium Marks or the Team Marks are used to promote or advertise the products or services of (A) [***], with the understanding that no other [***], and provided that, during the first [***] calendar years following the Effective Date only, prior to entering into a sponsorship agreement with [***], StadCo shall [***], or (B) [***], so long as in the case of both (A) and (B), any such sponsorship arrangement [***]. Without limiting the foregoing, Naming Rights Partner’s category protection rights pursuant to Section 4(a) will not prohibit (X) StadCo from [***], for so long as [***]; provided that [***], StadCo shall first give Naming Rights Partner written notice of [***], which written notice shall set forth [***],
14


provided that [***] (1) [***]; (2) [***]; (3) [***]; (4) [***], (5) [***]; (6) [***]; (7) [***]; and (8) [***], subject to the approval of StadCo [***], such approval not to be unreasonably withheld, conditioned or delayed, and [***], except for [***], which shall be permitted. If Naming Rights Partner agrees [***] within [***] days of its receipt of the written notice, then Naming Rights Partner shall [***]. If [***], then StadCo shall have no further obligations to Naming Rights Partner pursuant to this proviso with respect to [***]; nor (Y) StadCo, either Team, or their respective Affiliates, licensees, tenants, vendors, concessionaires or sponsors, from [***], including without limitation, by [***], or [***].
(iii)    Naming Rights Partner’s rights to promote and advertise products and services in the Exclusive Category, are subject to the following restrictions:
(1)    Any [***] may be promoted [***], only for as long as either Team or StadCo or any of their Affiliates does not have a sponsorship arrangement with [***] that is [***]; and
(2)    In the event a [***] of a Team or StadCo or any of their Affiliates is [***], then Naming Rights Partner may [***], but must do so without using any Team Mark, any Stadium Mark, any Designation or the Stadium Name or the Stadium Logos; provided, however, that the Parties acknowledge and agree that if the limitation set forth in this Section 4(c)(iii)(2) applies to [***], it shall not apply to [***].
(iv)    Naming Rights Partner’s category protection rights pursuant to Section 4(a) shall not prohibit or otherwise restrict either Team or any of its Affiliates from continuing an existing sponsorship arrangement, modifying, renewing, or extending such existing sponsorship arrangement, or entering into a new sponsorship arrangement with any (1) [***] or (2) [***]; provided that in no event will any arrangement described in this Section 4(c)(iv) allow either Team or any of its Affiliates to promote the products or services of any such [***] within the Stadium at any time without Naming Rights Partner’s prior approval.
(d)    Exceptions to Category Protection and Other Rights.
(i)    StadCo acknowledges and agrees that, notwithstanding any other provision of this Section 4(d) or elsewhere in this Agreement, and except in the case of No-Signage Events as described in Section 4(d)(iv) below, neither StadCo nor any other Person, except as may be required by Law, shall Obscure any of [***] provided for in this Agreement [***], unless [***]; provided, however, that [***] (A) [***]; (B) [***]; (C) [***]; and (D) [***].
(ii)    Naming Rights Partner’s category protection rights pursuant to Section 4(a) and prominence rights pursuant to Section 4(e) will not apply to the following: (A) [***]; (B) [***]; (C) [***]; (D) [***]; (E) [***]; or (F) [***] (collectively, the “Limited Exclusivity Events”); provided, however, that with respect to Limited Exclusivity Events that [***], (1) Naming Rights Partner’s signage or advertising will not be Obscured unless [***], except for events described in Section 4(d)(ii)(B) for which StadCo will, [***] and (2) StadCo shall [***], except for events described in Section 4(d)(ii)(B) for which StadCo will [***]. Naming Rights Partner’s category protection rights pursuant to Section 4(a) and prominence
15


rights pursuant to Section 4(e) will also not apply to (I) [***] or (II) the displaying of the marks of [***].
(iii)    Naming Rights Partner’s category protection under Section 4(a) does not extend to [***] and, therefore, such [***] may include advertising or promotion of the products or services of third parties within the Exclusive Category, provided that (A) such inclusion of advertising or promotion of products or services within the Exclusive Category must be [***] and may not be [***], and (B) nothing in this Section 4(d)(iii) shall limit StadCo’s obligation to [***].
(iv)    Naming Rights Partner acknowledges and agrees that during [***] (each, a “No-Signage Event”), signage and advertising may be required to be Obscured, and any such actions and their effects will not be deemed a violation of Naming Rights Partner’s category protection rights pursuant to Section 4(a) or prominence rights pursuant to Section 4(e); provided, however, that with respect to such No-Signage Events, StadCo shall [***], (A) [***]; (B) [***]; (C) [***], and (D) [***], and in connection therewith, StadCo acknowledges [***] and that achieving the objectives described in clauses (A) through (D) above is of extreme importance to Naming Rights Partner, and consequently, StadCo will [***]. Naming Rights Partner agrees that it may not be entitled to certain Assets in or around the Stadium Complex for a commercially reasonable period before, during, and after a No-Signage Event, and that no Substitute Assets or other remedies shall be granted to or available to Naming Rights Partner in connection therewith.
(v)    Subject to Naming Rights Partner’s approval rights set forth in Section 4(d)(i), Naming Rights Partner acknowledges and agrees that during [***] (each, a “Major Event”), [***] and [***], and any such actions and their effects will not be deemed a violation of Naming Rights Partner’s category protection rights pursuant to Section 4(a) or prominence rights pursuant to Section 4(e); provided, however, that with respect to such Major Events, (A) [***], (B) StadCo shall [***], (C) StadCo shall [***], and (D) StadCo shall [***], and in connection therewith, StadCo acknowledges that [***]and that achieving the objectives described in clauses (B) through (D) above is of extreme importance to Naming Rights Partner, and consequently, StadCo will [***].
(vi)    Nothing in this Agreement shall prevent the NFL from licensing any Team Marks to any provider in the Exclusive Category for any reason. If any Assets conflict with, or are deemed by the NFL to conflict with, any exclusive advertising or sponsorship rights granted by any NFL Entity to one of its advertisers or sponsors, such Assets are subject to termination in whole or in part at any time upon written notice to Naming Rights Partner. If there is any failure to provide any Assets in accordance with this Section 4(d)(v), StadCo shall [***] and such failure to provide such Assets shall not be deemed a StadCo Default.
(vii)    Notwithstanding anything to the contrary in this Agreement, Naming Rights Partner acknowledges and agrees that the NFL and its designees (including, without limitation, NFL sponsors) are not required to use the Stadium Name or the Stadium Logos in any promotional materials or broadcasts, or in any theme art or merchandise, in connection with NFL-controlled events held at the Stadium, and may incorporate images of the Stadium from
16


which signage that displays the Stadium Name or Stadium Logos has been removed or otherwise obscured (e.g., as part of an official Super Bowl logo).
(e)    Prominence.
(i)    StadCo will ensure that the quality of the signage included in the Naming Rights Assets and the aggregate level of prominence to be received by Naming Rights Partner with respect to the Naming Rights Assets, including exterior and interior signage, will be [***]; provided that Naming Rights Partner acknowledges and agrees that [***].
(ii)    The Assets will result in Naming Rights Partner having the most prominent (1) [***], and (2) [***], in each case when compared with any other individual Stadium sponsor or advertiser, and with such prominence being viewed in the aggregate as opposed to on an Asset-by-Asset basis. In the event that Naming Rights Partner reasonably believes that the prominence requirements specified in this Section 4(e) have not been satisfied, Naming Rights Partner shall so notify StadCo, and the Parties agree to meet for a period of up to thirty (30) days to try to resolve the issue. If the Parties are unable to resolve the matter to Naming Rights Partner’s reasonable satisfaction, then the Parties agree to submit the matter to final, binding arbitration in accordance with Section 15.
(f)    No Rights to Any Additional Teams. Naming Rights Partner acknowledges and agrees that the Assets granted under this Agreement do not include any rights, benefits, or privileges related to or in connection with any team (other than the Teams) that may, from time to time, play one or more of its home games in the Stadium. StadCo and any such additional team shall have the right to grant rights, benefits, and privileges related to such additional team to another sponsor within the Exclusive Category with respect to any such additional team’s home games played at the Stadium. Notwithstanding the foregoing, StadCo shall (i) [***]; (ii) [***], and (iii) [***], and StadCo will [***]. In the event that [***], such team may [***] so long as [***].
(g)    Ambush Marketing. StadCo shall, to the extent within its reasonable control, use good faith efforts to take appropriate measures as are necessary to protect the rights granted to Naming Rights Partner under this Agreement from being violated in a way that is materially inconsistent with Naming Rights Partner’s category protection described in Section 4(a); provided, however, such measures shall not include any obligation of StadCo to expend funds other than nominal amounts unless (i) [***] or (ii) [***]. If there is a circumstance outside of the reasonable control of StadCo that violates Naming Rights Partner’s category protection rights pursuant to Section 4(a), the Parties shall meet and confer regarding a potential course of action.
5.    Fees.
(a)    Sponsorship Fees. Commencing with the Initial Contract Year and continuing throughout the Term, in exchange for the rights with respect to the Assets to be provided to Naming Rights Partner during each Contract Year, Naming Rights Partner shall pay to StadCo the fees set forth in Section 5(b) (the “Sponsorship Fees”).
(b)    Payment Schedule for Sponsorship Fees.
17


(i)    The Sponsorship Fees due for each Contract Year shall be payable in four (4) equal installments on April 1, July 1, October 1, and January 1 of such Contract Year as set forth below; provided, however, that Naming Rights Partner’s obligation to pay the first installment or any subsequent installment of the Sponsorship Fees shall be deferred until the Stadium Opening Date occurs, and to the extent that the Stadium Opening Date occurs after the date upon which any installment of the Sponsorship Fees would have otherwise been due, then such installments shall be due and payable to StadCo on the Stadium Opening Date (e.g., if the Stadium Opening Date occurs on July 1, 2020, the April 1, 2020 installment and the July 1, 2020 installment will be due on July 1, 2020).
Contract
Year
Payments Due Total
Sponsorship Fees
April 1 July 1 October 1 January 1
Initial Contract Year $5,575,000 $5,575,000 $5,575,000 $5,575,000 $22,300,000
2 $6,200,000 $6,200,000 $6,200,000 $6,200,000 $24,800,000
3 $6,225,625 $6,225,625 $6,225,625 $6,225,625 $24,902,500
4 $6,252,301 $6,252,301 $6,252,301 $6,252,301 $25,009,203
5 $6,280,070 $6,280,070 $6,280,070 $6,280,070 $25,120,280
6 $6,875,000 $6,875,000 $6,875,000 $6,875,000 $27,500,000
7 $6,875,000 $6,875,000 $6,875,000 $6,875,000 $27,500,000
8 $6,875,000 $6,875,000 $6,875,000 $6,875,000 $27,500,000
9 $6,875,000 $6,875,000 $6,875,000 $6,875,000 $27,500,000
10 $6,875,000 $6,875,000 $6,875,000 $6,875,000 $27,500,000
11 $6,875,000 $6,875,000 $6,875,000 $6,875,000 $27,500,000
12 $6,875,000 $6,875,000 $6,875,000 $6,875,000 $27,500,000
13 $6,875,000 $6,875,000 $6,875,000 $6,875,000 $27,500,000
14 $6,875,000 $6,875,000 $6,875,000 $6,875,000 $27,500,000
15 $6,875,000 $6,875,000 $6,875,000 $6,875,000 $27,500,000
16 $6,875,000 $6,875,000 $6,875,000 $6,875,000 $27,500,000
17 $6,875,000 $6,875,000 $6,875,000 $6,875,000 $27,500,000
18 $6,875,000 $6,875,000 $6,875,000 $6,875,000 $27,500,000
18


Contract
Year
Payments Due Total
Sponsorship Fees
19 $6,875,000 $6,875,000 $6,875,000 $6,875,000 $27,500,000
20 $6,875,000 $6,875,000 $6,875,000 $6,875,000 $27,500,000
TOTAL $534,631,982
(c)    Playoff Fees. In addition to the Sponsorship Fees described in Section 5(a), if either or both of the Teams participate in the NFL playoffs, Naming Rights Partner shall, to the extent applicable to a home NFL playoff game, be entitled to continue to receive the Assets for each such playoff game except to the extent such Assets are prohibited or otherwise restricted or not made available by the NFL and, in connection therewith, Naming Rights Partner shall pay to StadCo a fee for each Asset [***] (collectively, the “Playoff Fees” and, together with the Sponsorship Fees, the “Fees”). StadCo represents and warrants to Naming Rights Partner that [***]. The Playoff Fees due for each Contract Year shall be payable thirty (30) days from receipt of an invoice after the last playoff game is played in such Contract Year.
(d)    Taxes; Fees and Commissions; Wire Transfer.
(i)    The Fees and other amounts payable to StadCo under this Agreement are exclusive of (i) agency fees and commissions payable by Naming Rights Partner, provided that nothing in this paragraph shall require Naming Rights Partner to pay agency fees or commissions to a representative or consultant for StadCo, and (ii) applicable sales and use taxes and similar charges (other than those assessed against StadCo’s net income) lawfully assessed or charged on the transactions under this Agreement, including the sale of the Assets and the other goods and services provided under this Agreement. Naming Rights Partner shall be liable for all such agency fees and commissions and all applicable federal, state, or local taxes or charges, if any, levied, assessed, or otherwise due with respect to the payments made by Naming Rights Partner hereunder, other than taxes or charges based solely on StadCo’s net income.
(ii)    Unless otherwise directed by StadCo from time to time during the Term, Naming Rights Partner shall make all Fees payments due hereunder to StadCo by wire transfer of immediately available funds in accordance with instructions provided by StadCo.
(e)    Interest on Late Payments. If any payment of Fees is not received on or before the date that is five (5) days after the applicable payment due date, StadCo may elect to charge Naming Rights Partner a late fee of one and one half percent (1.5%) per month (or, if lower, the maximum rate allowed by Law) from the applicable payment due date until such amount is paid in full (including any such accrued and unpaid interest). Naming Rights Partner acknowledges and agrees that any such election by StadCo does not waive any other remedy available to StadCo under this Agreement or otherwise at law or in equity.
(f)    Costs and Expenses.
(i)    Costs for [***] and [***]. StadCo shall be responsible for all costs and expenses related to [***]: (i) [***], provided that Naming Rights Partner shall be responsible for
19


[***], and (ii) [***], except, in all cases, all costs and expenses related to a change of the Stadium Name shall be the responsibility of Naming Rights Partner as provided in Section 3(e)(iv) and all costs and expenses related to a change of the Stadium Logos will be borne by the applicable Party as provided in Sections 3(c)(ii) and 3(c)(iii).
(ii)    [***].
(1)    [***], in lieu of being responsible for [***] pay to [***], as calculated pursuant to paragraph (3) of this Section 5(f)(ii), toward all [***], whether [***] or [***], related to the [***] (other than any costs and expenses related to a change of the Stadium Name which shall be the responsibility of Naming Rights Partner as provided in Section 3(e)(iv) and all costs and expenses related to a change of the Stadium Logos will be borne by the applicable Party as provided in Sections 3(c)(ii) and 3(c)(iii)), that were [***], including [***], and such other items mutually agreed upon by the Parties (collectively, the “[***]”).
(2)    [***] shall submit to [***] each month commencing on the Effective Date an invoice for [***] incurred by [***] are incurred by [***]), with reasonable backup documentation therefor. [***] pay [***] the amount due under such invoice within thirty (30) days after receipt. [***] shall submit [***] copies of invoices with reasonable backup documentation therefor for costs incurred and paid by [***] during each Contract Year to be included in [***] with respect to such Contract Year (the invoices submitted by [***] to [***] and the invoices submitted by [***] to [***] pursuant to this paragraph (2), collectively, the “[***]”).
(3)    As reimbursement of [***] Invoices paid by [***] with respect to each Contract Year, [***] shall pay to [***], within thirty (30) days following the end of such Contract Year, an amount (the “[***]”) equal to the lesser of (i) [***] or (ii) the unreimbursed balance, if any, of the aggregate Annual [***] paid by [***] during such Contract Year pursuant to this Agreement [***], whether such [***] were reimbursed under this Agreement [***] (the intent of the Parties being that any [***] shall only be reimbursed once).
(iii)    Responsibility for All Other Costs and Expenses. Except as otherwise specifically set forth in this Agreement, including Section 5(f)(i) with respect to [***], and Section 5(f)(ii)(3) with respect to the [***], Naming Rights Partner shall be solely responsible for all other costs and expenses incurred with respect to [***], all other costs [***] and Naming Rights Partner signage, including all costs and expenses incurred and required deposits (1) to conceive, create, produce, fabricate, deliver, and install Naming Rights Partner signage, advertising, and other promotional materials included in the Assets to be installed, used, or displayed in the Stadium Complex; (2) to build out any permanent or temporary activation space in the Stadium Complex included in the Assets, including to conceive, create, produce, fabricate, deliver, and install fixtures, furnishings, and equipment therein; (3) in connection with all modifications, alterations, and improvements to, and all replacements of, all Assets described in the immediately preceding clauses (1) and (2), including all [***]; and (4) in connection with the activation and decommissioning of the Assets (collectively, the “Asset Costs”); provided that StadCo shall be solely responsible for all costs and expenses of [***]. StadCo agrees to [***], including [***], if necessary. Naming Rights Partner may request, at any time and in good faith, that StadCo reasonably take action with regard to [***] and/or [***]. Naming Rights Partner shall
20


reimburse StadCo, within thirty (30) days following receipt of an invoice from StadCo or its designee with reasonable backup documentation therefor, for all Asset Costs incurred by StadCo or its designee.
6.    Default and Remedies.
(a)    Default by Naming Rights Partner. The occurrence of one (1) or more of the following events shall constitute a default by Naming Rights Partner (each, a “Naming Rights Partner Default”):
(i)    Naming Rights Partner’s failure to pay an installment of the Fees when due and the continuation of such failure for five (5) business days after delivery of written notice by StadCo to Naming Rights Partner specifying such failure.
(ii)    Naming Rights Partner’s failure to pay any other amounts when due to StadCo under this Agreement and the continuation of such failure for thirty (30) days after delivery of written notice by StadCo to Naming Rights Partner specifying such failure.
(iii)    Naming Rights Partner’s failure to perform or comply with any other material term or condition of this Agreement, or a material breach of any representation or warranty made by Naming Rights Partner in this Agreement, and the continuation of such failure or breach for a period of ninety (90) days after delivery of written notice by StadCo to Naming Rights Partner specifying such failure or breach; provided that, if Naming Rights Partner has taken commercially reasonable steps to cure such failure or breach within such ninety (90) day period, but the failure is of a type or character that is not reasonably susceptible of cure within such ninety (90) day period and would otherwise be capable of cure by Naming Rights Partner using commercially reasonable efforts, then Naming Rights Partner shall have such additional time as may be necessary in order to effect such cure.
(iv)    Naming Rights Partner (A) files a petition in bankruptcy; (B) is adjudicated bankrupt; (C) has a petition in bankruptcy filed against it that is not dismissed within sixty (60) days after filing; (D) becomes insolvent or is unable, or admits in writing its inability, to pay its debts generally as they become due; (E) makes a general assignment for the benefit of its creditors; or (F) has a receiver, custodian, or similar official appointed with respect to all or substantially all of its assets.
(b)    Rights and Remedies of StadCo. Upon the occurrence and during the continuance of a Naming Rights Partner Default, StadCo, in its sole discretion, shall have the right to do any one (1) or more of the following: (i) enforce any rights provided for in this Agreement; (ii) recover all damages and other sums available at law or in equity; (iii) exercise any other right or remedy available at law or in equity, including seeking an injunction or order of specific performance; and (iv) terminate this Agreement by written notice to Naming Rights Partner. The remedies set forth herein are in addition to StadCo’s rights and remedies at law and in equity.
(c)    Default by StadCo. The occurrence of one or more of the following events shall constitute a default by StadCo (each, a “StadCo Default”):
21


(i)    StadCo’s failure to perform or comply with any material term or condition of this Agreement, or a material breach of any representation or warranty made by StadCo in this Agreement, and the continuation of such failure or breach for a period of ninety (90) days after delivery of written notice by Naming Rights Partner to StadCo specifying such failure or breach, except in the case of StadCo’s failure to pay to Naming Rights Partner the [***], in which case the breach must be remedied within five (5) business days after delivery of written notice specifying such failure to pay the [***]; provided that, if StadCo has taken commercially reasonable steps to cure such failure or breach within such ninety (90) day period, but the failure is of a type or character that is not reasonably susceptible of cure within such ninety (90) day period and would otherwise be capable of cure by StadCo using commercially reasonable efforts, then StadCo shall have such additional time as may be necessary in order to effect such cure.
(ii)    StadCo (A) files a petition in bankruptcy; (B) is adjudicated bankrupt; (C) has a petition in bankruptcy filed against it that is not dismissed within sixty (60) days after filing; (D) becomes insolvent or is unable, or admits in writing its inability, to pay its debts generally as they become due; (E) makes a general assignment for the benefit of its creditors; or (F) has a receiver, custodian, or similar official appointed with respect to all or substantially all of its assets.
(d)    Rights and Remedies of Naming Rights Partner. Upon the occurrence and during the continuance of a StadCo Default, Naming Rights Partner, in its sole discretion, shall have the right to do any one (1) or more of the following: (i) enforce any rights provided for in this Agreement; (ii) recover all damages and other sums available at law or in equity; (iii) exercise any other right or remedy available at law or in equity, including seeking an injunction or order of specific performance; and (iv) terminate this Agreement by written notice to StadCo. If Naming Rights Partner terminates this Agreement in accordance with clause (iv) of this Section 6(d), the Sponsorship Fees shall be [***] and StadCo shall [***] within thirty (30) days after the effective date of such termination. The remedies set forth herein are in addition to Naming Rights Partner’s rights and remedies at law and in equity.
(e)    Special Termination Rights. If at any time [***] may provide [***] written notice thereof [***]. [***] shall then, within thirty (30) days of receipt of such written notice from [***], provide [***] with [***] and shall [***]. If [***], then [***] may [***] terminate this Agreement by providing written notice thereof to [***]. In the event of such termination, the Sponsorship Fees shall [***] and StadCo shall [***] within thirty (30) days after the effective date of such termination.
(f)    Effect of Termination. Upon termination of this Agreement in accordance with the terms of this Agreement for any reason, all rights, benefits, and privileges granted to Naming Rights Partner under this Agreement shall automatically revert to StadCo, and Naming Rights Partner shall pay to StadCo any amounts then due and owing through the date of termination, and StadCo shall refund to Naming Rights Partner any amounts which have been overpaid by Naming Rights Partner.
7.    Late Completion or Failure to Complete. StadCo presently anticipates that the Stadium Opening Date shall occur on or prior to [***]. Nevertheless, Naming Rights Partner
22


acknowledges that construction of the Stadium is not guaranteed and it may not be completed by [***]. Notwithstanding anything to the contrary in this Agreement:
(a)    If the Stadium Opening Date has not occurred on or before [***] shall have the right to terminate this Agreement by delivering written notice of such termination to [***].
(b)    Naming Rights Partner shall not be entitled to any remedy or relief, whether by way of damages, credit, rebate, off-set, deferral, reduction, or abatement of any amounts payable under this Agreement, including the Sponsorship Fees, or to any relief from its obligations under this Agreement, by reason of the Stadium Opening Date not occurring by [***].
8.    Force Majeure; Eminent Domain; Casualty; Changes to NFL Rules.
(a)    Effect of Force Majeure. If a Party is unable to perform any of its obligations under this Agreement (other than a payment obligation) due to a Force Majeure Event (other than a taking by eminent domain or condemnation, which is governed by Sections 8(b) and 8(c), a Casualty Event, which is governed by Section 8(d), or a Work Stoppage, which is governed by Section 9), upon written notice to the other Party, such non-performing Party’s obligations shall be abated for the duration of the Force Majeure Event. Notwithstanding the foregoing, if a Force Majeure Event (other than a Force Majeure Event that results in previously scheduled regular season NFL home games of a Team not being played at the Stadium, which is governed by Section 9) results in (i) [***], or (ii) [***], then StadCo and Naming Rights Partner shall [***]. If, following such consultation, the Parties [***], then [***]. Naming Rights Partner shall continue to pay the Sponsorship Fees for the duration of the Force Majeure Event.
(b)    Total Condemnation of Stadium. If the Stadium, substantially all of the Stadium, or the right of StadCo to occupy or possess all or substantially all of the Stadium shall be taken by eminent domain or condemnation by any governmental authority for any public or private use or purpose, the Term shall terminate upon the earlier of (i) the date when the possession of the portion of the Stadium or right so taken shall be required for such use or purpose or (ii) the effective date of the taking. In such event, the Sponsorship Fees paid or due shall be apportioned as of the date of such taking or condemnation and StadCo shall [***] within thirty (30) days after the effective date of the taking or condemnation.
(c)    Partial Condemnation of Stadium. If less than all or substantially all of the Stadium shall be taken or condemned by any governmental authority for any public or private use or purpose, and StadCo determines, in its sole discretion, within a commercially reasonable period of time after such taking or condemnation, that the remaining portion of the Stadium cannot economically and feasibly be used to host Stadium events, including by the Teams for playing NFL football games, then this Agreement may be terminated by [***] by providing written notice to [***]. In such event, the Sponsorship Fees paid or due for the period during which the taking occurs shall be apportioned as of the date of such taking or condemnation and StadCo shall [***].
(d)    Casualty.
(i)    If, at any time during the Term, the Stadium is damaged in a manner that will render it unusable for public events (including for NFL games of either Team) for more than
23


[***] as a result of any event, cause, or occurrence (any such event, cause, or occurrence, and including a substantial destruction of the Stadium, a “Casualty Event”), regardless of whether such Casualty Event constitutes a Force Majeure Event, then Naming Rights Partner shall continue to pay the Sponsorship Fees, and StadCo shall give Naming Rights Partner a written notice within [***] after the end of the Casualty Event stating whether StadCo will rebuild or restore the Stadium such that it will be usable for public events (including for NFL games of the Teams).
(ii)    If the notice states StadCo will not rebuild or restore the Stadium, then this Agreement shall automatically terminate. In the event of such termination, then, subject to Section 8(d)(iv), the Sponsorship Fees paid or due for the Contract Year during which termination occurs shall be apportioned as of the date of such termination [***].
(iii)    If the notice states that StadCo will rebuild or restore the Stadium, then Naming Rights Partner shall not have the right to terminate this Agreement as a result of the Casualty Event, except as set forth in Section 9(a)(ii).
(iv)    If a Casualty Event (other than a Casualty Event that results in previously scheduled regular season NFL home games of a Team not being played at the Stadium, which is governed by Section 9) [***], then StadCo and Naming Rights Partner shall [***]. If, [***], then [***]. [***]. Notwithstanding the foregoing, in the event that this Agreement is terminated by Naming Rights Partner in accordance with Section 8(d)(ii), [***].
(e)    Changes in NFL Rules. If any amendment, modification, supplement, or other change in any NFL Rules at any time during the Term [***], then StadCo shall promptly notify Naming Rights Partner in writing and StadCo and Naming Rights Partner shall [***].
9.    Lost Games from Force Majeure Events, Casualty Events, and Work Stoppage; [***].
(a)    Remedies for Lost Games.
(i)    If, in any NFL season, at least [***] and fewer than [***] previously scheduled regular season home NFL games of the Teams in the aggregate at the Stadium (excluding any such home NFL games designated by the NFL to be played at any stadium other than the Stadium) are not played as the result of a Force Majeure Event, Casualty Event, and/or a Work Stoppage, and such games are not rescheduled to be played in the Stadium during the same NFL season, then Naming Rights Partner shall continue to pay the Sponsorship Fees and StadCo shall [***].
(ii)    If, in any NFL season, [***] or more previously scheduled regular season home NFL games of the Teams in the aggregate at the Stadium (excluding any such home NFL games designated by the NFL to be played at any stadium other than the Stadium) are not played as the result of a Force Majeure Event, Casualty Event, and/or a Work Stoppage and such games are not rescheduled to be played in the Stadium during the same NFL season, then Naming Rights Partner shall [***].
(iii)    In addition to the foregoing, if more than [***] consecutive previously scheduled regular season home NFL games over consecutive seasons for each Team at the
24


Stadium (excluding any such home NFL games designated by the NFL to be played at any stadium other than the Stadium) are not played as the result of a Force Majeure Event, Casualty Event, and/or Work Stoppage, then Naming Rights Partner shall [***].
(b)    [***]. If (i) [***], or (ii) [***], then Naming Rights Partner shall [***]. If [***], then Naming Rights Partner shall [***]. Naming Rights Partner agrees that [***], it will consider in good faith any proposals from StadCo to [***] or to [***] in response to the occurrence of the events described in clauses (i) or (ii) of this Section 9(b) for a period of no less than forty-five (45) days after Naming Rights Partner provides such notice to StadCo, and if Naming Rights Partner and StadCo are unable to come to agreement at the end of such forty-five (45) day period, then [***].
10.    Intellectual Property.
(a)    Ownership of Naming Rights Partner Marks. As between the Parties, Naming Rights Partner shall own all right, title, and interest with respect to the Naming Rights Partner Marks and the Stadium Marks and all intellectual property rights inherent therein and appurtenant thereto. Naming Rights Partner represents and warrants that, as of the Effective Date, the trademark “SOFI” is registered with the USPTO as set forth on Schedule 4, and that Naming Rights Partner has the right to grant the licenses granted to StadCo under this Agreement.
(b)    Registration and Protection of Stadium Marks. Naming Rights Partner shall file appropriate Intent to Use Applications for registration of the Stadium Marks with the USPTO at its sole expense. Upon mutual agreement between Naming Rights Partner and StadCo, Naming Rights Partner shall also file appropriate applications for registration of the Stadium Marks with the Trademark Offices of foreign jurisdictions at Naming Rights Partner’s sole expense. During the Term, Naming Rights Partner agrees (i) not to abandon, forfeit, or cancel any United States federal or foreign applications or registrations sought or obtained by Naming Rights Partner relating to the Stadium Marks without the prior written consent of StadCo; and (ii) it will take all appropriate steps to maintain, demonstrate usage, and renew such applications or registrations. StadCo agrees to cooperate with Naming Rights Partner to prosecute and maintain such applications and registrations, including by providing specimens of use and other documents that may be required and requested by Naming Rights Partner. If any Stadium Logos are reasonably deemed by Naming Rights Partner or StadCo to be a creative work capable of protection and registration with the United States Copyright Office, Naming Rights Partner will promptly file an appropriate copyright application for the Stadium Logos.
(c)    Licenses to StadCo. Subject to the terms and conditions of this Agreement, Naming Rights Partner hereby grants to StadCo and its Affiliates the following licenses during the Term: (i) an exclusive royalty-free, irrevocable worldwide, fully paid-up license to use the Stadium Marks, and the Naming Rights Partner Marks as incorporated into the Stadium Marks, and (ii) a non-exclusive, royalty-free, irrevocable worldwide, fully paid-up, license to use the Naming Rights Partner Marks other than the Stadium Marks. The foregoing licenses are limited to use by StadCo and its Affiliates in connection with the operation, merchandising, marketing, and promotion of the Stadium Complex and Stadium Complex events, including with respect to any telecasts and broadcasts (whether by radio, television, Internet, or any other medium, live or
25


recorded, whether now existing or developed after the Effective Date) of Stadium Complex events, for any reproductions of the Stadium Complex likeness in such telecasts and broadcasts, and to allow StadCo to designate the Stadium Complex by the Stadium Name and to fulfill its obligations under this Agreement. The foregoing licenses include the right to sublicense the Stadium Marks to the following third parties: (A) the NFL Entities, (B) the Teams, (C) vendors and concessionaires of the Stadium Complex and/or Teams and promoters of Stadium Complex and/or Team events, who may, in turn, subcontract the manufacture of products, related supplies, novelties, souvenirs, and any other goods or items used, consumed, sold or given away in connection with their respective use and operation of the Stadium Complex, (D) sponsors, media partners and licensees of the Stadium Complex, Teams and/or NFL Entities for promotional, advertising, merchandising and other commercial purposes (e.g., “Official Pizza Provider of the [Stadium Name]”), and (E) the city of Inglewood, Los Angeles County, the State of California, or any political subdivision or tourism board of the foregoing, to promote the Stadium Complex, the Performance Venue, the District and tourism, or for other non-commercial uses. Any and all uses of the Stadium Marks, including uses by third parties as described in subsections (A) through (E) of this Section 10(c), must first be approved pursuant to the procedure set forth in Section 10(m), and any and all uses of the Naming Rights Partner Marks shall be subject to the prior written approval of Naming Rights Partner, which approval shall not be unreasonably withheld, conditioned, or delayed. Except as provided in the following sentence, the license rights granted pursuant to this Section 10(c) shall terminate upon the expiration or termination of this Agreement. Subject to the terms and conditions of this Agreement, Naming Rights Partner hereby grants to StadCo and its Affiliates, (I) during and after the Term, a non-exclusive, royalty-free, worldwide, fully paid-up, irrevocable license to (x) use the Stadium Marks and Naming Rights Partner Marks for archival and historical uses (e.g., providing historical information and commentary and for literary, photographic, video, digital, or other documentary works that discuss the Stadium Complex and its history), provided that such license shall not allow StadCo and its Affiliates to use the Stadium Marks and Naming Rights Partner Marks for any commercial purpose, and (y) sublicense the use of the Stadium Marks to the Organizing Committee for the Olympic Games, the International Olympic Committee, and the International Paralympic Committee as such organizations may require in connection with events held at the Stadium Complex, and (II) after the Term, a non-exclusive, royalty-free, worldwide, fully-paid up, irrevocable license to use the Stadium Marks and Naming Rights Partner Marks in connection with inventory run-out as set forth in Section 10(k).
(d)    Merchandising. Subject to the terms and conditions of this Agreement, Naming Rights Partner hereby grants to StadCo the exclusive, royalty-free, worldwide, fully paid-up, irrevocable license to apply, or have applied, the Stadium Marks to articles of merchandise bearing the Stadium Marks.
(e)    Licenses to Naming Rights Partner. Subject to the terms and conditions of this Agreement, StadCo hereby grants to Naming Rights Partner an exclusive (but only within the Exclusive Category), limited, non-transferable, royalty-free, irrevocable license to use the Team Marks and Stadium Marks to promote its sponsorship in advertising, marketing, and promotional endeavors subject to the terms of this Agreement. All Team Marks and related goodwill are and will remain the property of the applicable Team or its Affiliate. Any and all uses of the Stadium Marks must first be approved pursuant to the procedure set forth in Section 10(m), and any and all uses of the Team Marks, including in any advertising copy, by Naming Rights Partner shall
26


be subject to the prior written approval of StadCo, which approval shall not be unreasonably withheld, conditioned, or delayed, and any use thereof shall be strictly limited to the Territory. For the avoidance of doubt, and without limitation, distribution of promotional material incorporating Team Marks via the internet, including social media, is not currently permissible under NFL Rules and is therefore prohibited. Naming Rights Partner shall comply with written usage guidelines and quality control standards established with respect to the Stadium Marks and the Team Marks that are provided by StadCo during the Term.
(f)    Uses of Marks. Each of StadCo and Naming Rights Partner shall not (w) use the Stadium Marks, the Naming Rights Partner Marks or the Team Marks in a negative manner; in any way that is contrary to public morals or has a deceptive or misleading effect; in a manner that compromises or reflects unfavorably upon the good name, goodwill, reputation, or image of the owner of such Marks or their respective owners, management, employees, players or coaches; in any manner that is inconsistent with NFL Rules or applicable Laws; in any manner that may result in the unauthorized use of any intellectual property of StadCo, Naming Rights Partner or either Team; or in any manner that tarnishes the image of StadCo, Naming Rights Partner or either Team or its/any of their Affiliates; (x) file or prosecute, or cause or permit any other Person to file or prosecute, a trademark or service mark application to register any Team Mark, Naming Rights Partner Mark or (except to the extent expressly permitted by this Agreement) any Stadium Mark, or any derivation or confusingly similar variation thereof; (y) attack any right, title, or interest in or to any Team Mark, Stadium Mark or Naming Rights Partner Mark in any jurisdiction or attack the validity of any such Marks; or (z) contest the fact that a Party’s rights under this Agreement are subject to the terms of this Agreement and cease upon the expiration or earlier termination of this Agreement. All Marks and related goodwill are and will remain the property of the applicable Party or its Affiliate.
(g)    Limitations on Licenses; Quality Control. All uses by a licensee or its sublicensee of a licensor’s Marks shall conform to the procedure set forth in Section 10(m). Unless otherwise permitted under this Agreement, as between the Parties, all such uses shall inure to the benefit of such licensor. No licensee or sublicensee shall be entitled to use licensor’s Marks in combination with its own trademarks or service marks, or trademarks or service marks of a third party, except if there is an identifiable separation between them such that there are two (2) or more distinct trademarks or service marks rather than a new composite trademark or service mark and providing such use is otherwise in accordance with this Section 10. Each such licensee and sublicensee shall maintain the same high quality control standards for all goods and services that such licensor presently uses for its trademarks and service marks or, in the case of StadCo, which conforms to the same high quality control standards for the use of trademarks and service marks in StadCo’s industry. Such licensor or its designee shall have the right to reasonably inspect each use of its Marks, and each licensee and its sublicensee shall timely comply with any reasonable request by such licensor regarding proper use of its Marks. No licensee or its sublicensee shall use any licensor Mark in a way that invalidates, disparages, or dilutes such Mark or disparages licensor.
(h)    Stadium Website. StadCo shall (i) register the www.sofistadium.com domain name (the “Stadium Domain Name”), (ii) assign the Stadium Domain Name to Naming Rights Partner (and Naming Rights Partner hereby agrees, upon assignment of the Stadium Domain Name, to grant StadCo during the Term an exclusive, royalty-free, worldwide, fully paid-up,
27


irrevocable license to the Stadium Domain Names for the purpose of promoting the Stadium Complex and events held at the Stadium Complex and for all of the purposes set forth with respect to the license and permitted sublicensing of the Stadium Name pursuant to Section 10(c)), and (iii) develop and maintain, at its sole cost and expense, the content for the website hosted on the Stadium Domain Name (the “Stadium Website”). Excluding the Stadium Domain Name, the Stadium Marks, and the Naming Rights Partner Marks incorporated in the Stadium Website, as between the Parties, StadCo shall own all right, title, and interest with respect to the Stadium Website and the content therein. Immediately upon any termination of this Agreement, the Parties will cooperate in good faith in the design and posting of a page that will re-direct visitors through hyperlinks to a website designated by StadCo, and StadCo will maintain the re-direct page at such Stadium Domain Name URL as the Parties may agree for a period of time to be reasonably determined by the Parties, not to exceed twelve (12) months (taking into account StadCo’s need to provide information for annually recurring events).
(i)    Stadium Social Media and Mobile Application.
(i)    StadCo will have the sole right to register Twitter, Facebook, Snapchat, Instagram and any other similar platform (and/or substitute and/or successor platform) accounts (the “Social Media Accounts”) in the name of the Stadium Complex, at its sole cost and expense. Upon the expiration of the Term, StadCo shall re-brand the Social Media Accounts and remove all Naming Rights Partner references from such Social Media Account handles and titles, provided, however, that the accounts and any content and data associated therewith shall remain the exclusive property of StadCo, except for, and subject to, Naming Rights Partner’s ownership of the Stadium Marks and Naming Rights Partner Marks.
(ii)    StadCo shall have the sole right to develop a Stadium mobile application for Android and iOS and any other mobile platform (the “Mobile Application”). Upon the expiration or earlier termination of this Agreement, StadCo shall re-brand the Mobile Platform and remove all Naming Rights Partner references from such Mobile Platform provided, however, that the accounts and any content and data associated therewith shall remain the exclusive property of StadCo, except for, and subject to, Naming Rights Partner’s ownership of the Stadium Marks and Naming Rights Partner Marks. The Parties will work in good faith and in accordance with applicable Law regarding the continued license and use after the Term of any customer data by Naming Rights Partner to the extent such customer data is collected through the Mobile Application during the Term and licensed to Naming Rights Partner during the Term.
(j)    Rights of NFL Entities. Naming Rights Partner acknowledges that the NFL Entities have certain rights to license the brand names, trademarks, trade names, service marks, copyrights, logos, symbols, emblems, designs, colors, identifications, and designations of the NFL and its member clubs and to grant sponsorship rights and benefits with respect to the NFL and its member clubs on a national and international basis, and that any exercise of such rights by any of the NFL Entities (or any other Person not under the control of StadCo) shall not be construed to be a StadCo Default, even if it involves the Team Marks or activity in the Territory.
(k)    Inventory Run-Out. Following the expiration or termination of this Agreement for any reason, StadCo and its sublicensees shall have the right to market and sell or otherwise dispose of then-existing inventory containing the Naming Rights Partner Marks or the Stadium
28


Marks until the earlier of [***] from the expiration or termination of this Agreement or until all such inventory has been depleted. Except as contemplated in this Section 10(k) and the historical use contemplated in Section 10(c), no Party shall have any other right to use the Stadium Marks after the Term without the written consent of the other Party, which consent shall not be unreasonably withheld, conditioned, delayed, or denied.
(l)    Notification of Infringement. Each Party shall notify the other Party of any infringement of the trademark rights or copyright in the Team Marks or Stadium Marks, as applicable. The Teams will have the sole right and discretion to take any action with respect to such infringement of the Team Marks. In the case of an infringement of the Stadium Marks, StadCo and Naming Rights Partner shall meet and confer and will agree on the course of action to protect the Stadium Marks. Naming Rights Partner shall have the first option, in its sole discretion, to take action with respect to such infringement of the Stadium Marks, and if Naming Rights Partner chooses not to take action, StadCo may, in its sole discretion, choose to do so. In any event, the other Party shall offer, and may be required to provide at the other Party’s reasonable request, all such assistance as may be necessary to protect such trademark rights or copyright of the Team Marks or Stadium Marks, including by joining in any proceedings; provided that each Party will be responsible for its own costs and expenses related to such enforcement or proceedings. Neither Party shall be entitled to make any statement or compromise in relation to any infringement without the other Party’s prior written consent where such statement or compromise would result in a breach of this Agreement. Notwithstanding the foregoing, each Party may resolve cases of infringement that would not otherwise result in a breach of this Agreement without the other Party’s consent. Each Party taking action with respect to such infringement shall be entitled to retain all damages and awards of costs paid or ordered in relation thereto. Each Party shall use reasonable efforts to police its trademarks for unauthorized uses of the trademarks by third parties and enforce and defend the trademarks from infringement through means that such Party may reasonably determine in its sole discretion, all at such Party’s sole expense.
(m)    Approval of Use of Marks.
(i)    As soon as reasonably practicable after the Effective Date, StadCo and Naming Rights Partner shall jointly develop, in good faith, a style guide that sets forth approved uses of the Stadium Marks (the “Style Guide”), provided, however, that unless the Parties otherwise agree in writing, such Style Guide will require references to the Stadium Name to conform to the requirements of Section 3(d)(ii) and the colors used with respect to the Stadium signage will conform to the Naming Rights Partner Signage Plan. Any use by any Party or its sublicensee of any Stadium Marks that complies with the Style Guide in all material respects and that does not otherwise require approval as set forth in this Agreement, and any use of the Stadium Marks by the Organizing Committee for the Olympic Games, the International Olympic Games, and the International Paralympic Committee as such organizations may require in connection with events held at the Stadium Complex, shall be deemed to have been approved by the other Party for all purposes of this Agreement, whether or not that other Party has specifically approved the particular use of such Stadium Marks.
(ii)    Notwithstanding anything to the contrary in this Agreement, any materials containing Team Marks, Naming Rights Partner Marks, or Stadium Marks (including the use of
29


such Marks as part of the Designations) shall not be deemed authorized or approved until approved in writing the applicable Team or Party, except as otherwise provided in Section 10(m)(i). A Party requesting approval shall provide a written request for approval to the other Party, which request shall include specific description of the proposed uses. The Party whose approval has been requested shall respond to the request for approval within five (5) business days, and failure to respond by the applicable deadline shall be deemed an approval. Each Party agrees that, once a particular use has been approved, the other Party need not seek approval for the same material use of (A) [***] and (B) [***]. Each Party further agrees that the other Party will not approve the use of, and a Party shall not use or commercially exploit, any rights granted hereunder (1) in a negative manner; (2) in a way that is contrary to public morals or has a deceptive or misleading effect; (3) in a manner that compromises or reflects unfavorably upon the good name, goodwill, reputation, or image of a Party, or its respective directors, officers, employees, agents, players or coaches; (4) in any manner that is inconsistent with NFL Rules; or (5) in any manner that may result in the unauthorized use of any intellectual property of a Party. After materials have been specifically, unconditionally, and finally approved, the Party using the materials shall not materially depart therefrom or add any material element thereto in any respect (e.g., inserting or replacing any element) without again complying with the provisions of this Section 10(m).
(n)    Players and Coaches. Naming Rights Partner acknowledges that this Agreement does not grant it any rights with respect to the name, likeness, signature, or other attributes of any player, coach, or other employee of either Team. Naming Rights Partner shall be responsible for securing whatever rights may be required for the use of such names, likenesses, signatures, or other attributes and may only do so, in all cases, including group photos, with the prior written consent of the applicable Team. Naming Rights Partner shall not exercise the rights granted in this Agreement in any manner that will imply Naming Rights Partner has obtained any such rights without separate written authorization from the applicable player, coach, or employee and Team; provided, however that if a Team provides prior written authorization to Naming Rights Partner for use of a Team group photograph, such use will not require separate written authorizations from individual players, coaches or employees of such Team, further provided that, in such event, neither Naming Rights Partner, nor its use of such Team group photograph, shall imply that any individual player, coach or employee has separately granted any such rights to Naming Rights Partner.
(o)    No Contests without Approval. Unless otherwise approved by StadCo in writing, Naming Rights Partner has no right to run contests, sweepstakes, or promotions in connection with the Stadium Marks or Team Marks or for the award of invitations, tickets, or other benefits granted to Naming Rights Partner under this Agreement. If StadCo grants Naming Rights Partner the right to run a contest, sweepstakes, or promotion, then Naming Rights Partner shall (i) be solely responsible for all aspects of such contest, sweepstakes, or promotion, which shall in each case be subject to StadCo’s prior written approval; (ii) be the official sponsor of such contest, sweepstakes, or promotion; (iii) comply with all applicable Laws with respect to such contest, sweepstakes, or promotion (including drafting promotion rules, which shall be subject to StadCo’s prior written approval); and (iv) indemnify the StadCo Indemnified Parties from any failure to so comply with all applicable Laws with respect to such contest, sweepstakes, or promotion.
30


(p)    Restrictions. Neither StadCo nor Naming Rights Partner shall, at any time, (i) contest or do or cause to be done any act or thing that, directly or indirectly, impairs or tends to impair or dilutes or tends to dilute any part of the right, title, and interest of the other Party in its Marks or (ii) in any manner represent that it has any ownership interest in the other Party’s Marks or the registrations therefor. Without limiting the generality of the foregoing, Naming Rights Partner shall not procure or claim any copyright, trademark, or other intellectual property right in any Team Marks.
(q)    Compliance with Law. Each Party represents and warrants that all materials produced or services provided by that Party in connection with this Agreement shall comply, at that Party’s sole expense, with all Laws. A Party’s approval of any materials or services is conditioned upon the Party using the materials complying with all Laws.
11.    Confidentiality. Commencing on the Effective Date and continuing for a period of five (5) years after the Expiration Date or the earlier termination of this Agreement, the Parties will keep confidential the specific terms and conditions of this Agreement; provided that disclosure may be made by either Party (a) as may be required by any court of competent jurisdiction, governmental agency (including as may be required to comply with the rules and regulations promulgated under the Securities Act of 1933 and the Securities and Exchange Act of 1934, in connection with a public offering of securities), or applicable Law (in such event, the disclosing Party shall (i) notify the other Party before disclosing any provision of this Agreement as soon as practicable in order to afford such other Party the opportunity to seek a protective order, and (ii) cooperate with the other Party in any such effort to seek a protective order or other available confidential treatment); (b) to its accountants, auditors, legal counsel, insurance advisors, underwriters, and consultants who agree to maintain all provisions of this Agreement in confidence; (c) to its lenders, potential lenders, investors, potential investors, purchasers, and potential purchasers who agree to maintain all provisions of this Agreement in confidence; (d) to its employees and the employees of its Affiliates who have a need to know and are informed of and bound by the obligation to maintain all provisions of this Agreement in confidence; (e) to enforce its rights under this Agreement; and (f) to the Teams and the NFL Entities.
12.    Representations, Warranties, and Covenants.
(a)    By StadCo. StadCo represents and warrants to Naming Rights Partner as of the Effective Date:
(i)    StadCo is in good standing and is duly authorized to transact business in the State of California, with full power and authority to enter into and fully perform its obligations under this Agreement.
(ii)    The execution and delivery of this Agreement by StadCo has been duly authorized, and no consent or approval of any other Person is required for (x) the execution and delivery of this Agreement by StadCo that has not been obtained as of the Effective Date or (y) the performance under this Agreement by StadCo that has not been obtained as of the Effective Date, except as otherwise set forth in this Agreement.
31


(iii)    This Agreement constitutes the valid, binding, and enforceable obligation of StadCo, subject to principles of equity and creditors rights generally.
(iv)    StadCo is an authorized licensee of the Team Marks, and, to StadCo’s knowledge, no use of any Team Mark as licensed under this Agreement infringes upon the intellectual property rights of any third party.
(v)    The execution and delivery of this Agreement by StadCo, and StadCo’s performance of its obligations hereunder, do not violate or otherwise breach any provision of any indenture, mortgage, lease, or other material contract, or any applicable Law, to which StadCo is a party or by which StadCo or any of its assets are bound, in each case which violation or breach will have a material adverse effect on StadCo’s ability to perform its obligations hereunder.
(vi)    StadCo has full authority and power to grant all of the rights and Assets contemplated in this Agreement to be granted by StadCo to Naming Rights Partner (including the Team Assets), and no other Person has any right, title, or interest that conflicts with StadCo’s rights to grant the rights and Assets contemplated by this Agreement to be granted to Naming Rights Partner (including the Team Assets).
(vii)    StadCo has been granted from the Teams any and all required rights, licenses, and benefits to be provided to Naming Rights Partner hereunder, there is nothing that would prevent, hinder or impair the Teams or StadCo from granting such rights, licenses, and benefits, and StadCo has a contractual right to require each of the Teams to comply with the terms and conditions of this Agreement and to provide the Team Assets to Naming Rights Partner.
(viii)    The Teams are members in good standing of the NFL.
(ix)    [***].
(x)    There is no litigation pending nor to the best of StadCo’s knowledge, is any litigation threatened against StadCo, a Team or any Affiliate with respect to any of the matters which are the subject of this Agreement or which are reasonably likely to impact on StadCo’s ability to perform hereunder.
(xi)    StadCo has obtained as of the Effective Date, or will obtain when required any and all material governmental approvals, licenses, and permits (including all signage permits) necessary to perform its obligations under this Agreement.
(xii)    StadCo shall, at all times during the Term and at no cost or expense to Naming Rights Partner other than as set forth in this Agreement, [***] (i) [***], (ii) [***], and (iii) [***].
(b)    By Naming Rights Partner. Naming Rights Partner represents and warrants to StadCo as of the Effective Date:
32


(i)    Naming Rights Partner is in good standing and duly authorized to transact business in the State of California, with full power and authority to enter into and fully perform its obligations under this Agreement.
(ii)    The execution and delivery of this Agreement by Naming Rights Partner has been duly authorized, and no consent or approval of any other Person is required for the execution and delivery of, or performance under, this Agreement by Naming Rights Partner that has not been obtained as of the Effective Date.
(iii)    This Agreement constitutes the valid, binding, and enforceable obligation of Naming Rights Partner, subject to principles of equity and creditors rights generally.
(iv)    Naming Rights Partner is the sole owner or an authorized licensee of the Naming Rights Partner Marks and the Stadium Marks, and, to Naming Rights Partner’s knowledge, no use of a Naming Rights Partner Mark or a Stadium Mark as licensed under this Agreement infringes upon the intellectual property rights of any third party.
(v)    The execution and delivery of this Agreement by Naming Rights Partner and Naming Rights Partner’s performance of its obligations hereunder do not violate or otherwise breach any provision of any indenture, mortgage, lease, or other material contract, or any applicable Law, to which Naming Rights Partner is a party or by which Naming Rights Partner or any of its assets are bound, in each case which violation or breach will have a material adverse effect on Naming Rights Partner’s ability to perform its obligations hereunder.
(vi)    Naming Rights Partner has full authority and power to grant all of the rights contemplated by this Agreement to be granted by Naming Rights Partner to StadCo, and no other Person has any right, title, or interest that conflicts with such Naming Rights Partner’s rights to grant the rights contemplated by this Agreement to be granted to StadCo.
(vii)    There is no litigation pending, nor to the best of Naming Rights Partner’s knowledge, is any litigation threatened against Naming Rights Partner or any Affiliate with respect to any of the matters which are the subject of this Agreement or which is reasonably likely to impact on Naming Rights Partner’s ability to perform hereunder.
13.    Indemnification and Insurance.
(a)    Indemnification by Naming Rights Partner. Naming Rights Partner shall defend, indemnify, and hold harmless StadCo, the Teams, the NFL, their respective Affiliates, and each of their respective officers, directors, employees, equity holders, agents, representatives, successors, and assigns (each, a “StadCo Indemnified Party” and, collectively, the “StadCo Indemnified Parties”) from and against any and all losses, including liabilities, costs, charges, judgments, claims, damages, penalties, fines, and expenses (including reasonable attorneys’ fees and expenses and costs of investigation and arbitration or litigation) (each, a “Loss”) to the extent incurred or suffered by any StadCo Indemnified Party relating to or arising out of or in connection with any of the following:
(i)    any breach of, or any inaccuracy in, any representation or warranty made by Naming Rights Partner in this Agreement;
33


(ii)    any breach of, or failure by, Naming Rights Partner to perform any covenant, obligation, or agreement of Naming Rights Partner set forth in this Agreement;
(iii)    any activation or use of the Assets by Naming Rights Partner or any of its guests, invitees, patrons, or designees not in compliance with this Agreement;
(iv)    any actual or alleged infringement or violation of any intellectual property right or other right of any third party resulting from or related to the use, adoption, or display of any Naming Rights Partner Mark incorporated into the Stadium Name, Stadium Logos or any other Stadium Mark, and any Naming Rights Partner Mark approved by Naming Rights Partner and used in accordance with this Agreement; or
(v)    any unfair competition, false advertising, products liability, or other claim of any nature resulting from or related to the use, adoption, or display of any Stadium Mark or Team Mark (including as used in any Designation) in connection with the advertising, promotion, or sale of Naming Rights Partner’s products or services or the promotion of Naming Rights Partner.
Notwithstanding the foregoing, Naming Rights Partner shall not have any indemnification obligations to the extent any Loss arises directly from the negligence or willful misconduct of any StadCo Indemnified Party.
(b)    Indemnification by StadCo. StadCo shall defend, indemnify, and hold harmless Naming Rights Partner and its Affiliates, and each of their respective officers, directors, employees, equity holders, agents, representatives, successors, and assigns (each, a “Naming Rights Partner Indemnified Party” and, collectively, “Naming Rights Partner Indemnified Parties”), from and against any and all Losses to the extent incurred or suffered by them relating to or arising out of or in connection with any of the following:
(i)    any breach of, or any inaccuracy in, any representation or warranty made by StadCo in this Agreement;
(ii)    any breach of, or failure by, StadCo to perform any covenant, obligation, or agreement of StadCo set forth in this Agreement;
(iii)    any actual or alleged infringement or violation of any intellectual property right or other right of any third party resulting from or related to any use, adoption, or display of any Team Mark approved by StadCo and used in accordance with this Agreement; or
(iv)    [***].
Notwithstanding the foregoing, StadCo shall not have any indemnification obligations to the extent any Loss arises directly from the negligence or willful misconduct of any Naming Rights Partner Indemnified Party.
(c)    Indemnification Process. Any Person entitled to indemnification pursuant to this Section 13 (each, an “Indemnified Person”) shall promptly notify the Party required to provide indemnification pursuant to this Section 13 (the “Indemnifying Person”) (it being understood that
34


the failure to so notify shall not excuse any Indemnifying Person from its obligations under this Section 13, except to the extent that such failure increases the liability of the Indemnifying Person under this Section 13) and shall tender to the Indemnifying Person the defense thereof. If the Indemnifying Person promptly assumes the defense of a claim covered by this Section 13 (each, a “Claim”), no Indemnified Person may settle or compromise such Claim without the prior written approval of the Indemnifying Person. If the Indemnifying Person does not promptly assume the defense of such Claim, the Indemnified Person may settle or compromise such Claim on such terms as the Indemnified Person may reasonably deem appropriate, and the Indemnifying Person shall reimburse the Indemnified Person for the cost of such settlement, in addition to the Indemnifying Person’s other obligations under this Section 13. The Indemnifying Person shall, upon request by the Indemnified Person, allow the Indemnified Person, at its own expense, to participate in the defense of any such Claim. The Indemnifying Person’s duty to pay any Claim under this Section 13 shall, in each instance, be reduced by the amount the Indemnified Person recovers from any third party in connection therewith, including as a result of, at its discretion, exercising its rights as a third party beneficiary under another contract or pursuing and receiving insurance proceeds in connection with such Claim. The intent of this provision is that the Indemnified Person be made as whole as possible and not receive a windfall.
(d)    Insurance.
(i)    Naming Rights Partner shall, at its sole expense, obtain and keep in full force and effect during the Term, the following types and amounts of insurance with an insurance carrier or carriers rated A:X or better according to A.M. Best Company Rating Guide and duly registered with the Secretary of State of, and authorized to conduct business in, the State of California: (A) commercial general liability insurance on an occurrence basis form, which shall insure against bodily injury, personal injury, property damage, advertising liability, products/completed operations, severability of interest, and contractual liability with respect to Naming Rights Partner’s tort indemnification obligations under this Agreement, with minimum limits of [***] each occurrence and in the aggregate; (B) workers’ compensation insurance, including employer’s liability in the amount of [***] each accident/disease/policy limit, complying with the statutory requirements of the State of California; (C) auto liability insurance for any owned, hired and non-owned vehicles with minimum limits of [***] each accident; (D) property insurance covering any personal property of Naming Rights Partner at the Stadium Complex in an amount not less than the total replacement value thereof; (E) media liability or equivalent professional liability insurance, with a minimum limit of [***] each claim and in the aggregate to cover claims related to infringement of intellectual property rights (including trademark, copyright, trade name, slogan, etc.), as well as rights of publicity claims, written on a claims-made (not occurrence) form and also maintained throughout the applicable statute of limitations or repose (where and when applicable) following termination of this Agreement; and (F) [***] of umbrella liability coverage per occurrence no more restrictive than the underlying commercial general liability and automobile liability policies. All policies described in clauses (A), (C), (E), and (F) above shall name StadCo, the Teams, and each of their respective Affiliates and each of their respective equity holders, officers, directors, employees, and agents, but only within the scope of their agency as such (the “StadCo Additional Insureds”) as additional insureds thereunder. All insurance policies required hereunder shall: (1) include a waiver of subrogation rights in favor of the StadCo Additional Insureds; (2) be primary and non-contributory to all other coverage that the StadCo Additional Insureds may have or obtain;
35


(3) not require that the StadCo Additional Insureds pay or be liable for any premiums or deductibles with respect to such insurance; (4) not provide for any deductibles or self-insured retentions in excess of [***] unless disclosed to and waived by Naming Rights Partner, which waiver shall not unreasonably withheld; and (5) policy limits may be met through the use of primary and excess policies so long as the total amount of the policy limits provided is equal to or greater than the required amount. Any and all deductibles in the above described insurance policies shall be the exclusive responsibility of Naming Rights Partner. Promptly following the Effective Date, Naming Rights Partner shall furnish StadCo with (x) a certificate of insurance evidencing such insurance coverage and containing a provision that the policies evidenced thereby shall endeavor not to be canceled or modified without at least ten (10) days’ advance written notice in case of cancellation due to non-payment of premium or otherwise without at least thirty (30) days’ advance written notice to StadCo and (y) copies of all General Liability Additional Insured, waivers of subrogation (if endorsed), and Notice of Cancellation endorsements or coverage forms. Naming Rights Partner’s maintenance of the insurance policies required under this Section 13(d)(i) shall in no way be interpreted as relieving Naming Rights Partner of any of its obligations under this Agreement.
(ii)    StadCo shall, at its sole expense, obtain and keep in full force and effect during the Term, the following types and amounts of insurance with an insurance carrier or carriers rated A:VII or better according to A.M. Best Company Rating Guide and duly registered with the Secretary of State of, and authorized to conduct business in, the State of California: (A) property insurance with respect to the Stadium Complex that insures against loss or damage of the kinds and in such amounts and coverages as are customarily carried on similarly situated stadiums in the United States; (B) commercial general liability insurance on an occurrence basis form, which shall insure against bodily injury, personal injury, property damage, advertising liability, products/completed operations, and contractual liability with respect to StadCo’s indemnification obligations under this Agreement, with minimum limits of [***] each occurrence and in the aggregate; (C) workers’ compensation insurance, including employer’s liability in the amount of [***] each accident/disease/policy limit, complying with the statutory requirements of the State of California; (D) auto liability insurance for any owned, hired, and non-owned vehicles with minimum limits of [***] each accident; and (E) [***] of umbrella liability coverage per occurrence no more restrictive than the underlying commercial general liability and automobile liability policies. All insurance policies required hereunder shall: (1) not provide for any deductibles in excess of [***]; and (2) may be met through the use of primary and excess policies so long as the total amount of the policy limits provided is equal to or greater than the required amount. Any and all deductibles in the above described insurance policies shall be the exclusive responsibility of StadCo.
14.    Limitation of Damages. Notwithstanding anything to the contrary contained in this Agreement, in no event shall a Party be liable to any other Party for any consequential, special, indirect, incidental, punitive, exemplary, or similar damages (including damages for loss of use, business, or profit) that any other Party suffers in connection with this Agreement, regardless of whether such action is based in contract, tort, or any other legal theory and whether such Party has been advised of the possibility of such damages or if such damages could have been reasonably foreseen. The foregoing limitation of damages shall not apply to the Parties’ indemnity obligations with respect to third party claims pursuant to Section 13.
36


15.    Arbitration.
(a)    Disputes Subject to Arbitration. If there is any controversy, claim, or dispute (“Dispute”) related to or arising out of this Agreement, the Parties shall attempt in good faith to resolve such Dispute by informal negotiation, subject to the Parties’ rights and remedies under Sections 6(b) and 6(d), except to the extent that immediate temporary injunctive relief is necessary to prevent harm to the aggrieved Party. If good faith negotiations are unsuccessful, the Parties may, but shall not be obligated to, enter into mediation, which would be held in Los Angeles, California before a mediator mutually agreed upon by the Parties. If the Dispute remains unresolved, the Parties agree that exclusive jurisdiction for the Dispute shall be binding arbitration before one (1) arbitrator mutually agreed upon by the Parties. Either Party may commence binding arbitration. If the Parties cannot agree on the selection of an arbitrator, they shall each select one (1) arbitrator from the list of qualified JAMS arbitrators and those two (2) arbitrators shall select the person who shall serve as the arbitrator for such Dispute. The arbitrator selected in accordance with this provision must have documented experience in interpreting complex commercial agreements, and preferably would have experience in naming rights or sponsorship disputes. Arbitration shall be initiated and take place in Los Angeles, California and shall be administered by JAMS pursuant to its Arbitration Rules and Procedures in effect at the time of the initiation of the arbitration; provided that: (i) within thirty (30) days after selection of the arbitrator, each of StadCo and Naming Rights Partner shall submit a written position statement describing such Party’s requested relief to the arbitrator, with a copy to the other Party, which submissions shall be followed by a videoconference or in-person hearing at which each Party is asked questions, witnesses may be asked questions, and each Party is given the opportunity to make a presentation regarding its written position statement; and (ii) the arbitrator shall, within ten (10) days after such hearing, issue an award as determined by the arbitrator. The language to be used in any arbitration proceedings shall be English.
(b)    Arbitration Award. The award or other remedy rendered by the arbitrator shall be final and non-appealable, shall identify a winning party, and judgment may be entered upon the award in accordance with applicable Law in any court having jurisdiction thereof.
(c)    Injunctive Relief. Notwithstanding anything in this Agreement to the contrary, each Party acknowledges that the other Party will be irreparably harmed by a continuing breach of Section 10 and that, solely with respect to a breach of Section 10 (and no other provisions of this Agreement), each Party shall have the right to bring proceedings to enjoin such breach in any court of competent jurisdiction, subject to Sections 17(n) and 17(s), without commencing binding arbitration; provided that such right shall not diminish the right of the aggrieved Party to, alternatively, seek or obtain injunctive relief through the arbitration process set forth in this Section 15.
16.    Appraisal.
(a)    Appraisal Process for [***]. If the Parties are unable to agree, after thirty (30) days of good faith discussions (including at least one (1) discussion between executive officers of both Parties), upon [***], then, upon the written request of either Party to the other Party (an “Appraisal Request”), the Parties, as their exclusive remedy (except in the case of a StadCo Default or a Naming Rights Partner Default), shall jointly retain a mutually acceptable third
37


party with expertise in the valuation of sports media rights and sports naming rights partnership or promotional rights (an “Appraiser”) in accordance with Section 16(c) to determine [***], giving due regard to [***]. If the Appraiser determines that [***], giving due regard to [***], then [***] (and the applicable provisions of this Section 16(a) shall again apply, with the same Appraiser to be used, if possible, in the event the appraisal process is once again triggered with respect to such additional or different Substitute Assets).
(b)    Appraisal Process for [***]. If the Parties are unable to agree, after thirty (30) days of good faith discussions (including at least one (1) discussion between executive officers of both Parties), upon [***], then, upon delivery of an Appraisal Request, the Parties, as their exclusive remedy (except in the case of a StadCo Default or a Naming Rights Partner Default), shall jointly retain an Appraiser in accordance with Section 16(c) to determine [***]. If the Appraiser determines that [***], [***] shall [***]. For the avoidance of doubt, in no event shall [***].
(c)    Selection and Determination of Appraiser. The Parties shall agree on an Appraiser no later than ten (10) business days following receipt of an Appraisal Request under Section 16(a) or Section 16(b). If the Parties do not agree on an Appraiser within such ten (10) business day period, then each Party shall select an appraiser of its choice and the two (2) Party-appointed appraisers shall select a third person to serve as the Appraiser. Within thirty (30) days after the selection of the Appraiser, each of the Parties shall submit a written position statement to the Appraiser describing such Party’s position with respect to [***]. The Appraiser will be permitted to hold a hearing at which each Party is asked questions, witnesses may be asked questions, and each Party is given the opportunity to make a presentation regarding its written position statement. The Appraiser shall issue a written determination of the matter referred pursuant to Section 16(a) or 16(b), as applicable (which the Appraiser shall use his or her best efforts to issue within thirty (30) days after the Appraiser receives the Parties’ written position statements). Such determination shall be binding on the Parties (absent manifest error).
(d)    Appraisal Costs. Each of StadCo and Naming Rights Partner shall be responsible for fifty percent (50%) of all fees of the Appraiser and all costs and expenses incurred by the Appraiser in connection with the appraisal under Section 16(a) or Section 16(b), as applicable. Each Party shall be responsible for all other costs and expenses incurred by such Party in connection with the appraisal under Section 16(a) or Section 16(b), as applicable, including such Party’s own legal, accounting, and expert fees.
(e)    Disputes Regarding Appraisal. Notwithstanding anything in this Agreement to the contrary, if there is a Dispute between the Parties with respect to the meaning, interpretation, or applicability of this Section 16, or with respect to any determination made by an Appraiser pursuant to this Section 16, then such Dispute shall be resolved in accordance with Section 15.
17.    Miscellaneous Provisions.
(a)    Relationship of Parties. All Parties shall at all times be independent contractors with respect to each other, and this Agreement shall not constitute either Party as the principal, agent, partner, or legal representative of the other Party for any purpose whatsoever.
38


(b)    Third Party Beneficiaries. This Agreement does not and is not intended to confer any rights upon any Person other than the Parties.
(c)    Sponsorship Revenues. Sponsorship revenues received by StadCo that are excluded from the calculation of All Revenues pursuant to the NFL Collective Bargaining Agreement shall be dedicated to and used for Stadium Complex construction and renovation projects.
(d)    Subject and Subordinate. This Agreement is subject and subordinate to (i) the rights of any bank, lending, or financing institution or any other lender in connection with any Financing, including the rights of any agent or trustee; (ii) NFL Rules; (iii) the terms of any existing or future contracts and agreements entered into by an NFL Entity relating to sponsorships or the broadcast or telecast of NFL games or that otherwise restrict the visibility of signage within the Stadium during nationally televised NFL games; (iv) if and to the extent applicable, the rules and regulations of the NBA, NHL, NCAA, FIFA, CFP, U.S. Olympic Committee, International Olympic Committee, and all other similar sanctioning or governing bodies; and (v) all applicable Laws, as any of the foregoing currently exist or as they may be amended or modified from time to time after the Effective Date. If, at any time after the Effective Date, any further action is necessary or desirable to comply with the NFL Rules or the rules and regulations of the NBA, NHL, NCAA, FIFA, CFP, U.S. Olympic Committee, International Olympic Committee, or a similar sanctioning or governing body, the Parties shall take or cause to be taken all such necessary or desirable action, including the execution and delivery of such instruments and documents as may be reasonably requested by the other Party for such purpose.
(e)    Waiver. The failure by a Party to exercise any right, power, or option given to it under this Agreement, or to insist upon strict compliance with the provisions of this Agreement by the other Party, shall not constitute a waiver of any provision of this Agreement with respect to any other or subsequent breach thereof, nor a waiver by such Party of its rights at any time thereafter to require exact and strict compliance with all the provisions hereof. The rights or remedies under this Agreement are cumulative to any other rights or remedies that may be granted by Law.
(f)    Notices. All notices, requests, or offers required or permitted to be made under this Agreement shall be in writing (and for purposes of this Section 17(f), electronic mail shall be considered “in writing”) and shall be deemed properly delivered on the earlier of actual receipt or three (3) days after the date deposited in the U.S. Mail (by certified or registered mail, return receipt requested) or one (1) day after being sent overnight via a recognized overnight delivery service with signature required (e.g., FedEx, UPS, and DHL) addressed as follows (or to one or more such other addresses as a Party may designate as its new addresses for such purpose by notice given to the other in accordance with this Section 17(f)):
39


If to StadCo: Stadco LA, LLC
1000 S. Prairie Avenue
Inglewood, CA 90301
Attention: Jason Gannon
With a copy to:
Arent Fox LLP
55 Second Street, 21st Floor
San Francisco, CA 94105
Attention: Richard L. Brand, Esq.
If to Naming Rights Partner:
Social Finance, Inc.
234 1st Street
San Francisco, CA 94105
Attention: Anthony Noto
With a copy to: Bryan Cave Leighton Paisner LLP
90 South Cascade Avenue, Suite 1300,
Colorado Springs, CO 90903
Attention: Steven B. Smith, Esq.
(g)    Severability. Should any provision of this Agreement be determined to be invalid or illegal for any reason, such invalidity or illegality shall not affect the validity or legality of any other provision, and all other provisions shall remain in full force and effect as if this Agreement had been executed with the invalid or illegal provision eliminated.
(h)    Assignment by StadCo.
(i)    StadCo may transfer its interest (in whole or in part, by operation of law, or otherwise), whether by security agreement, collateral assignment, or transfer of any other kind (collectively, “Assign”), in this Agreement or any of its rights or obligations under this Agreement, without the prior written consent of Naming Rights Partner, to an Affiliate or to any Person in connection with a sale or transfer of the Stadium Complex or the sale or transfer of the [***]. In connection with any such assignment (each, an “Assignment”), StadCo shall [***], and provided that [***]. Effective as of the date of such Assignment, StadCo shall be relieved of any further obligations under this Agreement. For the avoidance of doubt, the Parties acknowledge that all or part of the ownership interest in either of the Teams or control of either of the Teams may be transferred in any manner permitted by Law and by the NFL without the prior consent of Naming Rights Partner.
(ii)    StadCo may sublicense any of its intellectual property rights arising under this Agreement, without the prior written consent of Naming Rights Partner, for purposes of facilitating the use or exploitation thereof for the benefit of StadCo as contemplated under this Agreement, provided that no such sublicense shall relieve StadCo of any of its obligations to Naming Rights Partner under this Agreement.
(iii)    StadCo shall have the right to Assign this Agreement and any or all of its rights under this Agreement, including its right to receive payments from Naming Rights Partner under this Agreement, without the prior written consent of Naming Rights Partner, to any bank,
40


lending or financing institution, or any other lender; any guarantor or insurer of any financing; or any trustee, collateral agent, fiduciary, or other entity appointed in connection with such financing (each, a “Finance Counterparty”) to secure any indebtedness of StadCo, including any securitization (each, a “Financing”). If StadCo notifies Naming Rights Partner of any such Assignment to a Finance Counterparty, then Naming Rights Partner shall, if and when requested by any such Finance Counterparty in writing, pay all amounts payable to StadCo by Naming Rights Partner under this Agreement directly to such Finance Counterparty or designated servicer of any of the foregoing. In connection therewith, Naming Rights Partner shall provide such further assurances and additional documentation as is reasonably requested by such Finance Counterparty. Naming Rights Partner shall accept performance by any Finance Counterparty of any term, covenant, condition, or agreement to be performed by StadCo under this Agreement with the same force and effect as though performed by StadCo. No StadCo Default under this Agreement shall exist or shall be deemed to exist (A) as long as any Finance Counterparty, in good faith, shall have commenced to cure such default within thirty (30) days following receipt of notice of such default and is prosecuting the same to completion with commercially reasonable diligence and, in any event, cures such default within sixty (60) days following receipt of such notice; or (B) if possession of the Stadium is required in order to cure such default, or if such default is not susceptible of being cured by a Finance Counterparty’s direct action, as long as such Finance Counterparty, in good faith, shall have notified Naming Rights Partner within thirty (30) days following receipt of notice of such default that such Finance Counterparty intends to institute proceedings under the applicable security instruments to require StadCo or such other appropriate party to effect such cure, and, in any event, such default is cured within one hundred eighty (180) days following receipt of such notice.
(i)    Assignment by Naming Rights Partner. Naming Rights Partner shall not Assign or sublicense its interest in this Agreement or any of its rights or obligations under this Agreement without the prior written consent of StadCo; provided that (i) [***], provided that (A) [***], and (B) [***], and (ii) [***], provided that [***] and [***].
(j)    Media Releases. Any public statement, public announcement, or other media release to be issued in connection with this Agreement must be approved by both Parties in writing before its release. The Parties will agree in advance on any press announcements regarding this Agreement, as well as the timing of the release of any such announcements. The Parties contemplate issuing a mutually approved press release following the full execution of this Agreement.
(k)    Headings. The Paragraph and Section headings in this Agreement are for convenience only and shall not be used in the interpretation or be considered part of this Agreement.
(l)    Survival. The provisions set forth in Sections 2(c), 6, 10, 11, and 13 through 16, together with any other provisions of this Agreement (including payment provisions) that by their terms and nature are intended to survive such expiration or termination, shall survive the expiration or termination of this Agreement.
(m)    Entire Agreement. This Agreement, including all Schedules and Exhibits hereto, constitutes the entire agreement and understanding between the Parties with respect to the
41


subject matter hereof and supersedes all prior agreements and understandings. All representations and negotiations relative to the matters contemplated by this Agreement are merged herein, and there are no contemporaneous understandings or agreements relating to the matters set forth herein other than those incorporated herein.
(n)    Governing Law; Venue. This Agreement shall be governed by and construed in accordance with the Laws of the State of California without regard to its conflict-of-laws provisions. For purposes of Section 15(c), and to enforce or confirm any arbitration award rendered or to pursue or enforce injunctive relief pursuant to Section 15(c), each Party hereby submits to the exclusive jurisdiction of the state or federal courts located in Los Angeles, California, and waives any objection based on venue or forum non conveniens with respect to any action instituted in such courts.
(o)    Amendments/Modification. This Agreement may not be amended or modified, except by written agreement executed by both Parties.
(p)    Counterparts. This Agreement may be executed in any number of counterparts, each of which shall be deemed an original, but all of which together shall constitute one and the same instrument. Counterparts may be delivered electronically by fax or by email as a .PDF attachment, and all such counterparts shall be deemed, and shall have the same legal force and effect as, an original counterpart.
(q)    Exculpation. Naming Rights Partner agrees that, in pursuing its rights and remedies against StadCo under this Agreement, it shall look only to StadCo or its property for the satisfaction of Naming Rights Partner’s remedies, and Naming Rights Partner will not have recourse against or otherwise look to the property or assets of any of StadCo’s current or future equity holders, officers, directors, or employees, disclosed or undisclosed.
(r)    No Inferences. Each Party is represented in this transaction by separate counsel, and the Parties have participated jointly in the negotiation and drafting of this Agreement. If there is an ambiguity or a question of intent or interpretation arises, this Agreement shall be construed as if drafted jointly by the Parties, and no presumption or burden of proof shall arise favoring or disfavoring either Party by virtue of the authorship of any provisions of this Agreement. No prior draft of this Agreement, or any negotiations or proceedings in pursuit of this Agreement, shall be offered or received as evidence to explain, construe, interpret, contradict, or clarify the terms of this Agreement or the intent of the Parties or their respective counsel.
(s)    Waiver of Jury Trial. Each Party hereby knowingly and voluntarily waives any rights to a trial by jury in any action, proceeding, or counterclaim brought by either Party against the other Party on, or in respect of, any matter whatsoever arising out of or in any way connected with this Agreement or any document or instrument delivered in connection with this Agreement or the relationship of the Parties under this Agreement.
(t)    General Interpretive Principles. Except as otherwise provided in this Agreement or unless the context otherwise requires, (i) the terms defined in Section 1 have the meanings assigned to them in Section 1 and include the plural as well as the singular; (ii) the use of any
42


gender shall be deemed to include the other genders; (iii) accounting terms have the meanings assigned to them in accordance with generally accepted accounting principles, consistently applied; (iv) references to “Sections,” “subsections,” “paragraphs,” and other subdivisions without reference to a document are to designated sections, subsections, paragraphs, and other subdivisions of this Agreement; (v) a reference to a subsection without further reference to a section is a reference to such subsection as contained in the same section in which the reference appears, and this rule also shall apply to paragraphs and other subdivisions; (vi) the words “herein,” “hereof,” “hereunder,” and other words of similar import refer to this Agreement as a whole and not to any particular provision; (vii) the word “including” means “including, but not limited to”; (viii) the words “not including” mean “excluding only”; (ix) the word “or” means “and/or” unless the context clearly prohibits that construction; (x) any approval or consent of a Party required under this Agreement shall be deemed to mean the approval or consent of such Party, in its sole discretion, and such Party will not be liable for withholding or delaying such approval or consent, or denying any request for such approval or consent; and (xi) when the term “commercially reasonable efforts” is used with respect to the obligation of either Party to cause any action or inaction by a third party, or is otherwise dependent on the actions or inactions of any third party, such term does not include the obligation of such Party to expend any material sum, and such Party will not be in breach of this Agreement if such commercially reasonable efforts fail as the result of any such action or inaction of any such third party.
(u)    Further Assurances. Each of Naming Rights Partner and StadCo shall execute, acknowledge, and deliver, without additional consideration, such further assurances, instruments, and documents, and shall take such further actions, as the other Party shall reasonably request in order to fulfill the intent of this Agreement and the transactions contemplated hereby.
(v)    Time is of the Essence. With regard to all dates, deadlines, and time periods set forth or referred to in this Agreement, time is of the essence.
(w)    Expenses. Each Party shall bear its own expenses in connection with this Agreement, and (except as set forth in this Agreement) the transactions contemplated hereby.
(x)    No Team or Stadium Event Representations, Warranties, or Covenants. Naming Rights Partner acknowledges that StadCo has neither made nor is making any representations, warranties, or covenants of any nature whatsoever regarding (i) the present or future performance of the Teams, (ii) the identity or playing ability or availability for any given home game of any of the present or future players of the Teams, (iii) attendance at home games of the Teams, (iv) any other similar or related matters regarding the performance, operations, or management of the Teams, (v) the identity of any performers who may participate in, or perform at, any Stadium events, or (vi) the attendance at any such Stadium events. Naming Rights Partner further acknowledges that it is knowingly taking and accepting the risk that future management decisions by the owners of each Team and other members of their respective management may adversely affect the performance of each Team.
(y)    No Consultants. Naming Rights Partner and StadCo each represent and warrant to the other that, except for [***] (“[***]”), who is employed by StadCo or its Affiliate, and [***] (“[***]”), who is employed by Naming Rights Partner, such Party has employed no brokers, finders, consultants, or financial advisers in respect of the transaction contemplated hereby.
43


StadCo or its Affiliate shall be responsible for the payment of all fees or commissions to [***] and Naming Rights Partner shall be responsible for the payment of all fees or commissions to [***].
(Signatures on following page)
44


IN WITNESS WHEREOF, the Parties have executed this Agreement as of the Effective Date.
STADCO
STADCO LA, LLC
By:
/s/ Jason S. Gannon
Jason S. Gannon
Managing Director
NAMING RIGHTS PARTNER
SOCIAL FINANCE, INC.
By:
/s/ Anthony J. Noto
Anthony J. Noto
Chief Executive Officer
45


SCHEDULE 1
DEPICTION OF THE STADIUM PLAZAS
[***]
Schedule 1-1


SCHEDULE 2
NAMING RIGHTS ASSETS
[***]
Schedule 2-1


SCHEDULE 3
TEAM ASSETS
[***]
Schedule 3-1


SCHEDULE 4
NAMING RIGHTS PARTNER MARKS
[***]
Schedule 4-1


SCHEDULE 5
STADIUM MARKS
(INCLUDING STADIUM LOGOS)
[***]
Schedule 5-1


SCHEDULE 6
TEAM MARKS
[***]
Schedule 6-1


EXHIBIT A
NAMING RIGHTS PARTNER SIGNAGE PLAN
[***]
Exhibit A - 1
Exhibit 10.13
Execution Version
REVOLVING CREDIT AGREEMENT
dated as of
September 27, 2018
among
SOCIAL FINANCE, INC.,
as the Borrower,
the Lenders party hereto,
the Issuing Banks party hereto,
and
GOLDMAN SACHS BANK USA,
as the Administrative Agent,
CITIBANK, N.A. and
GOLDMAN SACHS BANK USA,
as Joint Lead Arrangers and Joint Bookrunners



TABLE OF CONTENTS
ARTICLE I DEFINITIONS
1
Section 1.01 Defined Terms 1
Section 1.02 Classification of Loans and Borrowings 29
Section 1.03 Terms Generally 29
Section 1.04 Accounting Terms; GAAP 29
Section 1.05 Exchange Rates; Currency Equivalents 30
Section 1.06 Electronic Execution of Documents 30
ARTICLE II THE CREDITS
30
Section 2.01 Commitments 30
Section 2.02 Loans and Borrowings 30
Section 2.03 Requests for Borrowings 31
Section 2.04 Funding of Borrowings 32
Section 2.05 Interest Elections 33
Section 2.06 Termination and Reduction of Commitments 34
Section 2.07 Repayment of Loans; Evidence of Debt 35
Section 2.08 Prepayment of Loans 35
Section 2.09 Fees 36
Section 2.10 Interest 37
Section 2.11 Alternate Rate of Interest; Illegality 38
Section 2.12 Increased Costs 40
Section 2.13 Break Funding Payments 41
Section 2.14 Taxes 42
Section 2.15 Payments Generally; Pro Rata Treatment; Sharing of Set-Off 46
Section 2.16 Mitigation Obligations; Replacement of Lenders 47
Section 2.17 Defaulting Lenders 48
Section 2.18 Incremental Facility 50
Section 2.19 Letters of Credit 52
Section 2.20 Extension of the Maturity Date 59
ARTICLE III REPRESENTATIONS AND WARRANTIES
60
Section 3.01 Organization; Powers 60
Section 3.02 Authorization; Enforceability 60
Section 3.03 Governmental Approvals; No Conflicts 60
Section 3.04 Financial Condition; No Material Adverse Change 60
Section 3.05 Properties 61
Section 3.06 Litigation and Environmental Matters 61
Section 3.07 Compliance with Laws and Agreements; No Default 61
Section 3.08 Investment Company Status 62
Section 3.09 Margin Stock 62
Section 3.10 Taxes 62
Section 3.11 ERISA 62
Section 3.12 Disclosure 63
Section 3.13 Subsidiaries 64
Section 3.14 Solvency 64
i


Section 3.15 Anti-Terrorism Law 64
Section 3.16 FCPA; Sanctions 65
ARTICLE IV CONDITIONS
65
Section 4.01 Effective Date 65
Section 4.02 Each Credit Event 67
ARTICLE V AFFIRMATIVE COVENANTS
67
Section 5.01 Financial Statements; Ratings Change and Other Information 68
Section 5.02 Notices of Material Events 70
Section 5.03 Existence; Conduct of Business 70
Section 5.04 Payment of Taxes and Other Claims 70
Section 5.05 Maintenance of Properties; Insurance 70
Section 5.06 Books and Records; Inspection Rights 71
Section 5.07 ERISA-Related Information 71
Section 5.08 Compliance with Laws and Agreements 72
Section 5.09 Use of Proceeds 72
Section 5.10 Guarantors 72
Section 5.11 Designation of Restricted and Unrestricted Subsidiaries 72
ARTICLE VI NEGATIVE COVENANTS
74
Section 6.01 Indebtedness 74
Section 6.02 Liens 76
Section 6.03 Fundamental Changes 78
Section 6.04 Restricted Payments 79
Section 6.05 Restrictive Agreements 80
Section 6.06 Transactions with Affiliates 81
Section 6.07 [Reserved] 81
Section 6.08 Investments 82
Section 6.09 Financial Covenant 83
ARTICLE VII EVENTS OF DEFAULT
83
Section 7.01 Events of Default 83
Section 7.02 Application of Funds 86
ARTICLE VIII THE AGENTS
87
Section 8.01 Appointment of the Administrative Agent 87
Section 8.02 Powers and Duties 87
Section 8.03 General Immunity 87
Section 8.04 Administrative Agent Entitled to Act as Lender 89
Section 8.05 Lenders’ Representations, Warranties and Acknowledgment 89
Section 8.06 Right to Indemnity 90
Section 8.07 Successor Administrative Agent 91
Section 8.08 Guaranty 92
Section 8.09 Withholding Taxes 92
ii


Section 8.10 Administrative Agent May File Bankruptcy Disclosure and Proofs of Claim 93
Section 8.11 Certain ERISA Matters. 93
ARTICLE IX MISCELLANEOUS
95
Section 9.01 Notices 95
Section 9.02 Waivers; Amendments 98
Section 9.03 Expenses; Indemnity; Damage Waiver 100
Section 9.04 Successors and Assigns 102
Section 9.05 Survival 106
Section 9.06 Counterparts; Integration; Effectiveness 107
Section 9.07 Severability 107
Section 9.08 Right of Setoff 107
Section 9.09 Governing Law; Jurisdiction; Consent to Service of Process 108
Section 9.10 Waiver Of Jury Trial 108
Section 9.11 Headings 109
Section 9.12 Confidentiality 109
Section 9.13 Interest Rate Limitation 111
Section 9.14 No Advisory or Fiduciary Responsibility 111
Section 9.15 Electronic Execution of Assignments and Certain Other Documents 111
Section 9.16 USA PATRIOT Act 112
Section 9.17 Release of Guarantors 112
Section 9.18 Acknowledgement and Consent to Bail-in of EEA Financial Institutions 112
Section 9.19 Judgment Currency 112
SCHEDULES
Schedule 2.01 Lenders, Commitments and Letter of Credit Issuer Sublimit
SCHEDULES TO THE DISCLOSURE LETTER
Schedule 2.19 Effective Date Letters of Credit
Schedule 3.11 Plans
Schedule 3.13 Capitalization
Schedule 6.02 Effective Date Liens
Schedule 6.05 Effective Date Restrictive Agreements
EXHIBITS
Exhibit A Form of Assignment and Assumption
Exhibit B Form of Borrowing Request
Exhibit C Form of Interest Election Request
Exhibit D Form of Revolving Note
Exhibit E Form of Guaranty
Exhibit F Form of Compliance Certificate
Exhibit G-1 Form of U.S. Tax Compliance Certificate
Exhibit G-2 Form of U.S. Tax Compliance Certificate
Exhibit G-3 Form of U.S. Tax Compliance Certificate
iii


Exhibit G-4 Form of U.S. Tax Compliance Certificate
Exhibit H Form of Intercompany Subordination Agreement
Exhibit I Form of Annual Forecast
iv


REVOLVING CREDIT AGREEMENT dated as of September 27, 2018 among SOCIAL FINANCE, INC., as the Borrower, the LENDERS and ISSUING BANKS party hereto and GOLDMAN SACHS BANK USA, as the Administrative Agent.
The Borrower (such term and each other capitalized term used and not otherwise defined in these recitals having the meaning assigned to it in Article 1), has requested the Lenders to make Loans to the Borrower and the Issuing Banks to issue Letters of Credit at the request of the Applicable Account Parties, in each case on a revolving credit basis on and after the date hereof and at any time and from time to time prior to the Maturity Date.
The proceeds of borrowings hereunder, together with the issuance of any letter of credit, are to be used for the purposes described in Section 5.09. The Lenders are willing to establish the credit facility referred to in the preceding paragraph upon the terms and subject to the conditions set forth herein. Accordingly, for valuable consideration of the mutual covenants and agreements herein contained, the parties hereto covenant and agree as follows:
ARTICLE I
DEFINITIONS
Section 1.01    Defined Terms. As used in this Agreement, the following terms have the meanings specified below:
ABR”, when used in reference to any Loan or Borrowing, refers to whether such Loan, or the Loans comprising such Borrowing, are bearing interest at a rate determined by reference to the Alternate Base Rate.
Adjusted EURIBO Rate” means, for any Interest Rate Determination Date with respect to an Interest Period for a EURIBOR Borrowing, the rate per annum equal to the EURIBO Rate for such Interest Period; provided that in no event shall the Adjusted EURIBO Rate be less than 0.00%.
Adjusted LIBO Rate” means, for any Interest Rate Determination Date with respect to an Interest Period (or, solely for purposes of clause (ii) in the defined term “Alternate Base Rate,” for purposes of determining the Alternate Base Rate as of any date) for a Eurodollar Borrowing, (a) for Borrowings denominated in Dollars, the rate per annum obtained by dividing (i) the LIBO Rate for Dollars for such Interest Period (or such date, as applicable) by (ii) an amount equal to (x) one minus (y) the Applicable Reserve Requirement or (b) for Borrowings denominated in a Permitted Foreign Currency (other than Euros), the rate per annum equal to the LIBO Rate for such currency for such Interest Period; provided that in no event shall the Adjusted LIBO Rate be less than 0.00%.
Administrative Agent” means Goldman Sachs Bank USA, in its capacity as administrative agent for the Lenders hereunder, or any successor administrative agent.
Administrative Questionnaire” means an Administrative Questionnaire in a form supplied by the Administrative Agent from time to time.
Affiliate” means, with respect to a specified Person, another Person that directly, or indirectly through one or more intermediaries, Controls or is Controlled by or is under common Control with the Person specified; provided that for the purposes of this Agreement and the other
1


Loan Documents, none of SoftBank Group Corp., SoftBank Group Capital Ltd., SB Sonic Holdco, Renren SF Holdings, Oak Pacific Investment, or their respective successors and assigns shall be considered “Affiliates” of the Borrower.
Affiliated Persons” means, with respect to any specified Person, (a) any Affiliate of such Person and (b) any Person Controlled by such Person or its Affiliate or the holdings of which are for the primary benefit of any such Persons.
Agent Parties” has the meaning set forth in Section 9.01(d).
Agents” means, collectively, the Administrative Agent and the Arrangers.
Aggregate Total Exposure” means, as at any date of determination, the sum of (i) the Dollar Equivalent of the aggregate principal amount of all outstanding Loans (excluding Loans made for the purpose of reimbursing the Issuing Banks for any amount drawn under any Letter of Credit, but not yet so applied) and (ii) the Letter of Credit Usage.
Agreed L/C Cash Collateral Amount” means 102% of the total outstanding Letter of Credit Usage.
Agreement” means this Revolving Credit Agreement, as the same may hereafter be modified, supplemented, extended, amended, restated or amended and restated from time to time.
Agreement Currency” has the meaning set forth in Section 9.19.
Alternate Base Rate” means, for any day, a rate per annum equal to the greatest of (i) the Prime Rate in effect on such day, (ii) the Federal Funds Effective Rate in effect on such day plus 12 of 1% and (iii) the sum of (a) the Adjusted LIBO Rate that would be payable on such day for a Eurodollar Borrowing with a one-month interest period plus (b) 1.00%. If the Administrative Agent shall have determined (which determination shall be conclusive absent manifest error) that it is unable to ascertain the Federal Funds Effective Rate for any reason, including the inability or failure of the Administrative Agent to obtain sufficient quotations in accordance with the terms of the definition thereof, the Alternate Base Rate shall be determined without regard to clause (ii) of the preceding sentence until the circumstances giving rise to such inability no longer exist. Any change in the Alternate Base Rate due to a change in the Prime Rate, the Federal Funds Effective Rate or the Adjusted LIBO Rate shall be effective on the effective day of such change in the Federal Funds Effective Rate or the Adjusted LIBO Rate, respectively.
Anti-Corruption Laws” means the FCPA, the U.K. Bribery Act 2010 to the extent applicable, all other applicable anti-corruption laws, the Bank Secrecy Act to the extent applicable, the USA Patriot Act, and the applicable anti-money laundering statutes of jurisdictions where the Borrower and its Subsidiaries conduct business, and the rules and regulations (if any) thereunder enforced by any governmental agency.
Anti-Terrorism Laws” has the meaning set forth in Section 3.15(a).
Applicable Account Party” has the meaning set forth in Section 2.19(a).
Applicable Creditor” has the meaning set forth in Section 9.19.
2


Applicable Percentage” means, with respect to any Lender, the percentage of the total Commitments represented by such Lender’s Commitment. If the Commitments have terminated or expired, the Applicable Percentages shall be determined based upon the Commitments most recently in effect, giving effect to any assignments.
Applicable Rate” means, for any day, (i) 1.00% per annum with respect to any Eurodollar Loan or EURIBOR Loan and (ii) 0.00% per annum with respect to any ABR Loan and (iii) 0.10% per annum with respect to the Unused Commitment Fee.
Applicable Reserve Requirement” means for any day as applied to a Eurodollar Borrowing, the aggregate (without duplication) of the maximum rates (expressed as a decimal ) of reserve requirements in effect on such day (including basic, supplemental, marginal and emergency reserves under any regulations of the Board or other Governmental Authority having jurisdiction with respect thereto) dealing with reserve requirements prescribed for eurocurrency funding (currently referred to as “Eurocurrency Liabilities” in Regulation D of the Board) maintained by a member bank of the Federal Reserve System.
Application” means a Letter of Credit application or agreement in the form approved by the applicable Issuing Bank, executed and delivered by the Borrower to the Administrative Agent and the applicable Issuing Bank requesting such Issuing Bank to issue a Letter of Credit.
Approved Fund” means any Person (other than a natural person) that is engaged in making, purchasing, holding or investing in bank loans and similar extensions of credit in the ordinary course of its activities and that is administered or managed by (a) a Lender, (b) an Affiliate of a Lender or (c) an entity or an Affiliate of an entity that administers or manages a Lender.
Arranger” means each of Citigroup Global Markets Inc. and Goldman Sachs Bank USA in its capacity as a joint lead arranger and a joint bookrunner.
Assignment and Assumption” means an assignment and assumption entered into by a Lender and an assignee (with the consent of any party whose consent is required by Section 9.04), and accepted by the Administrative Agent, in the form of Exhibit A or any other form approved by the Administrative Agent.
Availability Period” means the period from and including the Effective Date to but excluding the earlier of the Maturity Date and the date of termination of the Commitments.
Bail-In Action” means the exercise of any Write-Down and Conversion Powers by the applicable EEA Resolution Authority in respect of any liability of an EEA Financial Institution.
Bail-In Legislation” means, with respect to any EEA Member Country implementing Article 55 of Directive 2014/59/EU of the European Parliament and of the Council of the European Union, the implementing law for such EEA Member Country from time to time which is described in the EU Bail-In Legislation Schedule.
Bankruptcy Code” means Chapter 11 of Title 11 of the United States Code, as amended from time to time and any successor statute and all rules and regulations promulgated thereunder.
3


Bankruptcy Event” means an Event of Default of the type described in Section 7.01(h), (i) or (j).
Beneficial Ownership Certification” means a certification regarding beneficial ownership required by the Beneficial Ownership Regulation, which certification shall be substantially similar in form and substance to the form of Certification Regarding Beneficial Owners of Legal Entity Customers published jointly, in May 2018, by the Loan Syndications and Trading Association and Securities Industry and Financial Markets Association.
Beneficial Ownership Regulation” means 31 C.F.R. § 1010.230.
Benefit Plan” means any of (a) an “employee benefit plan” (as defined in ERISA) that is subject to Title I of ERISA, (b) a “plan” as defined in Section 4975 of the Code or (c) any Person whose assets include (for purposes of ERISA Section 3(42) or otherwise for purposes of Title I of ERISA or Section 4975 of the Code) the assets of any such “employee benefit plan” or “plan”.
Board” means the Board of Governors of the Federal Reserve System of the United States of America (or any successor).
Borrower” means Social Finance, Inc., a Delaware corporation.
Borrowing” means Loans of the same currency and Type, made, converted or continued on the same date and, in the case of Eurodollar Loans or EURIBOR Loans, as to which a single Interest Period is in effect.
Borrowing Minimum” means (a) in the case of a Eurodollar Borrowing denominated in Dollars, $5,000,000, (b) in the case of a Eurodollar Borrowing denominated in any Permitted Foreign Currency or a EURIBOR Borrowing, the smallest amount of such Permitted Foreign Currency that is an integral multiple of 100,000 units of such currency and that has a Dollar Equivalent in excess of $5,000,000 and (c) in the case of an ABR Borrowing, $5,000,000.
Borrowing Multiple” means (a) in the case of a Eurodollar Borrowing denominated in Dollars, $1,000,000, (b) in the case of a Eurodollar Borrowing denominated in any Permitted Foreign Currency or a EURIBOR Borrowing, the smallest amount of such Permitted Foreign Currency that is an integral multiple of 100,000 units of such currency and that has a Dollar Equivalent in excess of $1,000,000 and (c) in the case of an ABR Borrowing, $1,000,000.
Borrowing Request” has the meaning set forth in Section 2.03.
Business Day” means any day that is not a Saturday, Sunday or other day on which commercial banks in New York City are authorized or required by law to remain closed; provided that, (a) when used in connection with a Eurodollar Loan, the term “Business Day” shall also exclude any day on which banks are not open for dealings in deposits in the applicable currency in the London interbank market and (b) when used in connection with any EURIBOR Loan, the term “Business Day” shall also exclude any day which is not a TARGET Day or any day on which banks in London are not open for general business.
Calculation Date” means (a) the last Business Day of each calendar quarter, (b) each date (with such date to be reasonably determined by the Administrative Agent) that is on or about the date
4


of (i) a Borrowing Request or an Interest Election Request with respect to any Loan or (ii) the issuance, amendment (including, without limitation, the date of any amendment increasing the amount of any Letter of Credit), renewal or extension of a Letter of Credit, (c) solely with respect to Letters of Credit, the first Business Day of each calendar month, and (d) if an Event of Default has occurred and is continuing, any Business Day as determined by the Administrative Agent in its sole discretion.
Capital Lease Obligations” of any Person means the obligations of such Person to pay rent or other amounts under any lease of (or other arrangement conveying the right to use) real or personal property, or a combination thereof, which obligations are required to be classified and accounted for as capital leases on a balance sheet of such Person under GAAP, and the amount of such obligations shall be the capitalized amount thereof determined in accordance with GAAP; provided that any obligations relating to a lease that was accounted for by such Person as an operating lease as of the Effective Date (or that would have been accounted for as an operating lease if such lease was in effect as of the Effective Date) shall be accounted for as obligations relating to an operating lease and not as Capital Lease Obligations.
Cash Collateral” has a meaning correlative to the below and shall include the proceeds of such cash collateral and other credit support.
Cash Collateralize” means, in respect of an Obligation, to provide and pledge (as a first priority perfected security interest) cash collateral in the applicable currency in an amount not to exceed 102% of such Obligations (except as otherwise expressly provided herein), at a location and pursuant to documentation in form and substance satisfactory to the Administrative Agent and the applicable Issuing Bank (and “Cash Collateralization” has a corresponding meaning).
Cash Equivalents” means:
(a)    direct obligations of, or obligations the principal of and interest on which are unconditionally guaranteed by, the United States of America (or by any agency thereof to the extent such obligations are backed by the full faith and credit of the United States of America), in each case maturing within one year from the date of issuance thereof;
(b)    investments in commercial paper maturing within 270 days from the date of issuance thereof and having, at such date of acquisition, a rating of at least “Prime 1” (or the then equivalent grade) by Moody’s or “A-1” (or the then equivalent grade) by S&P;
(c)    investments in certificates of deposit, banker’s acceptances and time deposits maturing within one year from the date of acquisition thereof issued or guaranteed by or placed with, and money market deposit accounts issued or offered by, the Administrative Agent or any domestic office of any commercial bank organized under the laws of the United States of America or any State thereof that issues (or the parent of which issues) commercial paper rated at least “Prime 1” (or the then equivalent grade) by Moody’s or “A-1” (or the then equivalent grade) by S&P;
(d)    fully collateralized repurchase agreements with a term of not more than 30 days for securities described in clause (a) above and entered into with a financial institution satisfying the criteria of clause (c) above;
5


(e)    investments in “money market funds” substantially all of whose assets are invested in investments of the type described in clauses (a) through (d) above;
(f)    in the case of any Foreign Subsidiary, other short-term investments that are analogous to the foregoing, are of comparable credit quality and are customarily used by companies in the jurisdiction of such Foreign Subsidiary for cash management purposes; and
(g)    investments permitted pursuant to Borrower’s investment policy as approved by the board of directors (or committee thereof) of the Borrower from time to time.
Change in Control” means (a) prior to an IPO, the failure by Permitted Holders to beneficially own at least 50.1% of the aggregate voting power of the Borrower’s Equity Interests on a fully diluted basis; provided that any such failure shall not constitute a Change in Control if (x) such failure was due to a bona fide equity financing transaction for, or recapitalization of, the Borrower and (y) a Change of Control under clause (b) would not have occurred if such failure was following an IPO; or (b) after an IPO, the acquisition of ownership, directly or indirectly, beneficially or of record, by any Person or group (within the meaning of the Securities Exchange Act and the rules of the Securities and Exchange Commission thereunder) other than the Permitted Holders , of more than 35% of the aggregate voting power of the Public Company’s Equity Interests on a fully diluted basis. The consummation of an IPO shall not constitute a Change in Control.
Change in Law” means the occurrence, after the date of this Agreement, of any of the following: (a) the adoption or taking effect of any law, rule, regulation or treaty, (b) any change in any law, rule, regulation or treaty or in the administration, interpretation, implementation or application thereof by any Governmental Authority or (c) the making or issuance of any request, rule, guideline or directive (whether or not having the force of law) by any Governmental Authority; provided that, notwithstanding anything herein to the contrary, (x) the Dodd-Frank Wall Street Reform and Consumer Protection Act and all requests, rules, guidelines or directives thereunder or issued in connection therewith and (y) all requests, rules, guidelines or directives promulgated by the Bank for International Settlements, the Basel Committee on Banking Supervision (or any successor or similar authority) or the United States or foreign regulatory authorities, in each case pursuant to Basel III, shall in each case be deemed to be a “Change in Law,” regardless of the date enacted, adopted or issued.
Charges” has the meaning set forth in Section 9.13.
Code” means the U.S. Internal Revenue Code of 1986, as amended from time to time.
Commitment” means, with respect to each Lender, the commitment of such Lender to make Loans hereunder and acquire participations in Letters of Credit hereunder, expressed as an amount representing the maximum aggregate amount of such Lender’s Loans hereunder, as such commitment may be (a) reduced from time to time pursuant to Section 2.06, (b) increased from time to time pursuant to Section 2.18, or (c) reduced or increased from time to time pursuant to assignments by or to such Lender pursuant to Section 9.04. The initial amount of each Lender’s Commitment as of the Effective Date is set forth on Schedule 2.01. The initial aggregate amount of the Lenders’ Commitments as of the Effective Date is $560,000,000.
Communications” has the meaning set forth in Section 9.01(d).
6


Connection Income Taxes” means Other Connection Taxes that are imposed on or measured by net income (however denominated) or that are franchise Taxes or branch profits Taxes.
Consolidated Tangible Net Worth” means, at any date of determination, stockholders’ equity as set forth on the most recent quarterly or annual consolidated balance sheet of the Borrower and its Subsidiaries less the amount of all intangible items included therein, including, without limitation, goodwill, franchises, licenses, patents, trademarks, trade names, copyrights, service marks, brand names and write-ups of intangible assets (but only to the extent that such items would be included on a consolidated balance sheet of the Borrower and its Subsidiaries in accordance with GAAP).
Control” means the possession, directly or indirectly, of the power to direct or cause the direction of the management or policies of a Person, whether through the ability to exercise voting power, by contract or otherwise. “Controlling” and “Controlled” have meanings correlative thereto.
Convertible Notes” means debt securities that are convertible solely into, or exchangeable solely for, Equity Interests and/or cash; provided that such debt securities (i) do not have a scheduled maturity date any earlier than the date that is 91 days after the Maturity Date applicable at the time of issuance thereof, (ii) only require interest to be paid in kind; provided that after an IPO, cash interest will be permitted and (iii) issued prior to an IPO shall be convertible solely into Equity Interests (and not for cash) and shall not require any cash payments to be made thereunder or contain any cash redemption features, except, in the case of clauses (i) and (ii), if as a result of a customary fundamental change or change in control event.
Credit Parties” has the meaning set forth in Section 9.12(a).
Debtor Relief Laws” means the Bankruptcy Code, and all other liquidation, conservatorship, bankruptcy, assignment for the benefit of creditors, moratorium, rearrangement, receivership, insolvency, reorganization, or similar debtor relief laws of the United States or other applicable jurisdictions from time to time in effect.
Declining Lender” has the meaning set forth in Section 2.20.
Default” means any event or condition which constitutes an Event of Default or which upon notice, lapse of time or both would, unless cured or waived, become an Event of Default.
Defaulting Lender” means, subject to Section 2.17(b), any Lender that (a) has failed to (i) fund all or any portion of its Loans within two Business Days of the date such Loans were required to be funded hereunder, unless such Lender notifies the Administrative Agent and the Borrower in writing that such failure is the result of such Lender’s good faith determination that one or more conditions precedent to such funding (each of which conditions precedent, together with any applicable default, shall be specifically identified in such writing) has not been satisfied, (ii) fund any portion of its participation in any Letter of Credit within two Business Days of the date required to be funded hereunder or (iii) pay to the Administrative Agent, any Issuing Bank or any other Lender any other amount required to be paid by it hereunder within three Business Days of the date when due, (b) has notified the Borrower, the Administrative Agent or any Issuing Bank in writing that it does not intend to comply with its funding obligations hereunder, or has made a public statement to that effect (unless such writing or public statement relates to such Lender’s obligation to fund a Loan hereunder and states that such position is based on such Lender’s good faith determination that a condition
7


precedent to funding (which condition precedent, together with any applicable default, shall be specifically identified in such writing or public statement) cannot be satisfied), (c) has failed, within three Business Days after written request by the Administrative Agent or the Borrower, to confirm in writing to the Administrative Agent and the Borrower that it will comply with its prospective funding obligations hereunder (provided that such Lender shall cease to be a Defaulting Lender pursuant to this clause (c) upon receipt of such written confirmation by the Administrative Agent and the Borrower), (d) has, or has a direct or indirect parent company that has, (i) become the subject of a proceeding under any Debtor Relief Law, or (ii) had appointed for it a receiver, custodian, conservator, trustee, administrator, assignee for the benefit of creditors or similar Person charged with reorganization or liquidation of its business or assets, including the Federal Deposit Insurance Corporation or any other state or federal regulatory authority acting in such a capacity or (e) has become the subject of a Bail-In Action; provided that a Lender shall not be a Defaulting Lender solely by virtue of the ownership or acquisition of any equity interest in that Lender or any direct or indirect parent company thereof by a Governmental Authority so long as such ownership interest does not result in or provide such Lender with immunity from the jurisdiction of courts within the United States or from the enforcement of judgments or writs of attachment on its assets or permit such Lender (or such Governmental Authority) to reject, repudiate, disavow or disaffirm any contracts or agreements made with such Lender. Any determination by the Administrative Agent that a Lender is a Defaulting Lender under clauses (a) through (d) above shall be conclusive and binding absent manifest error, and such Lender shall be deemed to be a Defaulting Lender (subject to Section 2.17(b)) upon delivery of written notice of such determination to the Borrower and each Lender.
Disclosure Letter” means the disclosure letter, dated as of the date hereof, as amended or supplemented from time to time pursuant to the terms of this Agreement.
Disqualified Equity Interests” means any Equity Interest which, by its terms (or by the terms of any security or other Equity Interests into which it is convertible or for which it is exchangeable), or upon the happening of any event or condition (i) matures or is mandatorily redeemable (other than solely for Qualified Equity Interests), pursuant to a sinking fund obligation or otherwise, (ii) is redeemable at the option of the holder thereof (other than solely for Qualified Equity Interests), in whole or in part, or (iii) is or becomes convertible into or exchangeable for Indebtedness or any other Equity Interests that would constitute Disqualified Equity Interests, in each case, prior to the date that is 91 days after the Maturity Date applicable at the time of issuance thereof, except, in the case of clauses (i) and (ii), if as a result of a change in control, fundamental change or asset sale, so long as any rights of the holders thereof upon the occurrence of such a change in control, fundamental change or asset sale event are subject to the prior expiration or termination of the Commitments, the payment in full of the principal of and interest on each Loan and all fees payable hereunder and the cancellation or expiration or Cash Collateralization of all Letters of Credit.
Disqualified Institution” means (a) any Person that has been identified in writing to the Administrative Agent prior to the Effective Date as a “Disqualified Institution” or (b) any Person that is a competitor or potential competitor of the Borrower or any of its Subsidiaries or any investor in any such competitor or potential competitor (in each case as determined in good faith by the Borrower and other than investors that are bona fide debt funds) that has been identified in writing to the Administrative Agent from time to time as a “Disqualified Institution” by the Borrower; provided that (i) any Person that becomes a “Disqualified Institution” after the applicable Trade Date with respect to an assignment or participation shall not retroactively be deemed a “Disqualified Institution” for purposes of such assignment or participation or any previously acquired assignment or participation
8


(but such Person shall not be able to increase its Commitments or participations hereunder) and (ii) such assignment or participation and, in the case of an assignment, the execution by the Borrower of an Assignment and Assumption with respect to such assignee, in each case, in connection with any assignment or participation described in the preceding clause (i), will not by itself result in such assignee no longer being considered a “Disqualified Institution”; provided, however, that, in each case, the term “Disqualified Institution” shall not include any person that has been identified in writing to the Administrative Agent from time to time by the Borrower as no longer constituting a “Disqualified Institution”.
Dollar Equivalent” means, at any time, (a) with respect to any amount denominated in Dollars, such amount and (b) with respect to any amount denominated in any Permitted Foreign Currency, the equivalent amount thereof in Dollars at such time as determined in accordance with Section 1.05(a) using the Exchange Rate with respect to such Permitted Foreign Currency at the time in effect under the provisions of such Section (except as otherwise expressly provided in Section 2.19(d)).
Dollars” or “$” refers to lawful money of the United States of America.
Domestic Subsidiary” means any Subsidiary that is organized under the laws of any political subdivision of the United States, excluding (x) any such Subsidiary substantially all of the assets of which consist of Equity Interests in one or more Subsidiaries that are “controlled foreign corporations” within the meaning of Section 957 of the Code and (y) any such Subsidiary that is owned (directly or indirectly) by a Subsidiary that is a “controlled foreign corporation” within the meaning of Section 957 of the Code.
EEA Financial Institution” means (a) any credit institution or investment firm established in any EEA Member Country which is subject to the supervision of an EEA Resolution Authority, (b) any entity established in an EEA Member Country which is a parent of an institution described in clause (a) of this definition, or (c) any financial institution established in an EEA Member Country which is a subsidiary of an institution described in clauses (a) or (b) of this definition and is subject to consolidated supervision with its parent.
EEA Member Country” means any of the member states of the European Union, Iceland, Liechtenstein, and Norway.
EEA Resolution Authority” means any public administrative authority or any person entrusted with public administrative authority of any EEA Member Country (including any delegee) having responsibility for the resolution of any EEA Financial Institution.
Effective Date” means the date on which the conditions specified in Section 4.01 are satisfied (or waived in accordance with Section 9.02).
Effective Date Financing Arrangements” has the meaning set forth in the definition of Permitted Asset-Based Financing.
Effective Date Letters of Credit” means the Letters of Credit listed on Schedule 6.07.
9


Environmental Laws” means all laws, rules, regulations, codes, ordinances, orders, decrees, judgments, injunctions, notices or binding agreements issued, promulgated or entered into by any Governmental Authority, relating in any way to the environment, preservation or reclamation of natural resources, the generation, use, handling, transportation, storage, treatment, disposal, management, release or threatened release of any Hazardous Material or to health and safety matters.
Environmental Liability” means any liability, contingent or otherwise (including any liability for damages, costs of investigation, reclamation or remediation, fines, penalties or indemnities), of the Borrower or any Restricted Subsidiary directly or indirectly resulting from or based upon (a) any Environmental Law, including compliance or noncompliance therewith, (b) the generation, use, handling, transportation, storage, treatment or disposal of any Hazardous Materials, (c) exposure to any Hazardous Materials, (d) the presence, release or threatened release of any Hazardous Materials into the environment or (e) any contract, agreement or other consensual arrangement pursuant to which liability is assumed or imposed with respect to any of the foregoing.
Equity Interests” means shares of capital stock, partnership interests, membership interests in a limited liability company, beneficial interests in a trust or other equity ownership interests in a Person, and any warrants, options or other rights entitling the holder thereof to purchase or acquire any such equity interest; provided that Equity Interests shall not include any Convertible Notes.
ERISA” means the U.S. Employee Retirement Income Security Act of 1974, as amended from time to time, and the regulations promulgated and rulings issued thereunder.
ERISA Affiliate” means any person that for purposes of Title I or Title IV of ERISA or Section 412 of the Code would be deemed at any relevant time to be a single employer or otherwise aggregated with the Borrower or a Restricted Subsidiary under Section 414(b), (c), (m) or (o) of the Code or Section 4001 of ERISA.
ERISA Event” means any one or more of the following: (a) any reportable event, as defined in Section 4043 of ERISA, with respect to a Plan, as to which the PBGC has not waived under subsection .22, .23, .25, .26, .27, .28, .29, .30, .31, .32, .34 or .35 of PBGC Regulation Section 4043 the requirement of Section 4043(a) of ERISA that it be notified of such event; (b) the termination of any Plan under Section 4041(c) of ERISA; (c) the institution of proceedings by the PBGC under Section 4042 of ERISA for the termination of, or the appointment of a trustee to administer, any Plan; (d) the failure to make a required contribution to any Plan that would result in the imposition of a lien or other encumbrance or the provision of security under Section 430 of the Code or Section 303 or 4068 of ERISA, or the arising of such a lien or encumbrance; (e) the failure to satisfy the minimum funding standard under Section 412 of the Code or Section 302 of ERISA, whether or not waived; or a determination that any Plan is, or is expected to be, considered an at-risk plan within the meaning of Section 430 of the Code or Section 303 of ERISA; (f) engaging in a non-exempt prohibited transaction within the meaning of Section 4975 of the Code or Section 406 of ERISA with respect to a Plan; (g) the complete or partial withdrawal of any Borrower, Restricted Subsidiary or any ERISA Affiliate from a Multiemployer Plan which results in the imposition of Withdrawal Liability or the reorganization or insolvency under Title IV of ERISA of any Multiemployer Plan or (h) a determination that any Multiemployer Plan is in endangered or critical status under Section 432 of the Code or Section 305 of ERISA.
10


EU Bail-In Legislation Schedule” means the EU Bail-In Legislation Schedule published by the Loan Market Association (or any successor person), as in effect from time to time.
EURIBO Rate” means, for any Interest Rate Determination Date with respect to an Interest Period for a EURIBOR Borrowing, the rate per annum determined by the Administrative Agent on the basis of the rate for deposits in such currency for a period equal to such Interest Period commencing on the first day of such Interest Period as administered by the Banking Federation of the European Union (or any other Person that takes over the administration of such rate) appearing on Reuters Screen EURIBOR01 page (or any successor page) as of approximately 11:00 a.m., Brussels, Belgium time, on such Interest Rate Determination Date; provided that, in the event such rate does not appear on such page or service or if such page or service shall cease to be available, the EURIBO Rate shall be determined by the Administrative Agent by reference to such other comparable publicly available service for displaying EURIBO rates as may be selected by the Administrative Agent, or, in the absence of such availability, the arithmetic mean of the rates (rounded upward to the nearest 1/100th of 1%) as supplied to the Administrative Agent at its request and quoted by the reference banks appointed by the Administrative Agent in consultation with the Borrower to leading banks who consent to such appointment in the Euro interbank market for deposits in Euros of a duration equal to the duration of such Interest Period, on such Interest Rate Determination Date.
EURIBOR”, when used in reference to any Loan or Borrowing, refers to whether such Loan, or the Loans comprising such Borrowing, are bearing interest at a rate determined by reference to the Adjusted EURIBO Rate.
Euro” or “” means the single currency of the European Union as constituted by the Treaty on European Union and as referred to in the EMU Legislation.
Eurodollar”, when used in reference to any Loan or Borrowing, refers to whether such Loan, or the Loans comprising such Borrowing, are bearing interest at a rate determined by reference to the Adjusted LIBO Rate.
Event of Default” has the meaning set forth in Article 7.
Exchange Act” has the meaning set forth in Section 9.01(e).
Exchange Rate” means, on any day, with respect to the applicable Permitted Foreign Currency, the rate at which such currency may be exchanged into Dollars, as set forth at approximately 11:00 a.m., London time, on such day on the Reuters World Currency Page “FX=” for such currency. In the event that such rate does not appear on any Reuters World Currency Page, then the Exchange Rate shall be determined by reference to such other publicly available service for displaying exchange rates as may be agreed upon by the Administrative Agent and the Borrower or, in the absence of such agreement, such Exchange Rate shall instead be the arithmetic average of the spot rates of exchange of the Administrative Agent in the market where its foreign currency exchange operations in respect of such currency are then being conducted, at or about 10:00 a.m., London time, on such date for the purchase of Dollars for delivery two Business Days later; provided that if at the time of any such determination, for any reason, no such spot rate is being quoted, the Administrative Agent, after consultation with the Borrower, may use any reasonable and customary method it deems appropriate to determine such rate, and such determination shall be presumed correct absent manifest error.
11


Excluded Subsidiary” means (a) any Unrestricted Subsidiary, (b) any Subsidiary that is prohibited by applicable law, rule or regulation (including in respect of any self-regulatory organization) or by any contractual obligation to which such Subsidiary is a party or by which it or any of its property or assets is bound from guaranteeing the Obligations; provided that any such agreement, instrument or other undertaking (i) is in existence on the Effective Date (or, with respect to a Subsidiary acquired after the Effective Date, as of the date such acquisition) and (ii) in the case of a Subsidiary acquired after the Effective Date, was not entered into in connection with, or in contemplation of, such acquisition, (c) any Subsidiary with respect to which guaranteeing the Obligations would require consent, approval, license or authorization from any Governmental Authority or self-regulatory organization, unless such consent, approval, license or authorization has been obtained, (d) any other Subsidiary with respect to which the Administrative Agent, in consultation with the Borrower, determines that the burden or cost or other consequences is excessive in view of the benefits to be obtained by the Lenders, (e) any Subsidiary that is a broker-dealer and (f) any Subsidiary that is a bank, industrial loan company or other deposit-taking or similarly regulated institution.
Excluded Taxes” means any of the following Taxes imposed on or with respect to a Recipient or required to be withheld or deducted from a payment to a Recipient, (a) Taxes imposed on or measured by net income (however denominated), franchise Taxes, and branch profits Taxes, in each case, (i) imposed by the jurisdiction (or any political subdivision thereof) under the laws of which such Recipient is organized or in which its principal office is located, or, in the case of any Lender, its applicable lending office is located or (ii) that otherwise are Other Connection Taxes, (b) in the case of a Lender or Issuing Bank, U.S. federal withholding Taxes imposed on amounts payable to or for the account of such Lender or Issuing Bank with respect to an applicable interest in a Loan or Commitment or obligations to reimburse amounts drawn under a Letter of Credit pursuant to a law in effect on the date on which (i) such Lender or Issuing Bank acquires such interest in the Loan, Commitment or Letter of Credit (other than pursuant to an assignment request by the Borrower under Section 2.16) or (ii) such Lender changes its lending office, except in each case to the extent that, pursuant to Section 2.14(b), amounts with respect to such Taxes were payable either to such Lender’s assignor immediately before such Lender became a party hereto or to such Lender immediately before it changed its lending office, (c) Taxes attributable to such Recipient’s failure to comply with Section 2.14(g) and (d) any U.S. federal withholding Taxes imposed under FATCA.
Executive Order” has the meaning set forth in Section 3.15(a).
Extending Lender” has the meaning set forth in Section 2.20.
Extension Agreement” means an extension agreement entered into pursuant to Section 2.20 in form and substance reasonably satisfactory to the Administrative Agent.
Extension Notice” has the meaning set forth in Section 2.20.
FATCA” means Sections 1471 through 1474 of the Code, as of the date of this Agreement (or any amended or successor version that is substantively comparable and not materially more onerous to comply with), any current or future regulations or official interpretations thereof and any agreements entered into pursuant to Section 1471(b)(1) of the Code or any published intergovernmental agreement and any fiscal or regulatory legislation, rules or official practices
12


adopted pursuant to any published intergovernmental agreement entered into in connection with the implementation of such Sections of the Code.
FCPA” means the Foreign Corrupt Practices Act of 1977, (15 U.S.C. §§ 78dd-1, et seq.) as amended.
Federal Funds Effective Rate” means for any day, the rate per annum equal to the weighted average of the rates on overnight Federal funds transactions with members of the Federal Reserve System arranged by federal funds brokers, as published by the Federal Reserve Bank of New York on the Business Day next succeeding such day or, if no such rate is so published on any day that is a Business Day, the average of the quotations for the day of such transactions received by the Administrative Agent from three federal funds brokers of recognized standing selected by it; provided that if the relevant screen rate shall be less than zero, such rate shall be deemed to be zero for purposes of this Agreement.
Financial Officer” means any of the chief financial officer, principal accounting officer, vice president of finance or corporate controller or most senior financial officer of the Borrower.
Financing Assets” means any of the following assets (or interests therein) from time to time originated, acquired or otherwise owned by the Borrower or any Subsidiary or in which the Borrower or any Subsidiary has any rights or interests, in each case, without regard to where such assets or interests are located: (a) student loans, (b) personal loans, (c) mortgage loans, (d) servicing rights, (e) residual bonds, (f) credit card receivables, (g) receivables assets, (h) franchise fees, royalties and other similar payments made related to the use of trade names and other intellectual property, business support, training and other services, (i) revenues related to distribution and merchandising of the products of the Borrower and its Subsidiaries, (j) intellectual property rights relating to the generation of any of the types of assets listed in this definition, (k) [reserved], (l) any securities issued by, and any Equity Interests of, any Special Purpose Financing Subsidiary or any Subsidiary of a Special Purpose Financing Subsidiary and any rights under any limited liability company agreement, trust agreement, shareholders agreement, organizational or formation documents or other agreement entered into in furtherance of the organization of such entity, (m) any fixed income debt or equity securities, (n) any income relating to any of the foregoing, and (o) any other assets and property to the extent customarily included in securitization transactions of the relevant type in the applicable jurisdictions (as determined by the Borrower in good faith).
Foreign Lender” means any Lender whose interest in any Obligation is treated for U.S. federal income tax purposes as owned by a Person that is not a U.S. Person.
Foreign Subsidiary” means any Subsidiary that is organized under the laws of any jurisdiction other than any Subsidiary organized under any political subdivision of the United States.
Fronting Exposure” means, at any time there is a Defaulting Lender, with respect to any Issuing Bank, such Defaulting Lender’s Applicable Percentage of the Letter of Credit Usage other than Letter of Credit Usage as to which such Defaulting Lender’s participation obligation has been reallocated to other Non-Defaulting Lenders or Cash Collateralized in accordance with the terms hereof.
GAAP” means generally accepted accounting principles in the United States of America.
13


Governmental Acts” means any act or omission, whether rightful or wrongful, of any present or future de jure or de facto government or Governmental Authority.
Governmental Authority” means the government of the United States of America, any other nation or any political subdivision thereof, whether state or local, and any agency, authority, instrumentality, regulatory body, court, central bank or other entity exercising executive, legislative, judicial, taxing, regulatory or administrative powers or functions of or pertaining to government (including any supra-national bodies such as the European Union or the European Central Bank).
Guarantee” of or by any Person (the “guarantor”) means any obligation, contingent or otherwise, of the guarantor guaranteeing or having the economic effect of guaranteeing any Indebtedness of any other Person (the “primary obligor”) in any manner, whether directly or indirectly, and including any obligation of the guarantor, direct or indirect, (a) to purchase or pay (or advance or supply funds for the purchase or payment of) such Indebtedness or other obligation or to purchase (or to advance or supply funds for the purchase of) any security for the payment thereof, (b) to purchase or lease property, securities or services for the purpose of assuring the owner of such Indebtedness of the payment thereof, (c) to maintain working capital, equity capital or any other financial statement condition or liquidity of the primary obligor so as to enable the primary obligor to pay such Indebtedness or other obligation or (d) as an account party in respect of any letter of credit or letter of guaranty issued to support such Indebtedness; provided, that the term Guarantee shall not include endorsements for collection or deposit in the ordinary course of business, or customary indemnification obligations entered into in connection with any acquisition or disposition of assets or of other entities (other than to the extent that the primary obligations that are the subject of such indemnification obligation would be considered Indebtedness hereunder).
Guarantor” means any Domestic Subsidiary of the Borrower that has delivered a Guaranty or a joinder agreement to a Guaranty pursuant to Section 5.10(a) hereof.
Guaranty” means a guaranty agreement in substantially the form of Exhibit E hereto.
Hazardous Materials” means all explosive or radioactive substances or wastes and all hazardous or toxic substances, wastes or other pollutants, including petroleum or petroleum distillates, asbestos or asbestos containing materials, polychlorinated biphenyls, radon gas, infectious or medical wastes and all other substances or wastes of any nature regulated pursuant to any Environmental Law.
Immaterial Subsidiary” means, at any date of determination, any Subsidiary of the Borrower (a) whose Total Assets as of the most recent available quarterly or year-end financial statements do not exceed 5% of the Total Assets of the Borrower and its Subsidiaries at such date and (b) whose revenues for the most recently ended four-quarter period for which financial statements are available do not exceed 5% of the consolidated revenues of the Borrower and its Subsidiaries for such period, in each case determined in accordance with GAAP; provided that (i) the Total Assets of all such Subsidiaries as of the most recent available quarterly or year-end financial statements shall not exceed 12.5% of the Total Assets of the Borrower and its Subsidiaries at such date and (ii) the total revenues of all such Subsidiaries for the most recently ended four-quarter period for which financial statements are available shall not exceed 12.5% of the consolidated revenues of the Borrower and its Subsidiaries for such period, in each case determined in accordance with GAAP. For any determination made as of or prior to the time any Person becomes an indirect or direct Subsidiary of
14


Borrower, such determination and designation shall be made based on financial statements provided by or on behalf of such Person in connection with the acquisition of such Person or such Person’s assets. The Borrower may change the designation of any Subsidiary as an Immaterial Subsidiary (and, to the extent that existing designated Immaterial Subsidiaries do not meet the limits provided above, the Borrower shall change such designation) by providing notice to the Administrative Agent; provided that any Restricted Subsidiary of Borrower formed or acquired after the Effective Date, as applicable, that meets the requirements of an “Immaterial Subsidiary” set forth herein shall be deemed designated as an “Immaterial Subsidiary” (without any requirement for any further notice to the Administrative Agent) unless the Borrower otherwise notifies the Administrative Agent in writing.
Increased Amount Date” has the meaning set forth in Section 2.18(a).
Incremental Available Amount” means $550,000,000.
Indebtedness” of any Person at any date means, without duplication, (a) all indebtedness of such Person for borrowed money, (b) all obligations of such Person for the deferred purchase price of property or services (other than current trade payables incurred in the ordinary course of such Person’s business and excluding payroll liabilities, deferred compensation obligations, purchase price adjustments, royalties and earn-outs and other contingent or deferred payments of a similar nature), (c) all obligations of such Person evidenced by notes, bonds, debentures or other similar instruments, (d) all Indebtedness created or arising under any conditional sale or other title retention agreement with respect to property acquired by such Person (even though the rights and remedies of the seller or lender under such agreement in the event of default are limited to repossession or sale of such property), (e) all Capital Lease Obligations of such Person, (f) Purchase Money Indebtedness of such Person, (g) all obligations of such Person, contingent or otherwise, as an account party or applicant under or in respect of bankers’ acceptances, letters of credit, surety bonds or similar arrangements, (h) all Guarantees of such Person in respect of obligations of the kind referred to in clauses (a) through (g) above, and (i) all obligations of the kind referred to in clauses (a) through (h) above secured by (or for which the holder of such obligation has an existing right, contingent or otherwise, to be secured by) any Lien on property (including accounts and contract rights) owned or acquired by such Person, whether or not such Person has assumed or become liable for the payment of such obligation; provided that Indebtedness shall not include (x) obligations incurred under, in respect of or in connection with Permitted Asset-Based Financings or (y) obligations with respect to any Third Party Funds; provided, further, that any Indebtedness that is collateralized by a Letter of Credit, bankers acceptances or similar arrangement for which the Borrower or any Restricted Subsidiary is an account party or applicant shall be treated as only one item of Indebtedness in an amount equal to the greater of the maximum aggregate principal amount of such Indebtedness or the amount of such backstop Letter of Credit bankers’ acceptance or similar arrangement.
Indemnified Taxes” means (a) Taxes, other than Excluded Taxes, imposed on or with respect to any payment made by or on account of any obligation of any Loan Party under any Loan Document and (b) to the extent not otherwise described in (a), Other Taxes.
Indemnitee” has the meaning set forth in Section 9.03(b).
Information” has the meaning set forth in Section 9.12(a).
15


Interest Election Request” has the meaning set forth in Section 2.05(b).
Interest Payment Date” means (a) with respect to any ABR Loan, the last day of each March, June, September and December and (b) with respect to any Eurodollar Loan or EURIBOR Loan, the last day of the Interest Period applicable to the Borrowing of which such Loan is a part and, in the case of a Eurodollar Borrowing or EURIBOR Borrowing with an Interest Period of more than three months’ duration, each day prior to the last day of such Interest Period that occurs at intervals of three months’ duration after the first day of such Interest Period.
Interest Period” means, with respect to any Eurodollar Borrowing or EURIBOR Borrowing, the period commencing on the date of such Borrowing and ending on the numerically corresponding day in the calendar month that is one, two, three or six months (or, with the consent of each Lender, twelve months or less than one month) thereafter, as the Borrower may elect; provided that (i) if any Interest Period would end on a day other than a Business Day, such Interest Period shall be extended to the next succeeding Business Day unless such next succeeding Business Day would fall in the next calendar month, in which case such Interest Period shall end on the next preceding Business Day and (ii) any Interest Period pertaining to a Eurodollar Borrowing or EURIBOR Borrowing that commences on the last Business Day of a calendar month (or on a day for which there is no numerically corresponding day in the last calendar month of such Interest Period) shall end on the last Business Day of the last calendar month of such Interest Period. For purposes hereof, the date of a Borrowing initially shall be the date on which such Borrowing is made and thereafter shall be the effective date of the most recent conversion or continuation of such Borrowing.
Interest Rate Determination Date” means, with respect to any Interest Period, the date that is two Business Days prior to the first day of such Interest Period.
Investment” means any loan, advance, extension of credit (by way of Guarantee or otherwise) or capital contributions by the Borrower or any of its Restricted Subsidiaries to any other Person. For the avoidance of doubt, notwithstanding anything to the contrary herein, the value of any Investment shall be deemed to be the original cost of such Investment plus the cost of all additions thereto, without any adjustments for increases or decreases in value, or write-ups, write-downs or write-offs with respect to such Investment; provided, that the value of such Investment shall be net of cash return received after the Effective Date as a result of any sale for cash, repayment, redemption, liquidation, distribution or other cash realization, not to exceed the original cost of such Investment.
IPO” means a bona fide underwritten sale to the public or a direct listing on a public exchange of Qualified Equity Interests of the Public Company pursuant to a registration statement (other than on Form S-8 or any other form relating to securities issuable under any benefit plan of the Borrower or any of its Subsidiaries, as the case may be) that is declared effective by the Securities and Exchange Commission.
IRS” means the United States Internal Revenue Service.
ISP 98” means, with respect to any Letter of Credit, the “International Standby Practices 1998” published by the Institute of International Banking Law & Practice, Inc. (or such later version thereof as may be acceptable to the applicable Issuing Bank and in effect at the time of issuance of such Letter of Credit).
16


Issuing Bank” means each Lender (or affiliate thereof) with a Letter of Credit Issuer Sublimit on Schedule 2.01 hereof, as Issuing Bank hereunder, and any other Lender (or affiliate thereof) that shall agree in writing, at the request of the Borrower and with the consent of the Administrative Agent, to become an “Issuing Bank”, in each case together with its permitted successors and assigns in such capacity.
Joinder Agreement” means a joinder agreement in form and substance reasonably satisfactory to the Administrative Agent.
Joint Venture” means an Investment pursuant to which the Borrower or a Restricted Subsidiary acquires less than the total amount of Equity Interests or other ownership interests in any Person and, after giving effect such Investment, such Person is not a “Subsidiary” of the Borrower or such Restricted Subsidiary.
Judgment Currency” has the meaning set forth in Section 9.19.
Lenders” means the Persons listed on Schedule 2.01 and any other Person that shall have become a party hereto pursuant to an Assignment and Assumption as an assignee, other than any such Person that ceases to be a party hereto pursuant to an Assignment and Assumption.
Letter of Credit” means a standby letter of credit issued or to be issued by an Issuing Bank pursuant to this Agreement in such form and substance as may be approved from time to time by the applicable Issuing Bank. Letters of Credit will only be issued in Dollars or any other Permitted Foreign Currency.
Letter of Credit Disbursement” means a payment made by an Issuing Bank pursuant to a Letter of Credit.
Letter of Credit Fee” has the meaning set forth in Section 2.09.
Letter of Credit Issuer Sublimit” means (i) with respect to each Issuing Bank as of the Effective Date, as set forth on Schedule 2.01, and (ii) with respect to any other Issuing Bank, an amount as shall be agreed to by the Administrative Agent, such Issuing Bank and the Borrower.
Letter of Credit Sublimit” means the lesser of (i) $200,000,000 and (ii) the aggregate unused amount of the Commitments then in effect.
Letter of Credit Usage” means, as at any date of determination, the sum of (i) the Dollar Equivalent of the maximum aggregate amount which is, or at any time thereafter may become, available for drawing under all Letters of Credit then outstanding and (ii) the Dollar Equivalent of the aggregate amount of all drawings under Letters of Credit honored by an Issuing Bank and not theretofore reimbursed by or on behalf of the Borrower. The Letter of Credit Usage of any Lender at any time shall be such Lender’s Applicable Percentage of the aggregate Letter of Credit Usage at such time.
Leverage Ratio” means, as of any date, the ratio of (i) the total Indebtedness of the Borrower and its Restricted Subsidiaries on such date to (ii) Consolidated Tangible Net Worth on such date.
17


LIBO Rate” means, for any Interest Rate Determination Date with respect to an Interest Period (or, solely for purposes of clause (iii) in the defined term “Alternate Base Rate,” for purposes of determining the Alternate Base Rate as of any date) for a Eurodollar Borrowing in any currency, the rate per annum determined by the Administrative Agent on the basis of the rate for deposits in such currency for a period equal to such Interest Period commencing on the first day of such Interest Period as administered by the ICE Benchmark Administration (or any other Person that takes over the administration of such rate for the relevant currency) appearing on Reuters Screen LIBOR01 page (or any successor page) as of approximately 11:00 a.m., London, England time, on such Interest Rate Determination Date; provided that, in the event such rate does not appear on such page or service or if such page or service shall cease to be available, the LIBO Rate shall be determined by the Administrative Agent by reference to such other comparable publicly available service for displaying LIBO rates as may be selected by the Administrative Agent, or, in the absence of such availability, the arithmetic mean of the rates (rounded upward to the nearest 1/100th of 1%) as supplied to Administrative Agent at its request and quoted by the reference banks appointed by the Administrative Agent in consultation with the Borrower to leading banks who consent to such appointment in the London interbank market for deposits in such currency of a duration equal to the duration of such Interest Period, on such Interest Rate Determination Date.
Lien” means, with respect to any asset, (a) any mortgage, deed of trust, lien, pledge, hypothecation, encumbrance, charge or security interest in, on or of such asset, and (b) the interest of a vendor or a lessor under any conditional sale agreement, capital lease or title retention agreement (or any financing lease having substantially the same economic effect as any of the foregoing) relating to such asset.
Limited Conditionality Acquisition” means any acquisition not prohibited by this Agreement whose consummation is not conditioned on the availability of, or on obtaining, third party financing.
Liquidity” means, at any date of determination, the sum of (i) the amount of Unrestricted cash and Cash Equivalents of the Borrower and its Restricted Subsidiaries on such date and (ii) the aggregate unused amount of the Commitments then in effect (but only to the extent that the Borrower could satisfy the conditions to Borrowing at such time).
Loan Documents” means this Agreement (including any amendment hereto or waiver hereunder), the Notes (if any), any Joinder Agreement, any Guaranty, any joinder agreements to any Guaranty delivered pursuant to Section 5.10(a) hereof and any other agreement, instrument or document executed after the date hereof and designated by its terms as a Loan Document.
Loan Parties” means the Borrower and the Guarantors.
Loans” means the revolving loans made by the Lenders to the Borrower pursuant to this Agreement.
Local Time” means (a) with respect to any Loan or Borrowing denominated in Dollars or any Letter of Credit denominated in Dollars, New York City time, and (b) with respect to any Loan or Borrowing denominated in a Permitted Foreign Currency or any Letter of Credit denominated in a Permitted Foreign Currency, London time.
18


Material Adverse Effect” means a material adverse effect on (a) the business, property, financial condition or results of operations of the Borrower and the Restricted Subsidiaries taken as a whole, (b) the ability of the Borrower or any other Loan Party to perform its payment obligations under any Loan Document to which it is a party and (c) the rights of or remedies available to the Agents and the Lenders under the terms of this Agreement or any Guaranty.
Material Domestic Subsidiary” means a wholly-owned Domestic Subsidiary that is neither (a) an Immaterial Subsidiary nor (b) a Special Purpose Financing Subsidiary.
Material Indebtedness” means Indebtedness (other than any Indebtedness under the Loan Documents and other than Indebtedness among the Borrower and its Subsidiaries), or obligations in respect of one or more Swap Agreements, of any one or more of the Borrower and its Restricted Subsidiaries in a principal amount exceeding $100,000,000. For purposes of determining Material Indebtedness, the “principal amount” of the obligations of the Borrower or any Restricted Subsidiary in respect of any Swap Agreement at any time shall be the maximum aggregate amount (giving effect to any netting agreements) that the Borrower or such Restricted Subsidiary would be required to pay if such Swap Agreement were terminated at such time.
Material Intellectual Property” means any intellectual property that, in the good faith judgment of the Borrower, the loss of which would reasonably be expected to result in a Material Adverse Effect.
Maturity Date” means September 27, 2023, as such date may be extended with respect to any Commitment pursuant to Section 2.20.
Maximum Rate” has the meaning set forth in Section 9.13.
Moody’s” means Moody’s Investors Service, Inc., or any successor thereto.
Multiemployer Plan” means any multiemployer plan as defined in Section 4001(a)(3) of ERISA, which is contributed to by (or to which there is or could be an obligation to contribute of) the Borrower or a Restricted Subsidiary or an ERISA Affiliate, and each such plan for the five-year period immediately following the latest date on which the Borrower, or a Restricted Subsidiary or an ERISA Affiliate contributed to or had an obligation to contribute to such plan.
New Commitments” has the meaning set forth in Section 2.18(a).
New Extending Lender” has the meaning set forth in Section 2.20.
New Lender” has the meaning set forth in Section 2.18(a).
New Loan” has the meaning set forth in Section 2.18(b).
Non-Consenting Lender” means any Lender that does not approve any consent, waiver or amendment that (i) requires the approval of all Lenders or all affected Lenders in accordance with the terms of Section 9.02 and (ii) has been approved by the Required Lenders.
Non-Defaulting Lender” means, at any time, each Lender that is not a Defaulting Lender at such time.
19


Non-Public Information” means information that has not been disseminated in a manner making it available to investors generally, within the meaning of Regulation FD.
Non-U.S. Plan” means any plan, fund (including, without limitation, any superannuation fund) or other similar program established, contributed to (regardless of whether through direct contributions or through employee withholding) or maintained outside the United States by the Borrower or one or more Restricted Subsidiaries primarily for the benefit of employees of the Borrower or such Restricted Subsidiaries residing outside the United States, which plan, fund or other similar program provides, or results in, retirement income, a deferral of income in contemplation of retirement or payments to be made upon termination of employment, and which plan is not subject to ERISA or the Code.
Note” has the meaning set forth in Section 2.07(e).
Obligations” means all amounts owing by any Loan Party to the Administrative Agent, any Issuing Bank or any Lender pursuant to the terms of this Agreement or any other Loan Document (including all interest which accrues after the commencement of any case or proceeding in bankruptcy after the insolvency of, or for the reorganization of the Borrower or any of its Subsidiaries, whether or not allowed in such case or proceeding).
Other Connection Taxes” means, with respect to any Recipient, Taxes imposed as a result of a present or former connection between such Recipient and the jurisdiction imposing such Tax (other than connections arising solely from such Recipient having executed, delivered, become a party to, performed its obligations under, received payments under, received or perfected a security interest under, engaged in any other transaction pursuant to or enforced any Loan Document, or sold or assigned an interest in any Loan or Loan Document). For the avoidance of doubt, Taxes described in clause (a) of the definition of Excluded Taxes constitute Other Connection Taxes.
Other Taxes” means any and all present or future stamp, court or documentary taxes or any other excise, property, intangible, recording, filing or similar Taxes which arise from any payment made under, from the execution, delivery, performance, enforcement or registration of, from the receipt or perfection of a security interest under, or otherwise with respect to, this Agreement and the other Loan Documents; excluding, however, such Taxes that are Other Connection Taxes imposed with respect to an assignment (other than such taxes imposed with respect to an assignment that occurs as a result of the Borrower’s request pursuant to Section 2.16(b)).
Participant” has the meaning set forth in Section 9.04(c)(i).
Participant Register” has the meaning set forth in Section 9.04(c)(iii).
Participating Lender” has the meaning set forth in Section 2.19(e).
PBGC” means the Pension Benefit Guaranty Corporation referred to and defined in ERISA and any successor entity performing similar functions.
Pension Plan” means any “employee pension benefit plan” within the meaning of Section 3(2) of ERISA, other than a Multiemployer Plan, that is subject to Title IV of ERISA, Section 412 of the Code or Section 302 of ERISA and is maintained in whole or in part by the Borrower, any
20


Restricted Subsidiary or any ERISA Affiliate or with respect to which any of the Borrower, any Restricted Subsidiary or any ERISA Affiliate has actual or contingent liability.
Permitted Acquisition” means any transaction or series of related transactions resulting in the acquisition by the Borrower or any of its Restricted Subsidiaries, whether by purchase, merger or otherwise, of all or substantially all of the assets or Equity Interests of, or a business line or unit or a division of, any Person; provided that
(a)    immediately prior to, and after giving effect thereto, no Default or Event of Default shall have occurred and be continuing or would result therefrom;
(b)    the Borrower shall take, or shall cause to be taken, each of the actions set forth in Section 5.10(a), if applicable, within the time period stated in Section 5.10(a); and
(c)    any Person or assets or division as acquired in accordance herewith shall be engaged in or related to a business permitted under Section 6.03(b).
Permitted Asset-Based Financing” means (a) any arrangements, including but not limited to credit agreements, Warehouse Facilities and repurchase agreements, in existence on the Effective Date and entered into by the Borrower or any Subsidiary for the purpose of financing the origination of loan products or monetizing any Financing Assets (the “Effective Date Financing Arrangements”); (b) any other arrangement existing on or entered into after the Effective Date that is similar to the Effective Date Financing Arrangements (as determined in good faith by the Borrower); (c) any asset-backed securitization transaction in which the Borrower or a Subsidiary sells or transfers Financing Assets to a Special Purpose Financing Subsidiary, which issues debt and/or equity interests (rated or unrated) secured by the cash flows from such Financing Assets; (d) any credit facility, repurchase arrangement, warehouse or other similar financing arrangement (as determined in good faith by the Borrower) initiated by the Borrower or any Subsidiary pursuant to which the Borrower or such Subsidiary, either directly or through one or more Subsidiaries, sells or pledges Financing Assets in return for advances, loans or other borrowings against such Financing Assets, (e) any hedge, swap, synthetic risk transfer or other derivative transaction designed to finance or refinance Financing Assets or (f) any transfer or sale (either directly or indirectly, including through a special purpose entity established by the Borrower or an Affiliate of the Borrower) of one or more Financing Assets, or a participation interest in Financing Assets, in the ordinary course of business.
Permitted Encumbrances” means:
(a)    Liens imposed by law for taxes, assessments or governmental charges or levies that are not yet delinquent or are being contested in compliance with Section 5.04;
(b)    carriers’, warehousemen’s, mechanics’, materialmen’s, landlord’s, supplier’s, repairmen’s and other like Liens imposed by law, arising in the ordinary course of business and securing obligations that are not overdue by more than 60 days or are being contested in good faith;
(c)    pledges and deposits made (i) in the ordinary course of business in compliance with workers’ compensation, unemployment insurance and other social security laws or regulations or employment laws or to secure other public, statutory or regulatory obligations and (ii) in respect of letters of credit, bank guarantees or similar instruments issued for the account of any Loan Party or
21


any Restricted Subsidiary in the ordinary course of business supporting obligations of the type set forth in clause (c)(i) above;
(d)    pledges and deposits to (i) secure the performance of bids, trade and commercial contracts, leases, statutory obligations, surety and appeal bonds, performance bonds and other obligations of a like nature, in each case incurred in the ordinary course of business and (ii) in respect of letters of credit, bank guarantees or similar instruments issued for the account of the Borrower or any Subsidiary in the ordinary course of business supporting obligations of the type set forth in clause (d)(i) above;
(e)    judgment liens in respect of judgments that do not constitute an Event of Default under Section 7.01(k) and Liens securing appeal or surety bonds related to such judgments;
(f)    easements, zoning restrictions, rights-of-way, building ordinances, encroachments, title defects and other irregularities, governmental restrictions on the use of property or conduct of business and Liens in favor of Governmental Authorities and similar encumbrances on real property imposed by law or arising in the ordinary course of business that do not secure any monetary obligations and do not materially detract from the value of the affected property or interfere with the ordinary conduct of business of the Borrower or any Restricted Subsidiary;
(g)    Uniform Commercial Code financing statements filed (or similar filings under applicable law) solely as a precautionary measure in connection with operating leases or other obligations not constituting Indebtedness;
(h)    Liens arising in respect of Third Party Funds; and
(i)    Liens on cash or Investments permitted hereunder securing Swap Agreements in the ordinary course of business submitted for clearing in accordance with applicable requirements of any Governmental Authority or self-regulatory organization.
Permitted Financing Documents” means all documents and agreements evidencing, relating to or otherwise governing a Permitted Asset-Based Financing, as the same may be amended, extended, renewed, restated, supplemented, or otherwise modified from time to time.
Permitted Foreign Currency” means, with respect to any Loans or Letter of Credit, Euros and any foreign currency reasonably requested by the Borrower from time to time and in which each Lender (in the case of Loans to be denominated in such other currency) and each applicable Issuing Bank (in the case of any Letters of Credit to be denominated in such other currency) has reasonably agreed, in accordance with its policies and procedures in effect at such time, to lend Loans or issue Letters of Credit as applicable.
Permitted Holders” means (a) holders of Equity Interests in the Borrower as of the Effective Date, (b) each of the respective Affiliated Persons of the Person referred to in clause (a), and (c) any group (within the meaning of the Securities Exchange Act and the rules of the Securities and Exchange Commission thereunder) Controlled by any Person or Persons referred to in clauses (a) or (b).
Permitted Investments” means:
22


(a)    direct obligations of the United States of America or any member of the European Union or any agency thereof or obligations guaranteed by the United States of America or any member of the European Union or any agency thereof, in each case with maturities not exceeding two years from the date of acquisition thereof; (b)    time deposit accounts, certificates of deposit, money market deposits, banker’s acceptances and other bank deposits maturing within 180 days of the date of acquisition thereof issued by a bank or trust company that is organized under the laws of the United States of America, any state thereof or any foreign country recognized by the United States of America having capital, surplus and undivided profits in excess of $250,000,000 and whose long-term debt, or whose parent holding company’s long-term debt, is rated A (or such similar equivalent rating or higher by at least one nationally recognized statistical rating organization (as defined in Rule 436 under the Securities Act));
(c)    repurchase obligations with a term of not more than 180 days for underlying securities of the types described in clause (a) above entered into with a bank meeting the qualifications described in clause (b) above;
(d)    commercial paper, maturing not more than one year after the date of acquisition, issued by a corporation (other than an Affiliate of the Borrower) organized and in existence under the laws of the United States of America or any foreign country recognized by the United States of America with a rating at the time as of which any investment therein is made of P 1 (or higher) according to Moody’s, or A 1 (or higher) according to S&P (or such similar equivalent rating or higher by at least one nationally recognized statistical rating organization (as defined in Rule 436 under the Securities Act));
(e)    securities with maturities of two years or less from the date of acquisition, issued or fully guaranteed by any State, commonwealth or territory of the United States of America, or by any political subdivision or taxing authority thereof, and rated at least A by S&P or A by Moody’s (or such similar equivalent rating or higher by at least one nationally recognized statistical rating organization (as defined in Rule 436 under the Securities Act));
(f)    shares of mutual funds whose investment guidelines restrict 95% of such funds’ investments to those satisfying the provisions of clauses (a) through (e);
(g)    money market funds that (i) comply with the criteria set forth in Rule 2a 7 under the Investment Company Act of 1940, (ii) are rated AAA by S&P and Aaa by Moody’s and (iii) have portfolio assets of at least $1,000,000,000;
(h)    time deposit accounts, certificates of deposit, money market deposits, banker’s acceptances and other bank deposits in an aggregate face amount not in excess of 0.5% of the total assets of the Borrower and the Subsidiaries, on a consolidated basis, as of the end of the Borrower’s most recently completed fiscal year; and
(i)    instruments equivalent to those referred to in clauses (a) through (h) above denominated in any foreign currency comparable in credit quality and tenor to those referred to above and commonly used by corporations for cash management purposes in any jurisdiction outside the United States of America to the extent reasonably required in connection with any business conducted by the Borrower or Restricted Subsidiary or any organized in such jurisdiction.
23


Person” means any natural person, corporation, limited liability company, trust, joint venture, association, company, partnership, Governmental Authority or other entity.
Plan” means any “employee benefit plan” as defined in Section 3 of ERISA (other than a Multiemployer Plan) subject to the provisions of Title IV of ERISA or Section 412 of the Code or Section 302 of ERISA maintained or contributed to by the Borrower, a Restricted Subsidiary or any ERISA Affiliate or to which the Borrower, a Restricted Subsidiary or an ERISA Affiliate has or could have an obligation to contribute, and each such plan subject to the provisions of Title IV of ERISA or Section 412 of the Code or Section 302 of ERISA for the five-year period immediately following the latest date on which the Borrower, a Restricted Subsidiary or an ERISA Affiliate maintained, contributed to or had an obligation to contribute to (or is deemed under Section 4069 of ERISA to have maintained or contributed to or to have had an obligation to contribute to, or otherwise to have liability with respect to) such plan.
Platform” has the meaning set forth in Section 9.01(d).
Prime Rate” means the rate of interest published by the Wall Street Journal, from time to time, as the prime rate. The Prime Rate is a reference rate and does not necessarily represent the lowest or best rate actually charged to any customer. The Administrative Agent or any Lender may make commercial loans or other loans at rates of interest at, above or below the Prime Rate.
Principal Office” for each of the Administrative Agent and any Issuing Bank, means the office of the Administrative Agent and such Issuing Bank as set forth in Section 9.01(a), or such other office or office of a third party or sub-agent, as appropriate, as such Person may from time to time designate to Borrower and each Lender upon two Business Days’ written notice.
Projections” has the meaning set forth in Section 3.12.
PTE” means a prohibited transaction class exemption issued by the U.S. Department of Labor, as any such exemption may be amended from time to time.
Public Company” means, after the IPO, the Person that shall have issued Equity Interests pursuant to such IPO (such person being either the Borrower or any direct parent company of the Borrower).
Public Lenders” means Lenders that do not wish to receive material non-public information with respect to the Borrower, the Subsidiaries or its or their securities.
Purchase Money Indebtedness” means Indebtedness incurred to finance the acquisition, construction or improvement of any fixed or capital asset to the extent incurred prior to or within 180 days following such acquisition, construction or improvement.
Qualified Equity Interests” means Equity Interests other than Disqualified Equity Interests.
Qualifying IPO” means an IPO in which the Borrower raises gross primary proceeds, or lists shares with an aggregate value at the time of such listing, of at least $200,000,000.
Recipient” means (a) the Administrative Agent, (b) any Lender and (c) any Issuing Bank, as applicable.
24


Refinancing Indebtedness” means refinancings, extensions, renewals, or replacements of Indebtedness so long as (i) such refinancings, renewals, or extensions do not result in an increase in the principal amount of the Indebtedness so refinanced, renewed, or extended, other than by the amount equal to premium or other amount paid, and fees and expenses incurred, in connection with such refinancing, extensions, renewals or replacements and by the amount of unfunded commitments with respect thereto, (ii) the final maturity date of the Refinancing Indebtedness is not earlier than the original Indebtedness being refinanced, (iii) the Refinancing Indebtedness is incurred by Persons who are the obligors of the original Indebtedness being refinanced and (iv) the terms of any such Refinancing Indebtedness that are not substantially identical to the original Indebtedness being refinanced are not materially more favorable (taken as a whole) to the investors providing such Refinancing Indebtedness than those applicable to the original Indebtedness being refinanced (except for covenants or other provisions applicable only to periods after the latest Maturity Date existing at the time of incurrence of such Refinancing Indebtedness), as determined by the Borrower in good faith.
Register” has the meaning set forth in Section 9.04(b)(iv).
Reimbursement Date” has the meaning set forth in Section 2.19(d).
Related Parties” means, with respect to any specified Person, such Person’s Affiliates and the respective directors, officers, employees, agents and advisors of such Person and such Person’s Affiliates.
Removal Effective Date” has the meaning set forth in Section 8.07(b).
Representatives” has the meaning set forth in Section 9.12(a).
Required Lenders” means, at any time, Lenders having more than 50% of the aggregate amount of the Commitments or, if the Commitments shall have been terminated, holding more than 50% of the aggregate outstanding principal amount of the Loans at such time. The Commitment and Loans of any Defaulting Lender shall be disregarded in determining Required Lenders at any time.
Reset Date” has the meaning set forth in Section 1.05(a).
Responsible Officer” means any of the President, Chief Executive Officer, Senior Vice President and the most senior financial officer from time to time of the applicable Loan Party, or any person designated by any such Loan Party in writing to the Administrative Agent from time to time, acting singly.
Restricted Payment” means any dividend or other distribution (whether in cash, securities or other property) with respect to any Equity Interests in the Borrower or any Restricted Subsidiary, or any payment (whether in cash, securities or other property), including any sinking fund or similar deposit, on account of the purchase, redemption, retirement, acquisition, cancellation or termination of any such Equity Interests in the Borrower. For the avoidance of doubt, the conversion of, or payment for (including, without limitation, payments of principal and payments upon redemption or repurchase), or paying any interest with respect to, any Convertible Notes shall not constitute a Restricted Payment.
25


Restricted Subsidiary” means any Subsidiary of the Borrower that is not an Unrestricted Subsidiary.
S&P” means Standard & Poor’s Ratings Services or any successor thereto.
Sanctioned Entity” means, at any time, (a) a country, region or territory which is the subject or target of comprehensive Sanctions (including, without limitation, as of the date of this Agreement, Cuba, Iran, North Korea, Sudan, Syria and the Crimea Region of the Ukraine), (b) an agency of the government of a country, (c) an organization directly or indirectly controlled by a country or its government or (d) a person or entity organized in, resident in or determined to be resident in a country or territory, that is subject to or target of comprehensive Sanctions.
Sanctioned Person” means, at any time, (a) any Person listed in any Sanctions-related list of designated Persons maintained by the Office of Foreign Assets Control of the U.S. Department of the Treasury, by the U.S. Department of State or by the United Nations Security Council, the European Union or any European Union member state, (b) any Person operating an establishment, organized or resident in a country, region or territory which is the subject or target of comprehensive Sanctions, or (c) any Person owned 50% or more or controlled by any such Person or Persons described in the foregoing clauses (a) and (b).
Sanctions” means economic or financial sanctions or trade embargoes imposed, administered or enforced from time to time by (a) the U.S. government, including those administered by the Office of Foreign Assets Control of the U.S. Department of the Treasury or the U.S. Department of State, or (b) the United Nations Security Council, the European Union, Her Majesty’s Treasury of the United Kingdom.
Solvent” means, with respect to the Borrower and its Restricted Subsidiaries on a particular date, that on such date (a) the fair value of the present assets of the Borrower and its Restricted Subsidiaries, taken as a whole, is greater than the total amount of liabilities, including, without limitation, contingent liabilities, of the Borrower and its Restricted Subsidiaries, taken as a whole, (b) the present fair saleable value of the assets of the Borrower and its Restricted Subsidiaries, taken as a whole, is not less than the amount that will be required to pay the probable liability of the Borrower and its Restricted Subsidiaries, taken as a whole, on their debts as they become absolute and matured, (c) the Borrower and its Restricted Subsidiaries, taken as a whole, do not intend to, and do not believe that they will, incur debts or liabilities (including current obligations and contingent liabilities) beyond their ability to pay such debts and liabilities as they mature in the ordinary course of business and (d) the Borrower and its Restricted Subsidiaries, taken as a whole, are not engaged in business or a transaction, and are not about to engage in business or a transaction, in relation to which their property would constitute an unreasonably small capital. The amount of contingent liabilities at any time shall be computed as the amount that, in the light of all the facts and circumstances existing at such time, represents the amount that can reasonably be expected to become an actual or matured liability (irrespective of whether such contingent liabilities meet the criteria for accrual under Statement of Financial Accounting Standard No. 5 (ASC 450)).
Special Purpose Financing Subsidiary” means (i) a direct or indirect Subsidiary of the Borrower established in connection with a Permitted Asset-Based Financing (including the issuers of the Effective Date Financing Arrangements) for the acquisition, sale or financing of Financing Assets or interests therein, and which is organized in a manner (as determined by the Borrower in good faith)
26


intended to reduce the likelihood that it would be substantively consolidated with the Borrower or any of the Subsidiaries (other than Special Purpose Financing Subsidiaries) in the event the Borrower or any such Subsidiary becomes subject to a proceeding under the U.S. Bankruptcy Code (or other insolvency law) and (ii) any subsidiary of a Special Purpose Financing Subsidiary.
Specified Event of Default” means an Event of Default of the type described in Section 7.01(a) or 7.01(b) or, with respect to the Borrower, a Bankruptcy Event.
Subsidiary” means any subsidiary of the Borrower.
subsidiary” means, with respect to any Person (the “parent”) at any date, any corporation, limited liability company, partnership, association or other entity the accounts of which would be consolidated with those of the parent in the parent’s consolidated financial statements if such financial statements were prepared in accordance with GAAP as of such date, as well as any other corporation, limited liability company, partnership, association or other entity (a) of which securities or other ownership interests representing more than 50% of the equity or more than 50% of the ordinary voting power or, in the case of a partnership, more than 50% of the general partnership interests are, as of such date, owned, controlled or held, or (b) that is, as of such date, otherwise Controlled, by the parent or one or more subsidiaries of the parent or by the parent and one or more subsidiaries of the parent and which is required by GAAP to be consolidated in the consolidated financial statements of the parent.
Swap Agreement” means any agreement with respect to any swap, forward, future or derivative transaction or option or similar agreement involving, or settled by reference to, one or more rates, currencies, commodities, equity or debt instruments or securities, or economic, financial or pricing indices or measures of economic, financial or pricing risk or value or any similar transaction or any combination of these transactions.
Taxes” means any and all present or future taxes, levies, imposts, duties, deductions, withholdings (including backup withholding), assessments, fees or other charges imposed by any Governmental Authority, including any interest, additions to tax or penalties applicable thereto.
Third Party Funds” means any accounts or funds, or any portion thereof, received by the Borrower or any of the Restricted Subsidiaries as agent on behalf of third parties in accordance with a written agreement that imposes a duty upon the Borrower or one or more of the Restricted Subsidiaries to collect and remit those funds to such third parties.
Total Assets” means the total assets of the Borrower and its Restricted Subsidiaries on a consolidated basis, as shown on the most recent balance sheet of the Borrower delivered pursuant to Section 5.01(a) or 5.01(b).
Total Exposure” means, for any Lender at any time, the sum of (i) the Dollar Equivalent of the aggregate principal amount of all outstanding Loans of such Lender plus (ii) such Lender’s Applicable Percentage of the Letter of Credit Usage.
Trade Date” has the meaning set forth in Section 9.04(b)(ii)(G).
27


Transactions” means the execution, delivery and performance by the Loan Parties of each Loan Document to which it is a party and the borrowing of Loans by the Borrower on the Effective Date.
Type” means, when used in reference to any Loan or Borrowing, whether the rate of interest on such Loan, or on the Loans comprising such Borrowing, is determined by reference to the Alternate Base Rate or the Adjusted LIBO Rate.
Unfunded Pension Liability” means the excess of a Pension Plan’s benefit liabilities under Section 4001(a)(16) of ERISA, over the current value of that Pension Plan’s assets, determined in accordance with the assumptions used for funding the Pension Plan pursuant to Section 412 of the Code for the applicable plan year.
Unreimbursed Amount” has the meaning set forth in Section 2.19(d).
Unrestricted” means, when referring to cash or Cash Equivalents, that such cash or Cash Equivalents (a) do not appear (or would be required to appear) as “restricted” on the consolidated balance sheet of the Borrower, (b) are not subject to any Lien, other than non-consensual Liens arising by operation of law or Liens permitted under Section 6.02(k) hereof and (c) are otherwise generally available for use by the Borrower or any Restricted Subsidiary.
Unrestricted Subsidiaries” means any Subsidiary of the Borrower that, at the time of determination, has previously been designated, and continues to be, an Unrestricted Subsidiary in accordance with Section 5.11.
Unused Commitment Fee” has the meaning set forth in Section 2.09(a).
USA Patriot Act” means the Uniting and Strengthening America by Providing Appropriate Tools Required to Intercept and Obstruct Terrorism Act of 2001 (Title III of Pub. L. No. 107-56 (signed into law October 26, 2001)), as amended from time to time.
U.S.” and “United States” means the United States of America.
U.S. Person” means any Person that is a “United States Person” as defined in Section 7701(a)(30) of the Code.
U.S. Tax Compliance Certificate” has the meaning set forth in Section 2.14(g)(ii)(B).
Warehouse Facility” means any debt facility entered into by the Borrower or any Subsidiary for the purpose of financing the origination of loan products.
Withdrawal Liability” means liability to a Multiemployer Plan as a result of a complete or partial withdrawal from such Multiemployer Plan, as such terms are defined in Title IV of ERISA.
Withholding Agent” means any Loan Party, the Administrative Agent and any other applicable withholding agent.
Write-Down and Conversion Powers” means, with respect to any EEA Resolution Authority, the write-down and conversion powers of such EEA Resolution Authority from time to
28


time under the Bail-In Legislation for the applicable EEA Member Country, which write-down and conversion powers are described in the EU Bail-In Legislation Schedule.
Section 1.02    Classification of Loans and Borrowings. For purposes of this Agreement, Loans may be classified and referred to by Type (e.g., a “Eurodollar Loan”). Borrowings also may be classified and referred to by Type (e.g., a “Eurodollar Borrowing”).
Section 1.03    Terms Generally. The definitions of terms herein shall apply equally to the singular and plural forms of the terms defined. Whenever the context may require, any pronoun shall include the corresponding masculine, feminine and neuter forms. The words “include,” “includes” and “including” shall be deemed to be followed by the phrase “without limitation.” The word “will” shall be construed to have the same meaning and effect as the word “shall.” Unless the context requires otherwise (a) any definition of or reference to any agreement, instrument or other document herein shall be construed as referring to such agreement, instrument or other document as from time to time amended, restated, amended and restated, supplemented or otherwise modified (subject to any restrictions on such amendments, amendments and restatements, supplements or modifications set forth herein), (b) any reference herein to any Person shall be construed to include such Person’s successors and assigns, (c) the words “herein,” “hereof” and “hereunder,” and words of similar import, shall be construed to refer to this Agreement in its entirety and not to any particular provision hereof, (d) except as otherwise specified with respect to the schedules to the Disclosure Letter, all references herein to Articles, Sections, Exhibits and Schedules shall be construed to refer to Articles and Sections of, and Exhibits and Schedules to, this Agreement, (e) the words “asset” and “property” shall be construed to have the same meaning and effect and to refer to any and all tangible and intangible assets and properties, including cash, securities, accounts and contract rights and (f) any reference to any law shall include all statutory and regulatory provisions consolidating, amending, replacing or interpreting such law and any reference to any law or regulation shall, unless otherwise specified, refer to such law or regulation as amended, modified or supplemented from time to time.
Section 1.04    Accounting Terms; GAAP. Except as otherwise expressly provided herein, all terms of an accounting or financial nature shall be construed in accordance with GAAP, as in effect from time to time; provided that, if the Borrower notifies the Administrative Agent that the Borrower requests an amendment to any provision hereof to eliminate the effect of any change occurring after the date hereof in GAAP or in the application thereof on the operation of such provision (or if the Administrative Agent notifies the Borrower that the Required Lenders request an amendment to any provision hereof for such purpose), regardless of whether any such notice is given before or after such change in GAAP or in the application thereof, then such provision shall be interpreted on the basis of GAAP as in effect and applied immediately before such change shall have become effective until such notice shall have been withdrawn or such provision shall have been amended to account for any such change following good faith negotiations between the Borrower and the Administrative Agent. Notwithstanding the foregoing, all financial covenants contained herein shall be calculated (1) without giving effect to any election under the Statement of Financial Accounting Standards No. 159 (ASC 825) (or any similar accounting principle) permitting or requiring a Person to value its financial liabilities or Indebtedness at the fair value thereof and (2) without giving effect to any treatment of Indebtedness in respect of convertible debt instruments under Accounting Standards Codification 470-20 (or any other Accounting Standards Codification or Financial Accounting Standard having a similar result or effect) to value any such Indebtedness in a reduced or bifurcated manner as described therein, and such Indebtedness shall at all times be valued at the full stated principal amount thereof.
29


Section 1.05    Exchange Rates; Currency Equivalents.
(a)    Not later than 1:00 p.m., New York City time, on each Calculation Date, the Administrative Agent shall (i) determine the Exchange Rate as of such Calculation Date with respect to the applicable Permitted Foreign Currency and (ii) give notice thereof to the applicable Issuing Bank and the Borrower. The Exchange Rates so determined shall become effective in the case of each subsequent Calculation Date, on the first Business Day immediately following such Calculation Date (a “Reset Date”), shall remain effective until the next succeeding Reset Date and shall for all purposes of this Agreement (other than any provision expressly requiring the use of a current exchange rate) be the Exchange Rates employed in converting any amounts between Dollars and any Permitted Foreign Currency.
(b)    Solely for purposes of Article II and related definitional provisions to the extent used therein, the applicable amount of any currency (other than Dollars) for purposes of the Loan Documents shall be such Dollar Equivalent amount as determined by the Administrative Agent and notified to the applicable Issuing Bank and the Borrower in accordance with Section 1.05(a). Amounts denominated in a Permitted Foreign Currency will be converted to Dollars for the purposes of calculating the Leverage Ratio at the Exchange Rate as of the date of calculation.
Section 1.06    Electronic Execution of Documents. The words “execution,” “signed,” “signature,” and words of like import in any Loan Document or any agreement entered into in connection therewith, including any Assignment and Assumption, or any notice, certificate or other instrument delivered in connection therewith shall be deemed to include electronic signatures or the keeping of records in electronic form, each of which shall be of the same legal effect, validity or enforceability as a manually executed signature or the use of a paper-based recordkeeping system, as the case may be, to the extent and as provided for in any applicable law, including the Federal Electronic Signatures in Global and National Commerce Act, the New York State Electronic Signatures and Records Act, or any other similar state laws based on the Uniform Electronic Transactions Act.
ARTICLE II
THE CREDITS
Section 2.01    Commitments. Subject to the terms and conditions set forth herein, each Lender severally agrees to make Loans in Dollars or in any Permitted Foreign Currency to the Borrower from time to time during the Availability Period in an aggregate principal amount that will not result in (a) the aggregate outstanding Dollar Equivalent amount of such Lender’s Loans exceeding such Lender’s Commitment, (b) the sum of the Aggregate Total Exposure exceeding the total Commitments or (c) any Lender’s Total Exposure exceeding such Lender’s Commitment; provided that the Borrower shall not request, and the Lenders shall not be required to fund, a Loan that is denominated in a Permitted Foreign Currency if, after the making of such Loan, the Dollar Equivalent of the aggregate principal amount of all Loans and Letters of Credit then outstanding that are denominated in a Permitted Foreign Currency (including such requested Loan) would exceed $200,000,000. Within the foregoing limits and subject to the terms and conditions set forth herein, the Borrower may borrow, prepay and reborrow Loans.
Section 2.02    Loans and Borrowings.
30


(a)    Each Loan shall be made as part of a Borrowing consisting of Loans made by the Lenders in accordance with their respective Applicable Percentages. The failure of any Lender to make any Loan required to be made by it shall not relieve any other Lender of its obligations hereunder; provided that the Commitments of the Lenders are several and no Lender shall be responsible for any other Lender’s failure to make Loans as required.
(b)    Subject to Section 2.11, (i) each Borrowing denominated in Dollars shall be comprised entirely of ABR Loans or Eurodollar Loans as the Borrower may request in accordance herewith, (ii) each Borrowing denominated in Euros shall be comprised entirely of EURIBOR Loans, and (iii) each Borrowing denominated in any Permitted Foreign Currency (other than Euros) shall be comprised entirely of Eurodollar Loans. Each Lender at its option may make any Loan by causing any domestic or foreign branch or Affiliate of such Lender to make such Loan; provided that any exercise of such option shall not affect the obligation of the Borrower to repay such Loan in accordance with the terms of this Agreement.
(c)    At the commencement of each Interest Period for any Eurodollar Borrowing or EURIBOR Borrowing, such Borrowing shall be in an aggregate amount that is an integral multiple of the Borrowing Multiple and not less than the Borrowing Minimum. At the time that each ABR Borrowing is made, such Borrowing shall be in an aggregate amount that is an integral multiple of the Borrowing Multiple and not less than the Borrowing Minimum; provided that an ABR Borrowing may be in an aggregate amount that is equal to the entire unused balance of the total Commitments. Borrowings of more than one Type may be outstanding at the same time; provided that there shall not at any time be more than a total of ten Eurodollar Borrowings or EURIBOR Borrowings outstanding; provided, further, that there shall be no limit to the number of ABR Borrowings outstanding at any time.
(d)    Notwithstanding any other provision of this Agreement, the Borrower shall not be entitled to request, or to elect to convert or continue, any Borrowing if the Interest Period requested with respect thereto would end after the Maturity Date.
Section 2.03    Requests for Borrowings. To request a Borrowing, the Borrower shall notify the Administrative Agent of such request by hand delivery, telecopy or other electronic transmission to the Administrative Agent of a written borrowing request in substantially the form of Exhibit B attached hereto (a “Borrowing Request”) (a) in the case of a Eurodollar Borrowing denominated in Dollars or a EURIBOR Borrowing, not later than 1:00 p.m. Local Time three Business Days before the date of the proposed Borrowing, (b) in the case of a Eurodollar Borrowing denominated in any Permitted Foreign Currency (other than Euros), not later than 1:00 p.m., Local Time, four Business Days before the date of the proposed Borrowing or (c) in the case of an ABR Borrowing, not later than 12:00 p.m. (New York City time) on the date of the proposed Borrowing. Each such Borrowing Request shall be signed by the Borrower and shall specify the following information in compliance with Section 2.02:
(i)    the aggregate amount and currency of the requested Borrowing;
(ii)    the date of such Borrowing, which shall be a Business Day;
(ii)    whether such Borrowing is to be an ABR Borrowing, a Eurodollar Borrowing or a EURIBOR Borrowing;
31


(iv)    in the case of a Eurodollar Borrowing or a EURIBOR Borrowing, the initial Interest Period to be applicable thereto, which shall be a period contemplated by the definition of the term “Interest Period”; and
(v)    the location and number of the account or accounts to which funds are to be disbursed, which shall comply with the requirements of Section 2.04.
If no election as to the Type of Borrowing is specified other than Borrowings denominated in a Permitted Foreign Currency, then the requested Borrowing shall be an ABR Borrowing. If no Interest Period is specified with respect to any requested Eurodollar Borrowing or EURIBOR Borrowing, then the Borrower shall be deemed to have selected an Interest Period of one month’s duration. If no currency is specified with respect to any requested Loan, the Borrower shall be deemed to have selected Dollars. Promptly following receipt of a Borrowing Request in accordance with this Section, the Administrative Agent shall advise each Lender of the details thereof and of the amount of such Lender’s Loan to be made as part of the requested Borrowing. Except as otherwise provided herein, a Borrowing Request for a Eurodollar Borrowing or a EURIBOR Borrowing shall be irrevocable on and after the related Interest Rate Determination Date, and the Borrower shall be bound to make a borrowing in accordance therewith. As soon as practicable after 10:00 a.m., New York City time, on each Interest Rate Determination Date, the Administrative Agent shall determine (which determination shall, absent manifest error, be final, conclusive and binding upon all parties) the interest rate that shall apply to the Eurodollar Borrowing or EURIBOR Borrowing for which an interest rate is then being determined for the applicable Interest Period and shall promptly give notice thereof (in writing or by telephone confirmed in writing) to Borrower and each Lender.
Section 2.04    Funding of Borrowings.
(a)    Each Lender shall make each Loan to be made by it hereunder on the proposed date thereof by wire transfer of immediately available funds by 2:00 p.m. Local Time to the account of the Administrative Agent most recently designated by it for such purpose by notice to the Lenders. The Administrative Agent will make such Loans available to the Borrower by promptly crediting the amounts so received, in like funds, to an account or accounts designated by the Borrower in the applicable Borrowing Request.
(b)    Unless the Administrative Agent shall have received notice from a Lender prior to the proposed date of any Borrowing that such Lender will not make available to the Administrative Agent such Lender’s Applicable Percentage of such Borrowing, the Administrative Agent may assume that such Lender has made such Applicable Percentage available on such date in accordance with paragraph (a) of this Section and may, in reliance upon such assumption, make available to the Borrower a corresponding amount. In such event, if a Lender has not in fact made its Applicable Percentage of the applicable Borrowing available to the Administrative Agent, then the applicable Lender and the Borrower severally agree to pay to the Administrative Agent forthwith on demand such corresponding amount with interest thereon, for each day from and including the date such amount is made available to the Borrower to but excluding the date of payment to the Administrative Agent, at (i) in the case of such Lender, (x) in the case of Loans denominated in Dollars, the greater of the Federal Funds Effective Rate and a rate determined by the Administrative Agent in accordance with banking industry rules on interbank compensation and (y) in the case of Loans denominated in a Permitted Foreign Currency, the rate determined by the Administrative Agent to be the cost to it of funding such amount (which determination will be conclusive absent
32


manifest error) or (ii) in the case of the Borrower, the interest rate applicable to (A) in the case of Loans denominated in Dollars, ABR Loans and (B) in the case of Loans denominated in a Permitted Foreign Currency, the interest rate applicable to the subject Loan pursuant to Section 2.10. If such Lender pays such amount to the Administrative Agent, then such amount shall constitute such Lender’s Loan included in such Borrowing.
Section 2.05    Interest Elections.
(a)    Each Borrowing of Loans initially shall be of the Type specified in the applicable Borrowing Request and, in the case of a Eurodollar Borrowing or EURIBOR Borrowing, shall have an initial Interest Period as specified in such Borrowing Request. Thereafter, the Borrower may elect to convert such Borrowing to a different Type (provided that Eurodollar Borrowings denominated in a Permitted Foreign Currency may not be converted to ABR Borrowings) or to continue such Borrowing and, in the case of a Eurodollar Borrowing or EURIBOR Borrowing, may elect Interest Periods therefor, all as provided in this Section. Subject to the limitation set forth in Section 2.02(c), the Borrower may elect different options with respect to different portions of the affected Borrowing, in which case each such portion shall be allocated among the Lenders holding the Loans comprising such Borrowing in accordance with their respective Applicable Percentages, and the Loans comprising each such portion shall be considered a separate Borrowing.
(b)    To make an election pursuant to this Section, the Borrower shall notify the Administrative Agent of such election by hand delivery, telecopy or other electronic transmission to the Administrative Agent of a written request (an “Interest Election Request”) in substantially the form of Exhibit C attached hereto by the time that a Borrowing Request would be required under Section 2.03 if the Borrower were requesting a Borrowing of the Type resulting from such election to be made on the effective date of such election. Each such Interest Election Request shall be signed by the Borrower.
(c)    Each Interest Election Request shall specify the following information in compliance with Section 2.02:
(i)    the Borrowing to which such Interest Election Request applies and, if different options are being elected with respect to different portions thereof, the portions thereof to be allocated to each resulting Borrowing (in which case the information to be specified pursuant to clauses (iii) and (iv) below shall be specified for each resulting Borrowing);
(ii)    the effective date of the election made pursuant to such Interest Election Request, which shall be a Business Day;
(iii)    whether the resulting Borrowing is to be an ABR Borrowing, a Eurodollar Borrowing or a EURIBOR Borrowing; and
(iv)    if the resulting Borrowing is a Eurodollar Borrowing or a EURIBOR Borrowing, the Interest Period to be applicable thereto after giving effect to such election, which shall be a period contemplated by the definition of the term “Interest Period.”
33


If any such Interest Election Request requests a Eurodollar Borrowing or a EURIBOR Borrowing but does not specify an Interest Period, then the Borrower shall be deemed to have selected an Interest Period of one month’s duration.
(d)    Promptly following receipt of an Interest Election Request, the Administrative Agent shall advise each Lender of the details thereof and of such Lender’s portion of each resulting Borrowing. Except as otherwise provided herein, an Interest Election Request for conversion to, or continuation of, any Eurodollar Borrowing or EURIBOR Borrowing shall be irrevocable on and after the related Interest Rate Determination Date, and the Borrower shall be bound to effect a conversion or continuation in accordance therewith.
(e)    If the Borrower fails to deliver a timely Interest Election Request with respect to a Eurodollar Borrowing or EURIBOR Borrowing prior to the end of the Interest Period applicable thereto, then, unless such Borrowing is repaid as provided herein, at the end of such Interest Period such Borrowing shall be continued as a Eurodollar Borrowing or a EURIBOR Borrowing, as applicable, with an Interest Period of one month’s duration. Notwithstanding any contrary provision hereof, if an Event of Default has occurred and is continuing, (i) no outstanding Borrowing denominated in Dollars may be converted to or continued as a Eurodollar Borrowing, (ii) unless repaid, each Eurodollar Borrowing denominated in Dollars shall be converted to an ABR Borrowing at the end of the Interest Period applicable thereto, and (iii) unless repaid, each Eurodollar Borrowing denominated in a Permitted Foreign Currency (other than Euros) or EURIBOR Borrowing shall be continued as a Eurodollar Borrowing or EURIBOR Borrowing, as applicable, with an Interest Period of one month’s duration.
Section 2.06    Termination and Reduction of Commitments.
(a)    Unless previously terminated, the Commitments shall terminate on the Maturity Date.
(b)    The Borrower may at any time terminate, or from time to time reduce, the Commitments; provided that (i) each partial reduction of the Commitments shall be in an amount that is an integral multiple of $1,000,000 and not less than $5,000,000 and (ii) the Borrower shall not terminate or reduce the Commitments if, after giving effect to any concurrent prepayment of the Loans in accordance with Section 2.08, the sum of the Aggregate Total Exposure would exceed the total Commitments.
(c)    The Borrower shall notify the Administrative Agent of any election to terminate or reduce the Commitments under paragraph (b) of this Section at least three Business Days prior to the effective date of such termination or reduction, specifying such election and the effective date thereof. Promptly following receipt of any notice, the Administrative Agent shall advise the Lenders of the contents thereof. Each notice delivered by the Borrower pursuant to this Section shall be irrevocable; provided that a notice of termination of the Commitments delivered by the Borrower may state that such notice is conditioned upon the effectiveness of other credit facilities or another transaction, in which case such notice may be revoked by the Borrower (by notice to the Administrative Agent on or prior to the specified effective date) if such condition is not satisfied. Any termination or reduction of the Commitments shall be permanent. Each reduction of the Commitments shall be applied to the Lenders in accordance with their respective Applicable Percentages.
34


(d)    If, after giving effect to any reduction of the Commitments, the Letter of Credit Sublimit exceeds the amount of the Commitments, such Letter of Credit Sublimit shall be automatically reduced by the amount of such excess (with such reduction applied on a pro rata basis to reduce the Letter of Credit Issuer Sublimit of each Issuing Bank).
Section 2.07    Repayment of Loans; Evidence of Debt.
(a)    The Borrower hereby unconditionally promises to pay to the Administrative Agent for the account of each Lender the then unpaid principal amount of each Loan on the Maturity Date.
(b)    Each Lender shall maintain in accordance with its usual practice an account or accounts evidencing the indebtedness of the Borrower to such Lender resulting from each Loan made by such Lender, including the amounts of principal and interest payable and paid to such Lender from time to time hereunder.
(c)    The Administrative Agent shall maintain accounts in which it shall record (i) the amount of each Loan made hereunder, the Type thereof and the Interest Period applicable thereto, (ii) the amount of any principal or interest due and payable or to become due and payable from the Borrower to each Lender hereunder and (iii) the amount of any sum received by the Administrative Agent hereunder for the account of the Lenders and each Lender’s share thereof.
(d)    The entries made in the accounts maintained pursuant to paragraph (b) or (c) of this Section shall be prima facie evidence of the existence and amounts of the obligations recorded therein (absent manifest error); provided that the failure of any Lender or the Administrative Agent to maintain such accounts or any error therein shall not in any manner affect the obligation of the Borrower to repay the Loans in accordance with the terms of this Agreement; provided, further, that the Borrower may inspect such accounts upon reasonable request.
(e)    Any Lender may request that Loans made by it be evidenced by a promissory note (each such promissory note being called a “Note” and all such promissory notes being collectively called the “Notes”). In such event, the Borrower shall prepare, execute and deliver to such Lender a Note payable to the order of such Lender (or, if requested by such Lender, to such Lender and its registered assigns) in substantially the form of Exhibit D attached hereto. Thereafter, the Loans evidenced by such Note and interest thereon shall at all times (including after assignment pursuant to Section 9.04) be represented by one or more promissory notes in such form payable to the order of the payee named therein (or, if such promissory note is a registered note, to such payee and its registered assigns).
Section 2.08    Prepayment of Loans.
(a)    The Borrower shall have the right at any time and from time to time to prepay any Borrowing in whole or in part, without premium or penalty (subject to the requirements of Section 2.13), subject to prior notice in accordance with paragraph (b) of this Section.
(b)    The Borrower shall notify the Administrative Agent in writing (including by telecopy or other electronic transmission) of any prepayment hereunder (i) in the case of prepayment of a Eurodollar Borrowing denominated in Dollars or a EURIBOR Borrowing, not later than 1:00 p.m., Local Time, three Business Days before the date of prepayment, (ii) in the case of a Eurodollar
35


Borrowing denominated in any Permitted Foreign Currency (other than Euros), not later than 1:00 p.m., Local Time, four Business Days before the date of prepayment or (iii) in the case of prepayment of an ABR Borrowing, not later than 1:00 p.m., New York City time, one Business Day before the date of prepayment. Each such notice shall be irrevocable and shall specify the prepayment date and the principal amount of each Borrowing or portion thereof to be prepaid; provided that, if a notice of prepayment is given in connection with a conditional notice of termination of the Commitments as contemplated by Section 2.06, then such notice of prepayment may be revoked if such notice of termination is revoked in accordance with Section 2.06. Promptly following receipt of any such notice relating to a Borrowing, the Administrative Agent shall advise the Lenders of the contents thereof. Each partial prepayment of any Borrowing shall be in an amount that would be permitted in the case of an advance of a Borrowing of the same Type as provided in Section 2.02. Each prepayment of a Borrowing shall be applied ratably to the Loans of the Lenders in accordance with their respective Applicable Percentages. Prepayments shall be accompanied by accrued interest to the extent required by Section 2.10 and any costs incurred as contemplated by Section 2.13.
(c)    If at any time (i) the Aggregate Total Exposure exceeds the total Commitments then in effect (other than as a result of any revaluation of the Dollar Equivalent of Loans or Letter of Credit Usage on any Calculation Date in accordance with Section 1.05) or (ii) the Aggregate Total Exposure exceeds 105% of the total Commitments solely as a result of any revaluation of the Dollar Equivalent of Loans or Letter of Credit Usage on any Calculation Date in accordance with Section 1.05, the Borrower shall promptly prepay the Loans or Cash Collateralize the outstanding amount of Letter of Credit Usage at the Agreed L/C Cash Collateral Amount of all Letter of Credit Usage, as applicable, to the extent necessary so that the Aggregate Total Exposure shall not exceed the Commitments then in effect.
(d)    Any prepayment of any Loan pursuant to this Section 2.08 shall be applied as specified by the Borrower in the applicable notice of prepayment.
Section 2.09     Fees.
(a)    The Borrower agrees to pay (or in the case of clause (ii), cause the Applicable Account Party to pay) to the Administrative Agent for the account of each Lender (other than any Defaulting Lender) in accordance with its Applicable Percentage (i) an unused commitment fee (the “Unused Commitment Fee”), which shall accrue at the percentage set forth in the definition of “Applicable Rate” on the average daily difference between (x) the Commitments and (y) the aggregate principal amount of (1) all outstanding Loans plus (2) the Letter of Credit Usage during the period from and including the date hereof to but excluding the date on which such Commitment terminates and (ii) a Letter of Credit participation fee (the “Letter of Credit Fee”) equal to the Applicable Rate with respect to Eurodollar Borrowings, multiplied by the average daily undrawn amount of the Letters of Credit (regardless of whether any conditions for drawing could then be met and determined as of the close of business on any date of determination). Accrued fees under this Section 2.09(a) shall be payable in arrears on the last day of March, June, September and December of each year and on the date on which the Commitments terminate, commencing on September 30, 2018; provided that any accrued Unused Commitment Fees that remain unpaid after the date on which the Commitments terminate shall be payable on demand. All fees under this Section 2.09(a) shall be computed on the basis of a year of 360 days and shall be payable for the actual number of days elapsed (including the first day but excluding the last day).
36


(b)    The Borrower agrees to pay (or cause the Applicable Account Party to pay) directly to each Issuing Bank, for its own account, the following fees:
(i)    a fronting fee equal to 0.125%, per annum based on the average daily undrawn amount on such Letters of Credit issued by such Issuing Bank; and
(ii)    such documentary and processing charges for any issuance, amendment, transfer or payment of a Letter of Credit as are in accordance with such Issuing Bank’s standard schedule for such charges and as in effect at the time of such issuance, amendment, transfer or payment, as the case may be.
(iii)    The fees in clause (b)(i) above shall be payable quarterly in arrears on March 31, June 30, September 30 and December 31 of each year during the Availability Period, commencing on the first such date to occur after the Effective Date, and on the Maturity Date.
(c)    The Borrower agrees to pay (i) to the Administrative Agent, for its own account, fees payable in the amounts and at the times separately agreed upon between the Borrower and the Administrative Agent and (ii) to the Administrative Agent, for the account of each Lender party to this Agreement on the Effective Date, an upfront fee in an amount equal to 0.10% of the aggregate principal amount of such Lender’s Commitments as of the Effective Date, which fee shall be earned, due and payable on the Effective Date .
(d)    All fees payable hereunder shall be paid on the dates due, in immediately available funds, to the parties specified herein. Fees paid shall not be refundable under any circumstances.
Section 2.10    Interest.
(a)    The Loans comprising each ABR Borrowing shall bear interest at the Alternate Base Rate plus the Applicable Rate.
(b)    The Loans comprising each Eurodollar Borrowing shall bear interest at the Adjusted LIBO Rate for the Interest Period in effect for such Borrowing plus the Applicable Rate.
(c)    The Loans comprising each EURIBOR Borrowing shall bear interest at the Adjusted EURIBO Rate for the Interest Period in effect for such Borrowing plus the Applicable Rate.
(d)    Notwithstanding the foregoing, at all times when an Event of Default listed in paragraph (a) or (b) of Article 7 has occurred hereunder and is continuing, any overdue amounts outstanding hereunder shall bear interest, after as well as before judgment, at a rate per annum equal to (i) in the case of overdue principal of any Loan, 2% plus the rate otherwise applicable to such Loan as provided in the preceding paragraphs of this Section and (ii) in the case of any other overdue amount, 2% plus the rate applicable to ABR Loans as provided in paragraph (a) of this Section.
(e)    Accrued interest on each Loan shall be payable in arrears on each Interest Payment Date for such Loan and upon termination of the Commitments; provided that (i) interest accrued pursuant to paragraph (d) of this Section shall be payable on demand, (ii) in the event of any repayment or prepayment of any Loan (other than a prepayment of an ABR Loan prior to the end of
37


the Availability Period), accrued interest on the principal amount repaid or prepaid shall be payable on the date of such repayment or prepayment and (iii) in the event of any conversion of any Eurodollar Loan or EURIBOR Loan prior to the end of the current Interest Period therefor, accrued interest on such Loan shall be payable on the effective date of such conversion.
(f)    Subject to Section 2.19(d), the Borrower agrees to pay to the applicable Issuing Bank, with respect to drawings honored under any Letter of Credit, interest on the amount paid by such Issuing Bank in respect of each such honored drawing from the date such drawing is honored to but excluding the date such amount is reimbursed by or on behalf of the Borrower at a rate equal to (i) for the period from the date such amount is honored to but excluding the applicable Reimbursement Date, the rate of interest otherwise payable hereunder with respect to Loans that are ABR Loans, and (ii) thereafter, a rate which is 2% per annum in excess of the rate of interest otherwise payable hereunder with respect to Loans that are ABR Loans, Eurodollar Loans or EURIBOR Loans (as applicable).
(g)    All interest hereunder shall be computed on the basis of a year of 360 days, except that interest computed by reference to the Alternate Base Rate at times when the Alternate Base Rate is based on the Prime Rate shall be computed on the basis of a year of 365 days (or 366 days in a leap year), and in each case, shall be payable for the actual number of days elapsed (including the first day but excluding the last day). The applicable Alternate Base Rate or Adjusted LIBO Rate shall be determined by the Administrative Agent or the applicable Issuing Bank, as the case may be, and such determination shall be conclusive absent manifest error.
Section 2.11    Alternate Rate of Interest; Illegality.
(a)    If prior to the commencement of any Interest Period for a Eurodollar Borrowing or EURIBOR Borrowing:
(i)    the Administrative Agent determines (which determination shall be conclusive absent manifest error) that adequate and reasonable means do not exist for ascertaining the Adjusted LIBO Rate or the Adjusted EURIBO Rate, as the case may be, for such Interest Period; or
(ii)    the Administrative Agent is advised by the Required Lenders that the Adjusted LIBO Rate or the Adjusted EURIBO Rate, as the case may be, for such Interest Period will not adequately and fairly reflect the cost to such Lenders (or Lender) of making or maintaining their Loans (or its Loan) included in such Borrowing for such Interest Period;
then the Administrative Agent shall give notice thereof to the Borrower and the Lenders by telephone, telecopy or other electronic transmission as promptly as practicable thereafter and, until the Administrative Agent notifies the Borrower and the Lenders that the circumstances giving rise to such notice no longer exist, (x) any Interest Election Request that requests the conversion of any Borrowing to, or continuation of any Borrowing as, a Eurodollar Borrowing or a EURIBOR Borrowing, as the case may be, shall be ineffective, and (y) if any Borrowing Request requests a Eurodollar Borrowing or a EURIBOR Borrowing, as the case may be, such Borrowing (x) if denominated in Dollars, shall be made as an ABR Borrowing or (y) in all other cases, shall be ineffective (and no Lender shall be obligated to make a Loan on account thereof).
38


(b)    If any Lender reasonably determines that any Change in Law has made it unlawful, or that any Governmental Authority has asserted after the Effective Date that it is unlawful, for such Lender or its applicable lending office to make or maintain any Eurodollar Borrowing or EURIBOR Borrowing, then, on notice thereof by such Lender to the Borrower through the Administrative Agent, any obligations of such Lender to make or continue any Eurodollar Borrowing or EURIBOR Borrowing, as the case may be, or to convert ABR Borrowings to Eurodollar Borrowings (if applicable) shall be suspended until such Lender notifies the Administrative Agent and the Borrower that the circumstances giving rise to such determination no longer exist. Upon receipt of such notice, the Borrower shall upon demand from such Lender (with a copy to the Administrative Agent) (i) with respect to Eurodollar Loans of such Lender denominated in Dollars, convert all such Eurodollar Loans of such Lender to ABR Loans, on the last of the Interest Period therefor, if such Lender may lawfully continue to maintain such Eurodollar Loans to such day, or immediately, if such Lender may not lawfully continue to maintain such Loans (in which case the Borrower shall not be required to make payments pursuant to Section 2.13 in connection with such payment) and (ii) with respect to Eurodollar Loans of such Lender denominated in a Permitted Foreign Currency (other than Euros) or EURIBOR Loans, prepay all such Eurodollar Loans and/or EURIBOR Loans of such Lender, on the last day of the Interest Period therefor, if such Lender may lawfully continue to maintain such Eurodollar Loans or EURIBOR Loans to such day, or immediately, if such Lender may not lawfully continue to maintain such Loans (in which case the Borrower shall not be required to make payments pursuant to Section 2.13 in connection with such payment), in each case, as applicable. Upon any such prepayment or conversion, the Borrower shall also pay accrued interest on the amount so prepaid or converted. Each Lender agrees to designate a different lending office if such designation will avoid the need for such notice and will not, in the determination of such Lender, otherwise be disadvantageous to it.
(c)    If at any time the Administrative Agent determines (which determination shall be conclusive absent manifest error) that (i) the circumstances set forth in Section 2.11(a) have arisen and such circumstances are unlikely to be temporary or (ii) the circumstances set forth in Section 2.11(a) have not arisen but either (w) the supervisor for the administrator of the LIBO Rate or the EURIBO Rate, as the case may be, has made a public statement that the administrator of the LIBOR Rate or the EURIBO Rate, as the case may be, is insolvent (and there is no successor administrator that will continue publication of the LIBOR Rate or the EURIBO Rate, as applicable), (x) the administrator of the LIBO Rate or the EURIBO Rate, as the case may be, has made a public statement identifying a specific date after which the LIBO Rate or the EURIBO Rate, as applicable, will permanently or indefinitely cease to be published by it (and there is no successor administrator that will continue publication of the LIBOR Rate or the EURIBO Rate, as applicable), (y) the supervisor for the administrator of the LIBO Rate or the EURIBO Rate, as the case may be, has made a public statement identifying a specific date after which the LIBO Rate or the EURIBO Rate, as the case may be, will permanently or indefinitely cease to be published or (z) the supervisor for the administrator of the LIBO Rate or the EURIBO Rate, as the case may be, or a Governmental Authority having jurisdiction over the Administrative Agent has made a public statement identifying a specific date after which the LIBO Rate or the EURIBO Rate, as the case may be, may no longer be used for determining interest rates for loans, then the Administrative Agent and the Borrower shall endeavor to establish an alternate rate of interest to the Adjusted LIBO Rate or the Adjusted EURIBO Rate, as the case may be, that gives due consideration to the then prevailing market convention for determining a rate of interest for similar syndicated loan facilities in the United States at such time, and shall enter into an amendment to this Agreement to reflect such alternate rate of interest and such other related changes to this Agreement as may be applicable (but for the avoidance of doubt, such
39


related changes shall not include a reduction of the Applicable Rate); provided that, if such alternate rate of interest as so determined would be less than zero, such rate shall be deemed to be zero for the purposes of this Agreement. Notwithstanding anything to the contrary in Section 9.02, such amendment shall become effective without any further action or consent of any other party to this Agreement so long as the Administrative Agent shall not have received, within five Business Days of the date notice of such alternate rate of interest is provided to the Lenders, a written notice from the Required Lenders stating that such Required Lenders object to such amendment. Until an alternate rate of interest shall be determined in accordance with this clause (c) (but, in the case of the circumstances described in clause (ii) of the first sentence of this Section 2.11(c), only to the extent the LIBO Rate or the EURIBO Rate, as applicable, for the applicable currency and such Interest Period is not available or published at such time on a current basis), (x) any Interest Election Request that requests the conversion of any Revolving Borrowing to, or continuation of any Revolving Borrowing as, a Eurodollar Borrowing or a EURIBOR Borrowing shall be ineffective and (y) if any Borrowing Request requests a Eurodollar Borrowing or EURIBOR Borrowing, such Borrowing (x) if denominated in Dollars, shall be made as an ABR Borrowing or (y) in all other cases, shall be ineffective (and no Lender shall be obligated to make a Loan on account thereof).
Section 2.12    Increased Costs.
(a)    If any Change in Law shall:
(i)    impose, modify or deem applicable any reserve, special deposit, compulsory loan, insurance charge or similar requirement against assets of, deposits with or for the account of, or credit extended by, any Lender or any Issuing Bank (except any such reserve requirement reflected in the Adjusted LIBO Rate);
(ii)    subject any Recipient to any Taxes (other than (A) Indemnified Taxes, (B) Taxes described in clauses (b) through (d) of the definition of Excluded Taxes and (C) Connection Income Taxes) on its loans, loan principal, letters of credit, commitments, or other obligations, or its deposits, reserves, other liabilities or capital attributable thereto; or
(iii)    impose on any Lender, any Issuing Bank or the London interbank market any other condition, cost or expense (other than Taxes) affecting this Agreement or Eurodollar Loans or EURIBOR Loans made by such Lender or such Issuing Bank;
and the result of any of the foregoing shall be to increase the cost to such Lender or such other Recipient of making, continuing, converting to or maintaining any Loan (or of maintaining its obligation to make any such Loan) or issuing, amending, extending, increasing or maintaining in place a Letter of Credit (or of maintaining its obligation to participate in or to issue any Letter of Credit) or to reduce the amount of any sum received or receivable by such Lender, Issuing Bank or other Recipient hereunder (whether of principal, interest or otherwise), then upon the request of such Lender, Issuing Bank or other Recipient, the Borrower will pay to such Lender, Issuing Bank or other Recipient, as the case may be, such additional amount or amounts as will compensate such Lender, Issuing Bank or other Recipient, as the case may be, for such additional costs incurred or reduction suffered.
(b)    If any Lender or any Issuing Bank determines that any Change in Law regarding capital adequacy or liquidity requirements has or would have the effect of reducing the rate
40


of return on such Lender’s or such Issuing Bank’s capital or on the capital of such Lender’s or such Issuing Bank’s holding company, if any, as a consequence of this Agreement, the Commitments hereunder or the Loans made by such Lender or the Letter of Credit issued by such Issuing Bank to a level below that which such Lender or such Lender’s holding company or such Issuing Bank or such Issuing Bank’s holding company could have achieved but for such Change in Law (taking into consideration such Lender’s or such Issuing Bank’s policies and the policies of such Lender’s or such Issuing Bank’s holding company with respect to capital adequacy or liquidity requirements), then from time to time the Borrower will pay to such Lender or such Issuing Bank such additional amount or amounts as will compensate such Lender or such Lender’s holding company for any such reduction suffered.
(c)    A certificate of a Lender or an Issuing Bank setting forth in reasonable detail the amount or amounts necessary to compensate such Lender or its respective holding company, as the case may be, as specified in paragraph (a) or (b) of this Section shall be delivered to the Borrower and shall be conclusive absent manifest error. The Borrower shall pay such Lender or such Issuing Bank the amount shown as due on any such certificate within 10 days after receipt thereof; provided that a Lender or Issuing Bank shall not be entitled to any compensation pursuant to this Section 2.12 to the extent such Lender or Issuing Bank is not generally imposing such charges or requesting such compensation from other similarly situated borrowers under similar circumstances.
(d)    Failure or delay on the part of any Lender or any Issuing Bank to demand compensation pursuant to this Section shall not constitute a waiver of such Lender’s or such Issuing Bank’s right to demand such compensation; provided that the Borrower shall not be required to compensate a Lender pursuant to this Section for any increased costs or reductions incurred more than 180 days prior to the date that such Lender or such Issuing Bank notifies the Borrower of the Change in Law giving rise to such increased costs or reductions and of such Lender’s or such Issuing Bank’s intention to claim compensation therefore; provided, further, that, if the Change in Law giving rise to such increased costs or reductions is retroactive (or has retroactive effect), then the 180-day period referred to above shall be extended to include the period of retroactive effect thereof.
Section 2.13    Break Funding Payments. In the event of (a) the payment or prepayment of any principal of any Eurodollar Loan or EURIBOR Loan other than on the last day of an Interest Period applicable thereto (whether voluntary, mandatory, automatic, by reason of acceleration, or otherwise), (b) the conversion of any Eurodollar Loan or EURIBOR Loan other than on the last day of the Interest Period applicable thereto, (c) the failure to borrow, convert, continue or prepay any Eurodollar Loan or EURIBOR Loan on the date specified in any notice delivered pursuant hereto (regardless of whether such notice may be revoked under Section 2.08(b) and is revoked in accordance therewith), or (d) the assignment of any Eurodollar Loan or EURIBOR Loan other than on the last day of the Interest Period applicable thereto as a result of a request by the Borrower pursuant to Section 2.16, then, in any such event, the Borrower shall compensate each Lender for the loss, cost and expense attributable to such event. In the case of a Eurodollar Loan or a EURIBOR Loan, such loss, cost or expense to any Lender shall be deemed to include an amount determined by such Lender to be the excess, if any, of (i) the amount of interest which would have accrued on the principal amount of such Loan had such event not occurred, at the Adjusted LIBO Rate or the Adjusted EURIBO Rate, as the case may be, that would have been applicable to such Loan, for the period from the date of such event to the last day of the then current Interest Period therefor (or, in the case of a failure to borrow, convert or continue, for the period that would have been the Interest Period for such Loan), over (ii) the amount of interest which would accrue on such principal amount
41


for such period at the interest rate which such Lender would bid were it to bid, at the commencement of such period, for deposits of the applicable currency of a comparable amount and period from other banks in the applicable interbank market. A certificate of any Lender setting forth in reasonable detail any amount or amounts that such Lender is entitled to receive pursuant to this Section shall be delivered to the Borrower and shall be conclusive absent manifest error. The Borrower shall pay such Lender the amount shown as due on any such certificate within 10 days after receipt thereof.
Section 2.14    Taxes.
(a)    For purposes of this Section 2.14, the term “Lender” includes any Issuing Bank and the term “applicable law” includes FATCA.
(b)    All payments by or on account of any obligation of any Loan Party under any Loan Document shall be made without deduction or withholding for any Taxes, except as required by law. If any applicable law (as determined in the good faith discretion of an applicable Withholding Agent) requires the deduction or withholding of any Tax from any such payment by a Withholding Agent, then the applicable Withholding Agent shall be entitled to make such deduction or withholding and timely pay the full amount deducted or withheld to the relevant Governmental Authority in accordance with applicable law and, if such Tax is an Indemnified Tax, then the sum payable by the applicable Loan Party shall be increased as necessary so that after such deduction or withholding of such Indemnified Taxes has been made (including such deductions and withholdings applicable to additional sums payable under this Section) the applicable Recipient receives an amount equal to the sum it would have received had no such deduction or withholding for Indemnified Taxes been made.
(c)    The Loan Parties shall timely pay to the relevant Governmental Authority in accordance with applicable law or, at the option of the Administrative Agent, timely reimburse it for the payment of any Other Taxes.
(d)    The Loan Parties shall jointly and severally indemnify each Recipient, within 10 days after demand therefore, for the full amount of any Indemnified Taxes (including Indemnified Taxes imposed or asserted on or attributable to amounts payable under this Section) paid by such Recipient or required to be withheld or deducted from a payment to such Recipient and any penalties, interest and reasonable expenses arising therefrom or with respect thereto, whether or not such Indemnified Taxes were correctly or legally imposed or asserted by the relevant Governmental Authority. A certificate as to the amount of such payment or liability delivered to the Borrower by a Lender (with a copy to the Administrative Agent), or by the Administrative Agent on its own behalf or on behalf of a Lender, shall be conclusive absent manifest error. No Loan Party shall be required to pay any amount under this Section 2.14(d) with respect to Other Taxes paid or reimbursed by a Loan Party pursuant to Section 2.14(c).
(e)    Each Lender shall severally indemnify the Administrative Agent, within 10 days after demand therefor, for (i) any Indemnified Taxes attributable to such Lender (but only to the extent that the Loan Parties have not already indemnified the Administrative Agent for such Indemnified Taxes and without limiting the obligation of the Loan Parties to do so), (ii) any Taxes attributable to such Lender’s failure to comply with the provisions of Section 9.04(c) relating to the maintenance of a Participant Register and (iii) any Excluded Taxes attributable to such Lender, in each case, that are payable or paid by the Administrative Agent in connection with any Loan
42


Document, and any reasonable expenses arising therefrom or with respect thereto, whether or not such Taxes were correctly or legally imposed or asserted by the relevant Governmental Authority. A certificate as to the amount of such payment or liability delivered to any Lender by the Administrative Agent shall be conclusive absent manifest error. Each Lender hereby authorizes the Administrative Agent to set off and apply any and all amounts at any time owing to such Lender under any Loan Document or otherwise payable by the Administrative Agent to the Lender from any other source against any amount due to the Administrative Agent under this paragraph (e).
(f)    As soon as practicable after any payment of Taxes by any Loan Party to a Governmental Authority pursuant to this Section 2.14, such Loan Party shall deliver to the Administrative Agent the original or a certified copy of a receipt issued by such Governmental Authority evidencing such payment, a copy of the return reporting such payment or other evidence of such payment reasonably satisfactory to the Administrative Agent.
(g)    (i) Any Lender that is entitled to an exemption from or reduction of withholding Tax with respect to payments made under any Loan Document shall deliver to the Borrower and the Administrative Agent, at the time or times reasonably requested by the Borrower or the Administrative Agent, such properly completed and executed documentation reasonably requested by the Borrower or the Administrative Agent as will permit such payments to be made without withholding or at a reduced rate of withholding. In addition, any Lender, if reasonably requested by the Borrower or the Administrative Agent, shall deliver such other documentation prescribed by applicable law or reasonably requested by the Borrower or the Administrative Agent as will enable the Borrower or the Administrative Agent to determine whether or not such Lender is subject to withholding or information reporting requirements. Notwithstanding anything to the contrary in the preceding two sentences, the completion, execution and submission of such documentation (other than such documentation set forth in Sections 2.14(g)(ii)(A), (ii)(B) and (ii)(D) below) shall not be required if in the Lender’s reasonable judgment such completion, execution or submission would subject such Lender to any material unreimbursed cost or expense or would materially prejudice the legal or commercial position of such Lender.
(ii)    Without limiting the generality of the foregoing, as long as the Borrower is a U.S. Person:
(A)    any Lender that is a U.S. Person shall deliver to the Borrower and the Administrative Agent on or prior to the date on which such Lender becomes a Lender under this Agreement (and from time to time thereafter upon the reasonable request of the Borrower or the Administrative Agent), executed copies of IRS Form W-9 certifying that such Lender is exempt from U.S. federal backup withholding tax;
(B)    any Foreign Lender, if it is legally entitled to do so, shall deliver to the Borrower and the Administrative Agent (in such number of copies as shall be required by law or requested by the recipient) on or prior to the date on which such Foreign Lender becomes a Lender under this Agreement (and from time to time thereafter as required by law or upon the reasonable request of the Borrower or the Administrative Agent), whichever of the following is applicable:
43


(a)    in the case of a Foreign Lender claiming the benefits of an income tax treaty to which the United States is a party (x) with respect to payments of interest under any Loan Document, executed copies of IRS Form W-8BEN-E or IRS Form W-8BEN, as applicable, establishing an exemption from, or reduction of, U.S. federal withholding Tax pursuant to the “interest” article of such tax treaty and (y) with respect to any other applicable payments under any Loan Document, IRS Form W-8BEN-E or IRS Form W-8BEN, as applicable, establishing an exemption from, or reduction of, U.S. federal withholding Tax pursuant to the “business profits” or “other income” article of such tax treaty;
(b)    executed copies of IRS Form W-8ECI;
(c)    in the case of a Foreign Lender claiming the benefits of the exemption for portfolio interest under Section 881(c) of the Code, (x) a certificate substantially in the form of Exhibit G-1 to the effect that such Foreign Lender is not (A) a “bank” within the meaning of Section 881(c)(3)(A) of the Code, (B) a “10-percent shareholder” of the Borrower within the meaning of Section 871(h)(3)(B) of the Code, or (C) a “controlled foreign corporation” related to the Borrower, as described in Section 881(c)(3)(C) of the Code (a “U.S. Tax Compliance Certificate”) and (y) executed copies of IRS Form W-8BEN-E or IRS Form W-8BEN, as applicable; or
(d)    to the extent a Foreign Lender is not the beneficial owner, executed copies of IRS Form W-8IMY, accompanied by IRS Form W-8ECI, IRS Form W8BEN-E or IRS Form W-8BEN, as applicable, a U.S. Tax Compliance Certificate substantially in the form of Exhibit G-2 or Exhibit G-3, IRS Form W-9, and/or other certification documents from each beneficial owner, as applicable; provided that if the Foreign Lender is a partnership and one or more direct or indirect partners of such Foreign Lender are claiming the portfolio interest exemption, such Foreign Lender may provide a U.S. Tax Compliance Certificate substantially in the form of Exhibit G-4 on behalf of each such direct or indirect partner;
(C)    any Foreign Lender shall, to the extent it is legally entitled to do so, deliver to the Borrower and the Administrative Agent (in such number of copies as shall be requested by the recipient) on or prior to the date on which such Foreign Lender becomes a Lender under this Agreement (and from time to time thereafter upon the reasonable request of the Borrower or the Administrative Agent), executed copies of any other form prescribed by applicable law as a basis for claiming exemption from or a reduction in U.S. federal withholding Tax, duly completed, together with such supplementary documentation as may be prescribed by applicable law to permit the Borrower or the Administrative Agent to determine the withholding or deduction required to be made; and
44


(D)    if a payment made to a Lender under any Loan Document would be subject to U.S. federal withholding Tax imposed by FATCA if such Lender were to fail to comply with the applicable reporting requirements of FATCA (including those contained in Section 1471(b) or 1472(b) of the Code, as applicable), such Lender shall deliver to the Borrower and the Administrative Agent at the time or times prescribed by law and at such time or times reasonably requested by the Borrower or the Administrative Agent such documentation prescribed by applicable law (including as prescribed by Section 1471(b)(3)(C)(i) of the Code) and such additional documentation reasonably requested by the Borrower or the Administrative Agent as may be necessary for the Borrower and the Administrative Agent to comply with their obligations under FATCA, to determine that such Lender has complied with such Lender’s obligations under FATCA or to determine the amount to deduct and withhold from such payment. Solely for purposes of this clause (D), “FATCA” shall include any amendments made to FATCA after the date of this Agreement.
Each Lender agrees that if any form or certification it previously delivered expires or becomes obsolete or inaccurate in any respect, it shall update such form or certification or promptly notify the Borrower and the Administrative Agent in writing of its legal inability to do so.
Each Lender authorizes the Administrative Agent to deliver to the Loan Parties and to any successor Administrative Agent any documentation provided by such Lender to the Administrative Agent pursuant to this Section 2.14(g).
(h)    If any party determines, in its sole discretion exercised in good faith, that it has received a refund of any Taxes as to which it has been indemnified pursuant to this Section 2.14 (including by the payment of additional amounts pursuant to this Section 2.14), it shall pay to the indemnifying party an amount equal to such refund (but only to the extent of indemnity payments made under this Section 2.14 with respect to the Taxes giving rise to such refund), net of all out-of-pocket expenses (including Taxes) of such indemnified party and without interest (other than any interest paid by the relevant Governmental Authority with respect to such refund). Such indemnifying party, upon the request of such indemnified party, as applicable, shall repay to such indemnified party the amount paid over pursuant to this paragraph (h) (plus any penalties, interest or other charges imposed by the relevant Governmental Authority) in the event that such indemnified party is required to repay such refund to such Governmental Authority. Notwithstanding anything to the contrary in this paragraph (h), in no event will the indemnified party be required to pay any amount to an indemnifying party pursuant to this paragraph (h), the payment of which would place the indemnified party in a less favorable net after-Tax position than the indemnified party would have been in if the Tax subject to indemnification and giving rise to such refund had not been deducted, withheld or otherwise imposed and the indemnification payments or additional amounts with respect to such Tax had never been paid. This paragraph (h) shall not be construed to require any Lender or the Administrative Agent to make available its Tax returns (or any other information relating to its Taxes that it deems confidential) to the indemnifying party or any other Person.
(i)    For all purposes of this Section 2.14, the term “Lender” includes and shall apply equally to the benefit of each Issuing Bank.
45


Each party’s obligations under this Section 2.14 shall survive the resignation or replacement of the Administrative Agent or any assignment of rights by, or the replacement of, a Lender, the termination of the Commitments and the repayment, satisfaction or discharge of all obligations under any Loan Document.
Section 2.15    Payments Generally; Pro Rata Treatment; Sharing of Set-Off.
(a)    The Borrower shall make each payment required to be made by it hereunder (whether of principal, interest or fees, or of amounts payable under Section 2.12, 2.13 or 2.14, or otherwise) prior to 1:00 p.m., New York City time, on the date when due, in immediately available funds, without set off or counterclaim. Any amounts received after such time on any date may, in the discretion of the Administrative Agent, be deemed to have been received on the next succeeding Business Day for purposes of calculating interest thereon. All such payments shall be made to the Administrative Agent at its Principal Office and except that payments pursuant to Section 2.12, 2.13 or 2.14 and Section 9.03 shall be made directly to the Persons entitled thereto. The Administrative Agent shall distribute any such payments received by it for the account of any other Person to the appropriate recipient promptly following receipt thereof. If any payment or performance hereunder shall be due on a day that is not a Business Day, the date for payment or performance shall be extended to the next succeeding Business Day, and, in the case of any payment accruing interest, interest thereon shall be payable for the period of such extension. All payments hereunder of principal or interest in respect of any Loan or Letter of Credit shall, except as otherwise expressly provided herein, be made in the currency of such Loan or Letter of Credit; all other payments hereunder and under each other Loan Document shall be made in Dollars.
(b)    If at any time insufficient funds are received by and available to the Administrative Agent to pay fully all amounts of principal, interest and fees then due hereunder, such funds shall be applied (i) first, towards payment of interest and fees then due hereunder, ratably among the parties entitled thereto in accordance with the amounts of interest and fees then due to such parties, and (ii) second, towards payment of principal then due hereunder, ratably among the parties entitled thereto in accordance with the amounts of principal then due to such parties.
(c)    If any Lender shall, by exercising any right of set off or counterclaim or otherwise, obtain payment in respect of any principal of or interest on any of its Loans resulting in such Lender receiving payment of a greater proportion of the aggregate amount of its Loans and accrued interest thereon than the proportion received by any other Lender, then the Lender receiving such greater proportion shall purchase (for cash at face value) participations in the Loans of other Lenders to the extent necessary so that the benefit of all such payments shall be shared by the Lenders ratably in accordance with the aggregate amount of principal of and accrued interest on their respective Loans; provided that (i) if any such participations are purchased and all or any portion of the payment giving rise thereto is recovered, such participations shall be rescinded and the purchase price restored to the extent of such recovery, without interest, and (ii) the provisions of this paragraph shall not be construed to apply to any payment made by the Borrower pursuant to and in accordance with the express terms of this Agreement (including the application of funds arising from the existence of a Defaulting Lender) or any payment obtained by a Lender as consideration for the assignment of or sale of a participation in any of its Loans to any assignee or participant. The Borrower consents to the foregoing and agrees, to the extent it may effectively do so under applicable law, that any Lender acquiring a participation pursuant to the foregoing arrangements may exercise
46


against the Borrower rights of set-off and counterclaim with respect to such participation as fully as if such Lender were a direct creditor of the Borrower in the amount of such participation.
(d)    Unless the Administrative Agent shall have received notice from the Borrower prior to the date on which any payment is due to the Administrative Agent for the account of the Lenders hereunder that the Borrower will not make such payment, the Administrative Agent may assume that the Borrower has made such payment on such date in accordance herewith and may, in reliance upon such assumption, distribute to the Lenders the amount due. In such event, if the Borrower has not in fact made such payment, then each of the Lenders severally agrees to repay to the Administrative Agent forthwith on demand the amount so distributed to such Lender with interest thereon, for each day from and including the date such amount is distributed to it to but excluding the date of payment to the Administrative Agent, at the greater of the Federal Funds Effective Rate and a rate determined by the Administrative Agent in accordance with banking industry rules on interbank compensation.
(e)    If any Lender or any Issuing Bank shall fail to make any payment required to be made by it pursuant to Section 2.04(b) or paragraph (d) of this Section, then the Administrative Agent may, in its discretion (notwithstanding any contrary provision hereof), apply any amounts thereafter received by the Administrative Agent for the account of such Lender or such Issuing Bank, as the case may be, to satisfy such Lender’s or such Issuing Bank’s, as applicable, obligations under such Sections until all such unsatisfied obligations are fully paid.
Section 2.16    Mitigation Obligations; Replacement of Lenders.
(a)    If any Lender requests compensation under Section 2.12, or if the Borrower is required to pay any Indemnified Tax or additional amount to any Lender or any Governmental Authority for the account of any Lender pursuant to Section 2.14, then such Lender shall use reasonable efforts to designate a different lending office for funding or booking its Loans hereunder or to assign its rights and obligations hereunder to another of its offices, branches or affiliates, if, in the judgment of such Lender, such designation or assignment (i) would eliminate or reduce amounts payable pursuant to Section 2.12 or Section 2.14, as the case may be, in the future and (ii) would not subject such Lender to any unreimbursed cost or expense and would not otherwise be disadvantageous to such Lender. The Borrower hereby agrees to pay all reasonable costs and expenses incurred by any Lender in connection with any such designation or assignment.
(b)    If (i) any Lender requests compensation under Section 2.12, (ii) the Borrower is required to pay any Indemnified Tax or additional amount to any Lender or any Governmental Authority for the account of any Lender pursuant to Section 2.14 or (iii) any Lender is a Defaulting Lender or a Non-Consenting Lender, then the Borrower may, at its sole expense and effort, upon notice to such Lender and the Administrative Agent, require such Lender to assign and delegate, without recourse (in accordance with and subject to the restrictions contained in Section 9.04), all its interests, rights (other than its existing rights to payments pursuant to Section 2.12 or Section 2.14) and obligations under this Agreement and the other Loan Documents to an assignee that shall assume such obligations (which assignee may be another Lender, if a Lender accepts such assignment); provided that (i) the Borrower shall have received the prior written consent of the Administrative Agent, which consent shall not unreasonably be withheld or delayed, (ii) such Lender shall have received payment of an amount equal to the outstanding principal of its Loans, accrued interest thereon, accrued fees and all other amounts payable to it hereunder and under the other Loan
47


Documents, from the assignee (to the extent of such outstanding principal and accrued interest and fees so assigned) or the Borrower (in the case of all other amounts so assigned), (iii) in the case of any such assignment resulting from a claim for compensation under Section 2.12 or payments required to be made pursuant to Section 2.14, such assignment will result in a reduction in such compensation or payments, (iv) such assignment does not conflict with applicable law, and (v) in the case of any assignment resulting from a Lender becoming a Non-Consenting Lender, (x) the applicable assignee shall have consented to, or shall consent to, the applicable amendment, waiver or consent and (y) the Borrower exercises its rights pursuant to this clause (b) with respect to all Non-Consenting Lenders relating to the applicable amendment, waiver or consent. A Lender shall not be required to make any such assignment or delegation if, prior thereto, as a result of a waiver by such Lender or otherwise, the circumstances entitling the Borrower to require such assignment and delegation cease to apply.
(c)    Each Lender hereby acknowledges that such Lender shall be deemed to consent to any such Assignment and Assumption necessary to effectuate any assignment of such Lender’s interests hereunder in the circumstances contemplated by this Section 2.16.
Section 2.17    Defaulting Lenders.
(a)    Notwithstanding anything to the contrary contained in this Agreement, if any Lender becomes a Defaulting Lender, then, until such time as such Lender is no longer a Defaulting Lender, to the extent permitted by applicable law:
(i)    Such Defaulting Lender’s right to approve or disapprove any amendment, waiver or consent with respect to this Agreement shall be restricted as set forth in the definition of Required Lenders and in Section 9.02.
(ii)    Any payment of principal, interest, fees or other amounts received by the Administrative Agent for the account of such Defaulting Lender (whether voluntary or mandatory, at maturity, pursuant to Article 7 or otherwise) or received by the Administrative Agent from a Defaulting Lender pursuant to Section 9.08 shall be applied at such time or times as may be determined by the Administrative Agent as follows: first, to the payment of any amounts owing by such Defaulting Lender to the Administrative Agent hereunder; second, to the payment on a pro rata basis of any amounts owing by such Defaulting Lender to the Issuing Banks hereunder; third, to Cash Collateralize the Issuing Banks’ Fronting Exposure with respect to such Defaulting Lender in accordance with Section 2.19(i); fourth, as the Borrower may request (so long as no Default or Event of Default exists), to the funding of any Loan in respect of which such Defaulting Lender has failed to fund its portion thereof as required by this Agreement, as determined by the Administrative Agent; fifth, if so determined by the Administrative Agent and the Borrower, to be held in a non-interest bearing deposit account and released pro rata in order to satisfy (x) such Defaulting Lender’s potential future funding obligations with respect to Loans under this Agreement and (y) Cash Collateralize the Issuing Banks’ future Fronting Exposure with respect to such Defaulting Lender with respect to future Letters of Credit issued under this Agreement, in accordance with the procedures set forth in Section 2.19(i); sixth, to the payment of any amounts owing to the Lenders or the Issuing Banks as a result of any judgment of a court of competent jurisdiction obtained by any Lender or any Issuing Bank against such Defaulting Lender as a result of such Defaulting Lender’s breach of its obligations under this Agreement; seventh, so long as no Default or Event of Default exists, to the payment of any amounts owing to the
48


Borrower as a result of any judgment of a court of competent jurisdiction obtained by the Borrower against such Defaulting Lender as a result of such Defaulting Lender’s breach of its obligations under this Agreement; and eighth, to such Defaulting Lender or as otherwise directed by a court of competent jurisdiction; provided that if (x) such payment is a payment of the principal amount of any Loans or Letter of Credit Disbursements in respect of which such Defaulting Lender has not fully funded its appropriate share, and (y) such Loans, and funded and unfunded participations in Letters of Credit, were made when the conditions set forth in Section 4.02 were satisfied or waived, such payment shall be applied solely to pay the Loans and Letter of Credit Disbursements to all Non-Defaulting Lenders on a pro rata basis prior to being applied to the payment of any Loans or Letter of Credit Disbursements of such Defaulting Lender until such time as all Loans and funded and unfunded participations in Letter of Credit Obligations, without giving effect to Section 2.17(a)(iv), are held by the Lenders pro rata in accordance with the Commitments without giving effect to Section 2.17(a)(iv). Any payments, prepayments or other amounts paid or payable to a Defaulting Lender that are applied (or held) to pay amounts owed by a Defaulting Lender pursuant to this Section shall be deemed paid to and redirected by such Defaulting Lender, and each Lender irrevocably consents hereto.
(iii)    (A)    No Defaulting Lender shall be entitled to receive any Unused Commitment Fee pursuant to Section 2.09 for any period during which that Lender is a Defaulting Lender (and the Borrower shall not be required to pay any such fee that otherwise would have been required to have been paid to that Defaulting Lender).
(B)    With respect to any Unused Commitment Fee or Letter of Credit Fee not required to be paid to any Defaulting Lender pursuant to clause (A) above, the Borrower shall (x) pay to each Non-Defaulting Lender that portion of any such fee otherwise payable to such Defaulting Lender with respect to such Defaulting Lender’s participation in Letters of Credit that has been reallocated to such Non-Defaulting Lender pursuant to clause (iv) below, (y) pay to each Issuing Bank the amount of any such fee otherwise payable to such Defaulting Lender to the extent allocable to such Issuing Bank’s Fronting Exposure to such Defaulting Lender and (z) shall not be required to pay the remaining amount of any such fee.
(iv)    Reallocation of Participations to Reduce Fronting Exposure. (A) So long as no Default or Event of Default has occurred and is continuing, all or any part of such Defaulting Lender’s participation in Letters of Credit shall be reallocated among the Non-Defaulting Lenders in accordance with their respective Applicable Percentages (calculated without regard to such Defaulting Lender’s Commitment) but only to the extent that such reallocation does not cause the Total Exposure of any Non-Defaulting Lender to exceed such Non-Defaulting Lender’s Commitment. No reallocation hereunder shall constitute a waiver or release of any claim of any party hereunder against a Defaulting Lender arising from that Lender having become a Defaulting Lender, including any claim of a Non-Defaulting Lender as a result of such Non-Defaulting Lender’s increased exposure following such reallocation.
(B)    If the reallocation described in clause (A) above cannot, or can only partially, be effected, the Borrower shall within one Business Day following notice by the Administrative Agent, Cash Collateralize for the benefit of the applicable Issuing Bank only the Borrower’s obligations corresponding to such Defaulting Lender’s Letter of Credit
49


Usage (after giving effect to any partial reallocation pursuant to clause (A) above) in accordance with the procedures set forth in Section 2.19 for so long as such Letter of Credit Usage is outstanding;
(C)    If the Borrower Cash Collateralizes any portion of such Defaulting Lender’s Letter of Credit Usage pursuant to clause (B) above, the Borrower shall not be required to pay any fees to such Defaulting Lender pursuant to Section 2.09(a)(ii) with respect to such Defaulting Lender’s Letter of Credit Usage during the period such Defaulting Lender’s Letter of Credit Usage is Cash Collateralized;
(D)    If the Letter of Credit Usage of the non-Defaulting Lenders is reallocated pursuant to clause (A) above, then the fees payable to the Lenders pursuant to Section 2.09(a)(ii) shall be adjusted in accordance with such non-Defaulting Lender’s Applicable Percentages; and
(E)    If all or any portion of such Defaulting Lender’s Letter of Credit Usage is neither reallocated nor Cash Collateralized pursuant to clause (A) or (B) above, then, without prejudice to any rights or remedies of any Issuing Bank or any other Lender hereunder, all fees payable under Section 2.09(a)(ii) with respect to such Defaulting Lender’s Letter of Credit Usage shall be payable to the applicable Issuing Bank until and to the extent that such Letter of Credit Usage is reallocated and/or Cash Collateralized.
(b)    If the Borrower, the Administrative Agent and the Issuing Banks agree in writing that a Lender is no longer a Defaulting Lender, the Administrative Agent will so notify the parties hereto, whereupon as of the effective date specified in such notice and subject to any conditions set forth therein (which may include arrangements with respect to any Cash Collateral), that Lender will, to the extent applicable, purchase at par that portion of outstanding Loans of the other Lenders or take such other actions as the Administrative Agent may determine to be necessary to cause the Loans and funded and unfunded participations in Letters of Credit to be held on a pro rata basis by the Lenders in accordance with their respective Applicable Percentages, without giving effect to Section 2.17(a)(iv), whereupon such Lender will cease to be a Defaulting Lender; provided that no adjustments will be made retroactively with respect to fees accrued or payments made by or on behalf of the Borrower while that Lender was a Defaulting Lender; and provided, further, that except to the extent otherwise expressly agreed by the affected parties, no change hereunder from Defaulting Lender to Lender will constitute a waiver or release of any claim of any party hereunder arising from that Lender’s having been a Defaulting Lender.
(c)    If a Bankruptcy Event with respect to a parent of any Lender shall occur following the date hereof and for so long as such event shall continue or any Issuing Bank has a good faith belief that any Lender has defaulted in fulfilling its obligations under one or more other agreements in which such Lender commits to extend credit, such Issuing Bank shall not be required to issue, amend or increase any Letter of Credit, unless such Issuing Bank shall have entered into arrangements with the Borrower or such Lender, reasonably satisfactory to such Issuing Bank, to defease any risk to it in respect of such Lender hereunder.
Section 2.18    Incremental Facility.
50


(a)    Borrower may by written notice to the Administrative Agent elect to request prior to the Maturity Date, one or more increases to the existing Commitments (any such increase, the “New Commitments”), by an amount not in excess of the Incremental Available Amount in the aggregate and not less than $25,000,000 individually (or such lesser amount which shall be approved by the Administrative Agent or such lesser amount that shall constitute the difference between the Incremental Available Amount on such date and all such New Commitments obtained prior to such date), and integral multiples of $25,000,000 in excess of that amount. Each such notice shall specify (A) the date (each, an “Increased Amount Date”) on which Borrower proposes that the New Commitments shall be effective, which shall be a date not less than 10 Business Days (or such shorter period as the Administrative Agent may agree in its reasonable discretion) after the date on which such notice is delivered to the Administrative Agent and which may be contingent upon the closing of an acquisition or other transaction and (B) the identity of each Lender or other Person that is an eligible assignee under Section 9.04(b), subject to approval thereof by the Administrative Agent and the Issuing Banks in the case of a Person that is not a Lender, to the extent such approval is required in the case of an assignment to such Person pursuant to such Section 9.04(b) (such approval not to be unreasonably withheld or delayed) (each, a “New Lender”), to whom Borrower proposes any portion of such New Commitments be allocated and the amounts of such allocations (it being understood that the identity of such Lenders or other Persons may be amended after the date of such notice so long as the approval requirements of this clause (B), if any, are satisfied); provided that any Lender approached to provide all or a portion of the New Commitments may elect or decline, in its sole discretion, to provide a New Commitment. Such New Commitments shall become effective as of such Increased Amount Date; provided that (1) on such Increased Amount Date before or after giving effect to such New Commitments, each of the conditions set forth in Section 4.02 shall be satisfied; (2) the New Commitments shall be effected pursuant to one or more Joinder Agreements executed and delivered by Borrower, the New Lenders and the Administrative Agent, and each of which shall be recorded in the Register and each New Lender shall be subject to the requirements set forth in Section 2.14; (3) Borrower shall make any payments required pursuant to Sections 2.12 and 2.13 in connection with the New Commitments; and (4) Borrower shall deliver or cause to be delivered any customary legal opinions or other documents reasonably requested by the Administrative Agent, the New Lenders or the Issuing Banks in connection with any such transaction.
(b)    On any Increased Amount Date on which New Commitments are effected, subject to the satisfaction of the foregoing terms and conditions, (i) each of the Lenders shall assign to each of the New Lenders, and each of the New Lenders shall purchase from each of the Lenders, at the principal amount thereof (together with accrued interest), such interests in the Loans and Letter of Credit Usage outstanding on such Increased Amount Date as shall be necessary in order that, after giving effect to all such assignments and purchases, such Loans and participation interests in Letter of Credit Usage will be held by existing Lenders and New Lenders ratably in accordance with their Commitments after giving effect to the addition of such New Commitments to the Commitments, (ii) each New Commitment shall be deemed for all purposes a Commitment and each Loan made thereunder (a “New Loan”) shall be deemed, for all purposes, a Loan, and (iii) each New Lender shall become a Lender for all purposes hereunder.
(c)    The Administrative Agent shall notify the Lenders promptly upon receipt of Borrower’s notice of each Increased Amount Date and in respect thereof (i) the New Commitments and the New Lenders, and (ii) the respective interests in such Lender’s Loans and participation interests in Letter of Credit Usage, in each case subject to the assignments contemplated by this Section 2.18.
51


(d)    The terms and provisions (including pricing) of the New Loans shall be identical to the existing Loans. Notwithstanding anything in Section 9.02 to the contrary, each Joinder Agreement may, without the consent of any other Lenders, effect such amendments to this Agreement and the other Loan Documents as may be necessary or appropriate in the opinion of the Administrative Agent to effect the provision of this Section 2.18.
Section 2.19    Letters of Credit.
(a)    Letters of Credit. During the Availability Period, subject to the terms and conditions hereof, the Issuing Banks agree to issue Letters of Credit (or amend, extend or increase an outstanding Letter of Credit) at the request and for the account of the Borrower or any Subsidiary (the “Applicable Account Party”) in the aggregate Dollar Equivalent up to but not exceeding the Letter of Credit Sublimit and denominated in Dollars or in a Permitted Foreign Currency; provided (i) the amount of each Letter of Credit shall not be less than $100,000 for Letters of Credit issued in Dollars (or, in the case of a Letter of Credit issued in a Permitted Foreign Currency, the smallest amount of such Permitted Foreign Currency that is an integral multiple of 100,000 units of such currency and that has a Dollar Equivalent in excess of $100,000) or, in each case, such lesser amount as is acceptable to the applicable Issuing Bank; (ii) after giving effect to such issuance or increase, in no event shall (x) the Aggregate Total Exposure exceed the Commitments then in effect or (y) any Lender’s Total Exposure exceed such Lender’s Commitment; (iii) after giving effect to such issuance or increase, in no event shall the Letter of Credit Usage exceed the Letter of Credit Sublimit then in effect, (iv) after giving effect to such issuance or increase, unless otherwise agreed to by the applicable Issuing Bank in writing, in no event shall the Letter of Credit Usage with respect to the Letters of Credit issued by such Issuing Bank exceed the Letter of Credit Issuer Sublimit of such Issuing Bank then in effect, and (v) in no event shall any Letter of Credit have an expiration date later than the earlier of (A) the fifth Business Day prior to the Maturity Date and (B) the date which is twelve months from the date of issuance of such Letter of Credit. Subject to the foregoing, the applicable Issuing Bank may agree that a Letter of Credit will automatically be extended for one or more successive periods not to exceed one year each, unless the applicable Issuing Bank is able to prevent extension for any additional period by sending notice to that effect to the beneficiary of the Letter of Credit; provided that such periods shall not extend beyond the date referred to in clause (A) above unless the applicable Issuing Bank consents to extensions beyond such date in its sole discretion (subject to cash collateralization arrangements, if any, separately agreed between the Issuing Bank and the Borrower); provided, further, that such Issuing Bank shall not extend any such Letter of Credit if it has received written notice that an Event of Default has occurred and is continuing at least one Business Day prior to the last Business Day that such Issuing Bank may send a non-extension notice; provided, further, if any Lender is a Defaulting Lender, the Issuing Banks shall not be required to issue, amend, extend or increase any Letter of Credit unless the applicable Issuing Bank has entered into arrangements satisfactory to it and the Borrower to eliminate such Issuing Bank’s risk with respect to the participation in Letters of Credit of such Defaulting Lender, including by Cash Collateralizing such Defaulting Lender’s Applicable Percentage of the Letter of Credit Usage at such time on terms satisfactory to the applicable Issuing Bank. Unless otherwise expressly agreed by the applicable Issuing Bank, the Borrower and the Applicable Account Party when a Letter of Credit is issued, the rules of the ISP 98 shall be stated therein to apply to each Letter of Credit.
(b)    Notice of Issuance. Whenever an Applicable Account Party desires the issuance or amendment of a Letter of Credit, it shall deliver to each of the Administrative Agent and the applicable Issuing Bank an Application in use by the applicable Issuing Bank at that time no later
52


than 1:00 p.m. (New York City time) at least five Business Days in advance of the proposed date of issuance or amendment or such shorter period as may be agreed to by the applicable Issuing Bank in any particular instance. Such Application shall be accompanied by documentary and other evidence of the proposed beneficiary’s identity as may reasonably be requested by the applicable Issuing Bank to enable the applicable Issuing Bank to verify the beneficiary’s identity or to comply with any applicable laws or regulations, including, without limitation, the USA Patriot Act or as otherwise customarily requested by the applicable Issuing Bank and shall specify the currency of such Letter of Credit. Upon satisfaction or waiver of the conditions set forth in Section 4.02 and subject to the terms and conditions set forth in this Section 2.19, the applicable Issuing Bank shall issue, amend, extend or increase the requested Letter of Credit subject to no violation of any of, and only in accordance with, the Issuing Bank’s standard operating procedures and policies as in effect from time to time. If a Letter of Credit is requested in a currency other than Dollars, the Issuing Bank shall not be required to issue such Letter of Credit if it does not issue Letters of Credit in such currency as of the requested issuance date. Upon the issuance of any Letter of Credit or amendment, extension or increase thereof, the applicable Issuing Bank shall promptly notify the Administrative Agent, and the Administrative Agent shall promptly notify each Lender with a Commitment of such issuance, which notice from the Administrative Agent shall be accompanied by a copy of such Letter of Credit or amendment, extension or increase thereof and the amount of such Lender’s respective participation in such Letter of Credit pursuant to Section 2.19(e).
(c)    Responsibility of the Issuing Banks With Respect to Requests for Drawings and Payments. In determining whether to honor any drawing under any Letter of Credit by the beneficiary(ies) thereof, the parties agree that, with respect to documents presented which appear on their face to be in substantial compliance with the terms of a Letter of Credit, the applicable Issuing Bank may, in its sole discretion, either accept and make payment upon such documents without responsibility for further investigation, regardless of any notice or information to the contrary, or refuse to accept and make payment upon such documents if such documents are not in strict compliance with the terms of such Letter of Credit. As between the Borrower, the Applicable Account Party and the applicable Issuing Bank, the Borrower and the Applicable Account Party assume all risks of the acts and omissions of, or misuse of the Letters of Credit issued by the applicable Issuing Bank or the proceeds thereof, by the respective beneficiaries of such Letters of Credit; provided, however, the foregoing does not limit any of the Borrower’s or the Applicable Account Party’s rights against any such beneficiary. In furtherance and not in limitation of the foregoing, an Issuing Bank shall not be responsible or have any liability for: (i) the form, validity, sufficiency, accuracy, genuineness or legal effect of any document submitted by any party in connection with the application for and issuance of any such Letter of Credit, even if it should in fact prove to be in any or all respects invalid, insufficient, inaccurate, fraudulent or forged; (ii) the validity or sufficiency of any instrument transferring or assigning or purporting to transfer or assign any such Letter of Credit or the rights or benefits thereunder or proceeds thereof, in whole or in part, which may prove to be invalid or ineffective for any reason; (iii) failure of the beneficiary of any such Letter of Credit to comply fully with any conditions required in order to draw upon such Letter of Credit; (iv) errors, omissions, interruptions or delays in transmission or delivery of any messages, by mail, cable, telegraph, telex or otherwise, whether or not they be in cipher; (v) errors in interpretation of technical terms; (vi) any loss or delay in the transmission or otherwise of any document required in order to make a drawing under any such Letter of Credit or of the proceeds thereof; (vii) the misapplication by any beneficiary of any such Letter of Credit of the proceeds of any drawing under such Letter of Credit; (viii) for any other action or inaction taken or suffered by such Issuing Bank under or in connection with any such Letter of Credit, if required or permitted under any applicable
53


domestic or foreign law or letter of credit practice; or (ix) any consequences arising from causes beyond the control of such Issuing Bank, including any Governmental Acts; none of the above shall affect or impair, or prevent the vesting of, any of such Issuing Bank’s rights or powers hereunder or place such Issuing Bank under any liability to the Borrower or any Applicable Account Party. Without limiting the foregoing and in furtherance thereof, any action taken or omitted by an Issuing Bank under or in connection with the Letters of Credit issued by it or any documents and certificates delivered thereunder, if taken or omitted in “good faith” (as such term is defined in Article 5 of the New York Uniform Commercial Code), shall not give rise to any liability on the part of the Issuing Bank to the Borrower, any Applicable Account Party or any party to this Agreement. Notwithstanding anything to the contrary contained in this Section 2.19(c), the applicable Issuing Bank shall not be excused from liability to the Borrower or the Applicable Account Party to the extent of any direct damages (as opposed to special, indirect, consequential or punitive damages, claims in respect of which are hereby waived by the Borrower to the extent permitted by applicable law) suffered by the Borrower or the Applicable Account Party that are caused by such Issuing Bank’s failure to exercise care when determining whether drafts and other documents presented under a Letter of Credit comply with the terms thereof. The parties hereto expressly agree that, in the absence of gross negligence, bad faith or willful misconduct on the part of the Issuing Bank (as determined by a final, non-appealable judgment of a court of competent jurisdiction), the Issuing Bank shall be deemed to have exercised care in each such determination.
(d)    Reimbursement by the Borrower of Amounts Drawn or Paid Under Letters of Credit. In the event the applicable Issuing Bank has determined to honor a drawing under a Letter of Credit, it shall promptly notify the Borrower, the Applicable Account Party and the Administrative Agent, and the Borrower shall reimburse (or cause the Applicable Account Party to reimburse), whether with its own funds, the funds of the Applicable Account Party or the proceeds of Loans, the applicable Issuing Bank on or before the Business Day immediately following the date on which such drawing is honored (the “Reimbursement Date”) in an amount in immediately available funds equal to the amount of such honored drawing, together with interest at the applicable rate provided in Section 2.10(g). If the Borrower or the Applicable Account Party fails to reimburse the applicable Issuing Bank on the Reimbursement Date, then (A) if the Unreimbursed Amount relates to a Letter of Credit denominated in a currency other than Dollars, automatically and with no further action, the obligation to reimburse such Unreimbursed Amount shall be permanently converted into an obligation to reimburse the Dollar Equivalent, determined using the Exchange Rate calculated as of the date when such payment was due, of such Unreimbursed Amount and (B) the Administrative Agent shall promptly notify each Lender of the Reimbursement Date, the currency and amount of the unreimbursed drawing (the “Unreimbursed Amount”) (and the Dollar Equivalent thereof if the immediately preceding clause (A) is applicable), and the amount of such Lender’s Applicable Percentage thereof. In such event, the Borrower shall be deemed to have requested ABR Loans to be disbursed on the Reimbursement Date in an amount equal to the Unreimbursed Amount, without regard to the minimum and multiples specified in Section 2.02 for the principal amount of ABR Loans, but subject to the amount of the unutilized portion of the Commitments and the conditions set forth in Section 4.02 (other than the delivery of a Borrowing Request). Any notice given by an Issuing Bank or the Administrative Agent pursuant to this Section 2.19(d) may be given by telephone if immediately confirmed in writing (which confirmation may be by telecopy or other electronic transmission); provided that the lack of such an immediate confirmation shall not affect the conclusiveness or binding effect of such notice. Anything contained herein to the contrary notwithstanding, (i) unless the Borrower (or the Applicable Account Party) shall have notified the Administrative Agent and the applicable Issuing Bank prior to 1:00 p.m. (New York City time) on the
54


date such drawing is honored that the Borrower (or the Applicable Account Party) intends to reimburse the applicable Issuing Bank on such date for the amount of such honored drawing with funds other than the proceeds of Loans, the Borrower shall be deemed to have given a timely Borrowing Request to the Administrative Agent requesting Lenders with Commitments to make Loans that are ABR Loans on the Reimbursement Date in an amount equal to the amount of such honored drawing, and (ii) subject to satisfaction or waiver of the conditions specified in Section 4.02, Lenders with Commitments shall, on the Reimbursement Date, make Loans that are ABR Loans in the amount of the Dollar Equivalent (determined in accordance with Section 1.05) of such honored drawing, the proceeds of which shall be applied directly by the Administrative Agent to reimburse the applicable Issuing Bank for the amount of such honored drawing; and provided, further, if for any reason proceeds of Loans are not received by the applicable Issuing Bank on the Reimbursement Date in an amount equal to the amount of such honored drawing, the Borrower shall (or shall cause the Applicable Account Party to) reimburse the applicable Issuing Bank, on demand, in an amount in immediately available funds equal to the excess of the amount of such honored drawing over the aggregate amount of such Loans, if any, which are so received. Nothing in this Section 2.19(d) shall be deemed to relieve any Lender with a Commitment from its obligation to make Loans on the terms and conditions set forth herein, and the Borrower shall retain any and all rights it may have against any such Lender resulting from the failure of such Lender to make such Loans under this Section 2.19(d).
(e)    Lenders’ Purchase of Participations in Letters of Credit. Immediately upon the issuance or increase of each Letter of Credit, without any further action by any Person, the applicable Issuing Bank shall be deemed to have sold to each Lender and each Lender shall have been deemed to have purchased from such Issuing Bank a participation in such Letter of Credit and any drawings honored thereunder in an amount equal to such Lender’s Applicable Percentage (with respect to the Commitments) of the maximum amount which is or at any time may become available to be drawn thereunder (each such Lender purchasing a participation, a “Participating Lender”). In the event that the Borrower or the Applicable Account Party shall fail for any reason to reimburse the applicable Issuing Bank as provided in Section 2.19(d), the applicable Issuing Bank shall promptly notify the Administrative Agent who will notify each Participating Lender of the unreimbursed amount of such honored drawing and of such Lender’s respective participation therein based on such Lender’s Applicable Percentage of the Commitments. Each Participating Lender shall make available to the Administrative Agent, for the account of the applicable Issuing Bank, an amount equal to its respective participation in the applicable currency, and in immediately available funds, no later than 1:00 p.m. (New York City time) on the first Business Day (under the laws of the jurisdiction in which the Principal Office of the Administrative Agent is located) after the date notified by the Administrative Agent. In the event that any Participating Lender fails to make available to the Administrative Agent on such Business Day the amount of such Lender’s participation in such Letter of Credit as provided in this Section 2.19(e), the applicable Issuing Bank shall be entitled to recover such amount on demand from such Lender together with interest thereon for three Business Days at the rate customarily used by such Issuing Bank for the correction of errors among banks and thereafter at the Alternate Base Rate. Nothing in this Section 2.19(e) shall be deemed to prejudice the right of any Participating Lender to recover from the applicable Issuing Bank any amounts made available by such Lender to the applicable Issuing Bank pursuant to this Section 2.19 in the event that the payment with respect to a Letter of Credit in respect of which payment was made by such Lender constituted gross negligence, bad faith or willful misconduct (as determined by a final, non-appealable judgment of a court of competent jurisdiction) on the part of such Issuing Bank. Each Lender acknowledges and agrees that its obligation to fund participations pursuant to this paragraph
55


in respect of Letters of Credit is absolute and unconditional and shall not be affected by any circumstance whatsoever, including any amendment, extension, or increase of any Letter of Credit, the occurrence and continuance of a Default, any reduction or termination of the Commitments or any force majeure or other event that under any rule of law or uniform practices to which any Letter of Credit is subject (including Rule 3.13 and Rule 3.14 of ISP 98) permits a drawing to be made under such Letter of Credit after the expiration thereof or after the expiration or termination of the Commitments or any other circumstance or happening whatsoever, whether or not similar to any of the foregoing, including those set forth in the following paragraph (f), and that each such payment shall be made without any defense, offset, abatement, withholding or reduction whatsoever; provided that if any Issuing Bank agrees, in its sole discretion, to extend any Letter of Credit issued by it beyond the fifth Business Day prior to the Maturity Date, no Participating Lender shall have any obligation to fund participations with respect to such Letter of Credit after the Maturity Date. Each Lender further acknowledges and agrees that, in issuing, amending, extending, or increasing any Letter of Credit, the applicable Issuing Bank shall be entitled to rely, and shall not incur any liability for relying, upon the representations and warranties of the Borrower deemed made pursuant to Section 4.02, unless, at least one Business Day prior to the time such Letter of Credit is issued, amended, extended, or increased (or, in the case of an automatic extension permitted pursuant to paragraph (a) of this Section, at least one Business Day prior to the time by which the notification of non-extension must be sent by the applicable Issuing Bank), the Required Lenders shall have notified the applicable Issuing Bank (with a copy to the Administrative Agent) in writing that, as a result of one or more events or circumstances described in such notice, one or more of the conditions precedent set forth in Section 4.02(a), 4.02(b) or 4.02(e) would not be satisfied if such Letter of Credit were then issued, amended, extended, or increased (it being understood and agreed that, in the event any Issuing Bank shall have received any such notice, no Issuing Bank shall have any obligation to issue, amend, extend, or increase any Letter of Credit until and unless it shall be satisfied that the events and circumstances described in such notice shall have been cured or otherwise shall have ceased to exist). In the event the applicable Issuing Bank shall have been reimbursed by other Lenders pursuant to this Section 2.19(e) for all or any portion of any drawing honored by such Issuing Bank under a Letter of Credit, such Issuing Bank shall distribute to the Administrative Agent who shall in turn distribute to each Lender which has paid all amounts payable by it under this Section 2.19(e) with respect to such honored drawing such Lender’s Applicable Percentage of all payments subsequently received by such Issuing Bank from the Borrower or the Applicable Account Party in reimbursement of such honored drawing when such payments are received. Any such distribution shall be made to a Lender at its primary address set forth below its name on the Administrative Questionnaire or at such other address as such Lender may request.
(f)    Obligations Absolute. The obligation of the Borrower and each Applicable Account Party to reimburse each Issuing Bank for drawings honored under the Letters of Credit issued by it and to repay any Loans made by Lenders pursuant to Section 2.19(d) and the obligations of Lenders under Section 2.19(e) shall be unconditional and irrevocable and shall be paid strictly in accordance with the terms hereof under all circumstances including any of the following circumstances: (i) any lack of validity or enforceability of any Letter of Credit; (ii) the existence of any claim, set off, defense or other right which the Borrower, any Applicable Account Party or any Lender may have at any time against a beneficiary or any transferee of any Letter of Credit (or any Persons for whom any such transferee may be acting), any Issuing Bank, any Lender or any other Person or, in the case of a Lender, against the Borrower, whether in connection herewith, the transactions contemplated herein or any unrelated transaction (including any underlying transaction between the Borrower or one of its Subsidiaries and the beneficiary(ies) for which any Letter of
56


Credit was procured); (iii) any draft or other document presented under any Letter of Credit proving to be forged, fraudulent, invalid or insufficient in any respect or any statement therein being untrue or inaccurate in any respect; (iv) payment by the applicable Issuing Bank under any Letter of Credit against presentation of a draft or other document which does not substantially comply with the terms of such Letter of Credit; (v) any adverse change in the business, operations, properties, assets, condition (financial or otherwise) or prospects of the Borrower, any Applicable Account Party or any Subsidiaries or any other Person; (vi) any breach hereof or any other Loan Document by any party hereto or thereto; (vii) any force majeure or other event that under any rule of law or uniform practices to which any Letter of Credit is subject (including Rule 3.13 and Rule 3.14 of ISP 98) permits a drawing to be made under such Letter of Credit after the expiration thereof or after the expiration or termination of the Commitments, (viii) any other circumstance or happening whatsoever, whether or not similar to any of the foregoing; or (ix) the fact that an Event of Default or a Default shall have occurred and be continuing.
(g)    Indemnification. Without duplication of any obligation of the Borrower under Section 9.03, in addition to amounts payable as provided herein, the Borrower hereby agrees to protect, indemnify, pay and save and hold harmless the Issuing Banks from and against any and all claims, demands, liabilities, damages and losses, and all reasonable and documented costs, charges and out-of-pocket expenses (including reasonable fees, out-of-pocket expenses and disbursements of one primary counsel (with exceptions for conflicts of interest), one regulatory counsel and one local counsel in each relevant jurisdiction), which the Issuing Banks may incur or be subject to as a consequence, direct or indirect, of, or arising out of, in any way being connected with, or as a result of (A) any Letter of Credit, including without limitation, the use of the proceeds therefrom and any refusal by any Issuing Bank to honor a demand for payment under a Letter of Credit if the documents presented in connection with such demand do not strictly comply with the terms of such Letter of Credit, other than as a result of the gross negligence, bad faith or willful misconduct of such Issuing Bank as determined by a final, non-appealable judgment of a court of competent jurisdiction or (B) the failure of the applicable Issuing Bank to honor a drawing under any such Letter of Credit as a result of any Governmental Act. The Borrower will pay all amounts owing under this Section promptly after written demand therefor.
(h)    Resignation and Removal of an Issuing Bank. An Issuing Bank may resign as an Issuing Bank by providing at least 30 days prior written notice to the Administrative Agent, the Lenders and the Borrower. An Issuing Bank may be replaced at any time by written agreement among the Borrower, the Administrative Agent, the replaced Issuing Bank (provided that no consent of the Issuing Bank will be required if the replaced Issuing Bank has no Letters of Credit or reimbursement obligations with respect thereto outstanding), the other Issuing Banks, if any, and the successor Issuing Bank. The Administrative Agent shall notify the Lenders of any such replacement of such Issuing Bank. At the time any such replacement or resignation shall become effective, the Borrower shall pay all unpaid fees accrued for the account of the replaced or resigning Issuing Bank. From and after the effective date of any such replacement or resignation, (i) any successor Issuing Bank shall have all the rights and obligations of an Issuing Bank under this Agreement with respect to Letters of Credit to be issued thereafter and (ii) references herein to the term “Issuing Bank” shall be deemed to refer to such successor or to any previous Issuing Bank, or to such successor and all previous Issuing Banks, as the context shall require. At the time any such resignation or replacement shall become effective, (a) the Borrower shall pay all unpaid fees accrued for the account of the replaced Issuing Bank pursuant to Section 2.09 and (b) the replaced Issuing Bank may at its option remain a party hereto to the extent that Letters of Credit issued by it remain outstanding and shall
57


continue to have all the rights and obligations of an Issuing Bank under this Agreement with respect to Letters of Credit issued by it prior to such replacement or resignation. After the replacement or resignation of an Issuing Bank hereunder, the replaced Issuing Bank shall not be required to issue, amend, extend or increase any Letters of Credit.
(i)    Cash Collateral. If any Event of Default shall occur and be continuing, on the Business Day that the Borrower receives notice from the Administrative Agent or the Required Lenders demanding the deposit of Cash Collateral pursuant to this paragraph, the Borrower shall deposit in an account with the Administrative Agent, in the name of the Administrative Agent and for the benefit of the Lenders and the Issuing Banks, an amount in cash equal to the Agreed L/C Cash Collateral Amount plus any accrued and unpaid interest thereon; provided that (i) any such required Cash Collateral shall be made in Dollars unless such Cash Collateral is attributable to undrawn Letters of Credit denominated in a Permitted Foreign Currency or outstanding Letter of Credit Disbursements made in a Permitted Foreign Currency (in which case such Cash Collateral shall be deposited (x) in the applicable Permitted Foreign Currency in an amount equal to the Agreed L/C Cash Collateral Amount of such undrawn Letters of Credit or outstanding Letter of Credit Disbursements or (y) in Dollars in an amount equal to 105% of the Dollar Equivalent of such undrawn Letters of Credit or outstanding Letter of Credit Disbursements (with the Dollar Equivalent amount subject to redetermination in accordance with Section 1.05(a)) and (ii) the obligation to deposit such Cash Collateral shall become effective immediately, and such Cash Collateral shall become immediately due and payable, without demand or other notice of any kind, upon the occurrence of any Event of Default with respect to the Borrower described in Section 7.01(h), (i) or (j). Such Cash Collateral shall be held by the Administrative Agent as collateral for the payment and performance of the obligations of the Borrower and any Applicable Account Party under this Agreement. The Administrative Agent shall have exclusive dominion and control, including the exclusive right of withdrawal, over such account. Other than any interest earned on the investment of such Cash Collateral, which investments shall be made at the option and sole discretion of the Administrative Agent and at the Borrower’s risk and expense, such Cash Collateral shall not bear interest. Interest or profits, if any, on such investments shall accumulate in such account. Moneys in such account shall be applied by the Administrative Agent to reimburse each Issuing Bank for any disbursements under Letters of Credit made by it and for which it has not been reimbursed and, to the extent not so applied, shall be held for the satisfaction of the reimbursement obligations of the Borrower and any Applicable Account Party for the Letter of Credit Usage at such time or, if the maturity of the Loans has been accelerated (but subject to the consent of Lenders with Letter of Credit Usage representing greater than 50% of the total Letter of Credit Usage), be applied to satisfy other obligations of the Borrower under this Agreement. If the Borrower is required to provide an amount of Cash Collateral hereunder as a result of the occurrence of an Event of Default, such amount (to the extent not applied as aforesaid) shall be returned to the Borrower (or as otherwise ordered by a court of competent jurisdiction) within five Business Days after all Events of Default have been cured or waived.
(j)    Application. To the extent that any provision of any Application related to any Letter of Credit is inconsistent with the provisions of this Section 2.19, the provisions of this Section 2.19 shall apply.
(k)    Upon the Effective Date, all Effective Date Letters of Credit shall be deemed to have been issued under this Agreement on the Effective Date and to be outstanding as Letters of Credit under this Agreement issued by the applicable Issuing Bank.
58


Section 2.20    Extension of the Maturity Date. Not earlier than 60 days prior to, nor later than 10 days prior to, any anniversary of the Effective Date, the Borrower may, upon written notice (the “Extension Notice”) to the Administrative Agent (which shall promptly notify the Lenders), request an extension of the Maturity Date for a period of one year; provided that no more than two such extensions may be requested pursuant to this Section 2.20. If the conditions in this Section 2.20 are met, the Maturity Date shall be extended to the date specified in such Extension Notice (which in no event shall be later than one year following the Maturity Date) for all Extending Lenders. If a Lender agrees, in its individual and sole discretion, to so extend its Commitment (an “Extending Lender”), it shall deliver to the Administrative Agent a written notice of its agreement to do so no later than 15 days after the date the applicable Extension Notice is received by the Administrative Agent (or such later date to which the Borrower and the Administrative Agent shall agree), and the Administrative Agent shall promptly thereafter notify the Borrower of such Extending Lender’s agreement to extend its Commitment (confirming the date of extension and the new Maturity Date (after giving effect to such extension) applicable to such Extending Lender). The Commitment of any Lender that fails to accept or respond to the Borrower’s request for extension of the Maturity Date (a “Declining Lender”) shall be terminated on the Maturity Date then in effect for such Lender (without regard to any extension by other Lenders) and on such Maturity Date the Borrower shall pay in full the unpaid principal amount of all Loans owing to such Declining Lender, together with all accrued and unpaid interest thereon and all fees accrued and unpaid under this Agreement to the date of such payment of principal and all other amounts due to such Declining Lender under this Agreement. The Administrative Agent shall promptly notify each Extending Lender of the aggregate Commitments of the Declining Lenders. Each Extending Lender may offer to increase its respective Commitment by an amount not to exceed the aggregate amount of the Declining Lenders’ Commitments, and such Extending Lender shall deliver to the Administrative Agent a notice of its offer to so increase its Commitment no later than 30 days after the date the applicable Extension Notice is received by the Administrative Agent (or such later date to which the Borrower and the Administrative Agent shall agree). To the extent the aggregate amount of additional Commitments that the Extending Lenders offer pursuant to the preceding sentence exceeds the aggregate amount of the Declining Lenders’ Commitments, such additional Commitments shall be reduced on a pro rata basis. To the extent the aggregate amount of Commitments that the Extending Lenders have so offered to extend is less than the aggregate amount of Commitments that the Borrower has so requested to be extended, the Borrower shall have the right but not the obligation to require any Declining Lender to (and any such Declining Lender shall) assign in full its rights and obligations under this Agreement to one or more banks or other financial institutions (which may be, but need not be, one or more of the Extending Lenders) which at the time agree to, in the case of any such Person that is an Extending Lender, increase its Commitment and in the case of any other such Person (a “New Extending Lender”), become a party to this Agreement; provided that (i) such assignment is otherwise in compliance with Section 9.04, (ii) such Declining Lender receives payment in full of the unpaid principal amount of all Loans owing to such Declining Lender, together with all accrued and unpaid interest thereon and all fees accrued and unpaid under this Agreement to the date of such payment of principal and all other amounts due to such Declining Lender under this Agreement and (iii) any such assignment shall be effective on the date on or before the date the Maturity Date is so extended as may be specified by the Borrower and agreed to by the respective New Extending Lenders and Extending Lenders, as the case may be, and the Administrative Agent. As a condition precedent to such extension, the Borrower shall deliver to the Administrative Agent a certificate of the Borrower, dated as of the date of the Extension Notice, signed by a Responsible Officer of the Borrower (i) certifying and attaching the resolutions adopted by the Borrower and the Guarantors approving or consenting to such extension and (ii) certifying that, before and after giving effect to such extension, each of the conditions of
59


Section 4.02 shall be satisfied as of the date of the Extension Notice. Any extension pursuant to this Section 2.20 shall be effected pursuant to an Extension Agreement executed and delivered by Borrower, the Extending Lenders, any New Extending Lenders, and the Administrative Agent. Each Extension Agreement may, without the consent of any other Lenders, effect such amendments to this Agreement and the other Loan Documents as may be necessary or appropriate in the opinion of the Administrative Agent to effect the provision of this Section 2.20.
ARTICLE III
REPRESENTATIONS AND WARRANTIES
The Borrower represents and warrants to the Lenders and the Issuing Banks that:
Section 3.01    Organization; Powers. Each of the Borrower and its Restricted Subsidiaries is duly organized and validly existing. Each of the Borrower and its Restricted Subsidiaries (other than any Immaterial Subsidiary) is (to the extent the concept is applicable in such jurisdiction) in good standing under the laws of the jurisdiction of its organization, has all requisite power and authority to carry on its business as now conducted and, except where the failure to do so, individually or in the aggregate, would not reasonably be expected to result in a Material Adverse Effect, is qualified to do business in, and is in good standing in, every jurisdiction where such qualification is required.
Section 3.02    Authorization; Enforceability. The Transactions are within the Borrower’s and each Guarantor’s corporate or other organizational powers and have been duly authorized by all necessary corporate or other organizational and, if required, equity holder action. Each of the Borrower and the Guarantors has duly executed and delivered each of the Loan Documents to which it is party, and each of such Loan Documents, constitutes its legal, valid and binding obligations, enforceable in accordance with its terms, subject to applicable bankruptcy, insolvency, reorganization, moratorium or other laws affecting creditors’ rights generally and subject to general principles of equity, regardless of whether considered in a proceeding in equity or at law.
Section 3.03    Governmental Approvals; No Conflicts. The Transactions (a) do not require any consent or approval of, registration or filing with, or any other action by, any Governmental Authority, except (i) such as have been obtained or made and are in full force and effect and (ii) those approvals, consents, registrations, filings or other actions, the failure of which to obtain or make would not reasonably be expected to have a Material Adverse Effect, (b) except as would not reasonably be expected to have a Material Adverse Effect, will not violate any applicable law or regulation or any order of any Governmental Authority, (c) will not violate any charter, by-laws or other organizational document of the Borrower or any Guarantor, and (d) except as would not reasonably be expected to have a Material Adverse Effect, will not violate or result in a default under any indenture, agreement or other instrument (other than the agreements and instruments referred to in clause (c)) binding upon the Borrower or any of its Restricted Subsidiaries or its assets.
Section 3.04    Financial Condition; No Material Adverse Change.
(a)    The Borrower has heretofore furnished to the Administrative Agent its (i) consolidated balance sheet and statements of income and cash flows as of and for the fiscal year ended December 31, 2017, audited by Deloitte LLP, independent public accountants, and (ii) consolidated balance sheet and statement of income as of and for the fiscal quarter ended June 30,
60


2018. Such financial statements present fairly, in all material respects, the financial position and results of operations and cash flows of the Borrower and its consolidated Restricted Subsidiaries as of such dates and for such periods in accordance with GAAP, subject to year-end adjustments and the absence of footnotes in the case of the unaudited financial statements referred to in clauses (ii) above.
(b)    Since December 31, 2017, no event, development or circumstance exists or has occurred that has had or would reasonably be expected to have a Material Adverse Effect.
Section 3.05    Properties.(a) Each of the Borrower and its Restricted Subsidiaries has good title to, or valid leasehold interests in or rights to use, all its real and tangible personal property material to its business, except for minor defects in title that do not interfere with its ability to conduct its business as currently conducted or to utilize such properties for their intended purposes.
(b)    Each of the Borrower and its Restricted Subsidiaries owns, or is licensed to use, all trademarks, trade names, copyrights, patents, software, domain names, trade secrets, know-how and other similar proprietary or intellectual property rights, including any registrations and applications for registration of, and all goodwill associated with, the foregoing, material to or necessary to its business as currently conducted, and the operation of such business or the use of any of the foregoing intellectual property rights by the Borrower and its Restricted Subsidiaries does not infringe upon, misappropriate, or otherwise violate the rights of any other Person, except for any such failures to own or be licensed to use, and such infringements, misappropriations, or violations that, individually or in the aggregate, would not reasonably be expected to result in a Material Adverse Effect.
Section 3.06    Litigation and Environmental Matters.
(a)    There are no actions, suits or proceedings by or before any arbitrator or Governmental Authority pending against or, to the knowledge of the Borrower, threatened in writing against or affecting the Borrower or any of its Restricted Subsidiaries (i) that would reasonably be expected, individually or in the aggregate, to result in a Material Adverse Effect or (ii) that involve this Agreement, any other Loan Document or the Transactions. Neither the Borrower nor any of its Restricted Subsidiaries is subject to or in default with respect to any final judgments, writs, injunctions, decrees, rules or regulations of any court or any federal, state, municipal or other governmental department, commission, board, bureau, agency or instrumentality, domestic or foreign, that, individually or in the aggregate, would reasonably be expected to result in a Material Adverse Effect.
(b)    Except with respect to any matter that, individually or in the aggregate, would not reasonably be expected to result in a Material Adverse Effect, neither the Borrower nor any of its Restricted Subsidiaries (i) has failed to comply with any Environmental Law or to obtain, maintain or comply with any permit, license or other approval required under any Environmental Law, (ii) has become subject to any Environmental Liability, or (iii) has received notice of any claim with respect to any Environmental Liability.
Section 3.07    Compliance with Laws and Agreements; No Default. Each of the Borrower and its Restricted Subsidiaries is in compliance with all laws, rules, regulations and orders of any Governmental Authority applicable to it or its property and all indentures, agreements and other instruments binding upon it or its property, except where the failure to do so, individually or in the
61


aggregate, would not reasonably be expected to result in a Material Adverse Effect. No Default has occurred and is continuing. No default under the terms of any funded Warehouse Facility has occurred and is continuing.
Section 3.08    Investment Company Status. None of the Borrower or any Restricted Subsidiary is or is required to be registered as an “investment company” under the Investment Company Act of 1940.
Section 3.09    Margin Stock. None of the Borrower or any Restricted Subsidiary is engaged in the business of purchasing or carrying, or extending credit for the purpose of purchasing or carrying, margin stock (within the meaning of Regulation U issued by the Board), and no proceeds of any Loan and no Letter of Credit will be used to purchase or carry any margin stock or to extend credit to others for the purpose of purchasing or carrying any margin stock in violation of Regulation U or Regulation X issued by the Board and all official rulings and interpretations thereunder or thereof.
Section 3.10    Taxes. Except as would not reasonably be expected to result in a Material Adverse Effect, (i) each of the Borrower and its Restricted Subsidiaries has timely filed or caused to be filed all Tax returns and reports required to have been filed with respect to income, properties or operations of the Borrower and its Restricted Subsidiaries, (ii) such returns accurately reflect in all material respects all liability for Taxes of the Borrower and its Restricted Subsidiaries as a whole for the periods covered thereby and (iii) each of the Borrower and its Restricted Subsidiaries has paid or caused to be paid all Taxes required to have been paid by it, except Taxes that are being contested in good faith by appropriate proceedings and, to the extent required by GAAP, for which the Borrower or such Restricted Subsidiary, as applicable, has set aside on its books adequate reserves in accordance with GAAP.
Section 3.11    ERISA.
(a)    Schedule 3.11 to the Disclosure Letter sets forth each Plan as of the Effective Date. Each Plan is in compliance in form and operation with its terms and with ERISA and the Code (including without limitation the Code provisions compliance with which is necessary for any intended favorable tax treatment) and all other applicable laws and regulations, except where any failure to comply would not reasonably be expected to result in a Material Adverse Effect. Each Plan (and each related trust, if any) which is intended to be qualified under Section 401(a) of the Code has received a favorable determination letter from the IRS to the effect that it meets the requirements of Sections 401(a) and 501(a) of the Code covering all applicable tax law changes or is comprised of a master or prototype plan that has received a favorable opinion letter from the IRS, and, nothing has occurred since the date of such determination that would adversely affect such determination (or, in the case of a Plan with no determination, nothing has occurred that would materially adversely affect the issuance of a favorable determination letter or otherwise materially adversely affect such qualification). No ERISA Event has occurred, or is reasonably expected to occur, other than as would not, individually or in the aggregate, reasonably be expected to result in a Material Adverse Effect.
(b)    There exists no Unfunded Pension Liability with respect to any Plan, except as would not reasonably be expected to result in a Material Adverse Effect.
(c)    None of the Borrower, any Restricted Subsidiary or any ERISA Affiliate is making or accruing an obligation to make contributions, or has within any of the five calendar years
62


immediately preceding the date this assurance is given or deemed given, made or accrued an obligation to make contributions to any Multiemployer Plan.
(d)    There are no actions, suits or claims pending against or involving a Plan (other than routine claims for benefits) or, to the knowledge of the Borrower, any Restricted Subsidiary or any ERISA Affiliate, threatened, which would reasonably be expected to be asserted successfully against any Plan and, if so asserted successfully, would reasonably be expected either singly or in the aggregate to result in a Material Adverse Effect.
(e)    The Borrower, its Restricted Subsidiaries and its ERISA Affiliates have made all contributions to or under each Plan and Multiemployer Plan required by law within the applicable time limits prescribed thereby, the terms of such Plan or Multiemployer Plan, respectively, or any contract or agreement requiring contributions to a Plan or Multiemployer Plan save where any failure to comply, individually or in the aggregate, would not reasonably be expected to result in a Material Adverse Effect.
(f)    No Plan which is subject to Section 412 of the Code or Section 302 of ERISA has applied for or received an extension of any amortization period, within the meaning of Section 412 of the Code or Section 302 or 304 of ERISA. The Borrower, any Restricted Subsidiary, and any ERISA Affiliate have not ceased operations at a facility so as to become subject to the provisions of Section 4062(e) of ERISA, withdrawn as a substantial employer so as to become subject to the provisions of Section 4063 of ERISA or ceased making contributions to any Plan subject to Section 4064(a) of ERISA to which it made contributions. None of the Borrower, any Restricted Subsidiary or any ERISA Affiliate have incurred or reasonably expect to incur any liability to PBGC except as would not reasonably be expected to result in material liability, save for any liability for premiums due in the ordinary course or other liability which would not reasonably be expected to result in material liability, and no lien imposed under the Code or ERISA on the assets of the Borrower or any Restricted Subsidiary or any ERISA Affiliate exists or, to the knowledge of the Borrower, is likely to arise on account of any Plan. None of the Borrower, any Restricted Subsidiary or any ERISA Affiliate has engaged in a transaction that could be subject to Section 4069 or 4212(c) of ERISA.
(g)    Each Non-U.S. Plan has been maintained in compliance with its terms and with the requirements of any and all applicable laws, statutes, rules, regulations and orders and has been maintained, where required, in good standing with applicable regulatory authorities, except as would not reasonably be expected to result in a Material Adverse Effect. All contributions required to be made with respect to a Non-U.S. Plan have been timely made, except as would not reasonably be expected to result in a Material Adverse Effect. Neither the Borrower nor any of its Restricted Subsidiaries has incurred any material obligation in connection with the termination of, or withdrawal from, any Non-U.S. Plan. The present value of the accrued benefit liabilities (whether or not vested) under each Non-U.S. Plan, determined as of the end of the Borrower’s most recently ended fiscal year on the basis of actuarial assumptions, each of which is reasonable, did not exceed the current value of the assets of such Non-U.S. Plan allocable to such benefit liabilities, except as would not reasonably be expected to result in a Material Adverse Effect.
Section 3.12    Disclosure. (a) The written information furnished by or on behalf of the Borrower to the Administrative Agent or any Lender in connection with the negotiation of this Agreement and syndication of the credit facilities provided for herein (other than the Projections (as defined below) and information of a general economic or industry nature and after giving effect to all
63


supplements and updates thereto), when taken as a whole, does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made therein not materially misleading in light of the circumstances under which such statements are made.
(b)    The written projections and other forward-looking information most recently furnished by or on behalf of the Borrower to the Administrative Agent or any Lender in connection with the negotiation of this Agreement and syndication of the credit facilities provided for herein (the “Projections”) have been prepared in good faith based upon assumptions that are believed by the Borrower to be reasonable at the time so furnished (it being understood that such Projections are subject to significant uncertainties and contingencies, any of which are beyond the Borrower’s control, that no assurance can be given that any particular Projections will be realized and that actual results during the period or periods covered by any such Projections may differ significantly from the projected results and such differences may be material).
Section 3.13    Subsidiaries. Schedule 3.13 to the Disclosure Letter sets forth as of the Effective Date a list of all Subsidiaries (other than Immaterial Subsidiaries) and the percentage ownership (directly or indirectly) of the Borrower therein. Except as would not, individually or in the aggregate, reasonably be expected to result in a Material Adverse Effect, the shares of capital stock or other ownership interests of all Restricted Subsidiaries of the Borrower are fully paid and non-assessable and are owned by the Borrower, directly or indirectly, free and clear of all Liens other than Liens permitted under Section 6.02. Each Subsidiary of the Borrower that is not listed on Schedule 3.13 to the Disclosure Letter (or any supplement thereto provided pursuant to Section 5.01(c)) is an Immaterial Subsidiary.
Section 3.14    Solvency. As of the Effective Date, the Borrower and the Subsidiaries, taken as a whole, are, and after giving effect to the Transactions, Solvent.
Section 3.15    Anti-Terrorism Law.
(a)    To the extent applicable, neither the Borrower nor any of its Subsidiaries is in violation of any legal requirement relating to U.S. economic sanctions or any laws with respect to terrorism or money laundering in any material respect, including Executive Order No. 13224 on Terrorist Financing effective September 24, 2001 (the “Executive Order”), the USA Patriot Act, the laws comprising or implementing the Bank Secrecy Act to the extent applicable and the laws administered by the United States Treasury Department’s Office of Foreign Asset Control (each as from time to time in effect) (collectively, “Anti-Terrorism Laws”).
(b)    None of (x) the Borrower, any of its Subsidiaries or any of the Borrower’s officers, (y) to the knowledge of the Borrower, any of the officers of any of the Borrower’s Subsidiaries or (z) to the knowledge of the Borrower, any of the directors or employees of the Borrower or its Subsidiaries, is any of the following:
(i)    a Person that is listed in the annex to, or is otherwise subject to the provisions of, the Executive Order;
(ii)    a Person owned or controlled by, or acting for or on behalf of, any Person that is listed in the annex to, or is otherwise subject to the provisions of, the Executive Order;
64


(iii)    a Person with which any Lender is prohibited from dealing or otherwise engaging in any transaction by any Anti-Terrorism Law; or
(iv)    a Sanctioned Entity or a Sanctioned Person.
(c)    The Borrower will not use, and will not permit any of its Subsidiaries to use, the proceeds of the Loans or any Letter of Credit or otherwise make available such proceeds or Letters of Credit to any Person described in Section 3.15(b)(i)-(iv), for the purpose of financing the activities of any Person described in Section 3.15(b)(i)-(iv) or in any other manner that would violate any Anti-Terrorism Laws or applicable Sanctions.
(d)    The Borrower has implemented and maintains in effect policies and procedures designed to promote compliance by the Borrower, its Subsidiaries and their respective directors, officers, employees and agents with applicable Anti-Terrorism Laws, applicable Anti-Corruption Laws and applicable Sanctions, and the Borrower, its Subsidiaries and the officers of the Borrower, and, to the knowledge of the Borrower, each of the officers of any of the Borrower’s Subsidiaries and each of the directors and employees of the Borrower and its Subsidiaries, are in compliance with applicable Anti-Terrorism Laws, Anti-Corruption Laws and Sanctions in all material respects.
Section 3.16    FCPA; Sanctions. No part of the proceeds of the Loans or any Letter of Credit will be used by the Borrower or any of its Subsidiaries, directly or, to the Borrower’s or any Subsidiary’s knowledge, indirectly, (a) in furtherance of an offer, payment, promise to pay, or authorization of the payment or giving of money, or anything else of value, to any Person in violation of the FCPA or any applicable Anti-Corruption Laws, (b) for the purpose of funding, financing or facilitating any activities, business or transaction of or with any Person, or in any country or territory that, at the time of such funding, financing or facilitating, is, or whose government is, a Sanctioned Person or Sanctioned Entity or (c) in any manner that would result in the violation of any Sanctions applicable to any party hereto. Neither the Borrower nor any of its Subsidiaries has, in the past five years, knowingly engaged in, or is now knowingly engaged in, transactions with any Person or in any country or territory in violation of applicable Sanctions in any material respect.
ARTICLE IV
CONDITIONS
Section 4.01    Effective Date. The obligations of the Lenders to make Loans and of the Issuing Banks to issue Letters of Credit hereunder shall not become effective until the date on which each of the following conditions is satisfied (or waived in accordance with Section 9.02):
(a)    The Administrative Agent (or its counsel) shall have received from each party hereto a counterpart of this Agreement and each other Loan Document to which any Loan Party is a party, signed on behalf of such Loan Party.
(b)    The Administrative Agent shall have received a Note executed by the Borrower in favor of each Lender requesting a Note in advance of the Effective Date.
(c)    The Administrative Agent shall have received favorable written opinions (addressed to the Administrative Agent, the Issuing Banks and the Lenders and dated the Effective
65


Date) of Wachtell, Lipton, Rosen & Katz and Orrick, Herrington & Sutcliffe LLP, counsel for the Borrower, in form and substance reasonably satisfactory to the Administrative Agent. The Borrower hereby requests such counsel to deliver such opinion.
(d)    The Administrative Agent shall have received (i) certified copies of the resolutions of the board of directors (or comparable governing body) of the Borrower and the Guarantors approving the transactions contemplated by the Loan Documents to which each such Loan Party is a party and the execution and delivery of such Loan Documents to be delivered by such Loan Party on the Effective Date, and all documents evidencing other necessary organizational action and governmental approvals, if any, with respect to the Loan Documents and (ii) all other documents reasonably requested by the Administrative Agent relating to the organization, existence and good standing of the Guarantors and the Borrower and authorization of the transactions contemplated hereby.
(e)    The Administrative Agent shall have received a certificate of the Secretary or an Assistant Secretary of the Borrower and each Guarantor certifying the names and true signatures of the officers of such entity authorized to sign the Loan Documents to which it is a party, to be delivered by such entity on the Effective Date and the other documents to be delivered hereunder on the Effective Date.
(f)    The Administrative Agent shall have received (i) a certificate, dated the Effective Date and signed on behalf of the Borrower by the President, a Vice President or a Financial Officer of the Borrower, confirming compliance with the conditions set forth in paragraphs (a) and (b) of Section 4.02 as of the Effective Date, and (ii) a solvency certificate, dated the Effective Date and signed on behalf of the Borrower by the most senior financial officer of the Borrower, certifying that, as of the Effective Date, the Borrower and the Restricted Subsidiaries, taken as a whole, are, and after giving effect to the Transactions and any Borrowings on the Effective Date, Solvent.
(g)    The Lenders, the Administrative Agent and the Arrangers shall have received all fees required to be paid by the Borrower on the Effective Date, and all expenses required to be reimbursed by the Borrower for which invoices have been presented at least three Business Days prior to the Effective Date, on or before the Effective Date.
(h)    The Administrative Agent shall have received, at least three Business Days prior to the Effective Date, to the extent reasonably requested by the Administrative Agent, any Issuing Bank or any of the Lenders at least five Business Days prior to the Effective Date, (i) all documentation and other information required by bank regulatory authorities under applicable “know-your-customer” and anti-money laundering rules and regulations, including the USA Patriot Act and (ii) if the Borrower qualifies as a “legal entity customer” under the Beneficial Ownership Regulation, a Beneficial Ownership Certification.
(i)    The Administrative Agent shall have received (i) audited consolidated financial statements of the Borrower for the annual period ended December 31, 2017 and (ii) unaudited interim consolidated financial statements of the Borrower for the quarterly period ended June 30, 2018.
(j)    Since December 31, 2017, no event, development or circumstance exists or has occurred that has had or could reasonably be expected to have a Material Adverse Effect.
66


The Administrative Agent shall notify the Borrower and the Lenders of the Effective Date, and such notice shall be conclusive and binding. Without limiting the generality of the provisions of Article 8, for purposes of determining compliance with the conditions specified in this Section, each Lender that has signed this Agreement shall be deemed to have consented to, approved or accepted or to be satisfied with, each document or other matter required thereunder to be consented to or approved by or acceptable or satisfactory to a Lender unless the Administrative Agent shall have received notice from such Lender prior to the proposed Effective Date specifying its objection thereto.
Section 4.02    Each Credit Event. Except as expressly set forth in Section 2.18(a), the obligation of each Lender to make a Loan on the occasion of any Borrowing, and of the Issuing Banks to issue, amend, renew or extend any Letter of Credit, is subject to the satisfaction of the following conditions:
(a)    The representations and warranties of the Borrower set forth in this Agreement and the other Loan Documents shall be true and correct in all material respects on and as of the date of such Borrowing, or the date of issuance, amendment, extension or increase of such Letter of Credit, as applicable, except that (i) for purposes of this Section, the representations and warranties contained in Section 3.04(a) shall be deemed to refer to the most recent statements furnished pursuant to clauses (a) and (b) (subject, in the case of unaudited and draft financial statements furnished pursuant to clauses (a) and (b), to year-end audit adjustments and the absence of footnotes), respectively, of Section 5.01, (ii) to the extent that such representations and warranties specifically refer to an earlier date, they shall be true and correct in all material respects as of such earlier date and (iii) to the extent that such representations and warranties are already qualified or modified by materiality or words of similar effect in the text thereof, they shall be true and correct in all respects.
(b)    At the time of and immediately after giving effect to such Borrowing, or issuance, amendment, extension or increase of a Letter of Credit, as applicable, no Default or Event of Default shall have occurred and be continuing.
(c)    The Administration Agent shall have received a Borrowing Request and such other documentation and assurances as shall be reasonably required by it in connection therewith.
(d)    The Issuing Banks shall have received all documentation and assurances required under Section 2.19 or otherwise as shall be reasonably required by it in connection therewith.
Each Borrowing or issuance, amendment, extension or increase of a Letter of Credit, as applicable, shall be deemed to constitute a representation and warranty by the Borrower that the conditions specified in paragraphs (a) and (b) of this Section 4.02 have been satisfied as of the date thereof. Notwithstanding anything to the contrary herein, a conversion of a Borrowing to a different Type or a continuation of a Borrowing shall not be deemed to constitute a Borrowing for purposes of this Section 4.02.
ARTICLE V
AFFIRMATIVE COVENANTS
Until the Commitments have expired or been terminated and the principal of and interest on each Loan and all fees and expenses and other amounts payable hereunder shall have been paid in full and the cancellation or expiration with no pending drawings or Cash Collateralization of all Letters of
67


Credit on terms reasonably satisfactory to the applicable Issuing Bank in an amount equal to the Agreed L/C Cash Collateral Amount of all Letter of Credit Usage, the Borrower covenants and agrees with the Lenders that:
Section 5.01    Financial Statements and Other Information. The Borrower will furnish to the Administrative Agent (for distribution to each Lender):
(a)    commencing with the fiscal year ending December 31, 2018, within (x) prior to an IPO, 120 days after each fiscal year end of the Borrower and (y) on and after an IPO, 90 days after each fiscal year end of the Public Company, its audited consolidated balance sheet and related statements of income and cash flows as of the end of and for such year, setting forth in each case in comparative form the figures for the previous fiscal year, all reported on by Deloitte LLP, or other independent public accountants of recognized national standing (without a “going concern” or like qualification or exception (other than a qualification related to the maturity of the Commitments and the Loans at the Maturity Date) and without any qualification or exception as to the scope of such audit) to the effect that such consolidated financial statements present fairly in all material respects the financial condition and results of operations of the Borrower (or, after an IPO, the Public Company) and its consolidated Subsidiaries on a consolidated basis in accordance with GAAP consistently applied;
(b)    commencing with the fiscal quarter ended September 30, 2018, (x) prior to an IPO, within 90 days after the end of each of the first three fiscal quarters of each fiscal year of the Borrower and (y) on and after an IPO, within 45 days after the end of each of the first three fiscal quarters of each fiscal year of the Public Company, its consolidated balance sheet and related statement of income as of the end of and for such fiscal quarter and the then elapsed portion of the fiscal year, setting forth in each case in comparative form the figures for the corresponding period or periods of (or, in the case of the balance sheet, as of the end of) the previous fiscal year, all certified by one of its Financial Officers as presenting fairly in all material respects the financial condition and results of operations of the Borrower (or, after an IPO, the Public Company) and its consolidated Subsidiaries on a consolidated basis in accordance with GAAP consistently applied, subject to normal year-end audit adjustments and the absence of footnotes;
(c)    concurrently with any delivery of financial statements under clause (a) or (b) above, a compliance certificate of a Financial Officer of the Borrower (or, after an IPO, the Public Company) in substantially the form of Exhibit F attached hereto (i) certifying as to whether a Default or Event of Default has occurred and is continuing as of the date thereof and, if a Default or Event of Default has occurred and is continuing as of the date thereof, specifying the details thereof and any action taken or proposed to be taken with respect thereto, (ii) setting forth reasonably detailed calculations demonstrating compliance with Section 6.09 as of the last day of the applicable fiscal quarter or fiscal year for which such financial statements are being delivered, (iii) if and to the extent that any change in GAAP that has occurred since the date of the audited financial statements referred to in Section 3.04 had an impact on such financial statements, setting forth a statement of reconciliation conforming such financial statements to GAAP, provided that such statement of reconciliation shall be required only if and to the extent necessary for the determination of compliance with Section 6.09, (iv) certifying as to the current list of Unrestricted Subsidiaries appropriately designated as such pursuant to Section 5.11(a) and (v) certifying as to the current list of Material Domestic Subsidiaries (excluding any Material Domestic Subsidiaries that are Excluded Subsidiaries);
68


(d)    promptly after the same become publicly available, copies of all periodic and other reports, proxy statements and other materials filed by the Borrower or any Restricted Subsidiary with the Securities and Exchange Commission, or any Governmental Authority succeeding to any or all of the functions of said Commission, or with any national securities exchange, as the case may be, in each case that is not otherwise required to be delivered to the Administrative Agent pursuant hereto;
(e)    concurrently with any delivery of financial statements under clause (a) or (b) above, the Borrower shall provide unaudited financial statements of the character and for the dates and periods as in such clauses (a) and (b) covering the Unrestricted Subsidiaries on a combined basis (if any), together with a consolidating statement reflecting eliminations or adjustments required to reconcile the financial statements of such Unrestricted Subsidiaries to the financial statements delivered pursuant to such clauses (a) and (b); provided that the Borrower shall not be required to provide such financial statements unless the Borrower compiles such combined financial statements as part of its regular internal reporting processes or is able to compile such combined financial statements without undue effort or expense;
(f)    prior to the first filing of a registration statement on Form S-1 with respect to the Qualified Equity Interests of the Public Company (or such earlier time at which the Borrower anticipates in good faith that it will be filing a registration statement on Form S-1 in the following four months), concurrently with any delivery of financial statements under clause (a) above, an annual summary profit and loss forecast (in substantially the form attached hereto as Exhibit I) (it being understood that (x) the first such annual summary profit and loss forecast shall be due concurrently with the delivery of the audited financial statements with respect to the fiscal year ended December 31, 2018 pursuant to clause (a) above and (y) if an annual summary profit and loss forecast is not provided because the Borrower anticipates in good faith that it will be filing a registration statement on Form S-1 in the following four months but does not so file such Form S-1, the Borrower shall deliver the annual summary profit and loss forecast promptly (and in any event within 30 days of the end of such four month period) thereafter);
(g)    promptly following any request in writing (including any electronic message) therefor, such other information regarding the operations, business affairs and financial condition of the Borrower or any Restricted Subsidiary, or compliance with the terms of this Agreement or any other Loan Document, as the Administrative Agent or any Lender (through the Administrative Agent) may reasonably request; and
(h)    not later than 45 days after the last day of each fiscal quarter, beginning with the quarter ended September 30, 2018, the Borrower shall deliver a report containing a summary of the performance data (including delinquency and default data) for the immediately preceding fiscal quarter with respect to the managed pool of student loans, personal loans and mortgage loans which are owned, originated, and serviced by the Borrower or any of its Subsidiaries, and including any securitized loans which were originated and are being serviced by the Borrower or any of its Subsidiaries as of the end of such fiscal quarter, which at the time of origination, complied with the Borrower’s underwriting criteria, whether or not such loans are required to be reflected as assets of the Borrower and its Subsidiaries on a consolidated balance sheet of the Borrower prepared in accordance with GAAP.
69


Information required to be delivered pursuant to Section 5.01(a), Section 5.01(b) or Section 5.01(d) may be delivered electronically and if so delivered, shall be deemed to have been delivered on the date (i) on which the Borrower posts such information, or provides a link thereto on the Borrower’s website on the Internet on any investor relations page at http://www.sofi.com (or any successor page) or at http://www.sec.gov; or (ii) on which such information is posted on the Borrower’s behalf on an Internet or intranet website, if any, to which the Lenders and the Administrative Agent have been granted access (whether a commercial, third-party website or whether sponsored by the Administrative Agent); provided that in the case of each of clause (i) and (ii) above, the Borrower shall notify (which may be by facsimile or electronic mail) the Administrative Agent of the posting of any such documents.
Section 5.02    Notices of Material Events. The Borrower will furnish to the Administrative Agent (for distribution to each Lender) prompt written notice of the following:
(a)    the occurrence of any Default or Event of Default;
(b)    the filing or commencement of any action, suit or proceeding by or before any arbitrator or Governmental Authority against or affecting the Borrower or any Restricted Subsidiary thereof that could reasonably be expected to result in a Material Adverse Effect;
(c)    any other development that results in, or the Borrower expects will result in, a Material Adverse Effect.
Each notice delivered under this Section 5.02 shall be accompanied by a statement of a Responsible Officer or other executive officer of the Borrower setting forth the details of the event or development requiring such notice and any action taken or proposed to be taken with respect thereto.
Section 5.03    Existence; Conduct of Business. The Borrower will, and will cause each of its Restricted Subsidiaries (other than any Immaterial Subsidiaries) to, do or cause to be done all things necessary to preserve, renew and keep in full force and effect its legal existence and the rights, licenses, permits, privileges and franchises material to the conduct of its business; provided that (i) the foregoing shall not prohibit any merger, consolidation, liquidation or dissolution permitted under Section 6.03, and (ii) none of the Borrower or any of its Restricted Subsidiaries (other than any Immaterial Subsidiaries) shall be required to preserve, renew or keep in full force and effect its rights, licenses, permits, privileges or franchises where failure to do so would not reasonably be expected to result in a Material Adverse Effect.
Section 5.04    Payment of Taxes and Other Claims. The Borrower will, and will cause each of its Restricted Subsidiaries to, pay all Tax liabilities, including all Taxes imposed upon it, upon its income or profits, or upon any properties or operations that, if unpaid, could reasonably be expected to result in a Material Adverse Effect, before the same shall become delinquent or in default, and all lawful claims other than Tax liabilities that, if unpaid, would become a Lien upon any properties of the Borrower or any of its Restricted Subsidiaries not otherwise permitted under Section 6.02, in both cases except where the validity or amount thereof is being contested in good faith by appropriate proceedings and to the extent required by GAAP, the Borrower or such Restricted Subsidiary has set aside on its books adequate reserves with respect thereto in accordance with GAAP.
Section 5.05    Maintenance of Properties; Insurance. The Borrower will, and will cause each of its Restricted Subsidiaries to, (a) keep and maintain all property used in the conduct of its business
70


in good working order and condition, ordinary wear and tear and casualty events excepted, except to the extent that failure to do so would not reasonably be expected to have a Material Adverse Effect and (b) maintain insurance with financially sound and reputable insurance companies in such amounts and against such risks as are customarily maintained by companies engaged in the same or similar businesses operating in the same or similar locations.
Section 5.06    Books and Records; Inspection Rights. The Borrower will, and will cause each of its Restricted Subsidiaries to, keep proper books of record and account in which entries full, true and correct in all material respects are made and are sufficient to prepare financial statements in accordance with GAAP. The Borrower will, and will cause each of its Restricted Subsidiaries to, permit any representatives designated by the Administrative Agent or any Lender (pursuant to the request made through the Administrative Agent), upon reasonable prior notice, to visit and inspect its properties, to examine and make extracts from its books and records to the extent reasonably necessary, and to discuss its affairs, finances and condition with its officers and independent accountants (provided that the Borrower or such Restricted Subsidiary shall be afforded the opportunity to participate in any discussions with such independent accountants), all at such reasonable times and as often as reasonably requested (but no more than once annually if no Event of Default exists). Notwithstanding anything to the contrary in this Section, none of the Borrower or any of its Restricted Subsidiaries shall be required to disclose, permit the inspection, examination or making copies or abstracts of, or discussion of, any document, information or other matter that (i) constitutes non-financial trade secrets or non-financial proprietary information, (ii) in respect of which disclosure to the Administrative Agent or any Lender (or their respective representatives) is prohibited by applicable law or any third party contract legally binding on Borrower or its Restricted Subsidiaries, or (iii) is subject to attorney, client or similar privilege or constitutes attorney work-product.
Section 5.07    ERISA-Related Information. The Borrower shall supply to the Administrative Agent (in sufficient copies for all the Lenders, if the Administrative Agent so requests): (a) promptly and in any event within 15 days after the Borrower, any Restricted Subsidiary or any ERISA Affiliate files a Schedule B (or such other schedule as contains actuarial information) to IRS Form 5500 in respect of a Plan with Unfunded Pension Liabilities, a copy of such IRS Form 5500 (including the Schedule B); (b) promptly and in any event within 30 days after the Borrower, any Restricted Subsidiary or any ERISA Affiliate knows or has reason to know that any ERISA Event has occurred, a certificate of the most senior financial officer of the Borrower describing such ERISA Event and the action, if any, proposed to be taken with respect to such ERISA Event and a copy of any notice filed with the PBGC or the IRS pertaining to such ERISA Event and any notices received by such Borrower, Restricted Subsidiary, or ERISA Affiliate from the PBGC or any other governmental agency with respect thereto; provided that, in the case of ERISA Events under paragraph (b) of the definition thereof, in no event shall notice be given later than the occurrence of the ERISA Event; (c) promptly, and in any event within 30 days, after becoming aware that there has been (i) a material increase in Unfunded Pension Liabilities (taking into account only Pension Plans with positive Unfunded Pension Liabilities) since the date the representations hereunder are given or deemed given, or from any prior notice, as applicable; (ii) the existence of potential withdrawal liability under Section 4201 of ERISA, if the Borrower, any Restricted Subsidiary and the ERISA Affiliates were to withdraw completely from any and all Multiemployer Plans, (iii) the adoption of, or the commencement of contributions to, any Plan subject to Title IV of ERISA or Section 412 of the Code or Section 302 of ERISA by the Borrower, any Restricted Subsidiary or any ERISA Affiliate, or (iv) the adoption of any amendment to a Plan subject to Title IV of ERISA or Section 412 of the Code or
71


Section 302 of ERISA which results in a material increase in contribution obligations of the Borrower, any Restricted Subsidiary or any ERISA Affiliate, a detailed written description thereof from the most senior financial officer of the Borrower; and (d) if, at any time after the Effective Date, the Borrower, any Restricted Subsidiary or any ERISA Affiliate maintains, or contributes to (or incurs an obligation to contribute to), a Pension Plan or Multiemployer Plan which is not set forth in Schedule 3.11 to the Disclosure Letter, then the Borrower shall deliver to the Administrative Agent an updated Schedule 3.11 to the Disclosure Letter as soon as practicable, and in any event within 30 days after the Borrower, such Restricted Subsidiary or such ERISA Affiliate maintains, or contributes to (or incurs an obligation to contribute to), thereto.
Section 5.08    Compliance with Laws and Agreements. The Borrower will, and will cause each of its Restricted Subsidiaries to, comply with all laws, rules, regulations and orders of any Governmental Authority applicable to it or its property and all indentures, agreements and other instruments binding upon it or its property, except where the failure to do so, individually or in the aggregate, would not reasonably be expected to result in a Material Adverse Effect. The Borrower will maintain in effect and use reasonable measures to enforce policies and procedures designed to promote compliance by the Borrower, its Restricted Subsidiaries and their respective directors, officers, employees and agents with applicable Anti-Corruption Laws, applicable Anti-Terrorism Laws and applicable Sanctions.
Section 5.09    Use of Proceeds. The proceeds of the Loans and any Letter of Credit will be used only for working capital and general corporate purposes, including, without limitation, for acquisitions, stock repurchases and other Investments not prohibited hereunder. No part of the proceeds of any Loan or Letter of Credit will be used (i) whether directly or indirectly, for any purpose that entails a violation of any of the Regulations of the Board, including Regulations T, U and X or (ii) for the purpose of making any Restricted Payment pursuant to Section 6.04(viii).
Section 5.10    Guarantors. If, as of the date of the most recently available financial statements delivered pursuant to Section 5.01(a) or 5.01(b), as the case may be, any Person shall have become a Material Domestic Subsidiary, then the Borrower shall, (i) within 45 days thereafter (or such longer period of time as the Administrative Agent may agree in its sole discretion) after delivery of such financial statements, cause such Material Domestic Subsidiary to enter into a Guaranty, or, if a Guaranty has previously been entered into by a Material Domestic Subsidiary (and remains in effect), a joinder agreement to such Guaranty in form and substance reasonably satisfactory to the Administrative Agent, and (ii) on or prior to the date any Guaranty or joinder agreement to a Guaranty has been delivered pursuant to clause (i) above, deliver to the Administrative Agent, each Issuing Bank and each Lender all documentation and other information required by bank regulatory authorities under applicable “know-your-customer” and anti-money laundering rules and regulations, including the USA Patriot Act; provided that this Section 5.10 shall not apply to any Material Domestic Subsidiary that is an Excluded Subsidiary. If requested by the Administrative Agent, the Administrative Agent shall receive an opinion of counsel for the Borrower in customary form and substance reasonably satisfactory to the Administrative Agent in respect of matters reasonably requested by the Administrative Agent relating to any Guaranty or joinder agreement delivered pursuant to this Section, dated as of the date of such Guaranty or joinder agreement.
Section 5.11    Designation of Restricted and Unrestricted Subsidiaries.
72


(a)    The board of directors of the Borrower may designate any Subsidiary, including a newly acquired or created Subsidiary, to be an Unrestricted Subsidiary if it meets the following qualifications:
(i)    such Subsidiary does not own any Equity Interest of the Borrower or any Restricted Subsidiary;
(ii)    the Borrower would be permitted to make an Investment at the time of the designation in an amount equal to the aggregate fair market value of all Investments of the Borrower or its Restricted Subsidiaries in such Subsidiary;
(iii)    any guarantee or other credit support thereof by the Borrower or any Restricted Subsidiary is permitted under Section 6.01 or Section 6.08;
(iv)    neither the Borrower nor any Restricted Subsidiary has any obligation to subscribe for additional Equity Interests of such Subsidiary or to maintain or preserve its financial condition or cause it to achieve specified levels of operating results except to the extent permitted by Section 6.01 or Section 6.08;
(v)    immediately before and after such designation, no Default or Event of Default shall have occurred and be continuing or would result from such designation; and
(vi)    no Subsidiary may be designated as an Unrestricted Subsidiary if it is a “restricted subsidiary” or a “guarantor” (or any similar designation) for any other Material Indebtedness of the Borrower or a Restricted Subsidiary that includes the concept of “unrestricted” subsidiaries.
Once so designated, the Subsidiary will remain an Unrestricted Subsidiary, subject to subsection (b).
(b)    A Subsidiary previously designated as an Unrestricted Subsidiary which fails to meet the qualifications set forth in Section 5.11(a)(i), (a)(iii) or (a)(iv) will be deemed to become at that time a Restricted Subsidiary, subject to the consequences set forth in Section 5.11(d). The board of directors of the Borrower may designate an Unrestricted Subsidiary to be a Restricted Subsidiary if the designation would not cause a Default or Event of Default.
(c)    Upon a Restricted Subsidiary becoming an Unrestricted Subsidiary:
(i)    all existing Investments of the Borrower and the Restricted Subsidiaries therein (valued at the Borrower’s proportional share of the fair market value of its assets less liabilities) will be deemed made at that time;
(ii)    all existing Indebtedness of the Borrower or a Restricted Subsidiary held by it will be deemed incurred at that time, and all Liens on property of the Borrower or a Restricted Subsidiary held by it will be deemed incurred at that time;
(iii)    all existing transactions between it and the Borrower or any Restricted Subsidiary will be deemed entered into at that time;
73


(iv)    it is released at that time from the Loan Documents to which it is a party; and
(v)    it will cease to be subject to the provisions of this Agreement as a Restricted Subsidiary.
(d)    Upon an Unrestricted Subsidiary becoming, or being deemed to become, a Restricted Subsidiary pursuant to Section 5.11(b):
(i)    all of its Indebtedness will be deemed incurred at that time for purposes of Section 6.01;
(ii)    Investments therein previously charged under Section 6.08 will be credited thereunder;
(iii)    if it is a Material Domestic Subsidiary, it shall be required to become a Guarantor pursuant to this Agreement to the extent it is not an Excluded Subsidiary; and
(iv)    it will thenceforward be subject to the provisions of this Agreement as a Restricted Subsidiary.
(e)    Any designation by the board of directors of the Borrower of a Subsidiary as an Unrestricted Subsidiary or a Restricted Subsidiary after the Effective Date will be evidenced to the Administrative Agent by promptly filing with the Administrative Agent a copy of the resolutions of the board of directors giving effect to the designation and a certificate of an officer of the Borrower certifying that the designation complied with the foregoing provisions.
ARTICLE VI
NEGATIVE COVENANTS
Until the Commitments have expired or terminated and the principal of and interest on each Loan and all fees and expenses and other amounts payable hereunder have been paid in full and the cancellation or expiration with no pending drawings or Cash Collateralization of all Letters of Credit on terms reasonably satisfactory to the applicable Issuing Bank in an amount equal to the Agreed L/C Cash Collateral Amount of all Letter of Credit Usage, the Borrower covenants and agrees with the Lenders that:
Section 6.01    Indebtedness. The Borrower will not, and will not permit any Restricted Subsidiary to, create, incur, assume or permit to exist any Indebtedness other than:
(a)    [Reserved.];
(b)    Indebtedness consisting of cash management services, including treasury, depository, overdraft, credit or debit card, purchasing cards, electronic funds transfer, cash pooling arrangements and other cash management arrangements of Borrower or any Subsidiary, in each case, in the ordinary course of business;
74


(c)    Indebtedness in respect of (1) bid bonds, performance bonds, surety bonds and similar obligations, in each case, incurred by Borrower or any of its Restricted Subsidiaries in the ordinary course of business, (2) appeal bonds in respect of judgments not constituting an Event of Default under Section 7.01(k) and (3) guarantees or obligations with respect to letters of credit supporting such bid bonds, performance bonds, surety bonds, appeal bonds and similar obligations;
(d)    Indebtedness representing the financing of insurance premiums in the ordinary course of business;
(e)    Guarantees of Indebtedness of the Borrower or any Restricted Subsidiary so long as such guaranteed Indebtedness is permitted under this Section 6.01; provided, that if the Indebtedness that is being guaranteed is unsecured and/or subordinated to the Obligations, the Guarantee shall also be unsecured and/or subordinated to the Obligations.
(f)    (x) Indebtedness constituting Capital Lease Obligations and Purchase Money Indebtedness and any Refinancing Indebtedness in respect thereof; provided that the aggregate principal amount of Indebtedness pursuant to this clause (f) shall not exceed $250,000,000 at any time outstanding, and (y) any Refinancing Indebtedness in respect thereof;
(g)    (x) Indebtedness in an aggregate principal amount at any time outstanding not to exceed the sum of (i) $500,000,000 plus (ii) so long as the Borrower has provided the financial statements described in Section 5.01(a) or 5.01(b), as applicable, any additional or other amount of Indebtedness, so long as, solely in this case of this clause (ii), the Leverage Ratio does not exceed 0.75 to 1.00 (or, if such Indebtedness is incurred in connection with any Permitted Acquisition, 1.00 to 1.00), determined on a pro forma basis after giving effect to such Indebtedness as of the end of the most recently ended fiscal quarter of the Borrower for which financial statements have been delivered and treating any New Commitments incurred on such date (or, in the case, of a Limited Conditionality Acquisition, to be incurred in connection with such acquisition) and any such Indebtedness consisting of a revolving credit facility, together with all Commitments hereunder, as fully drawn; provided, that, in the case of any such Indebtedness the proceeds of which are to be used primarily to consummate a Limited Conditionality Acquisition substantially concurrently with the issuance or incurrence of such Indebtedness, the Leverage Ratio shall be determined on the date the acquisition agreement with respect to such Limited Conditionality Acquisition is signed and not on the date such Indebtedness is incurred or issued; and (y) any Refinancing Indebtedness in respect of Indebtedness incurred under clause (g)(x)(ii));
(h)    Obligations under the Loan Documents;
(i)    letters of credit denominated in currencies not available under this Agreement;
(j)    (x) Indebtedness consisting of Convertible Notes; provided that with respect to any Convertible Notes that may be exchangeable for or convertible into cash (other than payment of principal of, and interest on, such Convertible Notes), the Leverage Ratio as of the date of issuance of such Convertible Notes, determined on a pro forma basis immediately after giving effect to the issuance of such Convertible Notes (and treating the Commitments hereunder as fully drawn) as of the end of the most recently ended fiscal quarter of the Borrower, shall not exceed 1.00 to 1.00; provided further that Indebtedness shall be determined without taking into account any cash or cash equivalents constituting proceeds of any such Convertible Notes to be issued on such date that may
75


otherwise reduce the amount of Indebtedness, and (y) any Refinancing Indebtedness in respect thereof;
(k)    Indebtedness between or among the Borrower and any Restricted Subsidiary; and
(l)    Indebtedness incurred in connection with any Permitted Asset-Based Financing, including any Guarantee thereof.
Notwithstanding the foregoing, any Indebtedness owed by a Loan Party to a Restricted Subsidiary that is not a Loan Party shall be permitted only to the extent subordinated to the Obligations pursuant to an intercompany subordination agreement in substantially the form attached hereto as Exhibit H or on such other customary terms reasonably satisfactory to the Administrative Agent.
Section 6.02    Liens. The Borrower will not, and will not permit any Restricted Subsidiary to, create, incur, assume or permit to exist any Lien on any property or asset now owned or hereafter acquired by it except:
(a)    Permitted Encumbrances;
(b)    any Lien on any property or asset of the Borrower or any Restricted Subsidiary existing on the date hereof and set forth in Schedule 6.02 to the Disclosure Letter and any modifications, renewals and extensions thereof and any Lien granted as a replacement or substitute therefor; provided that (i) such Lien shall not apply to any other property or asset of the Borrower or any Restricted Subsidiary other than improvements thereon or proceeds thereof, and (ii) such Lien shall secure only those obligations which it secures on the date hereof and any refinancing, extension, renewal or replacement thereof that does not increase the outstanding principal amount thereof except by an amount equal to a premium or other amount paid, and fees and expenses incurred, in connection with such refinancing, extensions, renewals or replacements;
(c)    any Lien existing on any property or asset prior to the acquisition thereof by the Borrower or any Restricted Subsidiary or existing on any property or asset of any Person that becomes a Restricted Subsidiary after the date hereof prior to the time such Person becomes a Restricted Subsidiary; provided that (i) such Lien is not created in contemplation of or in connection with such acquisition or such Person becoming a Restricted Subsidiary, as the case may be, (ii) such Lien shall not apply to any other property or assets of the Borrower or any Restricted Subsidiary, and (iii) such Lien shall secure only those obligations which it secures on the date of such acquisition or the date such Person becomes a Restricted Subsidiary, as the case may be, and any refinancing, extension, renewal or replacement thereof that does not increase the outstanding principal amount thereof except by an amount equal to a premium or other amount paid, and fees and expenses incurred, in connection with such refinancing, extensions, renewals or replacements;
(d)    Liens on fixed or capital assets acquired, constructed, financed or improved by the Borrower or any Restricted Subsidiary; provided that (i) such security interests secure Indebtedness that is not prohibited by Section 6.01, (ii) such security interests and the Indebtedness secured thereby are initially incurred prior to or within 180 days after such acquisition or the completion of such construction or improvement, (iii) the Indebtedness secured thereby does not exceed 100% of the cost of acquiring, constructing or improving such fixed or capital assets and
76


customary related expenses, and (iv) such security interests shall not apply to any other property or assets of the Borrower or any Restricted Subsidiary other than additions, accessions, parts, attachments or improvements thereon or proceeds thereof; provided that clauses (ii) and (iii) shall not apply to any Refinancing Indebtedness pursuant to Section 6.01(f) hereof or any Lien securing such Refinancing Indebtedness;
(e)    (i) non-exclusive licenses, sublicenses, leases or subleases and (ii) licenses of intellectual property that are exclusive as to territory only as to geographical areas outside of the United States, in each case granted to others in the ordinary course of business or granted to the Borrower or any Restricted Subsidiary, in each case not interfering in any material respect with the business of the Borrower and its Restricted Subsidiaries, taken as a whole;
(f)    the interest and title of a lessor or licensor under any lease, license, sublease or sublicense entered into by the Borrower or any Restricted Subsidiary in the ordinary course of its business and other statutory and common law landlords’ Liens under leases;
(g)    in connection with the sale or transfer of any assets in a transaction not prohibited hereunder, customary rights and restrictions contained in agreements relating to such sale or transfer pending the completion thereof;
(h)    in the case of any joint venture, any put and call arrangements related to its Equity Interests set forth in its organizational documents or any related joint venture or similar agreement;
(i)    Liens securing Indebtedness to finance insurance premiums owing in the ordinary course of business to the extent such financing is not prohibited hereunder;
(j)    Liens on earnest money deposits of cash or cash equivalents made in connection with any acquisition not prohibited hereunder;
(k)    bankers’ Liens, rights of setoff and other similar Liens existing solely with respect to cash and cash equivalents or other securities on deposit in one or more accounts maintained by the Borrower or any Restricted Subsidiary, in each case granted in the ordinary course of business in favor of the banks, securities intermediaries or other depository institutions with which such accounts are maintained, securing amounts owing to such institutions with respect to cash management, operating account arrangements and similar arrangements;
(l)    Liens in the nature of the right of setoff in favor of counterparties to contractual agreements not otherwise prohibited hereunder with the Borrower or any of its Restricted Subsidiaries in the ordinary course of business;
(m)    the provision of cash collateral securing Indebtedness incurred pursuant to Section 6.01(i);
(n)    Liens and deposits securing obligations under Swap Agreements entered to hedge or mitigate commercial risk and not for speculative purposes;
77


(o)    Liens securing reimbursement obligations with respect to commercial letters of credit which encumber documents and other property relating to such letters of credit and products and proceeds thereof;
(p)    Liens in favor of the Loan Parties or Liens granted by a Restricted Subsidiary that is not a Loan Party in favor of another Restricted Subsidiary that is not a Loan Party;
(q)    other Liens securing obligations not otherwise permitted hereunder in an aggregate principal amount at any time outstanding not to exceed $300,000,000; and
(r)    Liens incurred in connection with any Permitted Asset-Based Financing.
Section 6.03    Fundamental Changes.
(a)    The Borrower will not, and will not permit any Restricted Subsidiary to, (x) merge into or consolidate with any other Person, or permit any other Person to merge into or consolidate with it, (y) sell, transfer, license, lease, enter into any sale-leaseback transactions with respect to, or otherwise dispose of (in one transaction or in a series of transactions) all or substantially all of the assets of the Borrower and the Restricted Subsidiaries, taken as a whole (in each case, whether now owned or hereafter acquired) or (z) liquidate or dissolve, except that, if at the time thereof and immediately after giving effect thereto no Default shall have occurred and be continuing:
(i)    any Restricted Subsidiary or any other Person may merge into or consolidate with the Borrower in a transaction in which the Borrower is the surviving corporation;
(ii)    any Person (other than the Borrower) may merge into or consolidate with any Restricted Subsidiary in a transaction in which the surviving entity is a Restricted Subsidiary (provided that any such merger or consolidation involving a Guarantor must result in a Guarantor as the surviving entity);
(iii)    any Restricted Subsidiary may sell, transfer, license, lease or otherwise dispose of its assets to the Borrower or to another Restricted Subsidiary; provided that any such disposition under this clause (iii) that is made to a Restricted Subsidiary that is not a Loan Party shall in no event be permitted if it would comprise all or substantially all of the assets of the Borrower and its Restricted Subsidiaries, taken as a whole;
(iv)    in connection with any acquisition, any Restricted Subsidiary may merge into or consolidate with any other Person, so long as the Person surviving such merger or consolidation shall be a Restricted Subsidiary (provided that any such merger or consolidation involving a Guarantor must result in a Guarantor as the surviving entity);
(v)    any Restricted Subsidiary may liquidate or dissolve if the Borrower determines in good faith that such liquidation or dissolution is in the best interests of the Borrower and is not materially disadvantageous to the Lenders; and
(vi)    any Restricted Subsidiary may sell, lease, transfer or otherwise dispose of all or substantially all assets of any Special Purpose Financing Subsidiary in connection with any Permitted Asset-Based Financing.
78


(b)    The Borrower will not, and will not permit any of its Restricted Subsidiaries to, engage to any material extent in any business other than businesses of the type conducted by the Borrower and its Restricted Subsidiaries on the date of execution of this Agreement and businesses reasonably related, complementary, ancillary or incidental thereto or that constitute reasonable extensions thereof (including, without limitation, any extension from consumer to business-to-business products and services).
For the avoidance of doubt, nothing in this Section 6.03 shall be deemed to restrict the transfer by the Borrower or any Restricted Subsidiary of intellectual property and/or the Equity Interests in any Foreign Subsidiary or Foreign Subsidiaries to any Foreign Subsidiary that is a Restricted Subsidiary.
Section 6.04    Restricted Payments. The Borrower will not, and will not permit any of its Restricted Subsidiaries to, declare or make any Restricted Payments with respect to the Borrower or any of its Restricted Subsidiaries, except:
(i)    any Restricted Subsidiary of the Borrower may make Restricted Payments to the Borrower or to any direct or indirect wholly-owned Restricted Subsidiary of the Borrower, and any non-wholly-owned Restricted Subsidiary may make Restricted Payments to the Borrower or any of its other Restricted Subsidiaries and to each other owner of Equity Interests of such Restricted Subsidiary ratably based on their relative ownership interests of the relevant class of Equity Interests;
(ii)    the Borrower may declare and make dividends payable solely in additional shares of Borrower’s Qualified Equity Interests and may exchange Equity Interests for its Qualified Equity Interests;
(iii)    the Borrower may (x) repurchase fractional shares of its Equity Interests arising out of stock dividends, splits or combinations, business combinations or conversions of convertible securities or exercises of warrants or options, (y) “net exercise” or “net share settle” warrants or options or (z) so long as no Event of Default then exists or would result therefrom, make cash settlement payments upon the exercise of warrants or options to purchase its Equity Interests;
(iv)    the Borrower may (x) redeem or otherwise cancel Equity Interests or rights in respect thereof granted to (or make payments on behalf of) directors, officers, employees or other providers of services to the Borrower and the Restricted Subsidiaries in an amount required to satisfy tax withholding obligations relating to the vesting, settlement or exercise of such Equity Interests or rights or (y) repurchase Equity Interests or rights in respect thereof granted to directors, officers, employees or other providers of services to the Borrower and the Restricted Subsidiaries pursuant to a right of repurchase set forth in equity compensation plans in connection with a cessation of service;
(v)    following a Qualifying IPO, the Borrower or any Restricted Subsidiary may make any Restricted Payment that has been declared by the Borrower or such Restricted Subsidiary, so long as (A) such Restricted Payment would be otherwise permitted under clause (viii) of this Section 6.04 at the time so declared and (B) such Restricted Payment is made within 60 days of such declaration;
(vi)    following a Qualifying IPO, the Borrower may repurchase Equity Interests pursuant to any accelerated stock repurchase or similar agreement; provided that the payment made by the Borrower with respect to such repurchase would be otherwise permitted under clause (viii) of this
79


Section 6.04 at the time such agreement was entered into as if it was a Restricted Payment made by the Borrower at such time;
(vii)    the Borrower may make Restricted Payments pursuant to and in accordance with stock option plans or other benefit plans or agreements for directors, management, employees or other eligible service providers of the Borrower or its Restricted Subsidiaries;
(viii)    so long as no Default or Event of Default then exists or would result therefrom, the Borrower may declare or make Restricted Payments not otherwise permitted under this Section 6.04 if, after giving pro forma effect to such Restricted Payment, the Borrower and its Restricted Subsidiaries have Liquidity of at least $500,000,000;
(ix)    so long as no Default or Event of Default then exists or would result therefrom, the Borrower may make Restricted Payments not otherwise permitted under this Section 6.04 (x) using the proceeds of any issuance of Equity Interests (provided that such Restricted Payment and the issuance of Equity Interests are substantially concurrent) or (y) that are announced in connection with a Qualifying IPO;
(x)    the acquisition by the Borrower of Equity Interests issued by the Borrower in connection with the satisfaction of loans made by the Borrower to one or more of its stockholders; provided that such loans were in existence as of the Effective Date;
(xi)    the receipt or acceptance by the Borrower or any Restricted Subsidiary of the return of Equity Interests issued by the Borrower or any Restricted Subsidiary to the seller of a Person, business or division as consideration for the purchase of such Person, business or division, which return is in settlement of indemnification claims owed by such seller in connection with such acquisition;
(xii)    following a Qualifying IPO, the Borrower may repurchase Equity Interests pursuant to the terms of a call spread or similar arrangement entered into in connection with the issuance of Convertible Notes;
(xiii)    the Borrower may make ordinary-course dividend payments in respect of Equity Interests of the Borrower and payments to repurchase Equity Interests of the Borrower in satisfaction of regulatory requirements or pursuant to “rights of first refusal,” in each case not otherwise permitted under this Section 6.04, in an aggregate amount not to exceed $400,000,000; and
(xiv)    the Borrower may make any intercompany payments not otherwise permitted under this Section 6.04 in connection with any Permitted Asset-Based Financing.
Section 6.05    Restrictive Agreements. The Borrower will not, and will not permit any of its Restricted Subsidiaries to, directly or indirectly, enter into, incur or permit to exist any agreement or other arrangement that prohibits, restricts or imposes any condition upon (a) the ability of the Borrower or any Restricted Subsidiary to create, incur or permit to exist any Lien upon any of its property or assets to secure the Obligations or (b) the ability of any Restricted Subsidiary to pay dividends or other distributions with respect to any shares of its Equity Interests or to make or repay loans or advances to the Borrower or any other Restricted Subsidiary or of any Restricted Subsidiary to Guarantee Indebtedness of the Borrower or any other Restricted Subsidiary under the Loan Documents; provided that (i) the foregoing shall not apply to restrictions and conditions imposed by
80


law or by this Agreement or any other Loan Document, (ii) the foregoing shall not apply to prohibitions, restrictions and conditions existing on the date hereof (and any amendments or modifications thereof that do not materially expand the scope of any such prohibition, restriction or condition), (iii) the foregoing shall not apply to customary prohibitions, restrictions and conditions contained in agreements relating to the sale of a Restricted Subsidiary or assets of the Borrower or any Restricted Subsidiary pending such sale; provided such restrictions and conditions apply only to the Restricted Subsidiary or assets to be sold and such sale is not prohibited hereunder, (iv) the foregoing shall not apply to any agreement, prohibition, or restriction or condition in effect at the time any Restricted Subsidiary becomes a Restricted Subsidiary of the Borrower, so long as such agreement was not entered into solely in contemplation of such Person becoming a Restricted Subsidiary of the Borrower (and any amendments or modifications thereof that do not materially expand the scope of any such prohibition restriction or condition), (v) the foregoing shall not apply to customary provisions in joint venture agreements and other similar agreements applicable to joint ventures, (vi) clause (a) of the foregoing shall not apply to restrictions or conditions imposed by any agreement relating to secured Indebtedness permitted by this Agreement if such restrictions or conditions apply only to the property or assets securing such Indebtedness, (vii) clause (a) of the foregoing shall not apply to customary provisions in leases, licenses, sub-leases and sub-licenses and other contracts restricting the assignment thereof, (viii) the foregoing shall not apply to restrictions or conditions set forth in any agreement governing Indebtedness not prohibited by Section 6.01; provided that such restrictions and conditions are customary for such Indebtedness (as determined in good faith by the Borrower), (ix) the foregoing shall not apply to restrictions on cash or other deposits (including escrowed funds) imposed under contracts entered into in the ordinary course of business or restrictions imposed by the terms of a Permitted Lien on the property subject to such Permitted Lien, (x) the foregoing shall not apply to encumbrances, restrictions, limitations, conditions or prohibitions in respect of Financing Assets or any other types of assets subject to, and any other encumbrances, restrictions, limitations, conditions or prohibitions consisting of customary provisions in connection with, any Permitted Asset-Based Financing (including any Special Purpose Financing Subsidiary created in connection therewith) and (xi) the foregoing shall not apply to any other instrument or agreement entered into after the Effective Date that contains any encumbrances, restrictions, limitations, conditions or prohibitions that, as determined by the Borrower, will not materially adversely affect the Borrower’s ability to make payments on the Loans.
Section 6.06    Transactions with Affiliates. The Borrower will not, and will not permit any of its Restricted Subsidiaries to, sell, lease or otherwise transfer any property or assets to, or purchase, lease or otherwise acquire any property or assets from, or otherwise engage in any other transactions with, any of its Affiliates (other than between or among the Borrower and its Restricted Subsidiaries and not involving any other Affiliate except as otherwise permitted hereunder), except (a) on terms and conditions not less favorable to the Borrower or such Restricted Subsidiary than could be obtained on an arm’s-length basis from unrelated third parties, (b) payment of customary directors’ fees, reasonable out-of-pocket expense reimbursement, indemnities (including the provision of directors and officers insurance) and compensation arrangements for members of the board of directors, officers or other employees of the Borrower or any of its Subsidiaries, (c) transactions approved by a majority of the disinterested directors of Borrower’s board of directors, (d) any transaction involving amounts less than $500,000 individually and $5,000,000 in the aggregate, (e) any Restricted Payment permitted by Section 6.04, and (f) transactions with Affiliates entered into in connection with any Permitted Asset-Based Financing.
Section 6.07    [Reserved].
81


Section 6.08    Investments. The Borrower will not, and will not permit any of its Restricted Subsidiaries to, directly or indirectly, make or own any Investment in any Person, except:
(a)    Investments existing on the date hereof;
(b)    Investments by any Loan Party or any Restricted Subsidiary in any Loan Party or any Restricted Subsidiary;
(c)    Investments in Joint Ventures and Unrestricted Subsidiaries in an aggregate amount for all Investments under this clause (c) not to exceed the greater of (x) $1,000,000,000 and (y) 10% of Total Assets;
(d)    payroll, travel, moving, entertainment and similar advances to directors and employees of the Borrower or any Subsidiary to cover matters that are expected at the time of such advances to be treated as expenses of the Borrower or such Subsidiary for accounting purposes and that are made in the ordinary course of business;
(e)    loans or advances to directors and employees of the Borrower or any Subsidiary made in the ordinary course of business; provided that the aggregate amount of such loans and advances outstanding at any time shall not exceed $50,000,000;
(f)    Permitted Acquisitions;
(g)    Investments not otherwise permitted by the foregoing provisions of this Section 6.08 in an aggregate amount for all such Investments under this clause (g) not to exceed the greater of (x) $100,000,000 and (y) 5% of Total Assets;
(h)    on or after an IPO, loans or advances to directors and employees of the Borrower or any Subsidiary made to satisfy tax obligations relating to the vesting, settlement or exercise of Equity Interests or rights;
(i)    following a Qualifying IPO, any call spread or similar arrangement in connection with the issuance of Convertible Notes;
(j)    Investments arising as a result of, or in or by any Special Purpose Financing Subsidiary made in connection with any Permitted Asset-Based Financing, including Investment of funds held in accounts permitted or required by the arrangements governing any sale or disposition of assets relating to any Permitted Asset-Based Financing;
(k)    any Guarantee of Indebtedness permitted by Section 6.01 hereunder;
(l)    accounts receivable, security deposits and prepayments arising and trade credit granted in the ordinary course of business;
(m)    Investments of a Restricted Subsidiary acquired after the Effective Date or of a person merged into the Borrower or a Restricted Subsidiary after the Effective Date, in each case to the extent that such Investments were not made in contemplation of or in connection with any such acquisition or merger;
82


(n)    Guarantees by the Borrower or any Restricted Subsidiary of obligations that do not constitute Indebtedness, in each case entered into in the ordinary course of business;
(o)    Investments to the extent that payment for such Investments is made with Equity Interests (other than Disqualified Equity Interests) of the Borrower or Public Company, as the case may be; and
(p)    Investments by the Borrower or any Restricted Subsidiary to the extent the Borrower or such Restricted Subsidiary would be able to make a Restricted Payment under Section 6.04 in such amount; provided that the amount of any such Investment shall also be deemed to be a Restricted Payment under the appropriate clause of Section 6.04 for all purposes hereunder; and
(q)    Permitted Investments.
Notwithstanding anything herein to the contrary, after the date hereof (x) the Borrower and each other obligor will not, and will not permit any of its Restricted Subsidiaries to, allow or cause any Domestic Subsidiary to be a subsidiary of a Foreign Subsidiary (other than any Domestic Subsidiary that is an existing subsidiary of an acquired Foreign Subsidiary at the time of the Permitted Acquisition or is a Subsidiary of a Foreign Subsidiary on the date of this Agreement) and (y) none of the Borrower or any Restricted Subsidiary shall contribute any Material Intellectual Property to an Unrestricted Subsidiary (for the avoidance of doubt, clause (y) shall not restrict the acquisition, directly or indirectly, of any intellectual property by an Unrestricted Subsidiary from any third party).
Section 6.09    Financial Covenant. The Borrower shall not permit:
(a)    Consolidated Tangible Net Worth as of the end of any fiscal quarter of the Borrower to be less than 50% of Consolidated Tangible Net Worth as of the Effective Date;
(b)    the Leverage Ratio as of the end of any fiscal quarter of the Borrower to be greater than 2.0 to 1.0; and
(c)    the amount of Unrestricted cash and Cash Equivalents of the Borrower and its consolidated Subsidiaries as of the last day of any calendar month ending after the Effective Date, as determined as of such date in accordance with GAAP, to be less than $100,000,000.
ARTICLE VII
EVENTS OF DEFAULT
Section 7.01    Events of Default.
If any of the following events (each, an “Event of Default”) shall occur:
(a)    the Borrower shall fail to pay (i) any principal of any Loan when and as the same shall become due and payable, whether at the due date thereof or at a date fixed for prepayment thereof or otherwise; or (ii) when due any amount payable to the applicable Issuing Bank in reimbursement of any drawing under any Letter of Credit;
83


(b)    the Borrower shall fail to pay any interest on any Loan or any fee or any other amount (other than an amount referred to in Section 7.01(a)) payable under any of the Loan Documents, when and as the same shall become due and payable, and such failure shall continue unremedied for a period of three Business Days;
(c)    any representation or warranty made or deemed made by or on behalf of the Borrower or any Restricted Subsidiary in or in connection with this Agreement or any other Loan Document or any amendment or modification hereof or thereof or waiver hereunder or thereunder, or in any report, certificate, financial statement or other document furnished pursuant to or in connection with this Agreement, any other Loan Document or any amendment or modification hereof or thereof or waiver hereunder or thereunder, shall prove to have been incorrect in any material respect when made or deemed made; provided that, in each case, to the extent that such representations and warranties are already qualified or modified by materiality or words of similar effect in the text thereof, they shall be true and correct in all respects;
(d)    the Borrower shall fail to observe or perform any covenant, condition or agreement contained in Section 5.02, Section 5.03 (solely with respect to the Borrower’s existence), Section 5.09 or in Article 6;
(e)    the Borrower or any Restricted Subsidiary shall fail to observe or perform any covenant, condition or agreement contained in any of the Loan Documents (other than those specified in clause (a), (b) or (d) of this Section 7.01), and such failure shall continue unremedied for a period of 30 days after notice thereof from the Administrative Agent to the Borrower (which notice will be given at the request of any Lender);
(f)    the Borrower or any Restricted Subsidiary shall fail to make any payment (whether of principal or interest and regardless of amount) in respect of any Material Indebtedness, when and as the same shall become due and payable (whether by scheduled maturity, required prepayment, acceleration, demand, or otherwise) and such failure shall have continued after the applicable grace period, if any;
(g)    any event or condition occurs that results in any Material Indebtedness becoming due prior to its scheduled maturity or that enables or permits (with or without the giving of notice, the lapse of time or both but with all applicable grace periods in respect of such event or condition under the documentation representing such Material Indebtedness having expired) the holder or holders of such Material Indebtedness or any trustee or agent on its or their behalf to cause such Material Indebtedness to become due, or to require the prepayment, repurchase, redemption or defeasance thereof, prior to its scheduled maturity; provided that this clause (g) shall not apply to (w) any requirement to, or any offer to, repurchase, prepay or redeem Indebtedness of a Person acquired in an acquisition permitted hereunder, to the extent such offer is required as a result of, or in connection with, such acquisition, (x) secured Indebtedness that becomes due as a result of the voluntary sale or transfer of the property or assets securing such Indebtedness, (y) any event or condition giving rise to any redemption, repurchase, conversion or settlement (or right to redeem, require repurchase, convert or settle) with respect to any Convertible Notes pursuant to its terms unless such redemption, repurchase, conversion or settlement (i) results from a default thereunder or an event of the type that constitutes an Event of Default or (ii) results from the occurrence of a “fundamental change” or “change in control” thereunder that requires cash payment thereon or cash redemption thereof or (z) an early payment requirement, unwinding or termination with respect to any
84


Swap Agreement except an early payment, unwinding or termination that results from a default or non-compliance thereunder by the Borrower or any Restricted Subsidiary, or another event of the type that would constitute an Event of Default;
(h)    an involuntary proceeding shall be commenced or an involuntary petition shall be filed seeking (i) liquidation, reorganization or other relief in respect of the Borrower or any Restricted Subsidiary (other than any Immaterial Subsidiary) or its debts, or of a substantial part of its assets, under any Debtor Relief Law or (ii) the appointment of a receiver, trustee, custodian, sequestrator, conservator or similar official for the Borrower or any Restricted Subsidiary (other than any Immaterial Subsidiary) or for a substantial part of its assets, and, in any such case, such proceeding or petition shall continue undismissed for 60 days or an order or decree approving or ordering any of the foregoing shall be entered;
(i)    except as may otherwise be permitted under Section 6.03, the Borrower or any Restricted Subsidiary (other than any Immaterial Subsidiary) shall (i) voluntarily commence any proceeding or file any petition seeking liquidation, reorganization or other relief under any Debtor Relief Law, (ii) consent to the institution of, or fail to contest in a timely and appropriate manner, any proceeding or petition described in clause (h) of this Article, (iii) apply for or consent to the appointment of a receiver, trustee, custodian, sequestrator, conservator or similar official for the Borrower or any Restricted Subsidiary (other than any Immaterial Subsidiary) or for a substantial part of its assets, (iv) file an answer admitting the material allegations of a petition filed against it in any such proceeding, (v) make a general assignment for the benefit of creditors or (vi) take any action for the purpose of effecting any of the foregoing;
(j)    the Borrower or any Restricted Subsidiary (other than any Immaterial Subsidiary) shall become unable, admit in writing its inability or fail generally to pay its debts as they become due;
(k)    one or more judgments for the payment of money in excess of $100,000,000 in the aggregate shall be rendered against the Borrower or any Restricted Subsidiary or any combination thereof (to the extent not paid or covered by a reputable and solvent independent third-party insurance company which has not disputed coverage) and the same shall remain undischarged for a period of 30 consecutive days during which execution shall not be effectively stayed, or any action shall be legally taken by a judgment creditor to attach or levy upon any assets of the Borrower or any Restricted Subsidiary to enforce any such judgment and such action shall not be stayed;
(l)    one or more ERISA Events shall have occurred, other than as would not reasonably be expected to result, individually or in the aggregate, in a Material Adverse Effect;
(m)    a Change in Control shall occur; or
(n)    any Loan Document, at any time after its execution and delivery and for any reason other than as expressly permitted hereunder or thereunder or satisfaction in full of all the obligations hereunder or thereunder, ceases to be in full force and effect; or any Loan Party contests in any manner the validity or enforceability of any Loan Document;
then, and in every such event (other than an event with respect to the Borrower described in clause (h), (i) or (j) of this Section 7.01), and at any time thereafter during the continuance of such event, the Administrative Agent may, and at the request of the Required Lenders shall, by notice to
85


the Borrower, take either or both of the following actions, at the same or different times: (i) terminate the Commitments and the obligations of the Issuing Banks to issue any Letter of Credit, and thereupon the Commitments and the obligations of the Issuing Banks to issue any Letter of Credit shall terminate immediately, and (ii) (A) declare the Loans then outstanding to be due and payable in whole (or in part, in which case any principal not so declared to be due and payable may thereafter be declared to be due and payable), and thereupon the principal of the Loans so declared to be due and payable, together with accrued interest thereon and all fees and other obligations of the Borrower accrued hereunder, shall become due and payable immediately, without presentment, demand, protest or other notice of any kind, all of which are hereby waived by the Borrower and (B) require that the Borrower Cash Collateralize the Letters of Credit in the amount of the Agreed L/C Cash Collateral Amount of the then Letter of Credit Usage; and, in the case of any event with respect to the Borrower described in clause (h), (i) or (j) of this Section 7.01, the Commitments and the obligations of the Issuing Banks to issue any Letter of Credit shall automatically terminate, and the principal of the Loans then outstanding, together with accrued interest thereon and all fees and other obligations of the Borrower accrued hereunder, shall automatically become due and payable, without presentment, demand, protest or other notice of any kind, all of which are hereby waived by the Borrower.
Section 7.02    Application of Funds. After the exercise of remedies provided for in Section 7.01 (or after the Loans have automatically become immediately due and payable and the Letter of Credit Usage shall have automatically been required to be Cash Collateralized as set forth in Section 7.01), any amounts received on account of the Obligations shall be applied by the Administrative Agent in the following order:
First, to payment of that portion of the Obligations constituting fees, indemnities, expenses and other amounts (other than principal and interest but including fees, charges and disbursements of counsel to the Administrative Agent and the Issuing Banks and amounts payable pursuant to Sections 2.12 and 2.14) payable to the Administrative Agent and each Issuing Bank in their respective capacity as such; ratably among them in proportion to the respective amounts described in this clause First payable to them;
Second, to payment of that portion of the Obligations constituting fees, indemnities and other amounts (other than principal, interest and fees payable to the Lenders (including fees, charges and disbursements of counsel to the respective Lenders and amounts payable pursuant to Sections 2.12 and 2.14));
Third, to payment of that portion of the Obligations constituting accrued and unpaid fees and interest on the Loans, Letter of Credit Usage and other Obligations, ratably among the Lenders and the Issuing Bank in proportion to the respective amounts described in this clause Third held by them;
Fourth, to payment of that portion of the Obligations constituting unpaid principal of the Loans and Letter of Credit Usage comprised of drawings under Letters of Credit honored by the applicable Issuing Bank and not theretofore reimbursed by or on behalf of the Borrower, ratably among the Lenders and the applicable Issuing Bank, in proportion to the respective amounts described in this clause Fourth held by them;
Fifth, to the Administrative Agent for the account of the applicable Issuing Bank, to Cash Collateralize that portion of Letter of Credit Usage comprised of the aggregate undrawn amount of Letters of Credit at the Agreed L/C Cash Collateral Amount; and
86


Last, the balance, if any, after all of the Obligations have been indefeasibly paid in full, to the Borrower or its designee or as otherwise required by law.
Subject to Section 2.19(i), amounts used to Cash Collateralize the aggregate undrawn amount of Letters of Credit pursuant to clause Fifth above shall be applied to satisfy drawings under such Letters of Credit as they occur. If any amount remains on deposit as Cash Collateral after all Letters of Credit have either been fully drawn or expired, such remaining amount shall be applied to the other Obligations, if any, in the order set forth above, and thereafter applied as provided in clause “Last” above.
ARTICLE VIII
THE AGENTS
Section 8.01    Appointment of the Administrative Agent. Each Lender and each Issuing Bank hereby irrevocably designates and appoints Goldman Sachs Bank USA as the Administrative Agent hereunder and under the other Loan Documents, and each Lender and each Issuing Bank hereby authorizes Goldman Sachs Bank USA to act as the Administrative Agent in accordance with the terms hereof and the other Loan Documents. The Administrative Agent hereby agrees to act in its capacity as such upon the express conditions contained herein and the other Loan Documents, as applicable. The provisions of this Article 8 are solely for the benefit of the Administrative Agent and Lenders and no Loan Party shall have any rights as a third party beneficiary of any of the provisions thereof (except as expressly set forth in Section 8.07). In performing its functions and duties hereunder, the Administrative Agent shall act solely as an agent of Lenders and does not assume and shall not be deemed to have assumed, and the use of the term “agent” (or any similar term) herein or in any other Loan Documents is not intended to connote, any obligation towards or relationship of agency or trust with or for Borrower or any of its Subsidiaries. No Arranger shall have any obligations in such capacities but shall be entitled to all benefits of this Article 8 and Article 9.
Section 8.02    Powers and Duties. Each Lender irrevocably authorizes the Administrative Agent to take such action on such Lender’s behalf and to exercise such powers, rights and remedies hereunder and under the other Loan Documents as are specifically delegated or granted to the Administrative Agent by the terms hereof and thereof, together with such powers, rights and remedies as are reasonably incidental thereto. The Administrative Agent may exercise such powers, rights and remedies and perform such duties by or through its Related Parties. The Administrative Agent shall not have, by reason hereof or any of the other Loan Documents, a fiduciary relationship in respect of any Lender or any other Person; and nothing herein or any of the other Loan Documents, expressed or implied, is intended to or shall be so construed as to impose upon the Administrative Agent any obligations in respect hereof or any of the other Loan Documents except as expressly set forth herein or therein.
Section 8.03    General Immunity.
(a)    The Administrative Agent and its Related Parties shall not be (i) responsible to any Lender for the execution, effectiveness, genuineness, validity, enforceability, collectability or sufficiency hereof or any other Loan Document or for any representations, warranties, recitals or statements made herein or therein or made in any written or oral statements or in any financial or other statements, instruments, reports or certificates or any other documents furnished or made by the
87


Administrative Agent to Lenders or by or on behalf of any Loan Party to the Administrative Agent or any Lender in connection with the Loan Documents and the transactions contemplated thereby or for the financial condition or business affairs of any Loan Party or any other Person liable for the payment of any Obligations, (ii) required to ascertain or inquire as to the performance or observance of any of the terms, conditions, provisions, covenants or agreements contained in any of the Loan Documents or as to the use of the proceeds of the Loans or as to the existence or possible existence of any Event of Default or Default or (iii) required to make any disclosures with respect to the foregoing. The Administrative Agent shall not be deemed to have knowledge or notice of the occurrence of any Default or Event of Default hereunder unless the Administrative Agent has received written notice from a Lender or the Borrower referring to this Agreement, describing such Default or Event of Default and stating that such notice is a “notice of default”. Neither the Administrative Agent nor any of its Related Parties shall, except as expressly set forth herein and in the other Loan Documents, have any duty to disclose, and shall not be liable for the failure to disclose, any information relating to the Borrower or any of its Affiliates that is communicated to or obtained by the Person serving as the Administrative Agent or any of its Affiliates in any capacity. Anything contained herein to the contrary notwithstanding, the Administrative Agent shall not have any liability arising from confirmations of the amount of outstanding Loans or the component amounts thereof.
(b)    The Administrative Agent and its Related Parties shall not be liable to Lenders for any action taken or omitted by the Administrative Agent under or in connection with any of the Loan Documents except to the extent caused by such Person’s gross negligence or willful misconduct, as determined by a final, non-appealable judgment of a court of competent jurisdiction. The Administrative Agent shall be entitled to refrain from any act or the taking of any action (including the failure to take an action) in connection herewith or any of the other Loan Documents or from the exercise of any power, discretion or authority vested in it hereunder or thereunder unless and until the Administrative Agent shall have received instructions in respect thereof from Required Lenders (or such other Lenders as may be required to give such instructions under Section 9.02) and, upon receipt of such instructions from Required Lenders (or such other Lenders, as the case may be), the Administrative Agent shall be entitled to act or (where so instructed) refrain from acting, or to exercise such power, discretion or authority, in accordance with such instructions, including for the avoidance of doubt refraining from any action that, in its opinion or the opinion of its counsel, may be in violation of any Loan Document or applicable law, including, for the avoidance of doubt, any action that may be in violation of the automatic stay under any Debtor Relief Law or that may affect a forfeiture, modification or termination of property of a Defaulting Lender in violation of any Debtor Relief Law. Without prejudice to the generality of the foregoing, (i) the Administrative Agent shall be entitled to rely, and shall be fully protected in relying, upon any communication, instrument or document believed by it to be genuine and correct and to have been signed or sent by the proper Person or Persons, and shall be entitled to rely and shall be protected in relying on opinions and judgments of attorneys (who may be attorneys for Borrower and its Subsidiaries), accountants, experts and other professional advisors selected by it; and (ii) no Lender shall have any right of action whatsoever against the Administrative Agent as a result of the Administrative Agent acting or (where so instructed) refraining from acting hereunder or any of the other Loan Documents in accordance with the instructions of Required Lenders (or such other Lenders as may be required to give such instructions under Section 9.02). The Administrative Agent may perform any and all of its duties and exercise its rights and powers under this Agreement or under any other Loan Document by or through any one or more sub-agents appointed by the Administrative Agent, provided that any such appointment of a sub-agent, other than to a Lender or an Affiliate of a Lender (other than any Disqualified Institution), shall require the express written consent of the Borrower and provided that,
88


for the avoidance of doubt, each sub-agent shall become bound by, and subject to Section 9.12. The Administrative Agent and any such sub-agent may perform any and all of its duties and exercise its rights and powers by or through its respective Related Parties. The exculpatory, indemnification and other provisions of this Section 8.03 and of Section 8.06 shall apply to any the Related Parties of the Administrative Agent and shall apply to their respective activities in connection with the syndication of the credit facilities provided for herein as well as activities as Administrative Agent. All of the rights, benefits, and privileges (including the exculpatory and indemnification provisions) of this Section 8.03 and of Section 8.06 shall apply to any such sub-agent and to the Related Parties of any such sub-agent, and shall apply to their respective activities as sub-agent as if such sub-agent and its Affiliates were named herein. Notwithstanding anything herein to the contrary, with respect to each sub-agent appointed by the Administrative Agent, (i) such sub-agent shall be a third party beneficiary under this Agreement with respect to all such rights, benefits and privileges (including exculpatory rights and rights to indemnification) and shall have all of the rights and benefits of a third party beneficiary, including an independent right of action to enforce such rights, benefits and privileges (including exculpatory rights and rights to indemnification) directly, without the consent or joinder of any other Person, against any or all of Loan Parties and the Lenders, (ii) such rights, benefits and privileges (including exculpatory rights and rights to indemnification) shall not be modified or amended without the consent of such sub-agent, and (iii) such sub-agent shall only have obligations to the Administrative Agent that appointed it and not to any Loan Party, Lender or any other Person and no Loan Party, Lender or any other Person shall have any rights, directly or indirectly, as a third party beneficiary or otherwise, against such sub-agent. The Administrative Agent shall not be responsible for the negligence or misconduct of any sub-agents except to the extent that a court of competent jurisdiction determines in a final and non-appealable judgment that the Administrative Agent acted with gross negligence, bad faith or willful misconduct in the selection of such sub-agent.
(c)    The Administrative Agent shall not be responsible or have any liability for, or have any duty to ascertain, inquire into, monitor or enforce, compliance with the provisions hereof relating to Disqualified Institutions. Without limiting the generality of the foregoing, the Administrative Agent shall not (x) be obligated to ascertain, monitor or inquire as to whether any Lender or Participant or prospective Lender or Participant is a Disqualified Institution or (y) have any liability with respect to or arising out of any assignment or participation of Commitments or Loans, or disclosure of confidential information, to any Disqualified Institution.
Section 8.04    Administrative Agent Entitled to Act as Lender. The agency hereby created shall in no way impair or affect any of the rights and powers of, or impose any duties or obligations upon, the Administrative Agent in its individual capacity as a Lender hereunder. With respect to its participation in the Loans, the Administrative Agent shall have the same rights and powers hereunder as any other Lender and may exercise the same as if it were not performing the duties and functions delegated to it hereunder, and the term “Lender” shall, unless the context clearly otherwise indicates, include the Administrative Agent in its individual capacity. The Administrative Agent and its Affiliates may accept deposits from, lend money to, own securities of, and generally engage in any kind of banking, trust, financial advisory or other business with Borrower or any of its Affiliates as if it were not performing the duties specified herein, and may accept fees and other consideration from Borrower for services in connection herewith and otherwise without having to account for the same to Lenders.
Section 8.05    Lenders’ Representations, Warranties and Acknowledgment.
89


(a)    Each Lender and each Issuing Bank expressly acknowledges that neither the Agents nor any of their respective Related Parties have made any representations or warranties to it and that no act by any Agent hereafter taken, including any review of the affairs of a Loan Party or any of its Affiliates, shall be deemed to constitute any representation or warranty by any Agent to any Lender or any Issuing Bank. Each Lender and each Issuing Bank represents and warrants that it has made its own independent investigation of the financial condition and affairs of Borrower and its Subsidiaries in connection with Loans and/or Letters of Credit issued hereunder and that it has made and shall continue to make its own appraisal of, and investigation into, the business, operations, property, financial and other condition and the creditworthiness of the Borrower and its Affiliates. Each Lender and each Issuing Bank also represents that it will, independently and without reliance upon any Agent or any other Lender, and based on such documents and information as it shall deem appropriate at the time, continue to make its own credit analysis, appraisals and decisions in taking or not taking action under this Agreement and the other Loan Documents and to make such investigation as it deems necessary to inform itself as to the business, operations, property, financial and other condition and creditworthiness of the Loan Parties and their Affiliates. No Agent shall have any duty or responsibility, either initially or on a continuing basis, to make any such investigation or any such appraisal on behalf of Lenders or to provide any Lender with any credit or other information with respect thereto, whether coming into its possession before the making of the Loans or at any time or times thereafter, and no Agent shall have any responsibility with respect to the accuracy of or the completeness of any information provided to Lenders.
(b)    Each Lender, by delivering its signature page to this Agreement, an Assignment and Assumption or a Joinder Agreement and funding its Loans, if applicable, on the Effective Date, or by the funding of any New Loans, as the case may be, shall be deemed to have acknowledged receipt of, and consented to and approved, each Loan Document and each other document required to be approved by any Agent, any Issuing Bank or the Lenders, as applicable on the Effective Date, the effective date of such Assignment and Assumption or as of the date of funding of such New Loans.
Section 8.06    Right to Indemnity. Each Lender, in proportion to its Applicable Percentage, severally agrees to indemnify the Administrative Agent and each Issuing Bank, to the extent that the Administrative Agent or such Issuing Bank shall not have been reimbursed by any Loan Party, for and against any and all liabilities, obligations, losses, damages, penalties, actions, judgments, suits, costs, expenses (including counsel fees and disbursements) or disbursements of any kind or nature whatsoever which may be imposed on, incurred by or asserted against the Administrative Agent or such Issuing Bank in exercising its powers, rights and remedies or performing its duties hereunder or under the other Loan Documents or otherwise in its capacity as Administrative Agent or such Issuing Bank in any way relating to or arising out of this Agreement, any Letter of Credit or the other Loan Documents; provided no Lender shall be liable for any portion of such liabilities, obligations, losses, damages, penalties, actions, judgments, suits, costs, expenses or disbursements resulting from the Administrative Agent’s or such Issuing Bank’s gross negligence, bad faith or willful misconduct, as determined by a final, non-appealable judgment of a court of competent jurisdiction (it being understood and agreed that no action taken in accordance with the directions of the Required Lenders (or such other Lenders as may be required to give such instructions under Section 9.02) shall constitute gross negligence or willful misconduct). If any indemnity furnished to the Administrative Agent or any Issuing Bank for any purpose shall, in the opinion of the Administrative Agent or such Issuing Bank, be insufficient or become impaired, the Administrative Agent or such Issuing Bank may call for additional indemnity and cease, or not commence, to do the acts indemnified against until
90


such additional indemnity is furnished; provided in no event shall this sentence require any Lender to indemnify the Administrative Agent or any Issuing Bank against any liability, obligation, loss, damage, penalty, action, judgment, suit, cost, expense or disbursement in excess of such Lender’s Applicable Percentage thereof; and provided, further, this sentence shall not be deemed to require any Lender to indemnify the Administrative Agent or any Issuing Bank against any liability, obligation, loss, damage, penalty, action, judgment, suit, cost, expense or disbursement described in the proviso in the immediately preceding sentence.
Section 8.07    Successor Administrative Agent.
(a)    The Administrative Agent shall have the right to resign at any time by giving prior written notice thereof to Lenders and Borrower. The Administrative Agent shall have the right to appoint a financial institution to act as the Administrative Agent hereunder, subject to the written consent of Borrower and the reasonable satisfaction of the Required Lenders, and the Administrative Agent’s resignation shall become effective on the earliest of (i) 30 days after delivery of the notice of resignation (regardless of whether a successor has been appointed or not), (ii) the acceptance of such successor Administrative Agent by Borrower and the Required Lenders and the acceptance of being the Administrative Agent by such successor, or (iii) such other date, if any, agreed to by the Required Lenders. Upon any such notice of resignation, if a successor Administrative Agent has not already been appointed by the retiring Administrative Agent, the Required Lenders shall have the right, with the written consent of the Borrower, to appoint a successor Administrative Agent.
(b)    If the Person serving as the Administrative Agent is a Defaulting Lender pursuant to clause (d) of the definition thereof, the Required Lenders may, to the extent permitted by applicable law, by notice in writing to the Borrower and such Person remove such Person as the Administrative Agent and, with the prior written consent of the Borrower, appoint a successor. If no such successor shall have been so appointed by the Required Lenders and shall have accepted such appointment within 30 days (or such earlier day as shall be agreed by the Required Lenders) (the “Removal Effective Date”), then such removal shall nonetheless become effective in accordance with such notice on the Removal Effective Date.
(c)    If neither the Required Lenders nor the Administrative Agent have appointed a successor Administrative Agent or such successor has not accepted such appointment within 30 days after delivery of notice of resignation by the retiring Administrative Agent or the Removal Effective Date, the Lenders shall be deemed to have succeeded to and become vested with all the rights, powers, privileges and duties of the retiring or removed Administrative Agent until such time, if any, as the Required Lenders appoint a successor Administrative Agent and such successor accepts such appointment. Upon the acceptance of any appointment as the Administrative Agent hereunder by a successor Administrative Agent, that successor Administrative Agent shall thereupon succeed to and become vested with all the rights, powers, privileges and duties of the retiring or removed Administrative Agent and the retiring or removed Administrative Agent shall promptly (i) transfer to such successor Administrative Agent all sums held under the Loan Documents, together with all records and other documents necessary or appropriate in connection with the performance of the duties of the successor Administrative Agent under the Loan Documents, and (ii) take such other actions, as may be necessary or appropriate in connection with the assignment to such successor Administrative Agent of the Loan Documents, whereupon such retiring or removed Administrative Agent shall be discharged from its duties and obligations hereunder or under the other Loan Documents (if not already discharged therefrom as provided above in this Article 8). After any
91


retiring or removed Administrative Agent’s resignation or removal hereunder as the Administrative Agent, the provisions of this Article 8 and Section 9.03 shall inure to its benefit as to any actions taken or omitted to be taken by it while it was the Administrative Agent hereunder.
Section 8.08    Guaranty.
(a)    Each Lender and each Issuing Bank hereby further authorizes the Administrative Agent, on behalf of and for the benefit of the Lenders and the Issuing Banks, to be the agent for and representative of the Lenders with respect to the Guaranty and the other Loan Documents. Subject to Section 9.02, without further written consent or authorization from any Lender or any Issuing Bank, the Administrative Agent may execute any documents or instruments necessary to release any Guarantor from the Guaranty pursuant to Section 9.17 or with respect to which Required Lenders (or such other Lenders as may be required to give such consent under Section 9.02) have otherwise consented.
(b)    Anything contained in any of the Loan Documents to the contrary notwithstanding, the Borrower, the Administrative Agent, each Issuing Bank and each Lender hereby agree that none of the Lenders or the Issuing Banks shall have any right individually to enforce the Guaranty, it being understood and agreed that all powers, rights and remedies hereunder and under any of the Loan Documents may be exercised solely by the Administrative Agent, for the benefit of the Lenders and the Issuing Bank in accordance with the terms hereof and thereof.
(c)    Notwithstanding anything to the contrary contained herein or any other Loan Document, when all Obligations have been paid in full and all Commitments have terminated or expired, upon request of Borrower, the Administrative Agent shall take such actions as shall be required to release all guarantee obligations provided for in any Loan Document. Any such release of guarantee obligations shall be deemed subject to the provision that such guarantee obligations shall be reinstated if after such release any portion of any payment in respect of the Obligations guaranteed thereby shall be rescinded or must otherwise be restored or returned upon the insolvency, bankruptcy, dissolution, liquidation or reorganization of Borrower or any Guarantor, or upon or as a result of the appointment of a receiver, intervenor or conservator of, or trustee or similar officer for, Borrower or any Guarantor or any substantial part of its property, or otherwise, all as though such payment had not been made.
Section 8.09    Withholding Taxes. To the extent required by any applicable law, the Administrative Agent may withhold from any payment to any Lender or any Issuing Bank an amount equivalent to any applicable withholding Tax. If the IRS or any other Governmental Authority asserts a claim that the Administrative Agent did not properly withhold Tax from amounts paid to or for the account of any Lender or any Issuing Bank because the appropriate form was not delivered or was not properly executed or because such Lender or such Issuing Bank failed to notify the Administrative Agent of a change in circumstance which rendered the exemption from, or reduction of, withholding Tax ineffective or for any other reason, or if the Administrative Agent reasonably determines that a payment was made to a Lender or an Issuing Bank pursuant to this Agreement without deduction of applicable withholding Tax from such payment, such Lender or such Issuing Bank, as the case may be, shall indemnify the Administrative Agent fully for all amounts paid, directly or indirectly, by the Administrative Agent as Tax or otherwise, including any penalties or interest and together with all expenses (including legal expenses, allocated internal costs and out-of-pocket expenses) incurred.
92


Section 8.10    Administrative Agent May File Bankruptcy Disclosure and Proofs of Claim. In case of the pendency of any proceeding under any Debtor Relief Laws relative to any Loan Party, the Administrative Agent (irrespective of whether the principal of any Loan shall then be due and payable as herein expressed or by declaration or otherwise and irrespective of whether the Administrative Agent shall have made any demand on Borrower) shall be entitled and empowered (but not obligated) by intervention in such proceeding or otherwise:
(a)    to file a verified statement pursuant to rule 2019 of the Federal Rules of Bankruptcy Procedure that, in its sole opinion, complies with such rule’s disclosure requirements for entities representing more than one creditor;
(b)    to file and prove a claim for the whole amount of the principal and interest owing and unpaid in respect of the Loans and all other Obligations that are owing and unpaid and to file such other documents as may be necessary or advisable in order to have the claims of the Lenders, the Issuing Banks and the Agents (including any claim for the reasonable compensation, expenses, disbursements and advances of the Agents, the Lenders and the Issuing Banks and their respective agents and counsel and all other amounts due the Agents, the Lenders and the Issuing Banks under Section 2.09 and Section 9.03 allowed in such judicial proceeding; and
(c)    to collect and receive any monies or other property payable or deliverable on any such claims and to distribute the same;
and, in each case, any custodian, receiver, assignee, trustee, liquidator, sequestrator or other similar official in any such judicial proceeding is hereby authorized by each other Agent, each Lender and each Issuing Bank to make such payments to the Administrative Agent and, in the event that the Administrative Agent shall consent to the making of such payments directly to the other Agents, the Lenders and/or the Issuing Banks, to pay to the Administrative Agent any amount due for the reasonable compensation, expenses, disbursements and advances of the Administrative Agent and its agents and counsel, and any other amounts due the Administrative Agent under Section 2.09 and Section 9.03. To the extent that the payment of any such compensation, expenses, disbursements and advances of the Administrative Agent, its agents and counsel, and any other amounts due the Administrative Agent under Section 2.09 and Section 9.03 out of the estate in any such proceeding, shall be denied for any reason, payment of the same shall be secured by a Lien on, and shall be paid out of, any and all distributions, dividends, money, securities and other properties that the other Agents, the Lenders and/or the Issuing Banks may be entitled to receive in such proceeding whether in liquidation or under any plan of reorganization or arrangement or otherwise.
Nothing contained herein shall be deemed to authorize the Administrative Agent to authorize or consent to or accept or adopt on behalf of any other Agent, any Lender or any Issuing Bank any plan of reorganization, arrangement, adjustment or composition affecting the Obligations or the rights of any Agent, any Lender or any Issuing Bank or to authorize the Administrative Agent to vote in respect of the claim of any Agent, any Lender or the Issuing Bank in any such proceeding.
Section 8.11    Certain ERISA Matters.
(a)    Each Lender (x) represents and warrants, as of the date such Person became a Lender party hereto, to, and (y) covenants, from the date such Person became a Lender party hereto to the date such Person ceases being a Lender party hereto, for the benefit of, the Administrative Agent
93


and the Arrangers and their respective Affiliates, and not, for the avoidance of doubt, to or for the benefit of the Borrower or any other Loan Party, that at least one of the following is and will be true:
(i)    such Lender is not using “plan assets” (within the meaning of 29 CFR § 2510.3-101, as modified by Section 3(42) of ERISA) of one or more Benefit Plans in connection with the Loans, the Letters of Credit or the Commitments,
(ii)    the transaction exemption set forth in one or more PTEs, such as PTE 84-14 (a class exemption for certain transactions determined by independent qualified professional asset managers), PTE 95-60 (a class exemption for certain transactions involving insurance company general accounts), PTE 90-1 (a class exemption for certain transactions involving insurance company pooled separate accounts), PTE 91-38 (a class exemption for certain transactions involving bank collective investment funds) or PTE 96-23 (a class exemption for certain transactions determined by in-house asset managers), is applicable with respect to such Lender’s entrance into, participation in, administration of and performance of the Loans, the Letters of Credit, the Commitments and this Agreement,
(iii)    (A) such Lender is an investment fund managed by a “Qualified Professional Asset Manager” (within the meaning of Part VI of PTE 84-14), (B) such Qualified Professional Asset Manager made the investment decision on behalf of such Lender to enter into, participate in, administer and perform the Loans, the Letters of Credit, the Commitments and this Agreement, (C) the entrance into, participation in, administration of and performance of the Loans, the Letters of Credit, the Commitments and this Agreement satisfies the requirements of sub-sections (b) through (g) of Part I of PTE 84-14 and (D) to the best knowledge of such Lender, the requirements of subsection (a) of Part I of PTE 84-14 are satisfied with respect to such Lender’s entrance into, participation in, administration of and performance of the Loans, the Letters of Credit, the Commitments and this Agreement, or
(iv)    such other representation, warranty and covenant as may be agreed in writing between the Administrative Agent, in its sole discretion, and such Lender.
(b)    In addition, (I) unless sub-clause (i) in the immediately preceding clause (a) is true with respect to a Lender or (II) if such sub-clause (i) is not true with respect to a Lender and such Lender has not provided another representation, warranty and covenant as provided in sub-clause (iv) in the immediately preceding clause (a), such Lender further (x) represents and warrants, as of the date such Person became a Lender party hereto, to, and (y) covenants, from the date such Person became a Lender party hereto to the date such Person ceases being a Lender party hereto, for the benefit of, the Administrative Agent and the Arrangers and their respective Affiliates, and not, for the avoidance of doubt, to or for the benefit of the Borrower or any other Loan Party, that:
(i)    none of the Administrative Agent, or any other Arranger or any of their respective Affiliates is a fiduciary with respect to the assets of such Lender (including in connection with the reservation or exercise of any rights by the Administrative Agent under this Agreement, any Loan Document or any documents related hereto or thereto),
(ii)    the Person making the investment decision on behalf of such Lender with respect to the entrance into, participation in, administration of and performance of the Loans, the Letters of Credit, the Commitments and this Agreement is independent (within the
94


meaning of 29 CFR § 2510.3-21) and is a bank, an insurance carrier, an investment adviser, a broker-dealer or other person that holds, or has under management or control, total assets of at least $50 million, in each case as described in 29 CFR § 2510.3-21(c)(1)(i)(A)-(E),
(iii)    the Person making the investment decision on behalf of such Lender with respect to the entrance into, participation in, administration of and performance of the Loans, the Letters of Credit, the Commitments and this Agreement is capable of evaluating investment risks independently, both in general and with regard to particular transactions and investment strategies (including in respect of the Obligations),
(iv)    the Person making the investment decision on behalf of such Lender with respect to the entrance into, participation in, administration of and performance of the Loans, the Letters of Credit, the Commitments and this Agreement is a fiduciary under ERISA or the Code, or both, with respect to the Loans, the Letters of Credit, the Commitments and this Agreement and is responsible for exercising independent judgment in evaluating the transactions hereunder, and
(v)    no fee or other compensation is being paid directly to the Administrative Agent or any other Arranger or any of their respective Affiliates for investment advice (as opposed to other services) in connection with the Loans, the Letters of Credit, the Commitments or this Agreement.
The representations set forth in this subsection (b) are intended to comply with the 29 C.F.R. 2510.3-21(a) and (c)(1) as promulgated on April 8, 2016 (81 Fed. Reg. 20,997). To the extent these regulations are revoked, repealed or no longer effective, these representations shall be deemed to be no longer in effect.
(c)    The Administrative Agent and the Arrangers hereby inform the Lenders that each such Person is not undertaking to provide impartial investment advice, or to give advice in a fiduciary capacity, in connection with the transactions contemplated hereby, and that such Person has a financial interest in the transactions contemplated hereby in that such Person or an Affiliate thereof (i) may receive interest or other payments with respect to the Loans, the Letters of Credit, the Commitments and this Agreement, (ii) may recognize a gain if it extended the Loans, the Letters of Credit or the Commitments for an amount less than the amount being paid for an interest in the Loans, the Letters of Credit or the Commitments by such Lender or (iii) may receive fees or other payments in connection with the transactions contemplated hereby, the Loan Documents or otherwise, including structuring fees, commitment fees, arrangement fees, facility fees, upfront fees, underwriting fees, ticking fees, agency fees, administrative agent or collateral agent fees, utilization fees, minimum usage fees, letter of credit fees, fronting fees, deal-away or alternate transaction fees, amendment fees, processing fees, term out premiums, banker’s acceptance fees, breakage or other early termination fees or fees similar to the foregoing.
ARTICLE IX
MISCELLANEOUS
Section 9.01    Notices.
95


(a)    Except in the case of notices and other communications expressly permitted to be given by telephone (and subject to paragraph (b) below), all notices and other communications provided for herein shall be in writing and shall be delivered by hand or overnight courier service, mailed by certified or registered mail or sent by telecopy (or other electronic image scan transmission (e.g. pdf via email)), as follows:
(i)    if to the Borrower, to it at:
Social Finance, Inc.
1 Letterman Drive Building A, Suite 4700
San Francisco, CA 94129
Attention: Chief Financial Officer
Email: MGill@sofi.org
with a copy to:
Wachtell, Lipton, Rosen & Katz
51 West 52nd Street
New York, NY 10019
Attention: Eric M. Rosof
Email: EMRosof@wlrk.com
(ii)    if to the Administrative Agent, to it at:
Goldman Sachs Bank USA
200 West Street New York, New York, 10282-2198
Attention: SBD Operations
Facsimile: (212) 428-9270
Email: gs-sbdagency-borrowernotices@ny.email.gs.com
with a copy to:
Cahill Gordon & Reindel, LLP
80 Pine Street
New York, New York, 10005
Attention: Corey Wright
Email: CWright@cahill.com
(iii)    if to any other Lender or any other Issuing Bank, to it at its address (or telecopy number) set forth in its Administrative Questionnaire.
Notices and other communications sent by hand or overnight courier service, or mailed by certified or registered mail, shall be deemed to have been given when received; notices and other communications sent by telecopier shall be deemed to have been given when sent (except that, if not given during normal business hours for the recipient, shall be deemed to have been given at the opening of business on the next Business Day for the recipient). Notices and other communications delivered through electronic communications to the extent provided in clause (b) below, shall be effective as provided in such clause (b).
96


(b)    Notices and other communications to the Lenders and the Issuing Banks hereunder may be delivered or furnished by electronic communications pursuant to procedures approved by the Administrative Agent; provided that the foregoing shall not apply to notices pursuant to Article 2 unless otherwise agreed by the Administrative Agent and the applicable Lender or the applicable Issuing Bank. The Administrative Agent or the Borrower may, in its discretion, agree to accept notices and other communications to it hereunder by electronic communications pursuant to procedures approved by it; provided that approval of such procedures may be limited to particular notices or communications. Unless the Administrative Agent otherwise prescribes, (i) notices and other communications sent to an e-mail address shall be deemed received upon the sender’s receipt of an acknowledgement from the intended recipient (such as by the “return receipt requested” function, as available, return e-mail or other written acknowledgement), and (ii) notices or communications posted to an Internet or intranet website shall be deemed received upon the deemed receipt by the intended recipient, at its e-mail address as described in the foregoing clause (i), of notification that such notice or communication is available and identifying the website address therefor; provided that, for both clauses (i) and (ii) above, if such notice, email or other communication is not sent during the normal business hours of the recipient, such notice or communication shall be deemed to have been sent at the opening of business on the next Business Day for the recipient.
(c)    Any party hereto may change its address or telecopy number for notices and other communications hereunder by notice to the other parties hereto (provided that any Lender may change its address or telecopy number by notice solely to the Administrative Agent and the Borrower).
(d)    The Borrower agrees that the Administrative Agent may, but shall not be obligated to, make the Communications (as defined below) available to the Lenders and the Issuing Banks by posting the Communications on Debt Domain, IntraLinks, Syndtrak or another similar electronic system (the “Platform”). THE PLATFORM IS PROVIDED “AS IS” AND “AS AVAILABLE.” The Agent Parties (as defined below) do not warrant the adequacy of the Platform and expressly disclaim liability for errors or omissions in the Communications. No warranty of any kind, express, implied or statutory, including any warranty of merchantability, fitness for a particular purpose, non-infringement of third-party rights or freedom from viruses or other code defects, is made by any Agent Party in connection with the Communications or the Platform. In no event shall the Administrative Agent or any of its Related Parties (collectively, the “Agent Parties”) be responsible or liable for damages of any kind, including, without limitation, direct or indirect, special, incidental or consequential damages, losses or expenses (whether in tort, contract or otherwise) to the Borrower, any other Loan Party, any Lender, any Issuing Bank or any other Person arising from the unauthorized use by others of information or other materials obtained through internet, electronic, telecommunications or other information transmission, including, without limitation, the transmission of Communications through the Platform, except to the extent that such damages have resulted from the willful misconduct or gross negligence of such Agent Party (as determined in a final, non-appealable judgment by a court of competent jurisdiction). “Communications” means, collectively, any notice, demand, communication, information, document or other material that any Loan Party provides to the Administrative Agent pursuant to any Loan Document or the transactions contemplated therein which is distributed to the Administrative Agent or any Lender by means of electronic communications pursuant to this Section 9.01, including through the Platform.
(e)    In the event the Borrower shall have any publicly traded Equity Interests or other securities or otherwise files or is required to file reports under Section 15(d) of the Securities
97


Exchange Act of 1934, as amended (the “Exchange Act”) , the Borrower and each Lender acknowledges that certain of the Lenders may be Public Lenders and, if any document, notice or other information required to be delivered hereunder is being distributed through the Platform, any information that the Borrower has indicated contains Non-Public Information will not be posted on that portion of the Platform designated for such Public Lenders. If the Borrower has not indicated whether a document, notice or other information provided to the Administrative Agent by or on behalf of the Borrower or any Subsidiary contains Non-Public Information, the Administrative Agent reserves the right to post such information solely on the portion of the Platform designated for Lenders that wish to receive material Non-Public Information with respect to the Borrower, the Subsidiaries and its and their securities. Notwithstanding the foregoing, nothing in this Section 9.01(e) shall create any obligation on the Borrower to indicate whether any information contains Non-Public Information, it being further agreed that if any such indication is provided by the Borrower in its discretion, such indication shall create no obligation on the Borrower to provide any such indication in the future.
(f)    Each Public Lender agrees to cause at least one individual at or on behalf of such Public Lender to at all times have selected the “Private Side Information” or similar designation on the content declaration screen of the Platform in order to enable such Public Lender or its delegate, in accordance with such Public Lender’s compliance procedures and applicable law, including United State federal and state securities laws, to make reference to information that is not made available through the “Public Side Information” portion of the Platform and that may contain Non Public Information with respect to the Borrower, the Subsidiaries or its or their securities.
Section 9.02    Waivers; Amendments.
(a)    No failure or delay by the Administrative Agent, any Issuing Bank or any Lender in exercising any right or power hereunder shall operate as a waiver thereof, nor shall any single or partial exercise of any such right or power, or any abandonment or discontinuance of steps to enforce such a right or power, preclude any other or further exercise thereof or the exercise of any other right or power. The rights and remedies of the Administrative Agent, the Issuing Banks and the Lenders hereunder are cumulative and are not exclusive of any rights or remedies that they would otherwise have. No waiver of any provision of this Agreement or any other Loan Document or consent to any departure by the Borrower or any other Loan Party therefrom shall in any event be effective unless the same shall be permitted by paragraph (b) of this Section, and then such waiver or consent shall be effective only in the specific instance and for the purpose for which given. Without limiting the generality of the foregoing, the making of a Loan or issuance of a Letter of Credit shall not be construed as a waiver of any Default or Event of Default, regardless of whether the Administrative Agent, the Issuing Banks or any Lender may have had notice or knowledge of such Default or Event of Default at the time. Notwithstanding the foregoing Borrower and Administrative Agent may, without the consent of the other Lenders, amend, modify or supplement this Agreement and any other Loan Document to cure any ambiguity, omission, typographical error, defect or inconsistency if such amendment, modification or supplement if the same is not objected to in writing by the Required Lenders within five Business Days following receipt of notice thereof.
(b)    None of this Agreement, any other Loan Document or any provision hereof or thereof may be waived, amended or modified except pursuant to an agreement or agreements in writing entered into by the Borrower and the Required Lenders or by the Borrower and the Administrative Agent with the consent of the Required Lenders; provided, however, that no such
98


amendment, waiver or consent shall: (i) extend or increase the Commitment of any Lender or any Issuing Bank (including, without limitation, amending the definition of “Applicable Percentage”) without the written consent of such Lender or such Issuing Bank, as applicable, (ii) reduce the principal amount of any Loan or Letter of Credit or reduce the rate of interest thereon, or reduce any fees payable hereunder, without the written consent of each Lender directly affected thereby and, in the case of any Letter of Credit, the applicable Issuing bank, (iii) postpone the scheduled date of payment of the principal amount of any Loan or Letter of Credit, or any interest thereon, or any fees payable hereunder, or reduce the amount of, waive or excuse any such payment, or postpone the scheduled date of expiration of any Commitment, without the written consent of each Lender directly affected thereby and, if applicable, the applicable Issuing Bank; provided, however, that notwithstanding clause (ii) or (iii) of this Section 9.02(b), only the consent of the Required Lenders shall be necessary to waive any obligation of the Borrower to pay interest at the default rate set forth in Section 2.10(d), (iv) change Section 7.02 or Section 2.15(b), Section 2.15(c) or any other Section hereof providing for the ratable treatment of the Lenders, in each case in a manner that would alter the pro rata sharing of payments required thereby, without the written consent of each Lender, (v) release all or substantially all of the value of the Guaranties provided by the Guarantors, without the written consent of each Lender, except to the extent the release of any Guarantor is permitted pursuant to Article 8 or Section 9.17 (in which case such release may be made by the Administrative Agent acting alone), (vi) change any of the provisions of this Section or the percentage referred to in the definition of “Required Lenders” or any other provision hereof specifying the number or percentage of Lenders required to waive, amend or modify any rights hereunder or make any determination or grant any consent hereunder, without the written consent of each Lender or (vii) waive any condition set forth in Section 4.01, or, in the case of any Loans made on the Effective Date, Section 4.02, without the written consent of each Lender and each Issuing Bank. Notwithstanding anything to the contrary herein, no such agreement shall amend, modify or otherwise affect the rights or duties of the Administrative Agent or the Issuing Banks hereunder without the prior written consent of the Administrative Agent or the Issuing Banks, as the case may be (it being understood that any change to Section 2.17 and Section 2.19 shall require the consent of the Administrative Agent and the Issuing Banks).
(c)    Notwithstanding the foregoing, this Agreement may be amended as contemplated by (i) Section 2.18 to effect New Commitments pursuant to a Joinder Agreement with only the consent of the Administrative Agent, the Borrower, the other Loan Parties and the New Lenders providing New Commitments, and (ii) Section 2.20 to effect an extension pursuant to an Extension Agreement with only the consent of the Administrative Agent, the Borrower, the other Loan Parties and the Extending Lenders and the New Extending Lenders.
(d)    Notwithstanding anything herein or in any other Loan Document to the contrary, during such period as a Lender is a Defaulting Lender, to the fullest extent permitted by applicable law, such Lender will not be entitled to vote in respect of amendments and waivers hereunder and the Commitment and the outstanding Loans or other extensions of credit of such Lender hereunder will not be taken into account in determining whether the Required Lenders or all of the Lenders or each directly affected Lender, as required, have approved any such amendment or waiver; provided, however, that any such amendment or waiver that would increase or extend the term of the Commitment of such Defaulting Lender, extend the date fixed for the payment of principal or interest or fees owing to such Defaulting Lender hereunder, reduce the principal amount of any obligation owing to such Defaulting Lender, reduce the amount of or the rate or amount of interest on any amount owing to such Defaulting Lender (other than in connection with the waiver of
99


any obligation of the Borrower to pay interest at the default rate set forth in Section 2.10(d)) or of any fee payable to such Defaulting Lender hereunder, or alter the terms of this paragraph, will require the consent of such Defaulting Lender.
Section 9.03    Expenses; Indemnity; Damage Waiver.
(a)    The Borrower shall pay (i) all reasonable and documented out of pocket costs and expenses incurred by the Administrative Agent, the Issuing Banks, the Lenders, the Arrangers and their respective Affiliates (including, without limitation, the reasonable and documented fees and disbursements of one primary firm of counsel for the Administrative Agent, the Issuing Banks, the Lenders and the Arrangers, taken as a whole) in connection with the syndication of the credit facilities provided for herein, the preparation, execution, delivery and administration of this Agreement, any other Loan Document or any amendments, modifications or waivers of the provisions hereof or thereof (whether or not the transactions contemplated hereby or thereby shall be consummated); and (ii) all reasonable and documented costs and expenses incurred by the Administrative Agent, the Issuing Banks, the Arrangers or any Lender (including, without limitation, the reasonable and documented fees, disbursements and other charges of one primary firm of counsel for the Administrative Agent, the Issuing Banks, the Lenders and the Arrangers, taken as a whole (and if reasonably necessary, of a single regulatory counsel and a single local counsel in each appropriate jurisdiction and, in the case of an actual or potential conflict of interest where the Administrative Agent, the Issuing Banks, any Lender or any Arranger affected by such conflict informs the Borrower of such conflict and thereafter retains its own counsel, of another primary firm of counsel for such affected person (and if reasonably necessary, of a single regulatory counsel and a single local counsel in each appropriate jurisdiction))), in connection with the enforcement or protection of its rights in connection with this Agreement or any other Loan Document, including its rights under this Section 9.03, or in connection with the Loans or Letters of Credit made hereunder, including all such reasonable and documented costs and expenses incurred during any workout, restructuring or negotiations in respect of such Loans.
(b)    The Borrower shall indemnify the Administrative Agent, the Issuing Banks, the Arrangers and each Lender, and each Related Party, successor, partner, representative or assign of any of the foregoing Persons (each such Person being called an “Indemnitee”) against, and hold each Indemnitee harmless from, any and all losses, claims, damages, liabilities and reasonable and documented out-of-pocket costs and expenses (including the reasonable and documented fees, charges and disbursements of a primary firm of counsel for all such Indemnitees (and if reasonably necessary, of a single regulatory counsel and a single local counsel in each appropriate jurisdiction and, in the case of an actual or potential conflict of interest where the Indemnitee affected by such conflict informs the Borrower of such conflict and thereafter retains its own counsel, of another primary firm of counsel for such affected Indemnitee (and if reasonably necessary, of a single regulatory counsel and a single local counsel in each appropriate jurisdiction))), incurred by or asserted against any Indemnitee by any third party or by the Borrower or any other Loan Party arising out of, in connection with, or as a result of (i) the execution or delivery of this Agreement, any other Loan Document or any agreement or instrument contemplated hereby, the performance by the parties hereto of their respective obligations hereunder or the consummation of the Transactions or any other transactions contemplated hereby, or, in the case of the Administrative Agent (and any sub-agent thereof) and its Related Parties only, the administration of this Agreement and the other Loan Documents, (ii) any Loan or Letter of Credit or the use of the proceeds therefrom (including any refusal by the Issuing Bank to honor a demand for payment under a Letter of Credit if the documents
100


presented in connection with such demand do not strictly comply with the terms of such Letters of Credit), (iii) any actual or alleged presence or release of Hazardous Materials on or from any property owned, leased or operated by the Borrower or any of its Subsidiaries, or any Environmental Liability related in any way to the Borrower or any of its Subsidiaries, or (iv) any actual or prospective action, suit, inquiry, claim, litigation, investigation or proceeding relating to any of the foregoing, whether based on contract, tort or any other theory and regardless of whether any Indemnitee is a party thereto (and regardless of whether such matter is initiated by a third party or the Borrower or any Affiliate of the Borrower); provided that such indemnity shall not, as to any Indemnitee, be available, (x) to the extent that such losses, claims, damages, liabilities, costs or reasonable and documented out-of-pocket costs or expenses are determined by a court of competent jurisdiction by final and non-appealable judgment to have resulted from the gross negligence, bad faith or willful misconduct of such Indemnitee, (y) result from a material breach by such Indemnitee of its obligations under this Agreement or any other Loan Document (as determined by a court of competent jurisdiction by final and non-appealable judgment), or (z) arise from any dispute between and among Indemnitees, to the extent such dispute does not involve an act or omission by the Borrower or its Subsidiaries (as determined by a court of competent jurisdiction by final and non-appealable judgment) other than any proceeding against the Administrative Agent, any Issuing Bank or any Arranger, in each case, acting in such capacity. This Section 9.03(b) shall not apply with respect to Taxes other than Taxes that represent losses, claims or damages arising from any non-Tax claim. The Borrower will not be required to indemnify any Indemnitee for any amount paid or payable by such Indemnitee in the settlement of any such indemnified losses, claims, damages, liabilities, costs or reasonable and documented expenses which is entered into by such Indemnitee without Borrower’s written consent (such consent not to be unreasonably withheld, conditioned or delayed) unless there is a final, non-appealable judgment of a court of competent jurisdiction for the plaintiff. In the case of any proceeding to which the indemnity in this paragraph applies, such indemnity and reimbursement obligations shall be effective, whether or not such proceeding is brought by the Borrower, any of its equityholders or creditors, an Indemnitee or any other Person, or an Indemnitee is otherwise a party thereto.
Without limiting in any way the indemnification obligations of the Borrower pursuant to Section 9.03(b) or of the Lenders pursuant to Section 8.06, to the extent permitted by applicable law, each party hereto shall not assert, and hereby waives, any claim against any Indemnitee on any theory of liability, for special, indirect, consequential or punitive damages (as opposed to direct or actual damages) arising out of, in connection with, or as a result of, this Agreement, any other Loan Document or any agreement or instrument contemplated hereby, the Transactions or any Loan or Letter of Credit or the use of the proceeds thereof; provided that nothing in this sentence shall relieve the Borrower of any obligation it may have to indemnify an Indemnitee against special, indirect, consequential or punitive damages asserted against such Indemnitee by a third party. No Indemnitee shall be liable for any damages arising from the use by unintended recipients of any information or other materials distributed to such unintended recipients by such Indemnitee through telecommunications, electronic or other information transmission systems in connection with this Agreement or the other Loan Documents or the transactions contemplated hereby or thereby other than for direct or actual damages resulting from the gross negligence, bad faith or willful misconduct of such Indemnitee as determined by a final and non-appealable judgment of a court of competent jurisdiction.
(c)    All amounts due under this Section 9.03 shall be payable promptly after written demand therefor.
101


Section 9.04    Successors and Assigns.
(a)    The provisions of this Agreement shall be binding upon and inure to the benefit of the parties hereto and their respective successors and assigns permitted hereby, except that (i) the Borrower may not assign or otherwise transfer any of its rights or obligations hereunder without the prior written consent of the Administrative Agent, each Lender and each Issuing Bank (and any attempted assignment or transfer by the Borrower without such consent shall be null and void) and (ii) no Lender may assign or otherwise transfer its rights or obligations hereunder except in accordance with this Section 9.04. Nothing in this Agreement, expressed or implied, shall be construed to confer upon any Person (other than the parties hereto, their respective successors and assigns permitted hereby, Participants (to the extent provided in subsection (c) of this Section 9.04), Indemnitees (to the extent provided in Section 9.03) and, to the extent expressly contemplated hereby, the Related Parties of each of the Administrative Agent, the Issuing Banks and the Lenders) any legal or equitable right, remedy or claim under or by reason of this Agreement.
(b)    (i) Subject to the conditions set forth in paragraph (b)(ii) below, any Lender may assign to one or more assignees all or a portion of its rights and obligations under this Agreement (including all or a portion of its Commitment and the Loans at the time owing to it) with the prior written consent of:
(A)    the Borrower (not to be unreasonably withheld or delayed); provided that no consent of the Borrower shall be required for an assignment to a Lender, an Affiliate of a Lender, an Approved Fund or, if a Specified Event of Default has occurred and is continuing; and provided, further, that the Borrower shall be deemed to have consented to any such assignment unless it shall object thereto by written notice to the Administrative Agent within 10 Business Days after having received notice thereof;
(B)    the Administrative Agent (such consent not to be unreasonably withheld or delayed); provided that no consent of the Administrative Agent shall be required for an assignment to a Lender, an Affiliate of a Lender or an Approved Fund; and
(C)    the Issuing Banks (such consent not to be unreasonably withheld or delayed).
(ii)    Assignments shall be subject to the following additional conditions:
(A)    except in the case of an assignment to a Lender or an Affiliate of a Lender or an assignment of the entire remaining amount of the assigning Lender’s Commitment or Loans and subject to Section 2.16(c), the amount of the Commitment or Loans of the assigning Lender subject to each such assignment (determined as of the date the Assignment and Assumption with respect to such assignment is delivered to the Administrative Agent) shall not be less than $15,000,000 (or a greater amount that is an integral multiple of $1,000,000), unless each of the Borrower and the Administrative Agent otherwise consent; provided that no such consent of the Borrower shall be required if a Specified Event of Default has occurred and is continuing;
102


(B)    each partial assignment shall be made as an assignment of a proportionate part of all the assigning Lender’s rights and obligations under this Agreement;
(C)    the parties to each assignment shall execute and deliver to the Administrative Agent an Assignment and Assumption, together with a processing and recordation fee (unless otherwise agreed to by the Administrative Agent in its sole discretion) of $3,500;
(D)    the assignee, if it shall not be a Lender, shall deliver to the Administrative Agent an Administrative Questionnaire in which the assignee designates one or more credit contacts to whom all syndicate-level information (which may contain material non-public information about the Borrower and its Related Parties or their respective securities) will be made available and who may receive such information in accordance with the assignee’s compliance procedures and applicable laws, including Federal and state securities laws;
(E)    no such assignment shall be made to (i) any Loan Party nor any Affiliate of a Loan Party, (ii) any Defaulting Lender or any of its subsidiaries, or any Person, who, upon becoming a Lender hereunder, would constitute any of the foregoing Persons described in this clause (ii), or (iii) any natural person;
(F)    in connection with any assignment of rights and obligations of any Defaulting Lender hereunder, no such assignment shall be effective unless and until, in addition to the other conditions thereto set forth herein, the parties to the assignment shall make such additional payments to the Administrative Agent in an aggregate amount sufficient, upon distribution thereof as appropriate (which may be outright payment, purchases by the assignee of participations or subparticipations, or other compensating actions, including funding, with the consent of the Borrower and the Administrative Agent, the applicable pro rata share of Loans previously requested but not funded by the Defaulting Lender, to each of which the applicable assignee and assignor hereby irrevocably consent), to (x) pay and satisfy in full all payment liabilities then owed by such Defaulting Lender to the Administrative Agent or any Lender hereunder (and interest accrued thereon), and (y) acquire (and fund as appropriate) its full pro rata share of all Loans in accordance with its Applicable Percentage. Notwithstanding the foregoing, in the event that any assignment of rights and obligations of any Defaulting Lender hereunder shall become effective under applicable law without compliance with the provisions of this paragraph, then the assignee of such interest shall be deemed to be a Defaulting Lender for all purposes of this Agreement until such compliance occurs; and
(G)    (a) No assignment or participation shall be made to any Person that was a Disqualified Institution (other than, in the case of participations (but not assignments), a Person who was a Disqualified Institution solely as a result of clause (c) of the definition thereof) as of the date (the “Trade Date”) on
103


which the assigning or participating Lender entered into a binding agreement to sell and assign or participate, as applicable, all or a portion of its rights and obligations under this Agreement to such Person (unless the Borrower has consented to such assignment or participation in writing in its sole and absolute discretion, in which case such Person will not be considered a Disqualified Institution for the purpose of such assignment or participation). For the avoidance of doubt, with respect to any assignee or Participant that becomes a Disqualified Institution after the applicable Trade Date (including as a result of the delivery of a supplement to the list of competitors or potential competitors or investors in such competitors or potential competitors pursuant to clause (b) of the definition of “Disqualified Institution”), (x) such assignee or Participant shall not retroactively be disqualified from becoming a Lender or Participant (but such Person shall not be able to increase its Commitments or participations hereunder) and (y) such assignment or participation and, in the case of an assignment, the execution by the Borrower of an Assignment and Assumption with respect to such assignee will not by itself result in such assignee no longer being considered a Disqualified Institution. Any assignment or participation in violation of this clause (G)(a) shall not be void, but the other provisions of this clause (G)(a) shall apply.
(b) The Administrative Agent (A) shall have the right (but not the obligation), and the Borrower hereby expressly authorizes the Administrative Agent, to post the list of Disqualified Institutions and any updates thereto from time to time on the Platform, including that portion of the Platform that is designated for “public side” Lenders and (B) shall provide the list of Disqualified Institutions and any updates thereto to each Lender or Participant requesting the same.
(iii)    Subject to acceptance and recording thereof pursuant to paragraph (b)(iv) of this Section 9.04, from and after the effective date specified in each Assignment and Assumption the assignee thereunder shall be a party hereto and, to the extent of the interest assigned by such Assignment and Assumption, have the rights and obligations of a Lender under this Agreement, and the assigning Lender thereunder shall, to the extent of the interest assigned by such Assignment and Assumption, be released from its obligations under this Agreement (and, in the case of an Assignment and Assumption covering all of the assigning Lender’s rights and obligations under this Agreement, such Lender shall cease to be a party hereto but shall continue to be entitled to the benefits of Section 2.12, Section 2.13, Section 2.14 and Section 9.03); provided that except to the extent otherwise expressly agreed by the affected parties, no assignment by a Defaulting Lender will constitute a waiver or release of any claim of any party hereunder arising from that Lender’s having been a Defaulting Lender. Any assignment or transfer by a Lender of rights or obligations under this Agreement that does not comply with this Section shall be treated for purposes of this Agreement as a sale by such Lender of a participation in such rights and obligations in accordance with subsection (c) of this Section 9.04.
(iv)    The Administrative Agent, acting for this purpose as a non-fiduciary agent of the Borrower, shall maintain at one of its offices a copy of each Assignment and Assumption delivered to it and a register for the recordation of the names and addresses of the Lenders, and the Commitment of, and principal amounts (and stated interest) of the Loans owing to, each Lender pursuant to the terms hereof from time to time (the “Register”). The
104


entries in the Register shall be conclusive (absent manifest error), and the Borrower, the Administrative Agent and the Lenders shall treat each Person whose name is recorded in the Register pursuant to the terms hereof as a Lender hereunder for all purposes of this Agreement, notwithstanding notice to the contrary. The Register shall be available for inspection by the Borrower and any Lender, at any reasonable time and from time to time upon reasonable prior notice. The Borrower agrees to indemnify the Administrative Agent from and against any and all losses, claims, damages and liabilities of whatsoever nature which may be imposed on, asserted against or incurred by the Administrative Agent in performing its duties under this Section 9.04(b)(iv), except to the extent that such losses, claims, damages or liabilities are determined by a court of competent jurisdiction by final and non-appealable judgment to have resulted from the gross negligence, bad faith or willful misconduct of the Administrative Agent. The Loans (including principal and interest) are registered obligations and the right, title, and interest of any Lender or its assigns in and to such Loans shall be transferable only upon notation of such transfer in the Register. The parties agree that the Register is intended to establish that the Loans, Commitments and Letters of Credit are in registered form under Section 5f.103-1(c) of the United States Treasury Regulations.
(v)    Upon its receipt of a duly completed Assignment and Assumption executed by an assigning Lender and an assignee, the assignee’s completed Administrative Questionnaire (unless the assignee shall already be a Lender hereunder), the processing and recordation fee referred to in paragraph (b) of this Section 9.04 and any written consent to such assignment required by paragraph (b) of this Section 9.04, the Administrative Agent shall accept such Assignment and Assumption and record the information contained therein in the Register; provided that if either the assigning Lender or the assignee shall have failed to make any payment required to be made by it pursuant to Section 2.04(b), Section 2.15(d) or Section 8.06, the Administrative Agent shall have no obligation to accept such Assignment and Assumption and record the information therein in the Register unless and until such payment shall have been made in full, together with all accrued interest thereon. No assignment shall be effective for purposes of this Agreement unless it has been recorded in the Register as provided in this paragraph.
(c)    (i)    Subject to Section 9.04(b)(ii)(G), any Lender may, without the consent of, or notice to, the Borrower, the Administrative Agent or the Issuing Banks, sell participations to one or more banks or other entities (but not to the Borrower or an Affiliate thereof) (a “Participant”) in all or a portion of such Lender’s rights and obligations under this Agreement (including all or a portion of its Commitment and the Loans owing to it); provided that (A) such Lender’s obligations under this Agreement shall remain unchanged, (B) such Lender shall remain solely responsible to the other parties hereto for the performance of such obligations, and (C) the Borrower, the Administrative Agent, the Issuing Banks and the other Lenders shall continue to deal solely and directly with such Lender in connection with such Lender’s rights and obligations under this Agreement. Any agreement or instrument pursuant to which a Lender sells such a participation shall provide that such Lender shall retain the sole right to enforce this Agreement and to approve any amendment, modification or waiver of any provision of this Agreement; provided that such agreement or instrument may provide that such Lender will not, without the consent of the Participant, agree to any amendment, modification or waiver described in the first proviso to Section 9.02(b) that affects such Participant. Subject to paragraph (c)(ii) of this Section 9.04, the Borrower agrees that each Participant shall be entitled to the benefits of Sections 2.12, 2.13 and 2.14 (subject to the requirements
105


and limitations therein, including the requirements under Section 2.14(g) (it being understood that the documentation required under Section 2.14(g) shall be delivered to the participating Lender) to the same extent as if it were a Lender and had acquired its interest by assignment pursuant to paragraph (b) of this Section; provided that such Participant agrees to be subject to the provisions of Section 2.16 as if it were an assignee under paragraph (b) of this Section. To the extent permitted by law, each Participant also shall be entitled to the benefits of Section 9.08 as though it were a Lender; provided such Participant agrees to be subject to Section 2.15(c) as though it were a Lender.
(ii)    A Participant shall not be entitled to receive any greater payment under Sections 2.12 or 2.14 than the applicable Lender would have been entitled to receive with respect to the participation sold to such Participant except to the extent such entitlement to receive a greater payment results from a Change in Law requiring a payment under Section 2.12 that occurs after the Participant acquired the applicable participation. Each Lender that sells a participation agrees, at the Borrower’s request and expense, to use reasonable efforts to cooperate with the Borrower to effectuate the provisions of Section 2.16(b) with respect to any Participant.
(iii)    Each Lender that sells a participation shall, acting solely for this purpose as a nonfiduciary agent of the Borrower, maintain a register on which it enters the name and address of each Participant and the principal amounts (and stated interest) of each Participant’s interest in the Loans or other obligations under the Loan Documents (the “Participant Register”); provided that no Lender shall have any obligation to disclose all or any portion of the Participant Register (including the identity of any Participant or any information relating to a Participant’s interest in any commitments, loans, letters of credit or its other obligations under any Loan Document) to any Person except to the extent that such disclosure is necessary to establish that such commitment, loan, letter of credit or other obligation is in registered form under Section 5f.103-1(c) of the United States Treasury Regulations. The entries in the Participant Register shall be conclusive absent manifest error, and such Lender shall treat each Person whose name is recorded in the Participant Register as the owner of such participation for all purposes of this Agreement notwithstanding any notice to the contrary. For the avoidance of doubt, the Administrative Agent (in its capacity as Administrative Agent) shall have no responsibility for maintaining a Participant Register.
(d)    Any Lender may at any time pledge or assign a security interest in all or any portion of its rights under this Agreement to secure obligations of such Lender, including without limitation any pledge or assignment to secure obligations to a Federal Reserve Bank or any other central bank having jurisdiction over such Lender, and this Section 9.04 shall not apply to any such pledge or assignment of a security interest; provided that no such pledge or assignment of a security interest shall release a Lender from any of its obligations hereunder or substitute any such pledgee or assignee for such Lender as a party hereto.
Section 9.05    Survival. All covenants, agreements, representations and warranties made by the Borrower herein and in the certificates or other instruments delivered in connection with or pursuant to this Agreement shall be considered to have been relied upon by the other parties hereto and shall survive the execution and delivery of this Agreement, the making of any Loans and the issuance of any Letters of Credit, regardless of any investigation made by any such other party or on its behalf and notwithstanding that the Administrative Agent, any Issuing Bank or any Lender may have had notice or knowledge of any Default, Event of Default or incorrect representation or warranty
106


at the time any credit is extended hereunder, and shall continue in full force and effect as long as the principal of or any accrued interest on any Loan or any fee or any other amount payable under this Agreement is outstanding and unpaid and so long as the Commitments have not expired or terminated. The provisions of Section 2.12, Section 2.13, Section 2.14, Section 2.19(g) and Section 9.03 and Article 8 shall survive and remain in full force and effect regardless of the consummation of the transactions contemplated hereby, the repayment of the Loans, the expiration or termination of the Letters of Credit, the expiration or termination of the Commitments, the resignation of the Administrative Agent, the replacement of any Lender or any Issuing Bank, the resignation of an Issuing Bank or the termination of this Agreement or any provision hereof.
Section 9.06    Counterparts; Integration; Effectiveness. This Agreement may be executed in counterparts (and by different parties hereto on different counterparts), each of which shall constitute an original, but all of which when taken together shall constitute a single contract. This Agreement, the other Loan Documents and any separate letter agreements with respect to fees payable to the Administrative Agent constitute the entire contract among the parties relating to the subject matter hereof and supersede any and all previous agreements and understandings, oral or written, relating to the subject matter hereof. Except as provided in Section 4.01, this Agreement shall become effective when it shall have been executed by the Administrative Agent and when the Administrative Agent shall have received counterparts hereof which, when taken together, bear the signatures of each of the other parties hereto, and thereafter shall be binding upon and inure to the benefit of the parties hereto and their respective successors and assigns. Delivery of an executed counterpart of a signature page of this Agreement by telecopy (or other electronic image scan transmission (e.g. pdf via email)) means shall be effective as delivery of a manually executed counterpart of this Agreement.
Section 9.07    Severability. Any provision of this Agreement held to be invalid, illegal or unenforceable in any jurisdiction shall, as to such jurisdiction, be ineffective to the extent of such invalidity, illegality or unenforceability without affecting the validity, legality and enforceability of the remaining provisions hereof; and the invalidity of a particular provision in a particular jurisdiction shall not invalidate such provision in any other jurisdiction. Without limiting the foregoing provisions of this Section 9.07, if and to the extent that the enforceability of any provisions in this Agreement relating to Defaulting Lenders shall be limited by Debtor Relief Laws, as determined in good faith by the Administrative Agent, then such provisions shall be deemed to be in effect only to the extent not so limited.
Section 9.08    Right of Setoff. If an Event of Default shall have occurred and be continuing, each Issuing Bank, each Lender and each of their respective Affiliates is hereby authorized at any time and from time to time, to the fullest extent permitted by law, to set off and apply any and all deposits (general or special, time or demand, provisional or final) at any time held by, and other obligations at any time owing by such Issuing Bank, such Lender or such Affiliate to or for the credit or the account of the Borrower against any of and all the obligations of the Borrower now or hereafter existing under this Agreement held by such Issuing Bank or such Lender, irrespective of whether or not such Issuing Bank or such Lender, as applicable, shall have made any demand under this Agreement and although such obligations may be unmatured; provided that in the event that any Defaulting Lender shall exercise any such right of setoff, (x) all amounts so set off shall be paid over immediately to the Administrative Agent for further application in accordance with the provisions of Section 2.17 and, pending such payment, shall be segregated by such Defaulting Lender from its other funds and deemed held in trust for the benefit of the Administrative Agent and the Lenders, and (y) the Defaulting Lender shall provide promptly to the Administrative Agent a statement describing in
107


reasonable detail the obligations owing to such Defaulting Lender as to which it exercised such right of setoff. The rights of each Issuing Bank and each Lender under this Section 9.08 are in addition to other rights and remedies (including other rights of setoff) which such Issuing Bank or such Lender may have. Each Issuing Bank and each Lender agrees to notify the Borrower and the Administrative Agent promptly after any such setoff and application; provided that the failure to give such notice shall not affect the validity of such setoff and application.
Section 9.09    Governing Law; Jurisdiction; Consent to Service of Process.
(a)    THIS AGREEMENT AND THE OTHER LOAN DOCUMENTS AND ANY CLAIM, CONTROVERSY OR DISPUTE UNDER, ARISING OUT OF OR RELATING TO THIS AGREEMENT OR THE OTHER LOAN DOCUMENTS AND THE TRANSACTIONS CONTEMPLATED HEREBY AND THEREBY, WHETHER BASED IN CONTRACT (AT LAW OR IN EQUITY), TORT OR ANY OTHER THEORY, SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAW OF THE STATE OF NEW YORK WITHOUT REGARD TO CONFLICTS OF LAW RULES THAT WOULD RESULT IN THE APPLICATION OF A DIFFERENT GOVERNING LAW.
(b)    The Borrower hereby irrevocably and unconditionally submits, for itself and its property, to the exclusive jurisdiction of the Supreme Court of the State of New York sitting in New York County, Borough of Manhattan and of the United States District Court of the Southern District of New York, and any appellate court from any thereof, in any action or proceeding arising out of or relating to this Agreement or any other Loan Document, or for recognition or enforcement of any judgment, and each of the parties hereto hereby irrevocably and unconditionally agrees that all claims in respect of any such action or proceeding may be heard and determined in such New York State or, to the extent permitted by law, in such Federal court. Each of the parties hereto agrees that a final judgment in any such action or proceeding shall be conclusive and may be enforced in other jurisdictions by suit on the judgment or in any other manner provided by law. Nothing in this Agreement shall affect any right that the Administrative Agent or any Lender may otherwise have to bring any action or proceeding relating to this Agreement or any other Loan Document against the Borrower or its properties in the courts of any jurisdiction.
(c)    The Borrower hereby irrevocably and unconditionally waives, to the fullest extent it may legally and effectively do so, any objection which it may now or hereafter have to the laying of venue of any suit, action or proceeding arising out of or relating to this Agreement or any other Loan Document in any court referred to in subsection (b) of this Section 9.09. Each of the parties hereto hereby irrevocably waives, to the fullest extent permitted by law, the defense of an inconvenient forum to the maintenance of such action or proceeding in any such court.
(d)    Each party to this Agreement irrevocably consents to service of process in the manner provided for notices in Section 9.01. Nothing in this Agreement will affect the right of any party to this Agreement to serve process in any other manner permitted by law.
Section 9.10    Waiver Of Jury Trial. EACH PARTY HERETO HEREBY WAIVES, TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, ANY RIGHT IT MAY HAVE TO A TRIAL BY JURY IN ANY LEGAL PROCEEDING DIRECTLY OR INDIRECTLY ARISING OUT OF OR RELATING TO THIS AGREEMENT, ANY OTHER LOAN DOCUMENT OR THE TRANSACTIONS CONTEMPLATED HEREBY (WHETHER BASED ON CONTRACT
108


(AT LAW OR IN EQUITY), TORT OR ANY OTHER THEORY). EACH PARTY HERETO (A) CERTIFIES THAT NO REPRESENTATIVE, AGENT OR ATTORNEY OF ANY OTHER PARTY HAS REPRESENTED, EXPRESSLY OR OTHERWISE, THAT SUCH OTHER PARTY WOULD NOT, IN THE EVENT OF LITIGATION, SEEK TO ENFORCE THE FOREGOING WAIVER AND (B) ACKNOWLEDGES THAT IT AND THE OTHER PARTIES HERETO HAVE BEEN INDUCED TO ENTER INTO THIS AGREEMENT BY, AMONG OTHER THINGS, THE MUTUAL WAIVERS AND CERTIFICATIONS IN THIS SECTION 9.10. EACH PARTY HERETO FURTHER REPRESENTS AND WARRANTS THAT IT HAS REVIEWED THIS WAIVER WITH ITS LEGAL COUNSEL AND THAT IT KNOWINGLY AND VOLUNTARILY WAIVES IT JURY TRIAL RIGHTS FOLLOWING CONSULTATION WITH LEGAL COUNSEL.
Section 9.11    Headings. Article and Section headings and the Table of Contents used herein are for convenience of reference only, are not part of this Agreement and shall not affect the construction of, or be taken into consideration in interpreting, this Agreement.
Section 9.12    Confidentiality.
(a)    Each of the Administrative Agent, the Issuing Banks and the Lenders agrees to maintain the confidentiality of the Information (as defined below) and to not use the Information for any purpose except in connection with the Loan Documents and related matters, and to not disclose the Information; provided that nothing herein shall prevent the Administrative Agent, the Issuing Banks or the Lenders (collectively, the “Credit Parties”) and their respective Affiliates from disclosing any Information (i) pursuant to the order of any court or administrative agency or in any pending legal, judicial or administrative proceeding, or otherwise as required by applicable law or compulsory legal process or to the extent requested or required by governmental and/or regulatory authorities, in each case based on the reasonable advice of their legal counsel (in which case such Credit Party agrees (except with respect to any audit or examination conducted by bank accountants or any governmental bank regulatory authority exercising examination or regulatory authority (or any request by such a governmental bank regulatory authority)) to the extent practicable and not prohibited by applicable law, rule or regulation, to inform you promptly thereof prior to disclosure), (ii) upon the request or demand of any regulatory authority having or purporting to have jurisdiction over an Credit Party or any of its Affiliates (in which case such Credit Party agrees (except with respect to any audit or examination conducted by bank accountants or any governmental bank regulatory authority exercising examination or regulatory authority (or any request by such a governmental bank regulatory authority)), to the extent practicable and not prohibited by applicable law, to inform you promptly thereof prior to disclosure), (iii) to the extent that such Information become publicly available other than by reason of improper disclosure by such Credit Party or any of its Affiliates in violation of any confidentiality obligations owing to the Borrower or any of its Affiliates (including those set forth in this Section), (iv) to the extent that such information is received by a Credit Party from a third party that is not, to such Credit Party’s knowledge, subject to contractual or fiduciary confidentiality obligations owing to the Borrower or any of its Affiliates, (v) to the extent that such information is independently developed by any Credit Party without use of the Information, (vi) to each Credit Party’s Affiliates and to its and their respective employees, legal counsel, independent auditors and other experts or agents (“Representatives”) who need to know such Information in connection with this Agreement and the transactions contemplated hereby and who are informed of the confidential nature of such Information and are or have been advised of their obligation to keep such Information confidential (it being understood that each Credit Party shall be responsible for any breach thereof by its Representatives), (vii) with the Borrower’s consent (not to be
109


unreasonably withheld, delayed or conditioned), to Participants or potential or prospective Participants or assignees (in each case which are or would be permitted Participants or assignees under Section 9.04 and other than Disqualified Institutions) and to any direct or indirect contractual counterparty to any swap or derivative transaction relating to the Borrower or any of its Subsidiaries, in each case, who enter into a written agreement with or for the express benefit of the Borrower that they shall be bound by the terms of this Section (or a written agreement containing provisions substantially similar and not less protective of the Information than this Section); provided that the consent of the Borrower shall not be required with respect to any administrative notices from any Agent to any Lender and (C) during any time that a Default or Event of Default has occurred and is continuing, (viii) to the extent the Borrower shall have consented to such disclosure in writing, (ix) to the extent reasonably necessary or advisable in connection with the exercise of any remedy or enforcement of any right under the Loan Documents, (x) for purposes of establishing a “due diligence” defense, (xi) to the CUSIP Service Bureau or any similar agency in connection with the issuance and monitoring of CUSIP numbers or other market identifiers with respect to the credit facilities provided hereunder and (xii) to market data collectors, similar services providers to the lending industry, and service providers to the Credit Parties in connection with the administration, settlement and management of this Agreement and the other Loan Documents. For the purposes of this Section 9.12, “Information” means all memoranda or other information received from or on behalf of the Borrower, in connection with the Loan Documents and the facilities under the Loan Documents, relating to the Borrower or its business; provided that, in the case of Information received from the Borrower after the date hereof, such information is clearly identified at the time of delivery as confidential. Any Person required to maintain the confidentiality of Information as provided in this Section 9.12 shall be considered to have complied with its obligation to do so if such Person has exercised the same degree of care to maintain the confidentiality of such Information as such Person would accord to its own confidential information.
(b)    EACH ISSUING BANK AND EACH LENDER ACKNOWLEDGES THAT INFORMATION AS DEFINED IN SECTION 9.12(A) FURNISHED TO IT PURSUANT TO THIS AGREEMENT MAY INCLUDE MATERIAL NON-PUBLIC INFORMATION CONCERNING THE BORROWER AND ITS RELATED PARTIES OR THEIR RESPECTIVE SECURITIES, AND CONFIRMS THAT IT HAS DEVELOPED COMPLIANCE PROCEDURES REGARDING THE USE OF MATERIAL NON-PUBLIC INFORMATION AND THAT IT WILL HANDLE SUCH MATERIAL NON-PUBLIC INFORMATION IN ACCORDANCE WITH THOSE PROCEDURES AND APPLICABLE LAW, INCLUDING FEDERAL AND STATE SECURITIES LAWS.
(c)    ALL INFORMATION, INCLUDING REQUESTS FOR WAIVERS AND AMENDMENTS, FURNISHED BY THE BORROWER OR THE ADMINISTRATIVE AGENT PURSUANT TO, OR IN THE COURSE OF ADMINISTERING, THIS AGREEMENT WILL BE SYNDICATE-LEVEL INFORMATION, WHICH MAY CONTAIN MATERIAL NON-PUBLIC INFORMATION ABOUT THE BORROWER AND ITS RELATED PARTIES OR THEIR RESPECTIVE SECURITIES. ACCORDINGLY, EACH ISSUING BANK AND EACH LENDER REPRESENTS TO THE BORROWER AND THE ADMINISTRATIVE AGENT THAT IT HAS IDENTIFIED IN ITS ADMINISTRATIVE QUESTIONNAIRE A CREDIT CONTACT WHO MAY RECEIVE INFORMATION THAT MAY CONTAIN MATERIAL NON-PUBLIC INFORMATION IN ACCORDANCE WITH ITS COMPLIANCE PROCEDURES AND APPLICABLE LAW.
110


Section 9.13    Interest Rate Limitation. Notwithstanding anything herein to the contrary, if at any time the interest rate applicable to any Loan, together with all fees, charges and other amounts which are treated as interest on such Loan under applicable law (collectively the “Charges”), shall exceed the maximum lawful rate (the “Maximum Rate”) which may be contracted for, charged, taken, received or reserved by the Lender holding such Loan in accordance with applicable law, the rate of interest payable in respect of such Loan hereunder, together with all Charges payable in respect thereof, shall be limited to the Maximum Rate and, to the extent lawful, the interest and Charges that would have been payable in respect of such Loan but were not payable as a result of the operation of this Section 9.13 shall be cumulated and the interest and Charges payable to such Lender in respect of other Loans or periods shall be increased (but not above the Maximum Rate therefor) until such cumulated amount, together with interest thereon at the Federal Funds Effective Rate to the date of repayment, shall have been received by such Lender.
Section 9.14    No Advisory or Fiduciary Responsibility. In connection with all aspects of each Transaction contemplated hereby (including in connection with any amendment, waiver or other modification hereof or of any other Loan Document), the Borrower acknowledges and agrees, and acknowledges its Subsidiaries’ understanding, that: (a) (i) the arranging and other services regarding this Agreement provided by the Administrative Agent, the Arrangers, the Issuing Banks and the Lenders are arm’s-length commercial transactions between the Borrower and its Affiliates, on the one hand, and the Administrative Agent, the Arrangers, the Issuing Banks and the Lenders, on the other hand, (ii) the Borrower has consulted its own legal, accounting, regulatory and tax advisors to the extent it has deemed appropriate, and (iii) the Borrower is capable of evaluating, and understands and accepts, the terms, risks and conditions of the Transactions contemplated hereby and by the other Loan Documents; (b) (i) each of the Administrative Agent, the Issuing Banks, the Arrangers and the Lenders is and has been acting solely as a principal and, except as expressly agreed in writing by the relevant parties, has not been, is not, and will not be acting as an advisor, agent or fiduciary for the Borrower or any of its Subsidiaries, or any other Person and (ii) neither the Administrative Agent, any Issuing Bank, any Arranger nor any Lender has any obligation to the Borrower or any of its Affiliates with respect to the Transactions contemplated hereby except those obligations expressly set forth herein and in the other Loan Documents; and (c) the Administrative Agent, the Issuing Banks, each Arranger and the Lenders and their respective Affiliates may be engaged in a broad range of transactions that involve interests that differ from those of the Borrower and its Affiliates, and none of the Administrative Agent, any Issuing Bank, any Arranger or any Lender has any obligation to disclose any of such interests to the Borrower or its Affiliates. The Borrower, on behalf of itself and each of its Subsidiaries and Affiliates, agrees that nothing in the Loan Documents or otherwise will be deemed to create an advisory, fiduciary or agency relationship or fiduciary or other implied duty between the Administrative Agent, any Issuing Bank, any Arranger or any Lender, on the one hand, and the Borrower, any of its Subsidiaries, or their respective equityholders or Affiliates, on the other.
Section 9.15    Electronic Execution of Assignments and Certain Other Documents. The words “execution,” “signed,” “signature,” and words of like import in any Assignment and Assumption or in any amendment or other modification hereof (including waivers and consents) shall be deemed to include electronic signatures or the keeping of records in electronic form, each of which shall be of the same legal effect, validity or enforceability as a manually executed signature or the use of a paper-based recordkeeping system, as the case may be, to the extent and as provided for in any applicable law, including the Federal Electronic Signatures in Global and National Commerce Act, the New York State Electronic Signatures and Records Act, or any other similar state laws based on the Uniform Electronic Transactions Act.
111


Section 9.16    USA PATRIOT Act. Each Lender, each Issuing Bank and the Administrative Agent (for itself and not on behalf of any Lender) hereby notifies the Borrower and each Guarantor that, pursuant to the requirements of the USA Patriot Act, it may be required to obtain, verify and record information that identifies the Borrower and each Guarantor, which information includes the name and address of the Borrower and each Guarantor and other information that will allow such Lender, such Issuing Bank or the Administrative Agent, as applicable, to identify the Borrower and each Guarantor in accordance with the USA Patriot Act. The Borrower and each Guarantor shall, promptly following a request by the Administrative Agent, any Issuing Bank or any Lender, provide all documentation and other information that the Administrative Agent, any Issuing Bank or such Lender, as applicable, requests in order to comply with its ongoing obligations under applicable “know your customer” and anti-money laundering rules and regulations, including the USA Patriot Act and the Beneficial Ownership Regulation.
Section 9.17    Release of Guarantors. In the event that all the Equity Interests in any Guarantor are sold, transferred or otherwise disposed of to a Person other than the Borrower or its Subsidiaries in a transaction permitted under this Agreement or, at the option of the Borrower by notice to the Administrative Agent so long as no Event of Default has occurred and is continuing, in the event that a Guarantor ceases to be a Material Domestic Subsidiary or becomes an Excluded Subsidiary, the Guarantee of such Guarantor shall be automatically released and the Administrative Agent shall, at the Borrower’s expense, promptly take such action and execute such documents as the Borrower may reasonably request to evidence the termination of the guarantee of such Guarantor.
Section 9.18    Acknowledgement and Consent to Bail-in of EEA Financial Institutions. Notwithstanding anything to the contrary in any Loan Document or in any other agreement, arrangement or understanding among any such parties, each party hereto acknowledges that any liability of any EEA Financial Institution arising under any Loan Document, to the extent such liability is unsecured, may be subject to the write-down and conversion powers of an EEA Resolution Authority and agrees and consents to, and acknowledges and agrees to be bound by:
(a)    the application of any Write-Down and Conversion Powers by an EEA Resolution Authority to any such liabilities arising hereunder which may be payable to it by any party hereto that is an EEA Financial Institution; and
(b)    the effects of any Bail-in Action on any such liability, including, if applicable:
(i)    a reduction in full or in part or cancellation of any such liability;
(ii)    a conversion of all, or a portion of, such liability into shares or other instruments of ownership in such EEA Financial Institution, its parent undertaking, or a bridge institution that may be issued to it or otherwise conferred on it, and that such shares or other instruments of ownership will be accepted by it in lieu of any rights with respect to any such liability under this Agreement or any other Loan Document; or
(iii)    the variation of the terms of such liability in connection with the exercise of the write-down and conversion powers of any EEA Resolution Authority.
Section 9.19    Judgment Currency. If, for the purpose of obtaining judgment in any court, it is necessary to convert a sum owing hereunder or under any other Loan Document in one currency into another currency, each party hereto agrees, to the fullest extent that it may effectively do so, that
112


the rate of exchange used shall be that at which in accordance with normal banking procedures in the relevant jurisdiction the first currency could be purchased with such other currency on the Business Day immediately preceding the day on which final judgment is given. The obligations of any Loan Party in respect of any sum due to any party hereto or under any other Loan Document or any holder of the obligations owing hereunder or under any other Loan Document (the “Applicable Creditor”) shall, notwithstanding any judgment in a currency (the “Judgment Currency”) other than the currency in which such sum is stated to be due hereunder or under such other Loan Document (the “Agreement Currency”), be discharged only to the extent that, on the Business Day following receipt by the Applicable Creditor of any sum adjudged to be so due in the Judgment Currency, the Applicable Creditor may in accordance with normal banking procedures in the relevant jurisdiction purchase the Agreement Currency with the Judgment Currency; if the amount of the Agreement Currency so purchased is less than the sum originally due to the Applicable Creditor in the Agreement Currency, each Loan Party agrees, as a separate obligation and notwithstanding any such judgment, to indemnify the Applicable Creditor against such loss.
[Remainder of page intentionally left blank]
113


IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be duly executed by their respective authorized officers as of the day and year first above written.
SOCIAL FINANCE, INC.,
as Borrower
By: /s/ Michelle Gill
Name: Michelle Gill
Title: Chief Financial Officer
[Signature Page to Revolving Credit Agreement]


GOLDMAN SACHS BANK USA,
as Administrative Agent, Issuing Bank and
as a Lender
By: /s/ Charles D. Johnston
Name: Charles D. Johnston
Title: Authorized Signatory
[Signature Page to Revolving Credit Agreement]


CITIBANK, N.A.,
as an Issuing Bank and a Lender
By: /s/ Maureen Maroney
Name: Maureen Maroney
Title: Vice President
[Signature Page to Revolving Credit Agreement]


DEUTSCHE BANK AG NEW YORK BRANCH,
as an Issuing Bank and a Lender
By: /s/ Virginia Cosenza
Name: Virginia Cosenza
Title: Vice President
By: /s/ Ming K. Chu
Name: Ming K. Chu
Title: Director
[Signature Page to Revolving Credit Agreement]


Mizuho Bank, Ltd.,
as a Lender
By: /s/ Donna DeMagistris
Name: Donna DeMagistris
Title: Authorized Signatory
[Signature Page to Revolving Credit Agreement]


MORGAN STANLEY SENIOR FUNDING, INC., as an Issuing Bank and a Lender
By:
/s/ Michael King
Name: Michael King
Title: Vice President
[Signature Page to Revolving Credit Agreement]


ROYAL BANK OF CANADA,
as a Lender
By: /s/ Glenn van Allen
Name: GLENN VAN ALLEN
Title: AUTHORIZED SIGNATORY
[Signature Page to Revolving Credit Agreement]


Schedule 2.01
Lenders, Commitments and Letter of Credit Issuer Sublimit
Initial Commitments
Lender Amount of Lender Commitment
Citibank, N.A. $145,000,000
Goldman Sachs Bank USA $115,000,000
Deutsche Bank AG New York Branch $100,000,000
Mizuho Bank, Ltd. $100,000,000
Morgan Stanley Senior Funding, Inc. $50,000,000
Royal Bank of Canada $50,000,000
Total $560,000,000
Letter of Credit Sublimits
Issuing Bank Amount of Letter of Credit Sublimit
Citibank, N.A. $60,700,000
Goldman Sachs Bank USA $50,000,000
Deutsche Bank AG New York Branch $35,700,000
Morgan Stanley Senior Funding, Inc. $17,900,000
Total $164,300,000



EXHIBIT A
FORM OF ASSIGNMENT AND ASSUMPTION
This Assignment and Assumption (the “Assignment and Assumption”) is dated as of the Effective Date set forth below and is entered into by and between [NAME OF ASSIGNOR] (the “Assignor”) and [NAME OF ASSIGNEE] (the “Assignee”). Capitalized terms used but not defined herein shall have the meanings given to them in the Credit Agreement identified below (as amended, restated, amended and restated, supplemented, extended and/or otherwise modified from time to time, the “Credit Agreement”), receipt of a copy of which is hereby acknowledged by the Assignee. The Standard Terms and Conditions set forth in Annex I attached hereto are hereby agreed to and incorporated herein by reference and made a part of this Assignment and Assumption as if set forth herein in full.
For an agreed consideration, the Assignor hereby irrevocably sells and assigns to the Assignee, and the Assignee hereby irrevocably purchases and assumes from the Assignor, subject to and in accordance with the Standard Terms and Conditions and the Credit Agreement, as of the Effective Date inserted by the Administrative Agent as contemplated below (i) all of the Assignor’s rights and obligations in its capacity as a Lender under the Credit Agreement and any other documents or instruments delivered pursuant thereto to the extent related to the amount and percentage interest identified below of all of such outstanding rights and obligations of the Assignor under the facility identified below (including, without limitation, any Letters of Credit included in such facility) and (ii) to the extent permitted to be assigned under applicable law, all claims, suits, causes of action and any other right of the Assignor (in its capacity as a Lender) against any Person, whether known or unknown, arising under or in connection with the Credit Agreement, any other documents or instruments delivered pursuant thereto or the loan transactions governed thereby or in any way based on or related to any of the foregoing, including contract claims, tort claims, malpractice claims, statutory claims and all other claims at law or in equity related to the rights and obligations sold and assigned pursuant to clause (i) above (the rights and obligations sold and assigned by the Assignor to the Assignee pursuant to clauses (i) and (ii) above being referred to herein collectively as the “Assigned Interest”). Such sale and assignment is without recourse to the Assignor and, except as expressly provided in this Assignment and Assumption, without representation or warranty by the Assignor.
1. Assignor:
[Assignor [is] [is not] a Defaulting Lender]
2. Assignee:
[and is an [Affiliate] [Approved Fund] of [identify Lender]]
3. Borrower: Social Finance, Inc.
4. Administrative
Agent:
Goldman Sachs Bank USA, as administrative agent under the Credit Agreement
5. Credit
Agreement:
Revolving Credit Agreement, dated as of September 27, 2018, among the Borrower, the Lenders party thereto, the Issuing Banks party thereto and
A-1


Goldman Sachs Bank USA, as Administrative Agent.
6. Assigned
Interest:
Facility Assigned Aggregate
Amount of
Commitment/Loans
for all Lenders
Amount of Commitment/Loans Assigned1 Percentage
Assigned of
Commitment/
Loans2
Revolving Facility $ $ %
Effective Date: _________________, 20__ [TO BE INSERTED BY ADMINISTRATIVE AGENT AND WHICH SHALL BE THE EFFECTIVE DATE OF RECORDATION OF TRANSFER IN THE REGISTER THEREFOR.]
1 The minimum assignment amount shall be $15,000,000, unless otherwise agreed by the Borrower and the Administrative Agent.
2 Set forth, to at least 9 decimals, as a percentage of the Commitment/Loans of all Lenders thereunder.
A-2


The Assignee agrees to deliver to the Administrative Agent a completed Administrative Questionnaire in which the Assignee designates one or more credit contacts to whom all syndicate-level information (which may contain material non-public information) will be made available and who may receive such information in accordance with the Assignee’s compliance procedures and applicable laws, including federal and state securities laws.
The terms set forth in this Assignment and Assumption are hereby agreed to:
ASSIGNOR:
[NAME OF ASSIGNOR]
By:
Name:
Title:
ASSIGNEE:
[NAME OF ASSIGNEE]
By:
Name:
Title:
A-3


[CONSENTED TO AND ACCEPTED:
GOLDMAN SACHS BANK USA, as Administrative Agent
By:
Name:
Title:
CONSENTED TO AND ACCEPTED:
[_],3
as an Issuing Bank
By:
Name:
Title:
3 Insert signature block for each Issuing Bank.
A-4


CONSENTED TO:
SOCIAL FINANCE, INC.
By:
Name:
Title: ]4
4 Signature blocks to be added if such consent is required by Section 9.04(b) of the Credit Agreement.
A-5


ANNEX I
REVOLVING CREDIT AGREEMENT
Standard Terms and Conditions for
Assignment and Assumption
1.    Representations and Warranties.
(a)    Assignor. The Assignor (a) represents and warrants that (i) it is the legal and beneficial owner of the Assigned Interest, (ii) the Assigned Interest is free and clear of any lien, encumbrance or other adverse claim, (iii) it has full power and authority, and has taken all action necessary, to execute and deliver this Assignment and Assumption and to consummate the transactions contemplated hereby and (iv) it is [not] a Defaulting Lender; and (b) assumes no responsibility with respect to (i) any statements, warranties or representations made in or in connection with the Credit Agreement or any other Loan Document, (ii) the execution, legality, validity, enforceability, genuineness, sufficiency or value of the Loan Documents or any collateral thereunder, (iii) the financial condition of the Borrower, any of its Subsidiaries or Affiliates or any other Person obligated in respect of any Loan Document or (iv) the performance or observance by the Borrower, any of its Subsidiaries or Affiliates or any other Person of any of their respective obligations under any Loan Document.
(b)    Assignee. The Assignee (a) represents and warrants that (i) it has full power and authority, and has taken all action necessary, to execute and deliver this Assignment and Assumption and to consummate the transactions contemplated hereby and to become a Lender under the Credit Agreement, (ii) it satisfies the requirements specified in the Credit Agreement (subject to consents, if any, as may be required thereunder) that are required to be satisfied by it in order to acquire the Assigned Interest and become a Lender, (iii) from and after the Effective Date, it shall be bound by the provisions of the Credit Agreement as a Lender thereunder and, to the extent of the Assigned Interest, shall have the obligations of a Lender thereunder, (iv) it is sophisticated with respect to decisions to acquire assets of the type represented by the Assigned Interest and either it, or the Person exercising discretion in making its decision to acquire the Assigned Interest, is experienced in acquiring assets of such type, (v) it has received and/or had the opportunity to review a copy of the Credit Agreement to the extent it has in its sole discretion deemed necessary, together with copies of the most recent financial statements delivered pursuant to Section 4.01(i), Section 5.01(a) and/or Section 5.01(b) thereof, as applicable, and such other documents and information as it has in its sole discretion deemed appropriate to make its own credit analysis and decision to enter into this Assignment and Assumption and to purchase the Assigned Interest, (vi) it has, independently and without reliance upon the Administrative Agent or any other Lender and based on such documents and information as it has deemed appropriate, made its own credit analysis and decision to enter into this Assignment and Assumption and to purchase the Assigned Interest, (vii) it is not a Disqualified Institution and (viii) attached to this Assignment and Assumption is any documentation required to be delivered by it pursuant to the terms of the Credit Agreement, duly completed and executed by the Assignee; (b) agrees that (i) it will, independently and without reliance on the Administrative Agent, the Assignor or any other Lender, and based on such documents and information as it shall deem appropriate at the time, continue to make its own credit decisions in taking or not taking action under the Loan Documents and (ii) it will perform in
A-I-1


accordance with their terms all of the obligations which by the terms of the Loan Documents are required to be performed by it as a Lender; and (c) appoints and authorizes the Administrative Agent to take such action as agent on its behalf and to exercise such powers under the Credit Agreement and the other Loan Documents as are delegated to or otherwise conferred upon the Administrative Agent by the terms thereof, together with such powers as are reasonably incidental thereto.
2.    Payments. From and after the Effective Date referred to in this Assignment and Assumption, the Administrative Agent shall make all payments in respect of the Assigned Interest (including payments of principal, interest, fees and other amounts) to the Assignor for amounts which have accrued to but excluding such Effective Date and to the Assignee for amounts which have accrued from and after such Effective Date.
3.    Effect of Assignment. Upon the delivery of a fully executed original hereof to the Administrative Agent, as of the Effective Date referred to in this Assignment and Assumption, (i) the Assignee shall be a party to the Credit Agreement and, to the extent provided in this Assignment and Assumption, have the rights and obligations of a Lender thereunder and under the other Loan Documents and (ii) the Assignor shall, to the extent provided in this Assignment and Assumption, relinquish its rights and be released from its obligations under the Credit Agreement and the other Loan Documents.
4.    General Provisions. This Assignment and Assumption shall be binding upon, and inure to the benefit of, the parties hereto and their respective successors and assigns. This Assignment and Assumption may be executed in any number of counterparts, which together shall constitute one instrument. Delivery of an executed counterpart of a signature page of this Assignment and Assumption by telecopy or other means of electronic imaging shall be effective as delivery of a manually executed counterpart of this Assignment and Assumption. THIS ASSIGNMENT AND ASSUMPTION AND ANY CLAIM, CONTROVERSY OR DISPUTE UNDER, ARISING OUT OF OR RELATING TO THIS AGREEMENT, WHETHER BASED IN CONTRACT (AT LAW OR IN EQUITY), TORT OR ANY OTHER THEORY, SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAW OF THE STATE OF NEW YORK WITHOUT REGARD TO CONFLICTS OF LAW RULES THAT WOULD RESULT IN THE APPLICATION OF A DIFFERENT GOVERNING LAW.
A-I-2


EXHIBIT B
FORM OF BORROWING REQUEST
Goldman Sachs Bank USA, as Administrative Agent
for the Lenders party to the Credit Agreement referred to below
[Date]
Ladies and Gentlemen:
The undersigned, Social Finance, Inc. (the “Borrower”), refers to the Revolving Credit Agreement, dated as of September 27, 2018 (as amended, restated, amended and restated, modified, extended and/or supplemented from time to time, the “Credit Agreement”, the terms defined therein being used herein as therein defined), among the Borrower, the lenders from time to time party thereto (each a “Lender” and collectively, the “Lenders”), the issuing banks from time to time party thereto (collectively, the “Issuing Banks”) and you, as Administrative Agent for such Lenders and Issuing Banks, and hereby gives you notice, irrevocably, pursuant to Section 2.03 of the Credit Agreement, that the undersigned hereby requests a Borrowing under the Credit Agreement, and in that connection sets forth below the information relating to such Borrowing (the “Proposed Borrowing”) as required by Section 2.03 of the Credit Agreement:
(i)    The Business Day of the Proposed Borrowing is _, 20_.5
(ii)    The aggregate principal amount of the Proposed Borrowing is [ ]. The currency of the requested Borrowing is [ ].6
(iii)    The Proposed Borrowing is to consist of [ABR Loans][Eurodollar Loans][EURIBOR Loans].
(iv)    [The initial Interest Period for the Proposed Borrowing is [one/two/three/six]/ [twelve months/insert period less than one month]7.]8
5 In the case of a Eurodollar Borrowing denominated in Dollars or a EURIBOR Borrowing, shall be a Business Day at least three Business Days after the date hereof; provided that any such notice shall be deemed to have been given on a certain day only if given before 1:00 p.m. (Local Time). In the case of a Eurodollar Borrowing denominated in any Permitted Foreign Currency (other than Euros), shall be a Business Day at least four Business Days after the date hereof; provided that any such notice shall be deemed to have been given on a certain day only if given before 1:00 p.m. (local time). In the case of ABR Loans, shall be a Business Day either (x) at least one Business Day after the date hereof (provided that any such notice shall be deemed to have been given on a certain day only if given before 1:00 p.m. (New York City time)) or (y) that is the date hereof (provided that any such notice shall be deemed to have been given on a certain day only if given before 12:00 p.m. (New York City time)).
6 Currency to be Dollars or a Permitted Foreign Currency.
7 Interest Periods of twelve or less than one month only available with the consent of each Lender.
8 To be included for a Proposed Borrowing of Eurodollar Loans and EURIBOR Loans.
B-1


(v)    The location and number of the account or accounts to which funds are to be disbursed is as follows:
[Insert location and number of the account(s)]
[Signature Page Follows]
B-2


The Borrower has caused this Borrowing Request to be executed and delivered by its duly authorized officer as of the date first written above.
Very truly yours,
SOCIAL FINANCE, INC.
By:
Name:
Title:
B-3


EXHIBIT C
FORM OF INTEREST ELECTION REQUEST
Goldman Sachs Bank USA, as Administrative Agent
for the Lenders party to the Credit Agreement referred to below
[Date]
Ladies and Gentlemen:
The undersigned, Social Finance, Inc. (the “Borrower”), refers to the Revolving Credit Agreement, dated as of September 27, 2018 (as amended, restated, amended and restated, modified, extended and/or supplemented from time to time, the “Credit Agreement,” the terms defined therein being used herein as therein defined), among the Borrower, the lenders from time to time party thereto (the “Lenders”), the issuing banks from time to time party thereto (collectively, the “Issuing Banks”) and you, as Administrative Agent for such Lenders and Issuing Banks, and hereby gives you notice, irrevocably, pursuant to Section 2.05 of the Credit Agreement, that the undersigned hereby requests to [convert] [continue] the Borrowing of Loans referred to below, and in that connection sets forth below the information relating to such [conversion] [continuation] (the “Proposed [Conversion] [Continuation]”) as required by Section 2.05 of the Credit Agreement:
(i)    The Proposed [Conversion] [Continuation] relates to the Borrowing of Loans originally made on _, 20_ (the “Outstanding Borrowing”) in the principal amount of $_ and currently maintained as a Borrowing of [ABR Loans] [Eurodollar Loans denominated in [_]9 with an Interest Period ending on _, _] [EURIBOR Loans with an Interest Period ending on _, _].
(ii)    The Business Day of the Proposed [Conversion] [Continuation] is _, _.10
(iii)    [The Outstanding Borrowing][A portion of the Outstanding Borrowing in the principal amount of $_] shall be [continued as a Borrowing of [Eurodollar Loans/ EURIBOR Loans with an Interest Period of [one/two/three/six months]/[twelve months/insert period less than one month]11]] [converted into a Borrowing of [ABR Loans] [Eurodollar Loans/EURIBOR Loans with
9 Insert applicable currency (i.e., Dollars or any Permitted Foreign Currency (other than Euros)).
10 In the case of a Eurodollar Borrowing denominated in Dollars or a EURIBOR Borrowing, shall be a Business Day at least three Business Days after the date hereof; provided that any such notice shall be deemed to have been given on a certain day only if given before 1:00 p.m. (Local Time). In the case of a Eurodollar Borrowing denominated in any Permitted Foreign Currency (other than Euros), shall be a Business Day at least four Business Days after the date hereof; provided that any such notice shall be deemed to have been given on a certain day only if given before 1:00 p.m. (Local Time). In the case of ABR Loans, shall be a Business Day either (x) at least one Business Day after the date hereof (provided that any such notice shall be deemed to have been given on a certain day only if given before 1:00 p.m. (New York City time)) or (y) that is the date hereof (provided that any such notice shall be deemed to have been given on a certain day only if given before 12:00 p.m. (New York City time)).
11 Interest Periods of twelve months or less than one month only available with the consent of each Lender.
C-1


an Interest Period of [one/two/three/six months]/[twelve months/insert period less than one month]12]]13.
[The undersigned hereby certifies that no Default or Event of Default has occurred and will be continuing on the date of the Proposed [Conversion] [Continuation] or will have occurred and be continuing on the date of the Proposed [Conversion] [Continuation].]14
[Signature Page Follows]

12 Interest Periods of twelve months or less than one month only available with the consent of each Lender.
13 If different options are selected for different portions of such Borrowing, include this information for each such portion.
14 In the case of a Proposed Conversion or Continuation, insert this sentence only in the event that the conversion is from an ABR Loan to a Eurodollar Loan or in the case of a continuation of a Eurodollar Loan or EURIBOR Loan.
C-2


The Borrower has caused this Interest Election Request to be executed and delivered by its duly authorized officer as of the date first written above.
Very truly yours,
SOCIAL FINANCE, INC.
By:
Name:
Title:
C-3


EXHIBIT D
FORM OF REVOLVING NOTE
New York, New York
[Date]
FOR VALUE RECEIVED, SOCIAL FINANCE, INC., a corporation organized and existing under the laws of the State of Delaware (the “Borrower”), hereby promises to pay to _ __________ or its registered assigns (the “Lender”), in Dollars, Euros or applicable Permitted Foreign Currency, in immediately available funds, at the Principal Office (such term, and each other capitalized term used but not defined herein, shall have the meaning assigned to such term in the Revolving Credit Agreement, dated as of September 27, 2018, among the Borrower, the lenders from time to time party thereto (including the Lender), the issuing banks from time to time party thereto and the Administrative Agent (as amended, restated, amended and restated, modified, extended and/or supplemented from time to time, the “Credit Agreement”)) of GOLDMAN SACHS BANK USA (the “Administrative Agent”) the unpaid principal amount of all Revolving Loans made by the Lender to the Borrower pursuant to the Credit Agreement, payable at such times and in such amounts as are specified in the Credit Agreement.
The Borrower promises also to pay to the Lender interest on the unpaid principal amount of each Revolving Loan incurred by the Borrower from the Lender in like money at said office from the date such Revolving Loan is made until paid at the rates and at the times provided in Section 2.10 of the Credit Agreement.
This Note is one of the Notes referred to in the Credit Agreement and is entitled to the benefits thereof and of the other Loan Documents. As provided in the Credit Agreement, this Note is subject to voluntary prepayment, in whole or in part, prior to the Maturity Date and the Revolving Loans may be converted from one Type (as defined in the Credit Agreement) into another Type to the extent provided in the Credit Agreement.
In case an Event of Default shall occur and be continuing, the principal of and accrued interest on this Note may be declared to be due and payable in the manner and with the effect provided in the Credit Agreement.
THIS NOTE AND ANY CLAIM, CONTROVERSY OR DISPUTE UNDER, ARISING OUT OF OR RELATING TO THIS AGREEMENT, WHETHER BASED IN CONTRACT (AT LAW OR IN EQUITY), TORT OR ANY OTHER THEORY, SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAW OF THE STATE OF NEW YORK WITHOUT REGARD TO CONFLICTS OF LAW RULES THAT WOULD RESULT IN THE APPLICATION OF A DIFFERENT GOVERNING LAW.
[Signature page follows]
D-1


IN WITNESS WHEREOF, the Borrower has caused this Note to be executed and delivered by a duly authorized officer as of the date first written above.
SOCIAL FINANCE, INC.
By:
Name:
Title:
D-2


EXHIBIT E
FORM OF GUARANTY
This GUARANTY, dated as of [_ _, 20_] (as amended, restated, amended and restated, supplemented, extended or otherwise modified from time to time, this “Agreement”), made by and among each of the undersigned guarantors (together with any other entity that becomes a guarantor hereunder, each, a “Guarantor” and collectively, the “Guarantors”) in favor of GOLDMAN SACHS BANK USA, as administrative agent (together with any successor administrative agent, the “Administrative Agent”), for the benefit of the Lenders (as defined below), the Issuing Banks (as defined below) and the Administrative Agent.
Reference is made to the Revolving Credit Agreement dated as of September 27, 2018 (as amended, restated, amended and restated, extended, supplemented or otherwise modified from time to time, the “Credit Agreement”), among Social Finance, Inc. (the Borrower”), the lenders from time to time party thereto (the “Lenders”), the issuing banks from time to time party thereto (collectively, the “Issuing Banks”) and the Administrative Agent.
Each Guarantor is a direct or indirect Domestic Subsidiary of the Borrower.
It is a condition precedent to the making of Loans (this, and each other capitalized term used but not defined in these recitals being defined as set forth in Section 1) to the Borrower under the Credit Agreement that each Subsidiary required to be a Guarantor as of the Effective Date shall have executed and delivered to the Administrative Agent this Agreement.
The Lenders have agreed to extend credit to the Borrower and the Issuing Banks have agreed to issue Letters of Credit, in each case, subject to the terms and conditions set forth in the Credit Agreement. Each Guarantor will derive substantial benefits from the extension of credit and/or issuance of Letters of Credit to the Borrower pursuant to the Credit Agreement and is willing to execute and deliver this Agreement in order to induce the Lenders to continue to extend such credit and the Issuing Banks to issue Letters of Credit. Accordingly, for valuable consideration of the mutual covenants and agreements herein contained, the parties hereto covenant and agree as follows:
SECTION 1.    Definitions. (a) Capitalized terms used in this Agreement and not otherwise defined herein have the meanings specified in the Credit Agreement.
(b)    The rules of construction specified in Section 1.03 of the Credit Agreement also apply to this Agreement.
SECTION 2.    Guarantee. (a) Each Guarantor hereby irrevocably and unconditionally guarantees, jointly with the other Guarantors and severally, as a primary obligor and not merely as a surety, the Obligations of the Borrower. Each Guarantor further agrees that the due and punctual payment of the Obligations of the Borrower may be extended or renewed, in whole or in part, without notice to or further assent from it, and that it will remain bound upon its guarantee hereunder notwithstanding any such extension or renewal of any Obligation. Each Guarantor hereby agrees to be liable under this Guaranty, without any limitation as to amount, for all present and future Obligations, including specifically all future increases in the outstanding amount of the
E-1


Loans or other Obligations and other future increases in the Obligations, whether or not any such increase is committed, contemplated or provided for by the Loan Documents on the date hereof.
(b)     Each Guarantor agrees that the obligations of each Guarantor hereunder are independent of the obligations of each other Guarantor or any other guarantee of the Obligations of the Borrower and when making any demand hereunder or otherwise pursuing its rights and remedies hereunder against any Guarantor, any Agent, Lender or Issuing Bank (collectively, the “Guaranteed Parties”) may, but shall be under no obligation to, make a similar demand on or otherwise pursue such rights and remedies as it may have against the Borrower, any other Guarantor or any other Person or against guarantee of the Obligations of the Borrower or any right of offset with respect thereto.
(c)    To the maximum extent permitted by applicable law, each Guarantor waives presentment to, demand of payment from and protest to the Borrower of any of the Obligations, and also waives notice of acceptance of its obligations and notice of protest for nonpayment. The obligations of each Guarantor hereunder shall not be affected by (i) the failure of any Guaranteed Party to assert any claim or demand or to enforce any right or remedy against the Borrower under the provisions of this Agreement (including under Section 2(b) above), any other Loan Document or otherwise; (ii) any extension or renewal of any of the Obligations; (iii) any rescission, waiver, amendment or modification of, or release from, any of the terms or provisions of any other Loan Document or other agreement; (iv) the failure or delay of any Guaranteed Party to exercise any right or remedy against any other guarantor of the Obligations; (v) the failure of any Guaranteed Party to assert any claim or demand or to enforce any remedy under any Loan Document or any other agreement or instrument; (vi) any default, failure or delay, willful or otherwise, in the performance of the Obligations; (vii) any increases in the outstanding amount of Loans and other Obligations; or (viii) any other act, omission or delay to do any other act which may or might in any manner or to any extent vary the risk of such Guarantor or otherwise operate as a discharge of such Guarantor as a matter of law or equity or which would impair or eliminate any right of any Guarantor to subrogation (other than payment in full of the Obligations (excluding contingent obligations as to which no claim has been made) or release pursuant to Section 17 hereof).
(d)     Each Guarantor further agrees that its guarantee hereunder constitutes a promise of payment when due (whether or not any bankruptcy or similar proceeding shall have stayed the accrual or collection of any of the Obligations or operated as a discharge thereof) and not merely of collection, and waives any right to require that any resort be had by any Guaranteed Party to any balance of any deposit account or credit on the books of any Guaranteed Party in favor of the Borrower or any Subsidiary or any other Person.
(e)    No payment made by the Borrower, any of the Guarantors or any other Person or received or collected by any Guaranteed Party from the Borrower, any of the Guarantors or any other Person by virtue of any action or proceeding or any set-off or appropriation or application at any time or from time to time in reduction of or in payment of the Obligations shall be deemed to modify, reduce, release or otherwise affect the liability of any Guarantor hereunder which shall, notwithstanding any such payment (other than any payment made by such Guarantor in respect of the Obligations or any payment received or collected from such Guarantor in respect of any of the Obligations) remain liable under this Guaranty until the earlier of (i) the date on which the Commitments shall have expired or terminated, all Obligations (excluding contingent obligations as to which no claim has been made) under the Credit Agreement shall have been paid in full and the
E-2


cancellation, expiration or Cash Collateralization of all Letters of Credit on terms reasonably satisfactory to the Issuing Banks in an amount equal to the Agreed L/C Cash Collateral Amount of all Letter of Credit Usage shall have occurred (the “Termination Date”) and (ii) the release or termination of a Guarantor’s obligations hereunder as provided in Section 17.
(f)    Except for the release or termination of a Guarantor’s obligations hereunder as provided in Section 17, the obligations of each Guarantor hereunder shall not be subject to any reduction, limitation, impairment or termination for any reason other than the payment in full in cash of the Obligations (excluding contingent obligations as to which no claim has been made), and shall not be subject to any defense, setoff, reduction, counterclaim, recoupment, discharge or termination whatsoever, by reason of the invalidity, illegality or unenforceability of the Obligations, any impossibility in the performance of the Obligations or otherwise.
(g)    Each Guarantor further agrees that its obligations hereunder shall continue to be effective or be reinstated, as the case may be, if at any time payment, or any part thereof, of any Obligation is rescinded or must otherwise be restored by any Guaranteed Party upon the bankruptcy or reorganization of the Borrower or otherwise.
(h)    In furtherance of the foregoing and not in limitation of any other right which any Guaranteed Party may have at law or in equity against any Guarantor by virtue hereof, upon the failure of the Borrower to pay any Obligation as and when the same shall become due, whether at maturity, by acceleration, after notice of prepayment or otherwise, each Guarantor hereby promises to and will forthwith pay, or cause to be paid, to the Administrative Agent for distribution to the applicable Guaranteed Parties in cash an amount equal to the unpaid principal amount of such Obligation.
(i)    Notwithstanding anything to the contrary in this Agreement or in any other Loan Document, the maximum liability of each Guarantor under this Agreement shall in no event exceed the amount that can be guaranteed by such Guarantor under applicable law, including applicable federal and state laws relating to the insolvency of debtors.
(j)    All rights and claims arising under this Section 2 or based upon or relating to any other right of reimbursement, contribution or subrogation that may at any time arise or exist in favor of any Guarantor as to any payment on account of the Obligations made by it or received or collected from its property shall be fully subordinated in all respects to the prior discharge of the Obligations. Until complete and satisfactory discharge of the Obligations, no Guarantor shall demand or receive any payment or distribution whatsoever (whether in cash, property or securities or otherwise) on account of any such right or claim. If any such payment or distribution is made or becomes available to any Guarantor in any bankruptcy case or receivership or insolvency or liquidation proceeding, such payment or distribution shall be delivered by the person making such payment or distribution directly to the Administrative Agent, for application to the payment of the Obligations. If any such payment or distribution is received by any Guarantor, it shall be held by such Guarantor in trust, as trustee of an express trust for the benefit of the Guaranteed Parties, and shall forthwith be transferred and delivered by such Guarantor to the Administrative Agent, in the exact form received and, if necessary, duly endorsed.
SECTION 3. Representations and Warranties; Additional Agreements. (a) Each of the Guarantors represents and warrants to the Administrative Agent that the representations and
E-3


warranties set forth in Section 3 of the Credit Agreement, each of which as they relate to such Guarantor is hereby incorporated herein by reference, are true and correct, in all material respects, except for representations and warranties that are qualified as to “Material Adverse Effect” or similar language, in which case such representations and warranties shall be true and correct (after giving effect to any such qualification therein) in all respects as of such date, in each case, unless expressly stated to relate to a specific earlier date, in which case such representations and warranties shall be true and correct in all material respects as of such earlier date, and the Administrative Agent shall be entitled to rely on each of such representations and warranties as if they were fully set forth herein, provided that each reference in each such representation and warranty to the Borrower’s knowledge shall, for the purposes of this Section 3(a), be deemed to be a reference to such Guarantor’s knowledge.
(b)    Until the Termination Date, each Guarantor covenants and agrees with the Administrative Agent for the benefit of the Guaranteed Parties that it will be bound by each of the covenants contained in the Credit Agreement to the extent applicable to such Guarantor.
SECTION 4.    Information. Each Guarantor assumes all responsibility for being and keeping itself informed of the Borrower’s financial condition and assets, and of all other circumstances bearing upon the risk of nonpayment of the Obligations and the nature, scope and extent of the risks that such Guarantor assumes and incurs hereunder, and agrees that no Guaranteed Party will have any duty to advise such Guarantor of information known to it or any of them regarding such circumstances or risks.
SECTION 5.    Notices. All communications and notices hereunder shall (except as otherwise expressly permitted herein) be in writing and given as provided in Section 9.01 of the Credit Agreement. All communications and notices hereunder to any Guarantor shall be given to it in care of the Borrower as provided in Section 9.01 of the Credit Agreement.
SECTION 6.    Survival of Agreement. All covenants, agreements, representations and warranties made by each Guarantor herein and in the certificates or other instruments prepared or delivered in connection with or pursuant to this Agreement or any other Loan Document shall be considered to have been relied upon by the Administrative Agent and shall survive the execution and delivery of this Agreement, the other Loan Documents and the making of any Loans and the issuance of any Letters of Credit, regardless of any investigation made by the Administrative Agent or on its behalf and notwithstanding that a Guaranteed Party may have had notice or knowledge of any Default, Event of Default or incorrect representation or warranty at the time any credit is extended under the Credit Agreement, and shall continue in full force and effect as long as any Obligation (excluding contingent obligations as to which no claim has been made) is outstanding and unpaid and so long as the Commitments have not expired or terminated.
SECTION 7.    Binding Effect; Several Agreement; Successors and Assigns. (a) This Agreement shall become effective as to each Guarantor when a counterpart hereof executed on behalf of such Guarantor shall have been delivered to the Administrative Agent (regardless of whether any other Guarantor has executed and delivered a counterpart hereof) and a counterpart hereof shall have been executed on behalf of the Administrative Agent.
(b)    Following the effectiveness of this Agreement as to a Guarantor in accordance with subsection (a) of this Section 7, this Agreement shall be binding upon such Guarantor and the
E-4


Administrative Agent and their respective permitted successors and assigns, and all covenants, promises and agreements by or on behalf of any Guarantor, the Administrative Agent and each other Guaranteed Party that are contained in this Agreement shall bind and inure to the benefit of their respective successors and assigns, except that no Guarantor shall have the right to assign or transfer any of its rights or obligations hereunder or any interest herein (and any such assignment or transfer shall be void) except as expressly contemplated by this Agreement or the Credit Agreement. This Agreement shall be construed as a separate agreement with respect to each Guarantor and may be amended, modified, supplemented, waived or released with respect to any Guarantor without the approval of any other Guarantor and without affecting the obligations of any other Guarantor hereunder.
SECTION 8.    [Reserved]
SECTION 9.    Administrative Agent’s Fees and Expenses; Indemnification. (a) The parties hereto agree that the Administrative Agent shall be entitled to reimbursement of its expenses incurred hereunder as provided in Section 9.03(a) of the Credit Agreement.
(b)    Each Guarantor, jointly and severally, agrees to indemnify the Administrative Agent and the other Indemnitees against, and hold each Indemnitee harmless from, any and all losses, claims, damages, liabilities and reasonable and documented out-of-pocket costs and expenses, in each case, to the extent the Borrower would be required to do so pursuant to section 9.03(b) of the Credit Agreement.
(c)    Any such amounts payable as provided hereunder shall be additional Obligations. The provisions of this Section 9 shall remain operative and in full force and effect regardless of the termination of this Agreement or any other Loan Document, the consummation of the transactions contemplated hereby, the repayment of any of the Obligations, the invalidity or unenforceability of any term or provision of this Agreement or any other Loan Document, or any investigation made by or on behalf of the Administrative Agent or any Lender. All amounts due under this Section 9 shall be payable on written demand therefor.
SECTION 10    APPLICABLE LAW. THIS AGREEMENT AND ANY CLAIM, CONTROVERSY OR DISPUTE UNDER, ARISING OUT OF OR RELATING TO THIS AGREEMENT, WHETHER BASED IN CONTRACT (AT LAW OR IN EQUITY), TORT OR ANY OTHER THEORY, SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAW OF THE STATE OF NEW YORK WITHOUT REGARD TO CONFLICTS OF LAW RULES THAT WOULD RESULT IN THE APPLICATION OF A DIFFERENT GOVERNING LAW.
SECTION 11.    Waivers; Amendment. (a) No failure or delay by any Guaranteed Party in exercising any right or power hereunder shall operate as a waiver thereof, nor shall any single or partial exercise of any such right or power, or any abandonment or discontinuance of steps to enforce such a right or power, preclude any other or further exercise thereof or the exercise of any other right or power. The rights and remedies of each Guaranteed Party hereunder and under the other Loan Documents are cumulative and are not exclusive of any rights or remedies that they would otherwise have. No waiver of any provision of this Agreement or consent to any departure by any Guarantor therefrom shall in any event be effective unless the same shall be permitted by paragraph (b) of this Section 11, and then such waiver or consent shall be effective only in the
E-5


specific instance and for the purpose for which given. No notice or demand on any Guarantor in any case shall entitle such Guarantor to any other or further notice or demand in similar or other circumstances.
(b)    Except as expressly contemplated by Section 5.10 of the Credit Agreement, neither this Agreement nor any provision hereof may be waived, amended or modified except pursuant to an agreement or agreements in writing entered into between the Administrative Agent and each Guarantor with respect to which such waiver, amendment or modification is to apply, in accordance with Section 9.02 of the Credit Agreement.
SECTION 12.    WAIVER OF JURY TRIAL. EACH PARTY HERETO HEREBY WAIVES, TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, ANY RIGHT IT MAY HAVE TO A TRIAL BY JURY IN ANY LEGAL PROCEEDING DIRECTLY OR INDIRECTLY ARISING OUT OF OR RELATING TO THIS AGREEMENT, ANY OTHER LOAN DOCUMENT OR THE TRANSACTIONS CONTEMPLATED HEREBY (WHETHER BASED ON CONTRACT (AT LAW OR IN EQUITY), TORT OR ANY OTHER THEORY). EACH PARTY HERETO (A) CERTIFIES THAT NO REPRESENTATIVE, AGENT OR ATTORNEY OF ANY OTHER PARTY HAS REPRESENTED, EXPRESSLY OR OTHERWISE, THAT SUCH OTHER PARTY WOULD NOT, IN THE EVENT OF LITIGATION, SEEK TO ENFORCE THE FOREGOING WAIVER AND (B) ACKNOWLEDGES THAT IT AND THE OTHER PARTIES HERETO HAVE BEEN INDUCED TO ENTER INTO THIS AGREEMENT BY, AMONG OTHER THINGS, THE MUTUAL WAIVERS AND CERTIFICATIONS IN THIS SECTION. EACH PARTY HERETO FURTHER REPRESENTS AND WARRANTS THAT IT HAS REVIEWED THIS WAIVER WITH ITS LEGAL COUNSEL AND THAT IT KNOWINGLY AND VOLUNTARILY WAIVES IT JURY TRIAL RIGHTS FOLLOWING CONSULTATION WITH LEGAL COUNSEL.
SECTION 13.    Severability. Any provision of this Agreement held to be invalid, illegal or unenforceable in any jurisdiction shall, as to such jurisdiction, be ineffective to the extent of such invalidity, illegality or unenforceability without affecting the validity, legality and enforceability of the remaining provisions hereof; and the invalidity of a particular provision in a particular jurisdiction shall not invalidate such provision in any other jurisdiction. Without limiting the foregoing provisions of this Section 13, if and to the extent that the enforceability of any provisions in this Agreement relating to Defaulting Lenders shall be limited by Debtor Relief Laws, as determined in good faith by the Administrative Agent, then such provisions shall be deemed to be in effect only to the extent not so limited.
SECTION 14.    Counterparts. This Agreement may be executed in counterparts (and by different parties hereto on different counterparts), each of which shall constitute an original but all of which when taken together shall constitute a single contract. Delivery of an executed counterpart of a signature page to this Agreement by facsimile transmission or other electronic imaging means shall be effective as delivery of a manually signed counterpart of this Agreement.
SECTION 15.    Headings. Section headings used herein are for convenience of reference only, are not part of this Agreement and are not to affect the construction of, or to be taken into consideration in interpreting, this Agreement.
E-6


SECTION 16.    Jurisdiction; Consent to Service of Process. (a) Each Guarantor hereby irrevocably and unconditionally submits, for itself and its property, to the exclusive jurisdiction of the Supreme Court of the State of New York sitting in New York County, Borough of Manhattan and of the United States District Court of the Southern District of New York, and any appellate court from any thereof, in any action or proceeding arising out of or relating to this Agreement or any other Loan Document, or for recognition or enforcement of any judgment, and each of the parties hereto hereby irrevocably and unconditionally agrees that all claims in respect of any such action or proceeding may be heard and determined in such New York State or, to the extent permitted by law, in such Federal court. Each of the parties hereto agrees that a final judgment in any such action or proceeding shall be conclusive and may be enforced in other jurisdictions by suit on the judgment or in any other manner provided by law. Nothing in this Agreement or any other Loan Document shall affect any right that the Administrative Agent or other Guaranteed Party may otherwise have to bring any action or proceeding relating to this Agreement or any other Loan Document against any Guarantor or its properties in the courts of any jurisdiction.
(b)    Each Guarantor hereby irrevocably and unconditionally waives, to the fullest extent it may legally and effectively do so, any objection which it may now or hereafter have to the laying of venue of any suit, action or proceeding arising out of or relating to this Agreement in any court referred to in sub-section (a) of this Section 16. Each of the parties hereto hereby irrevocably waives, to the fullest extent permitted by law, the defense of an inconvenient forum to the maintenance of such action or proceeding in any such court.
(c)    Each party to this Agreement irrevocably consents to service of process in the manner provided for notices in Section 5. Nothing in this Agreement will affect the right of any party to this Agreement to serve process in any other manner permitted by law.
SECTION 17.    Termination; Release of a Guarantor. (a) This Agreement and the guarantees set forth herein shall terminate on the Termination Date.
(b)    In the event that all the Equity Interests in any Guarantor are sold, transferred or otherwise disposed of to a Person other than the Borrower or its Subsidiaries in a transaction permitted under the Credit Agreement or, at the option of the Borrower by notice to the Administrative Agent so long as no Event of Default has occurred and is continuing, in the event that a Guarantor ceases to be a Material Domestic Subsidiary or becomes an Excluded Subsidiary, the Guarantee of such Guarantor shall be automatically released and the Administrative Agent shall, at the Borrower’s expense, promptly take such action and execute such documents as the Borrower may reasonably request to evidence the termination of the guarantee of such Guarantor hereunder.
SECTION 18.    Right of Setoff. If an Event of Default shall have occurred and be continuing, each Guaranteed Party and each of their respective Affiliates is hereby authorized at any time and from time to time, to the fullest extent permitted by law, to set off and apply any and all deposits (general or special, time or demand, provisional or final) at any time held by, and other obligations at any time owing by such Guaranteed Party or such Affiliate to or for the credit or the account of any Guarantor against any of and all the obligations of such Guarantor now or hereafter existing under this Agreement held by such Guaranteed Party irrespective of whether or not such Guaranteed Party shall have made any demand under this Agreement and although such obligations may be unmatured; provided that in the event that any Defaulting Lender shall exercise any such right of setoff, (x) all amounts so set off shall be paid over immediately to the Administrative Agent
E-7


for further application in accordance with the provisions of Section 2.17 of the Credit Agreement and, pending such payment, shall be segregated by such Defaulting Lender from its other funds and deemed held in trust for the benefit of the Administrative Agent, the Lenders and the Issuing Bank, and (y) the Defaulting Lender shall provide promptly to the Administrative Agent a statement describing in reasonable detail the obligations owing to such Defaulting Lender as to which it exercised such right of setoff. The rights of each Guaranteed Party under this Section 18 are in addition to other rights and remedies (including other rights of setoff) which such Guaranteed Party may have. Each Guaranteed Party agrees to notify such Guarantor and the Administrative Agent promptly after any such setoff and application; provided that the failure to give such notice shall not affect the validity of such setoff and application.
E-8


IN WITNESS WHEREOF, the parties hereto have duly executed this Agreement as of the day and year first above written.
[INSERT GUARANTOR NAME]
By:
Name:
Title:
[INSERT GUARANTOR NAME]
By:
Name:
Title:
GOLDMAN SACHS BANK USA,
as Administrative Agent
By:
Name:
Title:
E-9


EXHIBIT F
FORM OF COMPLIANCE CERTIFICATE
This Compliance Certificate is delivered to you pursuant to Section 5.01(c) of the Revolving Credit Agreement, dated as of September 27, 2018 (as amended, restated, amended and restated, supplemented, extended or modified from time to time, the “Credit Agreement”), among Social Finance, Inc. (the “Borrower”), the lenders from time to time party thereto, the issuing banks from time to time party thereto and Goldman Sachs Bank USA, as Administrative Agent. Terms defined in the Credit Agreement and not otherwise defined herein are used herein as therein defined.
1.    I am the duly elected, qualified and acting [_]15 of the Borrower.
2.    I have reviewed and am familiar with the contents of this Compliance Certificate and I have reviewed the terms of the Credit Agreement and the other Loan Documents. I am providing this Compliance Certificate solely in my capacity as an officer of the Borrower.
3.    The financial statements for the fiscal [quarter][year] of the Borrower ended [-,-] are attached hereto as ANNEX 1 or have been otherwise delivered to the Administrative Agent pursuant to the requirements of Section 5.01 of the Credit Agreement (the “Financial Statements”). [The Financial Statements present fairly in all material respects as of the date of each such statement the financial condition and results of operations of the Borrower16 and its consolidated Subsidiaries on a consolidated basis in accordance with GAAP consistently applied, subject to year-end adjustments and the absence of footnotes.]17
4.    No Default or Event of Default has occurred and is continuing as of the date hereof[,-except for-]18.
5.    Attached hereto as ANNEX 2 are the computations required by Section 5.01(c)(ii) of the Credit Agreement.19
6.    [Attached hereto as ANNEX 3 is the statement of reconciliation required by Section 5.01(c)(iii) of the Credit Agreement.]20
15 Certificate may be signed by any Financial Officer of the Borrower (any of the chief financial officer, principal accounting officer, vice president of finance or corporate controller or most senior financial officer of the Borrower).
16 After an IPO, the Public Company.
17 To be included only if the Compliance Certificate is certifying quarterly financials under Section 5.01(b) of the Credit Agreement.
18 Specify the details of any Default or Event of Default, if any, and any action taken or proposed to be taken with respect thereto.
19 Set forth reasonably detailed calculations demonstrating compliance with Section 6.09 of the Credit Agreement as of the last day of the applicable fiscal quarter or fiscal year for which the Financial Statements are being delivered.
20 If and to the extent that any change in GAAP that has occurred since the date of the audited financial statements referred to in Section 3.04 of the Credit Agreement had an impact on such financial statements, include a statement of reconciliation conforming such financial statements to GAAP to the extent required pursuant to Section 6.09 of the Credit Agreement.
F-1


7.    [Attached hereto as ANNEX 3 is a list of each Unrestricted Subsidiary of the Borrower as of the date of delivery of this Compliance Certificate (to the extent that there have been any changes in the list of Unrestricted Subsidiaries since the Closing Date or the most recent list provided).]
8.    [Attached hereto as ANNEX 4 is a list of each Material Domestic Subsidiary (excluding any Material Domestic Subsidiary that is an Excluded Subsidiary) of the Borrower as of the date of delivery of this Compliance Certificate (to the extent that there have been any changes in the list of Material Domestic Subsidiaries since the Closing Date or the most recent list provided).]
IN WITNESS WHEREOF, I have executed this Compliance Certificate as of the date first written above.
SOCIAL FINANCE, INC.
By:
Name:
Title:
F-2


ANNEX 1
[Applicable Financial Statements to be attached]
F-3


ANNEX 2
The information described herein is as of [_,_]21, (the “Computation Date”) and, except as otherwise indicated below, pertains to the period from [_,_]22 to the Computation Date (the “Relevant Period”).
Consolidated Tangible Net Worth for the Relevant Period ended on the Computation Date Amount
1. Stockholders’ equity as set forth on the most recent quarterly or annual consolidated balance sheet of the Borrower and its Subsidiaries $
less
2. All intangible items included therein, including, without limitation, goodwill, franchises, licenses, patents, trademarks, trade names, copyrights, service marks, brand names and write-ups of intangible assets (but only to the extent that such items would be included on a consolidated balance sheet of the Borrower and its Subsidiaries in accordance with GAAP) $
$
Leverage Ratio for the Relevant Period ended on the Computation Date Amount
1. Total Indebtedness of the Borrower and its Restricted Subsidiaries $
2. Consolidated Tangible Net Worth $
$
21 Insert the last day of the respective fiscal quarter or fiscal year covered by the financial statements which are required to be accompanied by this Compliance Certificate.
22 Insert the first day of the most recently completed four consecutive fiscal quarters of the Borrower ended on the Computation Date.
F-4


Unrestricted cash and Cash Equivalents of the Borrower and its consolidated Subsidiaries23 Amount
1. Unrestricted cash of the Borrower and its Restricted Subsidiaries $
2. Cash Equivalents of the Borrower and its Restricted Subsidiaries:
(a) Direct obligations of, or obligations the principal of and interest on which are unconditionally guaranteed by, the United States of America (or by any agency thereof to the extent such obligations are backed by the full faith and credit of the United States of America), in each case maturing within one year from the date of issuance thereof $
(b) Investments in commercial paper maturing within 270 days from the date of issuance thereof and having, at such date of acquisition, a rating of at least “Prime 1” (or the then equivalent grade) by Moody’s or “A-1” (or the then equivalent grade) by S&P $
(c) Investments in certificates of deposit, banker’s acceptances and time deposits maturing within one year from the date of acquisition thereof issued or guaranteed by or placed with, and money market deposit accounts issued or offered by, the Administrative Agent or any domestic office of any commercial bank organized under the laws of the United States of America or any State thereof that issues (or the parent of which issues) commercial paper rated at least “Prime 1” (or the then equivalent grade) by Moody’s or “A-1” (or the then equivalent grade) by S&P $
(d) Fully collateralized repurchase agreements with a term of not more than 30 days for securities described in clause (a) above and entered into with a financial institution satisfying the criteria of clause (c) above $
(e)  Investments in “money market funds” substantially all of whose assets are invested in investments of the type described in clauses (a) through (d) above $
(f) In the case of any Foreign Subsidiary, other short-term investments that are analogous to the foregoing, are of comparable credit quality and are customarily used by companies in the jurisdiction of such Foreign Subsidiary for cash management purposes $
(g) Investments permitted pursuant to Borrower’s investment policy as approved by the board of directors (or committee thereof) of the Borrower from time to time $
$
23 To be calculated as of the last day of the most recent calendar month. Unrestricted cash or Cash Equivalents (a) do not appear (or would be required to appear) as “restricted” on the consolidated balance sheet of the Borrower, (b) are not subject to any Lien, other than non-consensual Liens arising by operation of law or Liens permitted under Section 6.02(k) of the Credit Agreement and (c) are otherwise generally available for use by the Borrower or any Restricted Subsidiary.
F-5


EXHIBIT G-1
FORM OF
U.S. TAX COMPLIANCE CERTIFICATE
(For Foreign Lenders That Are Not Partnerships For U.S. Federal Income Tax Purposes)
Reference is hereby made to the Revolving Credit Agreement, dated as of September 27, 2018 (as amended, restated, amended and restated, extended, supplemented or otherwise modified in writing from time to time, the “Credit Agreement”), among Social Finance, Inc., a Delaware corporation, as the Borrower, lenders and issuing banks from time to time party thereto and Goldman Sachs Bank USA, as the Administrative Agent. Capitalized terms used herein but not otherwise defined shall have the meaning given to them in the Credit Agreement.
Pursuant to the provisions of Section 2.14 of the Credit Agreement, the undersigned hereby certifies that (i) it is the sole record and beneficial owner of the Loan(s) (as well as any Note(s) evidencing such Loan(s)) in respect of which it is providing this certificate, (ii) it is not a “bank” within the meaning of Section 881(c)(3)(A) of the Code, (iii) it is not a “10-percent shareholder” of the Borrower within the meaning of Section 871(h)(3)(B) of the Code, (iv) it is not a “controlled foreign corporation” related to the Borrower, as described in Section 881(c)(3)(C) of the Code and (v) no payments in connection with any Loan Document are effectively connected with the undersigned’s conduct of a U.S. trade or business.
The undersigned has furnished the Borrower and the Administrative Agent with a certificate of its non-U.S. Person status on IRS Form W-8BEN-E or W-8BEN, as applicable. By executing this certificate, the undersigned agrees that (1) if the information provided on this certificate changes, or if this certificate expires or becomes obsolete or inaccurate in any respect, the undersigned shall promptly deliver to the Borrower and the Administrative Agent an updated certificate or other appropriate documentation (including any new documentation reasonably requested by the Borrower or the Administrative Agent) or notify the Borrower and the Administrative Agent in writing of its legal inability to do so, and (2) the undersigned shall have at all times furnished the Borrower and the Administrative Agent with a properly completed and currently effective certificate in either the calendar year in which each payment is to be made to the undersigned, or in either of the two calendar years preceding such payments.
[Signature Page Follows]
G-1-1


[Lender]
By:
Name:
Title:
[Address]
Dated: ____________________, 20[  ]
G-1-2


EXHIBIT G-2
FORM OF
U.S. TAX COMPLIANCE CERTIFICATE
(For Participants That Are Neither U.S. Persons Nor Partnerships For U.S. Federal Income Tax Purposes)
Reference is hereby made to the Revolving Credit Agreement, dated as of September 27, 2018 (as amended, restated, amended and restated, extended, supplemented or otherwise modified in writing from time to time, the “Credit Agreement”), among Social Finance, Inc., a Delaware corporation, as the Borrower, lenders and issuing banks from time to time party thereto and Goldman Sachs Bank USA, as the Administrative Agent. Capitalized terms used herein but not otherwise defined shall have the meaning given to them in the Credit Agreement.
Pursuant to the provisions of Section 2.14 of the Credit Agreement, the undersigned hereby certifies that (i) it is the sole record and beneficial owner of the participation in respect of which it is providing this certificate, (ii) it is not a “bank” within the meaning of Section 881(c)(3)(A) of the Code, (iii) it is not a “10-percent shareholder” of the Borrower within the meaning of Section 871(h)(3)(B) of the Code, (iv) it is not a “controlled foreign corporation” related to the Borrower, as described in Section 881(c)(3)(C) of the Code and (v) no payments in connection with any Loan Document are effectively connected with the undersigned’s conduct of a U.S. trade or business.
The undersigned has furnished its participating Lender with a certificate of its non-U.S. Person status on IRS Form W-8BEN-E or W-8BEN, as applicable. By executing this certificate, the undersigned agrees that (1) if the information provided on this certificate changes, or if this certificate expires or becomes obsolete or inaccurate in any respect, the undersigned shall promptly deliver to such Lender an updated certificate or other appropriate documentation (including any new documentation reasonably requested by such Lender) or notify such Lender in writing of its legal inability to do so, and (2) the undersigned shall have at all times furnished such Lender with a properly completed and currently effective certificate in either the calendar year in which each payment is to be made to the undersigned, or in either of the two calendar years preceding such payments.
[Signature Page Follows]
G-2-1


[Participant]
By:
Name:
Title:
[Address]
Dated: ____________________, 20[  ]
G-2-2


EXHIBIT G-3
FORM OF
U.S. TAX COMPLIANCE CERTIFICATE
(For Participants That Are Not U.S. Persons And That Are Partnerships For U.S. Federal Income Tax Purposes)
Reference is hereby made to the Revolving Credit Agreement, dated as of September 27, 2018 (as amended, restated, amended and restated, extended, supplemented or otherwise modified in writing from time to time, the “Credit Agreement”), among Social Finance, Inc., a Delaware corporation, as the Borrower, lenders and issuing banks from time to time party thereto and Goldman Sachs Bank USA, as the Administrative Agent. Capitalized terms used herein but not otherwise defined shall have the meaning given to them in the Credit Agreement.
Pursuant to the provisions of Section 2.14 of the Credit Agreement, the undersigned hereby certifies that (i) it is the sole record owner of the participation in respect of which it is providing this certificate, (ii) its direct or indirect partners/members are the sole beneficial owners of such participation, (iii) with respect to such participation, neither the undersigned nor any of its direct or indirect partners/members that is claiming the portfolio interest exemption (its “Applicable Partners/Members”) is a “bank” extending credit pursuant to a loan agreement entered into in the ordinary course of its trade or business within the meaning of Section 881(c)(3)(A) of the Code, (iv) none of its Applicable Partners/Members is a “10-percent shareholder” of the Borrower within the meaning of Section 871(h)(3)(B) of the Code, (v) none of its Applicable Partners/Members is a “controlled foreign corporation” related to the Borrower, as described in Section 881(c)(3)(C) of the Code and (vi) no payments in connection with any Loan Document are effectively connected with the conduct of a U.S. trade or business by the undersigned or any of its Applicable Partners/Members.
The undersigned has furnished its participating Lender with an IRS Form W-8IMY accompanied by one of the following forms from each of its partners/members that is claiming the portfolio interest exemption: (i) an IRS Form W-8BEN-E or W-8BEN, as applicable, or (ii) an IRS Form W-8IMY accompanied by an IRS Form W-8BEN-E or W-8BEN, as applicable, from each of such partner’s/member’s beneficial owners that is claiming the portfolio interest exemption. By executing this certificate, the undersigned agrees that (1) if the information provided on this certificate changes, or if this certificate expires or becomes obsolete or inaccurate in any respect, the undersigned shall promptly deliver to such Lender an updated certificate or other appropriate documentation (including any new documentation reasonably requested by such Lender) or notify such Lender in writing of its legal inability to do so, and (2) the undersigned shall have at all times furnished such Lender with a properly completed and currently effective certificate in either the calendar year in which each payment is to be made to the undersigned, or in either of the two calendar years preceding such payments.
G-3-1


[Participant]
By:
Name:
Title:
[Address]
Dated: ____________________, 20[  ]
G-3-2


EXHIBIT G-4
FORM OF
U.S. TAX COMPLIANCE CERTIFICATE
(For Foreign Lenders That Are Partnerships For U.S. Federal Income Tax Purposes)
Reference is hereby made to the Revolving Credit Agreement, dated as of September 27, 2018 (as amended, restated, amended and restated, extended, supplemented or otherwise modified in writing from time to time, the “Credit Agreement”), among Social Finance, Inc., a Delaware corporation, as the Borrower, lenders and issuing banks from time to time party thereto and Goldman Sachs Bank USA, as the Administrative Agent. Capitalized terms used herein but not otherwise defined shall have the meaning given to them in the Credit Agreement.
Pursuant to the provisions of Section 2.14(f) of the Credit Agreement, the undersigned hereby certifies that (i) it is the sole record owner of the Loan(s) (as well as any Note(s) evidencing such Loan(s)) in respect of which it is providing this certificate, (ii) its direct or indirect partners/members are the sole beneficial owners of such Loan(s) (as well as any Note(s) evidencing such Loan(s)), (iii) with respect to the extension of credit pursuant to this Credit Agreement or any other Loan Document, neither the undersigned nor any of its direct or indirect partners/members that is claiming the portfolio interest exemption (its “Applicable Partners/Members”) is a “bank” extending credit pursuant to a loan agreement entered into in the ordinary course of its trade or business within the meaning of Section 881(c)(3)(A) of the Code, (iv) none of its Applicable Partners/Members is a “10-percent shareholder” of the Borrower within the meaning of Section 871(h)(3)(B) of the Code, (v) none of its Applicable Partners/Members is a “controlled foreign corporation” related to the Borrower, as described in Section 881(c)(3)(C) of the Code and (vi) no payments in connection with any Loan Document are effectively connected with the conduct of a U.S. trade or business by the undersigned or any of its Applicable Partners/Members.
The undersigned has furnished the Borrower and the Administrative Agent with an IRS Form W-8IMY accompanied by one of the following forms from each of its partners/members that is claiming the portfolio interest exemption: (i) an IRS Form W-8BEN-E or W-8BEN, as applicable, or (ii) an IRS Form W-8IMY accompanied by an IRS Form W-8BEN-E or W-8BEN, as applicable, from each of such partner’s/member’s beneficial owners that is claiming the portfolio interest exemption. By executing this certificate, the undersigned agrees that (1) if the information provided on this certificate changes, or if this certificate expires or becomes obsolete or inaccurate in any respect, the undersigned shall promptly deliver to the Borrower and the Administrative Agent an updated certificate or other appropriate documentation (including any new documentation reasonably requested by the Borrower or the Administrative Agent) or notify the Borrower and the Administrative Agent in writing of its legal inability to do so, and (2) the undersigned shall have at all times furnished the Borrower and the Administrative Agent with a properly completed and currently effective certificate in either the calendar year in which each payment is to be made to the undersigned, or in either of the two calendar years preceding such payments.
[Signature Page Follows]
G-4-1


[Lender]
By:
Name:
Title:
[Address]
Dated: ____________________, 20[  ]
G-4-2


Exhibit H
FORM OF INTERCOMPANY SUBORDINATION AGREEMENT
This INTERCOMPANY SUBORDINATION AGREEMENT (this “Agreement”), dated as of _, 20_ , is entered into by and among the Persons listed on the signature pages hereof, in favor of the Agent (as defined below).
Reference is made to that certain Revolving Credit Agreement, dated as of September 27, 2018 (the “Closing Date”) (as amended, restated, supplemented or otherwise modified from time to time, the “Credit Agreement”) among Social Finance, Inc., a Delaware corporation (“Borrower”), the Lenders party thereto, Goldman Sachs Bank USA, as Administrative Agent (the “Agent”) and the other parties from time to time party thereto. Capitalized terms used but not defined in this Agreement shall have the meanings assigned to such terms in the Credit Agreement.
Each of the undersigned Loan Parties listed on the signature page hereto as a “Payor” (each, in such capacity, a “Payor”) is now or may hereafter become indebted or otherwise obligated to such other Person listed below as a “Payee” (each, in such capacity, a “Payee”) in respect of Indebtedness (including trade payables) (the unpaid principal amount and all other amounts payable in respect thereof, “Intercompany Subordinated Indebtedness”).
In consideration of the mutual covenants and agreements herein contained, the parties hereto covenant and agree as follows:
1.    Anything in this Agreement to the contrary notwithstanding, any Intercompany Subordinated Indebtedness owed by any Payor that is a Loan Party to any Payee that is not a Loan Party shall be subordinate and junior in right of payment, to the extent and in the manner hereinafter set forth, to the Obligations until the payment in full in cash of all Obligations (other than contingent obligations not yet validly asserted) and the termination or expiration of all Commitments and the cancellation or expiration or Cash Collateralization of all Letters of Credit on terms reasonably satisfactory to the applicable Issuing Bank; provided that each Payor may make payments to the applicable Payee so long as no Event of Default under and as defined in the Credit Agreement shall have occurred and be continuing and such Payor has not received notice thereof from the Agent (provided that no such notice shall be required to be given in the case of any Event of Default arising under Section 7.01(h), 7.01(i) or 7.01(j) of the Credit Agreement) (such Obligations and other indebtedness and obligations in connection with any renewal, refunding, restructuring or refinancing thereof, including interest thereon accruing after the commencement of any proceedings referred to in clause (i) below, whether or not such interest is an allowed claim in such proceeding, being hereinafter collectively referred to as “Senior Indebtedness”).
(i)    In the event of any insolvency or bankruptcy proceedings, and any receivership, liquidation, reorganization or other similar proceedings in connection therewith, relating to any Payor or to its property, and in the event of any proceedings for voluntary liquidation, dissolution or other winding up of such Payor (except as expressly permitted by the Credit Agreement), whether or not involving insolvency or bankruptcy, then, if an Event of Default (as defined in the Credit Agreement) has occurred and is continuing, (x) the holders of Senior Indebtedness shall be paid in full in cash in respect of all amounts constituting Senior Indebtedness (other than contingent obligations not yet
H-1


validly asserted) before any Payee is entitled to receive (whether directly or indirectly), or make any demands for, any payment on account of this Agreement and (y) until the holders of Senior Indebtedness are paid in full in cash in respect of all amounts constituting Senior Indebtedness (other than contingent obligations not yet validly asserted), any payment or distribution to which such Payee would otherwise be entitled (other than debt securities of such Payor that are subordinated, to at least the same extent as this Agreement, to the payment of all Senior Indebtedness then outstanding (such securities being hereinafter referred to as “Restructured Debt Securities”)) shall be made to the holders of Senior Indebtedness.
(ii)    If any Event of Default (as defined in the Credit Agreement) occurs and is continuing after prior written notice from the Agent (provided that no such notice shall be required to be given in the case of any Event of Default arising under Section 7.01(h), 7.01(i) or 7.01(j) of the Credit Agreement) to the Borrower, then no payment or distribution of any kind or character shall be made by or on behalf of the Payor, or any other Person on its behalf, with respect to any Intercompany Subordinated Indebtedness.
(iii)    If any payment or distribution of any character, whether in cash, securities or other property (other than Restructured Debt Securities), and whether directly, by purchase, redemption, exercise of any right of setoff or otherwise, with respect to any amounts outstanding under any Intercompany Subordinated Indebtedness shall (despite these subordination provisions) be received by any Payee in violation of Section 1(i) or Section 1(ii) above prior to all Senior Indebtedness having been paid in full in cash (other than contingent obligations not yet validly asserted), such payment or distribution shall be held by such Payee in trust (segregated from other property of such Payee) for the benefit of the Agent, and shall be paid over or delivered in accordance with the Loan Documents.
(iv)    Each Payee agrees to file all claims against each relevant Payor in any bankruptcy or other proceeding in which the filing of claims is required by law in respect of any Intercompany Subordinated Indebtedness, and the Agent shall be entitled to all of such Payee’s rights thereunder. If for any reason a Payee fails to file such claim at least ten Business Days prior to the last date on which such claim should be filed, such Payee hereby irrevocably appoints the Agent as its true and lawful attorney-in-fact and the Agent is hereby authorized to act as attorney-in-fact in such Payee’s name to file such claim or, in the Agent’s discretion, to assign such claim to and cause proof of claim to be filed in the name of the Agent or its nominee. In all such cases, whether in administration, bankruptcy or otherwise, the person or persons authorized to pay such claim shall pay to the Agent the full amount payable on the claim in the proceeding, and, to the full extent necessary for that purpose, each Payee hereby assigns to the Agent all of such Payee’s rights to any payments or distributions to which such Payee otherwise would be entitled. If the amount so paid is greater than such Payee’s liability hereunder, the Agent shall pay the excess amount to the party entitled thereto pursuant to the Loan Documents and applicable law. In addition, each Payee hereby irrevocably appoints the Agent as its attorney-in-fact to exercise all of such Payee’s voting rights in connection with any bankruptcy proceeding or any plan for the reorganization of each relevant Payor.
(v)    Each Payee waives the right to compel that any property of any Payor or any property of any guarantor of any Senior Indebtedness or any other Person be applied in any
H-2


particular order to discharge such Senior Indebtedness. Each Payee expressly waives the right to require the Agent or any other holder of Senior Indebtedness to proceed against any Payor, any guarantor of any Senior Indebtedness or any other Person, or to pursue any other remedy in its or their power that such Payee cannot pursue and that would lighten such Payee’s burden, notwithstanding that the failure of the Agent or any such other holder to do so may thereby prejudice such Payee. Each Payee agrees that it shall not be discharged, exonerated or have its obligations hereunder reduced (i) as a result of any delay by the Agent or any other holder of Senior Indebtedness in proceeding against or enforcing any remedy against any Payor, any guarantor of any Senior Indebtedness or any other Person; (ii) by the Agent or any holder of Senior Indebtedness releasing any Payor, any guarantor of any Senior Indebtedness or any other Person from all or any part of the Senior Indebtedness; or (iii) by the discharge of any Payor, any guarantor of any Senior Indebtedness or any other Person by an operation of law or otherwise, with or without the intervention or omission of the Agent or any such holder.
(vi)    Each Payee waives all rights and defenses arising out of an election of remedies by the Agent or any other holder of Senior Indebtedness, even though that election of remedies, including any nonjudicial foreclosure with respect to any property securing any Senior Indebtedness (if any), has impaired the value of such Payee’s rights of subrogation, reimbursement, or contribution against any Payor, any guarantor of any Senior Indebtedness or any other Person. Each Payee expressly waives any rights or defenses it may have by reason of protection afforded to any Payor, any guarantor of any Senior Indebtedness or any other Person with respect to the Senior Indebtedness pursuant to any anti-deficiency laws or other laws of similar import that limit or discharge the principal debtor’s indebtedness upon judicial or nonjudicial foreclosure of property or assets securing any Senior Indebtedness (if any).
(vii)    Each Payee agrees that, without the necessity of any reservation of rights against it, and without notice to or further assent by it, any demand for payment of any Senior Indebtedness made by the Agent or any other holder of Senior Indebtedness may be rescinded in whole or in part by the Agent or such holder, and any Senior Indebtedness may be continued, and the Senior Indebtedness or the liability of any Payee, any guarantor thereof or any other Person obligated thereunder, or any right of offset with respect thereto, may, from time to time, in whole or in part, be renewed, extended, modified, accelerated, compromised, waived, surrendered or released by the Agent or any other holder of Senior Indebtedness, in each case without notice to or further assent by such Payee, which will remain bound hereunder, and without impairing, abridging, releasing or affecting the subordination provided for herein.
(viii)    Each Payee waives any and all notice of the creation, renewal, extension or accrual of any Senior Indebtedness, and any and all notice of or proof of reliance by holders of Senior Indebtedness upon the subordination provisions set forth herein. The Senior Indebtedness shall be deemed conclusively to have been created, contracted or incurred, and the consent to create the obligations of any Payee with respect to Intercompany Subordinated Indebtedness shall be deemed conclusively to have been given, in reliance upon the subordination provisions set forth herein.
H-3


(ix)    To the maximum extent permitted by law, each Payee waives any claim it might have against the Agent or any other holder of Senior Indebtedness with respect to, or arising out of, any action or failure to act or any error of judgment, negligence, or mistake or oversight whatsoever on the part of the Agent or any such holder, or any of their Related Parties, with respect to any exercise of rights or remedies under the Loan Documents, except to the extent due to the gross negligence or willful misconduct of the Agent or any such holder, as the case may be, or any of its Related Parties, as determined by a court of competent jurisdiction in a final and non-appealable judgment. None of the Agent, any other holder of Senior Indebtedness or any of their Related Parties shall be liable for failure to demand, collect or realize upon any guarantee of any Senior Indebtedness, or for any delay in doing so, or shall be under any obligation to sell or otherwise dispose of any property upon the request of any Payor, any Payee or any other Person or to take any other action whatsoever with regard to any such guarantee or any other property.
Each Payee and each Payor hereby agree that the subordination provisions set forth in this Agreement are for the benefit of the Agent and the other holders of Senior Indebtedness. The Agent and the other holders of Senior Indebtedness are obligees under this Agreement to the same extent as if their names were written herein as such and the Agent may, on behalf of itself and such other holders, proceed to enforce the subordination provisions set forth herein.
All rights and interests of the Agent and the other holders of Senior Indebtedness hereunder, and the subordination provisions and the related agreements of the Payors and Payees set forth herein, shall remain in full force and effect irrespective of:
(i)    any lack of validity or enforceability of the Credit Agreement or any other Loan Document;
(ii)    any change in the time, manner or place of payment of, or in any other term of, all or any of the Senior Indebtedness or any amendment or waiver or other modification, whether by course of conduct or otherwise, of, or consent to departure from, the Credit Agreement or any other Loan Document;
(iii)    any release, amendment, waiver or other modification, whether in writing or by course of conduct or otherwise, of or consent to departure from, any guarantee of any Senior Indebtedness; or
(iv)    any other circumstances that might otherwise constitute a defense available to, or a discharge of, any Payor in respect of any Senior Indebtedness or of any Payee or any Payor in respect of the subordination provisions set forth herein.
The Indebtedness owed by any Payor to a Loan Party that is a Payee shall not be subordinated to, and shall rank pari passu in right of payment with, any other obligation of such Payor.
Nothing contained in the subordination provisions set forth above is intended to or will impair, as between each Payor and each Payee, the obligations of such Payor, which are absolute and unconditional, to pay to such Payee the principal of and interest on any Intercompany Subordinated Indebtedness as and when due and payable in accordance with its terms, or is intended
H-4


to or will affect the relative rights of such Payee and other creditors of such Payor other than the holders of Senior Indebtedness.
This Agreement shall be binding upon each Payor and its successors and assigns, and the terms and provisions of this Agreement shall inure to the benefit of each Payee and its successors and assigns, including subsequent holders hereof. Notwithstanding anything to the contrary contained herein, in any other Loan Document or in any other promissory note or other instrument, this Agreement supplements any and all promissory notes or other instruments which create or evidence any loans or advances made on, before or after the date hereof by any Payee to the Borrower or any Subsidiary.
From time to time after the date hereof, additional Subsidiaries of Borrower may become parties hereto (as Payor and/or Payee, as the case may be) by executing a counterpart signature page to this Agreement (each additional Subsidiary, an “Additional Party”). Upon delivery of such counterpart signature page to the Payees, notice of which is hereby waived by the other Payors, each Additional Party shall be a Payor and/or a Payee, as the case may be, and shall be as fully a party hereto as if such Additional Party were an original signatory hereof. Each Payor expressly agrees that its obligations arising hereunder shall not be affected or diminished by the addition or release of any other Payor or Payee hereunder. This Agreement shall be fully effective as to any Payor or Payee that is or becomes a party hereto regardless of whether any other Person becomes or fails to become or ceases to be a Payor or Payee hereunder.
No amendment, modification or waiver of, or consent with respect to, any provisions of this Agreement shall be effective unless the same shall be in writing and signed and delivered by each Payor and Payee whose rights or obligations shall be affected thereby; provided that, until such time as (i) all the Obligations have been paid in full in cash (other than contingent obligations not yet validly asserted) and (ii) all Commitments have terminated or expired and all Letters of Credit have been cancelled, are expired or have been Cash Collateralized on terms reasonably satisfactory to the applicable Issuing Bank, the Agent shall have provided its prior written consent to such amendment, modification, waiver or consent (such consent not to be unreasonably withheld to the extent such amendment or modification is required to comply with any applicable law or is not adverse to the interests of the Lenders).
THIS AGREEMENT SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK.
H-5


IN WITNESS WHEREOF, the parties hereto have caused their duly authorized officers to execute and deliver this Agreement as of the date first above written.
Payor
[  ]
By:
Name:
Title:
H-6


IN WITNESS WHEREOF, the parties hereto have caused their duly authorized officers to execute and deliver this Agreement as of the date first above written.
Payee
[  ]
By:
Name:
Title:
H-7


EXHIBIT I
FORM OF ANNUAL FORECAST
Fiscal
Year
Revenue
OpEx
Operating Income
D&A
Other Expense / (Income)
Net Income
CapEx
I-1
Exhibit 10.14
Execution version

OFFICE LEASE
ONE TEHAMA
246 FIRST STREET (SF) OWNER, LLC,
a Delaware limited liability company,
as Landlord,
and
SOCIAL FINANCE, INC.,
a Delaware corporation,
as Tenant.
ONE TEHAMA
[Social Finance, Inc.]

TABLE OF CONTENTS
Page
ARTICLE 1
PREMISES, BUILDING, PROJECT, AND COMMON AREAS
5
ARTICLE 2
LEASE TERM
6
ARTICLE 3
BASE RENT
12
ARTICLE 4
ADDITIONAL RENT
13
ARTICLE 5
USE OF PREMISES
23
ARTICLE 6
SERVICES AND UTILITIES
25
ARTICLE 7
REPAIRS
29
ARTICLE 8
ADDITIONS AND ALTERATIONS
30
ARTICLE 9
COVENANT AGAINST LIENS
36
ARTICLE 10
TENANT'S INDEMNITY AND INSURANCE
36
ARTICLE 11
DAMAGE AND DESTRUCTION
43
ARTICLE 12
NONWAIVER
46
ARTICLE 13
CONDEMNATION
46
ARTICLE 14
ASSIGNMENT AND SUBLETTING
47
ARTICLE 15
SURRENDER OF PREMISES; OWNERSHIP AND REMOVAL OF TRADE FIXTURES
53
ARTICLE 16
HOLDING OVER
54
ARTICLE 17
CERTIFICATES
54
ARTICLE 18
MORTGAGE OR GROUND LEASE
55
ARTICLE 19
DEFAULTS; REMEDIES
57
ARTICLE 20
COVENANT OF QUIET ENJOYMENT
61
ARTICLE 21
LETTER OF CREDIT
61
ARTICLE 22
INTENTIONALLY OMITTED
66
ARTICLE 23
SIGNS
66
ARTICLE 24
COMPLIANCE WITH LAW
68
ARTICLE 25
LATE CHARGES
69
ARTICLE 26
LANDLORD'S RIGHT TO CURE DEFAULT; PAYMENTS BY TENANT
70
ARTICLE 27
ENTRY BY LANDLORD
70
ARTICLE 28
NOTICES
71
ARTICLE 29
MISCELLANEOUS PROVISIONS
72
LIST OF EXHIBITS
EXHIBIT A OUTLINE OF PREMISES
EXHIBIT B TENANT WORK LETTER
SCHEDULE 1 TO EXHIBIT B LANDLORD WORK
SCHEDULE 2 TO EXHIBIT B LANDLORD WORK PLANS
EXHIBIT C FORM OF NOTICE OF LEASE TERM DATES
EXHIBIT D RULES AND REGULATIONS
EXHIBIT E FORM OF TENANT'S ESTOPPEL CERTIFICATE
EXHIBIT F FORM OF SNDAA
EXHIBIT G FORM OF LETTER OF CREDIT
EXHIBIT H TENANT'S EXTERIOR SIGNAGE
EXHIBIT I ENGINEERING STAFF REQUIREMENTS
(i)
ONE TEHAMA
[Social Finance, Inc.]


Page
EXHIBIT J LIST OF QUALIFICATIONS OF SERVICE PROVIDERS AND AGREEMENTS
EXHIBIT K REPAIR AND MAINTENANCE SPECIFICATIONS
EXHIBIT L LOCATION OF TELECOMMUNICATIONS EQUIPMENT, THIRD-PARTY ROOF EQUIPMENT, AND GENERATOR
(ii)
ONE TEHAMA
[Social Finance, Inc.]

INDEX
Page(s)
Abatement Event 61
Abatement Event Termination Date 62
Abatement Event Termination Notice 61
Above Standard Alterations 39
Above Standard Tenant Improvements Exhibit B
Additional Insureds 44
Additional Rent 13
Adjusted L-C Amount 67
Advocate Arbitrators. 9
Alterations 36
Anticipated Delivery Date 2
Anti-Money Laundering Laws 81
Appealable Tax Expenses 18
Appeals Notice 18
Applicable Laws 70
Approved Working Drawings
Exhibit B, Exhibit B
Arbitration Agreement 10
Architect Exhibit B
Audit Notice 20
Bank 62
Bank Credit Threat 63
Bank Prime Loan 72
Bankruptcy Code 64
Base Building 38
Base Rent 12
Bicycles 24
Briefs 10
Brokers 79
Building 6
Building Direct Expenses 13
Building Structure 32
Building System 32
Building System Documents 31
Building Systems 32
Cafeteria 23
Cafeteria Users 23
Capital Improvement Notice 33
capital in nature 34
CASp 71
Casualty 45
City
69, Exhibit B
Code Exhibit B
Comparable Area 8
Comparable Buildings 8
(iii)
ONE TEHAMA
[Social Finance, Inc.]


Page(s)
Comparable Transactions 7
Concessions 7
Constant Rate Equivalent Approach 7
Construction Professional 45
Contemplated Effective Date 52
Contemplated Transfer 52
Contract Exhibit B
Control 54
Coordination Fee Exhibit B
Credit Rating Threshold 62
Delay Notice Exhibit B
Delayed Repair Termination Date 47
Delayed Repair Termination Notice 47
Delivery Condition Exhibit B
Delivery Date Exhibit B
Delivery Delay Termination Date Exhibit B
Delivery Delay Termination Notice Exhibit B
Delivery Notice Exhibit B
Deposit Period 66
Design Problem Exhibit B
Eligibility Period 61
Emergency 35
Encumbrances 56
Engineers Exhibit B
Estimate 19
Estimate Statement 19
Estimated Building Direct Expenses 19
Estoppel Reminder Notice 56
Excess Personal Property 77
Expense Year 13
Fair Market Rent Rate, 7
FDIC 65
Final Costs Exhibit B
Final Retention Exhibit B
Final Space Plan Exhibit B
Final Working Drawings Exhibit B
Fire Control Room Schedule 1 to Exhibit B
First Rebuttals 10
Fitness Center 23
Fitness Center Users 23
Fixed Period 66
Force Majeure 77
Force Majeure Delay Exhibit B
Generator 29
Generator Area 29
(iv)
ONE TEHAMA
[Social Finance, Inc.]


Page(s)
Hazardous Substance 22
HVAC 24
Intention to Transfer Notice 52
Interest Rate 72
Interim Cash Deposit 66
Landlord Summary
Landlord Caused Delay Exhibit B
Landlord Parties 45
Landlord Party 45
Landlord Response Notice 9
Landlord Use Rights 68
Landlord Work Exhibit B
Landlord's Capital Improvements 33
Landlord's Casualty Notice 45
Landlord's Initial Statement 11
Landlord's Warranty Period 5
Late Delivery Date Abatements Exhibit B
L-C 62
L-C Amount 62
LC Expiration Date 63
LC Replacement Notice 65
Lease Summary
Lease Commencement Date
6, Summary
Lease Commencement Date Delay Exhibit B
Lease Expiration Date 6
Lease Term 6
Lease Year 6
Lines 80
Mail 74
Management Standard 30
Material Alteration 36
Material Alterations 36
Mortgagee 56
Neutral Arbitrator 9
Neutral Audit 21
New Lease Notice 55
Nine Month Period 52
Non-Office Permits Exhibit B
Non-Reimbursable Capital Improvements 34
North Financial District 8
Notices 73
OFAC 80
Office Permits Exhibit B
Operating Expenses 13
Option Conditions 7
(v)
ONE TEHAMA
[Social Finance, Inc.]


Page(s)
Option Notice 7
Option Rent 7
Option Term 7
Option Terms 7
Original Improvements 42
OTC Exhibit B
Outside Agreement Date 9
Over-Allowance Amount Exhibit B
Over-Allowance Payments Exhibit B
Patriot Act 81
Payment Notice Exhibit B
Permit Contingency Date Exhibit B
Permit Drawings Exhibit B
Permit Notice Exhibit B
Permits Exhibit B
Permitted Alterations 36
Permitted Transferee 54
Personal Property Limitation 77
Pre-Delivery Landlord Work Exhibit B
Premises 5
Project 6
Proposition 13 17
Receivership 65
Records 20
Refusal Notice Exhibit B
Reimbursable Capital Improvements 14
REIT Requirements 77
Releases Exhibit B
Remaining Landlord Work Exhibit B
Rent 13
Rent Abatement 12
Rent Abatement Date Exhibit B
Rent Abatement Period 12
Re-Routed Lines 28
Review Period 20
Roof Deck 68
Roof Deck Users 68
RSF Summary
Ruling 11
Second Rebuttals 11
Secured Areas 73
Security Deposit Laws 65
Service Agreements 30
Site Operations Manager 30
SNDAA 56
(vi)
ONE TEHAMA
[Social Finance, Inc.]


Page(s)
South Financial District 8
Staircase 28
Staircase Removal Requirements 28
Statement 19
Subject Space 49
Substantial Completion of the Tenant Improvements Exhibit B
Summary Summary
Tax Expenses 16
Telecommunications Equipment 27
Tenant Summary
Tenant Agents 38
Tenant Damage 5
Tenant Delay Exhibit B
Tenant Delay Notice Exhibit B
Tenant Facility Coordinator 20
Tenant Funded Capital Improvements, 34
Tenant Improvement Allowance Exhibit B
Tenant Improvement Allowance Items Exhibit B
Tenant Improvement Changes Exhibit B
Tenant Improvements Exhibit B
Tenant Parties 45
Tenant Party 45
Tenant Work Letter 5
Tenant's Agents Exhibit B
Tenant's Dogs 22
Tenant's Engineers 30
Tenant's Exterior Signage 69
Tenant's Initial Statement 11
Tenant's Rebuttal Statement 11
Tenant's Security Personnel 25
Tenant's Share 18
Tenant's South Side Exterior Signage 69
Tenant's Subleasing Costs 52
Termination Effective Date Exhibit B
Termination Notice 52
Third Party Operator 23
TI Contractor Exhibit B
Transfer 49
Transfer Notice 49
Transfer Premium 51, 52
Transferee 49
Transfers 49
Unused L-C Proceeds 65
Window Covering Allowance Exhibit B
Window Covering Costs Exhibit B
(vii)
ONE TEHAMA
[Social Finance, Inc.]


ONE TEHAMA
OFFICE LEASE
This Office Lease (the "Lease"), dated as of the date set forth in Section 1 of the Summary of Basic Lease Information (the "Summary"), below, is made by and between 246 FIRST STREET (SF) OWNER, LLC, a Delaware limited liability company ("Landlord"), and SOCIAL FINANCE, INC., a Delaware corporation ("Tenant").
SUMMARY OF BASIC LEASE INFORMATION
TERMS OF LEASE
DESCRIPTION
1. Date: August 6, 2018
2.
Premises (Article 1).
2.1 Building:
246 1st Street, San Francisco, CA 94105, containing 98,566 rentable square feet of space ("RSF").
2.2 Premises:
The entire Building, excluding the Building Structure, containing a total of 98,566 RSF, as further set forth in Exhibit A to the Lease located on the basement through sixth (6th) floors of the Building, including the mezzanine (2nd level) of the Building, together with an interior area for trash and recycling, loading and unloading, and deliveries. Tenant also has the right to use the roof of the Building in accordance with Section 6.5 and Article 22.
3.
Lease Term (Article 2).
3.1 Lease Term:
The period commencing on the Lease Commencement Date (defined in Section 3.3 of the Summary), and expiring on the "Lease Expiration Date", as that term is defined in Section 3.3 of this Summary, below (anticipated to be approximately one hundred thirty-two (132) months).
3.2 Option Terms:
Two (2) five (5)-year options to renew, as more particularly set forth in Section 2.2 of the Lease.
ONE TEHAMA
[Social Finance, Inc.]


3.3 Lease Commencement Date:
The date (the "Lease Commencement Date") that is the earlier of (i) the date upon which Tenant first commences to conduct business from the Premises and (ii) April 1, 2019. The Lease Commencement Date is subject to extension as set forth in Exhibit B attached hereto.
3.4 Lease Expiration Date:
The last day of the one hundred thirty-second (132nd) full calendar month following the Lease Commencement Date.
4.
Base Rent (Article 3):
Period During Lease Term
Annual
Base Rent**
Monthly Installment
of Base Rent
Annual Base Rental Rate Per RSF
Lease Year 1*
$6,899,620.00 $574,968.33 $70.000
Lease Year 2 $7,106,608.60 $592,217.38 $72.100
Lease Year 3 $7,319,806.86 $609,983.90 $74.263
Lease Year 4 $7,539,401.06 $628,283.42 $76.491
Lease Year 5 $7,765,583.10 $647,131.92 $78.786
Lease Year 6 $7,998,550.59 $666,545.88 $81.149
Lease Year 7 $8,238,507.11 $686,542.26 $83.584
Lease Year 8 $8,485,662.32 $707,138.53 $86.091
Lease Year 9 $8,740,232.19 $728,352.68 $88.674
Lease Year 10 $9,002,439.15 $750,203.26 $91.334
Lease Year 11 – Lease Expiration
Date
$9,272,512.33 $772,709.36 $94.074
*The Monthly Installments of Base Rent payable by Tenant during the period commencing on the first day of the first full calendar month of the Lease Term and continuing through the last day of the sixth (6th) full calendar month of the Lease Term shall be abated pursuant to Section 3.2 below.
5. Intentionally Omitted
6.
Tenant's Share (Article 4):
100%.
-2-
ONE TEHAMA
[Social Finance, Inc.]


7.
Permitted Use (Article 5):
General office and related uses consistent with a first-class office building
8.
Letter of Credit (Article 21):
$6,000,000.00, subject to the terms of Article 21 of the Lease
9.
Address of Tenant (Article 28):
Prior to Lease Commencement Date:
Social Finance, Inc.
One Letterman Dr., Building A, Suite 4700
San Francisco, CA 94129
Attention: Chief Financial Officer
and
Social Finance, Inc.
One Letterman Dr., Building A, Suite 4700
San Francisco, CA 94129
Attention: Director of Facilities & Real Estate
and
Social Finance, Inc.
l 070 l Parkridge Blvd., Suite 120
Reston, VA 20191
Attention: General Counsel
After Lease Commencement Date:
Social Finance, Inc.
246 1st Street
San Francisco, CA 94105
Attention: Chief Financial Officer
and
Social Finance, Inc.
246 1st Street
San Francisco, CA 94105
Attention: Director of Facilities & Real Estate
and
Social Finance, Inc.
10701 Parkridge Blvd., Suite 120
Reston, VA 20191
Attention: General Counsel
-3-
ONE TEHAMA
[Social Finance, Inc.]


10.
Address of Landlord (Article 28):
See Article 28 of the Lease.
11.
Broker(s) (Section 29.24):
Avison Young-Northem California, Ltd. (Nick Slonek and John Cashin), representing Tenant.
CBRE, Inc. (Bob Kraynak), representing Landlord.
12.
Tenant Improvement Allowance (Exhibit B):
$105.00 per RSF, plus the Window Covering Allowance, as further described in Section 2.1 of Exhibit B.
-4-
ONE TEHAMA
[Social Finance, Inc.]


ARTICLE 1
PREMISES, BUILDING, AND PROJECT
1.1    Premises, Building, and Project.
1.1.1    The Premises. Landlord hereby leases to Tenant and Tenant hereby leases from Landlord the premises set forth in Section 2.2 of the Summary (the "Premises"). The outline of the Premises is set forth in Exhibit A attached hereto. The parties hereto agree that the lease of the Premises is upon and subject to the terms, covenants and conditions herein set forth, and Tenant covenants as a material part of the consideration for this Lease to keep and perform each and all of such terms, covenants and conditions by it to be kept and performed and that this Lease is made upon the condition of such performance. The parties hereto hereby acknowledge that the purpose of Exhibit A is to show the approximate location of the Premises in the "Building," as that term is defined in Section 1.1.2, below, only, and such Exhibit is not meant to constitute an agreement, representation or warranty as to the construction of the Premises, the precise area thereof, or the elements thereof or of the accessways to the Premises or the "Project," as that term is defined in Section 1.1.2, below. Except as specifically set forth in this Lease and in the Tenant Work Letter attached hereto as Exhibit B (the "Tenant Work Letter"), Tenant shall accept the Premises in its presently existing "as-is" condition and Landlord shall not be obligated to provide or pay for any improvement work or services related to the improvement of the Premises. Tenant also acknowledges that neither Landlord nor any agent of Landlord has made any representation or warranty regarding the condition of the Premises, the Building or the Project or with respect to the suitability of any of the foregoing for the conduct of Tenant's business, except as specifically set forth in this Lease and the Tenant Work Letter. The commencement of business operations from the Premises by Tenant shall presumptively establish that the Premises and the Building were at such time in good and sanitary order, condition and repair, except for (i) minor "punchlist" matters related to the Premises or Building which are brought to Landlord's attention within thirty (30) days after Tenant commences business operations from the Premises; (ii) latent defects in the performance of work required to satisfy the "Delivery Condition", as that term is defined in Section 1 of the Tenant Work Letter attached hereto, which are brought to Landlord's attention on or before the first (1st) anniversary of the Lease Commencement Date; and (iii) Landlord's obligations set forth in Section 5.4 and Articles 7 and 24 of this Lease. Notwithstanding the foregoing, upon the Delivery Date, the Building Structure (including the roof, roof membrane and skylights) and the HVAC system constituting a Building System (the "Warranted Items") shall be in good working condition and repair, and Landlord hereby covenants that the Warranted Items shall remain in good working condition until the later of (A) twelve (12) months following the Lease Commencement Date and (B) April 30, 2020 ("Landlord's Warranty Period"). Landlord shall, at Landlord's sole cost and expense (which shall not be deemed an Operating Expense, as that term is defined in Section 4.2.3), repair or replace any failed or inoperable portion of the Warranted Items during the Landlord's Warranty Period, provided that the need to repair or replace was not caused by the misuse, misconduct, damage, destruction, omissions, and/or negligence (collectively, "Tenant Damage") of Tenant, its subtenants and/or assignees, if any, or any Tenant Parties, as that term is defined in Section 10.8, below, by any modifications, Alterations, as that term is defined in Section 8.1 below, or improvements (including the Tenant Improvements, as that term is defined in Section 2.1 of the Work Letter) constructed by or on behalf of Tenant, or
-5-
ONE TEHAMA
[Social Finance, Inc.]


by Tenant's failure to comply with the terms of Article 7 below. Landlord's warranty set forth in this Section 1.1.1 shall not be deemed to require Landlord to replace any portion of the Warranted Items, as opposed to repair such portion of the Warranted Items, unless prudent commercial property management practices dictate replacement rather than repair of the item in question. To the extent repairs which Landlord is required to make pursuant to this Section 1.1.1 are necessitated in part by Tenant Damage, then Tenant shall reimburse Landlord for an equitable proportion of the cost of such repair. If it is determined that the Warranted Items (or any portion thereof) were not in good working condition and repair as of the Delivery Date, Landlord shall not be liable to Tenant for any damages, but as Tenant's sole remedy, Landlord, at no cost to Tenant, shall promptly commence such work or take such other action as may be necessary to place the same in good working condition and repair, and shall thereafter diligently pursue the same to completion.
1.1.2    The Building and The Project. The Premises are a part of the building set forth in Section 2.1 of the Summary (the "Building"). The term "Project," as used in this Lease, shall mean (i) the Building, and (ii) the land upon which the Building is located.
1.13    Tenant Access. Except when and where Tenant's right of access is specifically excluded in this Lease, and except in the event of an emergency, Tenant shall have the right of access to the Premises, and the Building twenty-four (24) hours per day, seven (7) days per week during the "Lease Term", as that term is defined in Section 2.1 below.
1.1.4    RSF of Premises and Building. Landlord and Tenant hereby stipulate and agree that the RSF of the Premises is as set forth in Section 2.2 of the Summary and the RSF of the Building is as set forth in Section 2.1 of the Summary.
ARTICLE 2
LEASE TERM
2.1    Initial Lease Term. The terms and provisions of this Lease shall be effective as of the date of this Lease. The term of this Lease (the "Lease Term") shall commence on the "Lease Commencement Date," as that term is set forth in Section 3.2 of the Summary, and shall terminate on the "Lease Expiration Date," as that term is set forth in Section 3.3 of the Summary, unless this Lease is sooner terminated or extended as hereinafter provided. This Lease is effective and binding upon Landlord and Tenant upon mutual execution and delivery hereof, notwithstanding the later Lease Commencement Date. For purposes of this Lease, the term "Lease Year" shall mean each consecutive twelve (12) month period during the Lease Term; provided, however the first Lease Year shall commence on the Lease Commencement Date and end on the last day of the twelfth (12th) full calendar month thereafter. At any time during the Lease Term, Landlord may deliver to Tenant a notice in the form as set forth in Exhibit C, attached hereto, as a confirmation only of the information set forth therein, which Tenant shall execute and return to Landlord within ten (10) business days of receipt thereof; provided that if such notice is not factually correct, then Tenant shall make such changes as are necessary to make such notice factually correct and shall thereafter return such notice to Landlord within said ten (10) business day period. Tenant's failure to execute and return such notice to Landlord within such time shall be conclusive upon Tenant that the information set forth in such notice is as specified therein.
-6-
ONE TEHAMA
[Social Finance, Inc.]


2.2    Option Terms.
2.2.1    Option Right. Landlord hereby grants to the Original Tenant and any Non-Transferee Assignee two (2) option(s) to extend the Lease Term each for a period of five (5) years (each an "Option Term" and, together, the "Option Terms"). Such options shall be irrevocably exercised only by written notice (an "Option Notice") delivered by Tenant to Landlord no earlier than twelve (12) months and no later than nine (9) months prior to the expiration of the Lease Term, provided that the following conditions (the "Option Conditions") are satisfied: (i) as of the date of delivery of such notice, Tenant is not in material economic or material non-economic default under this Lease beyond any applicable notice and cure periods expressly set forth in this Lease; (ii) as of the end of the Lease Term, Tenant is not in material economic or material non-economic default under this Lease beyond any applicable notice and cure periods expressly set forth in this Lease; (iii) Tenant has not previously been in material economic or material non-economic default under this Lease beyond any applicable notice and cure periods expressly set forth in this Lease more than two (2) times during the immediately preceding twelve (12) month period; and (iv) this Lease then remains in full force and effect and the Original Tenant or any Permitted Transferee occupies at least three (3) floors of the Building. Landlord may, at Landlord's option, exercised in Landlord's sole and absolute discretion, waive any of the Option Conditions in which case the option, if otherwise properly exercised by Tenant, shall remain in full force and effect. Upon the proper exercise of each such option to extend, and provided that Tenant satisfies all of the Option Conditions (except those, if any, which are waived by Landlord), the Lease Term, as it applies to the Premises, shall be extended for a period of five (5) years. The rights contained in this Section 2.2 shall be personal to Original Tenant and any Non-Transferee Assignee and may be exercised by Original Tenant or any Non-Transferee Assignee only (and not by any other Transferee (as that term is defined in Section 14.1 below) of Tenant's interest in this Lease).
2.2.2    Option Rent. The annual Rent payable by Tenant during each Option Term (the "Option Rent") shall be equal to the "Fair Market Rent Rate," as that term is defined below, for the Premises as of the commencement date of such Option Term. The "Fair Market Rent Rate," as used in this Lease, shall be determined by calculating the net rent, which net rent shall then be adjusted on an effective basis, which net effective rent shall then be present valued and reduced by all upfront concessions and, thereafter, shall be future valued into an average annual constant rental rate figure (collectively, the "Constant Rate Equivalent Approach"). The Fair Market Rent Rate shall take into consideration any "base year" or "expense stop" applicable thereto), including all escalations, at which tenants (pursuant to leases consummated within the eighteen (18) month period preceding the first day of the Option Term), are leasing non-sublease, non-encumbered, non-fixed rate options, non-equity space comparable in size, location and quality to the Premises, for a term of five (5) years, in an arm's length transaction, which comparable space is located in "Comparable Buildings," as that term is defined in this Section 2.2.2, below (transactions satisfying the foregoing criteria shall be known as the "Comparable Transactions"), and taking into consideration differences in the age and quality of such buildings, the differences in the historical rental rates ascribed to such buildings, the floor height of, and the views from, the comparable space vis-à-vis the subject space, and making adjustments for the following concessions (the "Concessions"): (a) rental abatement concessions, if any, being granted such tenants in connection with such comparable space; (b) tenant improvements or allowances provided or to be provided for such comparable space, and taking into account the value, if any, of the existing improvements in the subject space (excluding the value of improvements in the
-7-
ONE TEHAMA
[Social Finance, Inc.]


Premises paid for by Tenant, as opposed to paid for from any allowance provided by Landlord), such value to be based upon the age, condition, design, quality of finishes and layout of the improvements; and (c) other reasonable monetary concessions being granted such tenants in connection with such comparable space; provided, however, that in calculating the Fair Market Rent Rate, no consideration shall be given to any period of rental abatement, if any, granted to tenants in comparable transactions in connection with the design, permitting and construction of tenant improvements in such comparable spaces. If, upon request by Tenant, Landlord provides a tenant improvement allowance as set forth below, the Fair Market Rent Rate shall additionally include a separate determination (which shall not affect the rental amount that is determined to be the Option Rent) as to whether, and if so to what extent, Tenant must provide Landlord with a letter of credit for Tenant's Rent obligations in connection with Tenant's lease of the Premises during the Option Term. Such determination shall be made by reviewing the extent of financial security then generally being imposed in Comparable Transactions with comparable tenant improvement allowances with respect to tenants of comparable financial condition and credit history to the then existing financial condition and credit history of Tenant (with appropriate adjustments to account for differences in the then-existing financial condition of Tenant and such other tenants). The Concessions (A) shall be reflected in the effective rental rate (which effective rental rate shall take into consideration the total dollar value of such Concessions as amortized on a straight-line basis over the applicable term of the Comparable Transaction (in which case such Concessions evidenced in the effective rental rate shall not be granted to Tenant in kind)) payable by Tenant, or (B) at Tenant's request, subject to Landlord's approval, all such Concessions shall be granted to Tenant in kind; provided, however, if Tenant requests all or a portion of such Concessions to be granted to Tenant in kind and Landlord does not approve such request by Tenant, then Landlord shall provide Tenant with an improvement allowance in an amount reasonably sufficient to allow Tenant to re-carpet and re-paint the Premises (and any remaining Concessions, including any additional improvement allowance owed to Tenant, shall be reflected in the effective rental rate pursuant to item (A), above). For purposes of this Lease, the term "Comparable Buildings" shall mean first-class single-tenant or multi-tenant occupancy office buildings which are comparable to the Building in terms of age, size and appearance, and are located in the "Comparable Area," which is the area bound by the Embarcadero to the North side of Harrison Street, the East side of Third Street and the South side of Market Street (the "South Financial District"). In addition, in determining the Fair Market Rent Rate, the difference between the Building and the Comparable Buildings in terms of historical significance, availability of signage opportunities and proximity to mass transit or freeways, shall be taken into account and the Fair Market Rent Rate shall be appropriately adjusted (to the extent such factors normally affect the rent received by the landlord of the Comparable Buildings) to reflect the existence or non-existence of such factors and all other relevant factors. In the event the Neutral Arbitrator determines that there are not enough Comparable Transactions in the Comparable Area in order to accurately determine the Fair Market Rent Rate, then the Comparable Area shall be expanded to include the area which is bound by the Embarcadero to the North side of Market Street, the South side of Washington Street, and the East side of Kearny Street (the "North Financial District"); provided, however, the rental rates in any Comparable Transaction located in the North Financial District shall be adjusted to account for the historical differences in rental rates typically achieved in the South Financial District as compared to the historical differences in rental rates typically achieved in the North Financial District.
-8-
ONE TEHAMA
[Social Finance, Inc.]


2.2.3    Determination of Option Rent. In the event Tenant timely and appropriately exercises an option to extend the Lease Term pursuant to Section 2.2.1, above, then Landlord shall deliver written notice (the "Landlord Response Notice") to Tenant on or before the date which is thirty (30) days after Landlord's receipt of the Exercise Notice of Landlord's determination of the Option Rent. Within ten (10) days following its receipt of the Landlord Response Notice, Tenant shall notify Landlord in writing whether it accepts or objects to the Option Rent set forth in Landlord's Response Notice. In the event that Tenant in good faith objects to Landlord's determination of the Option Rent, then Landlord and Tenant shall meet and attempt to agree upon the Option Rent using their best good-faith efforts. If Landlord and Tenant fail to reach agreement on or before the date that is ninety (90) days prior to the expiration of the initial Lease Term (the "Outside Agreement Date"), then the Option Rent shall be determined by binding arbitration pursuant to the terms of this Section 2.2.3. Each party shall make a separate determination of the Option Rent, within five (5) days following the Outside Agreement Date, and such determinations shall be submitted to arbitration in accordance with Section 2.2.3.1 through Section 2.2.3.4, below. The determination of the arbitrators shall be made by taking into consideration all Comparable Transactions as calculated under the Constant Rate Equivalent Approach.
2.2.3.1    Landlord and Tenant shall each appoint one arbitrator who shall by profession be a MAI appraiser or real estate broker who shall have been active over the five (5) year period ending on the date of such appointment in the appraising and/or leasing of Comparable Buildings. The determination of the arbitrators shall be limited solely to the issue area of whether Landlord's or Tenant's submitted Option Rent is the closest to the actual Option Rent as determined by the arbitrators, taking into account the requirements of Section 2.2.2, above. Each such arbitrator shall be appointed within fifteen (15) days after the Outside Agreement Date. Landlord and Tenant may consult with their selected arbitrators prior to appointment and may select an arbitrator who is favorable to their respective positions (including an arbitrator who has previously represented Landlord and/or Tenant, as applicable). The arbitrators so selected by Landlord and Tenant shall be deemed "Advocate Arbitrators."
2.2.3.2    The two Advocate Arbitrators so appointed shall be specifically required pursuant to an engagement letter within ten (10) days of the appointment of the last appointed Advocate Arbitrator to agree upon and appoint a third arbitrator ("Neutral Arbitrator") who shall be an appraiser (as opposed to a real estate broker or an attorney) qualified under the same criteria set forth hereinabove for qualification of the two Advocate Arbitrators except that (i) neither the Landlord or Tenant or either parties' Advocate Arbitrator may, directly, or indirectly, consult with the Neutral Arbitrator prior or subsequent to his or her appearance, and (ii) the Neutral Arbitrator cannot be someone who has represented Landlord and/or Tenant during the five (5) year period prior to such appointment. The Neutral Arbitrator shall be retained via an engagement letter jointly prepared by Landlord's counsel and Tenant's counsel.
2.2.3.3    If either Landlord or Tenant fail to appoint an Advocate Arbitrator within fifteen (15) days after the applicable Outside Agreement Date, either party may petition the presiding judge of the Superior Court of the City and County of San Francisco to appoint such Advocate Arbitrator subject to the criteria set forth in Section 2.2.3.1 of this Lease, or if he or she refuses to act, either party may petition any judge having jurisdiction over the parties to appoint such Advocate Arbitrator.
-9-
ONE TEHAMA
[Social Finance, Inc.]


2.2.3.4    If the two Advocate Arbitrators fail to agree upon and appoint the Neutral Arbitrator, then either party may petition the presiding judge of the Superior Court of the City and County of San Francisco to appoint the Neutral Arbitrator, subject to criteria in Section 2.2.3.1 of this Lease, or if he or she refuses to act, either party may petition any judge having jurisdiction over the parties to appoint such arbitrator.
2.2.3.5    The costs of the Neutral Arbitrator shall be split equally by Landlord and Tenant. The costs of the Advocate Arbitrator representing Tenant shall be borne by Tenant. The costs of the Advocate Arbitrator representing Landlord shall be borne by Landlord. The costs of petitioning any judge under Section 2.2.3.3, above, shall be borne by the party failing to timely appoint the Advocate Arbitrator. The costs of petitioning any judge under Section 2.2.3.4 shall be split equally by Landlord and Tenant.
2.2.3.6    Within ten (10) days following the appointment of the Arbitrator, Landlord and Tenant shall enter into an arbitration agreement (the "Arbitration Agreement") which shall set forth the following:
2.2.3.6.1    Each of Landlord's and Tenant's best and final and binding determination of the Option Rent exchanged by the parties pursuant to Section 2.2.3, above;
2.2.3.6.2    An agreement to be signed by the Neutral Arbitrator, the form of which agreement shall be attached as an exhibit to the Arbitration Agreement, whereby the Neutral Arbitrator shall agree to undertake the arbitration and render a decision in accordance with the terms of this Lease, as modified by the Arbitration Agreement, and shall require the Neutral Arbitrator to demonstrate to the reasonable satisfaction of the parties that the Neutral Arbitrator has no conflicts of interest with either Landlord or Tenant;
2.2.3.6.3    Instructions to be followed by the Neutral Arbitrator when conducting such arbitration, which instructions shall be mutually and reasonably prepared by Landlord and Tenant and consistent with the terms and conditions of this Lease;
2.2.3.6.4    That Landlord and Tenant shall each have the right to submit to the Neutral Arbitrator (with a copy to the other party), on or before the date that occurs fifteen (15) days following the appointment of the Neutral Arbitrator, an advocate statement (and any other information such party deems relevant) prepared by or on behalf of Landlord or Tenant, as the case may be, in support of Landlord's or Tenant's respective determination of the Fair Market Rent Rate (the "Briefs");
2.2.3.6.5    That within five (5) business days following the exchange of Briefs, Landlord and Tenant shall each have the right to provide the Neutral Arbitrator (with a copy to the other party) with a written rebuttal to the other party's Brief (the "First Rebuttals"); provided, however, such First Rebuttals shall be limited to the facts and arguments raised in the other party's Brief and shall identify clearly which argument or fact of the other party's Brief is intended to be rebutted;
2.2.3.6.6    That within three (3) business days following Landlord's and/or Tenant's receipt of the other party's First Rebuttal, Landlord and Tenant, as
-10-
ONE TEHAMA
[Social Finance, Inc.]


applicable, shall have the right to provide the Neutral Arbitrator (with a copy to the other party) with a written rebuttal to the other party's First Rebuttal (the "Second Rebuttals"); provided, however, such Second Rebuttals shall be limited to the facts and arguments raised in the other party's First Rebuttal and shall identify clearly which argument or fact of the other party's First Rebuttal is intended to be rebutted;
2.2.3.6.7    The date, time and location of the arbitration, which shall be mutually and reasonably agreed upon by Landlord and Tenant, taking into consideration the schedules of the Neutral Arbitrator, the Advocate Arbitrators, Landlord and Tenant, and each party's applicable consultants, which date shall in any event be within forty-five (45) days following the appointment of the Neutral Arbitrator;
2.2.3.6.8    That no discovery shall take place in connection with the arbitration, other than to verify the factual information that is presented by Landlord or Tenant;
2.2.3.6.9    That the Neutral Arbitrator shall not be allowed to undertake an independent investigation or consider any factual information other than presented by Landlord or Tenant or their respective Advocate Arbitrators, except that the Neutral Arbitrator shall be permitted, with representatives of each of Landlord and Tenant present, to visit the Project and the buildings containing the Comparable Transactions;
2.2.3.6.10    The specific persons that shall be allowed to attend the arbitration;
2.2.3.6.11    Tenant shall have the right to present oral arguments to the Neutral Arbitrator at the arbitration for a period of time not to exceed two (2) hours ("Tenant's Initial Statement");
2.2.3.6.12    Following Tenant's Initial Statement, Landlord shall have the right to present oral arguments to the Neutral Arbitrator at the arbitration for a period of time not to exceed two (2) hours ("Landlord's Initial Statement");
2.2.3.6.13    Following Landlord's Initial Statement, Tenant shall have one (1) additional hour to present additional arguments and/or to rebut the arguments of Landlord ("Tenant's Rebuttal Statement");
2.2.3.6.14    Following Tenant's Rebuttal Statement, Landlord shall have one (1) additional hour to present additional arguments and/or to rebut the arguments of Tenant;
2.2.3.6.15    That, not later than ten (10) days after the date of the arbitration, the Neutral Arbitrator shall render a decision (the "Ruling") indicating whether Landlord's or Tenant's submitted Option Rent is closer to the Option Rent as determined by the Neutral Arbitrator;
2.2.3.6.16    That following notification of the Ruling, Landlord's or Tenant's submitted Option Rent determination, whichever is selected by the Neutral Arbitrator as being closer to the Option Rent shall become the then applicable Option Rent;
-11-
ONE TEHAMA
[Social Finance, Inc.]


2.2.3.6.17    That the decision of the Neutral Arbitrator shall be binding on Landlord and Tenant; and
2.2.3.6.18    If a date by which an event described in Section 2.2.3.3, above, is to occur falls on a weekend or a holiday, the date shall be deemed to be the next business day.
2.2.3.7    In the event that the Option Rent shall not have been determined pursuant to the terms hereof prior to the commencement of the Option Term, Tenant shall be required to pay the Option Rent equal to the Base Rent in effect at the end of the initial Lease Term as increased by three percent (3%), but in no event shall such amount be greater than Landlord's final determination of Option Rent submitted to the Neutral Arbitrator and in no event less than Tenant's final determination of Option Rent submitted to the Neutral Arbitrator. Upon the final determination of the Option Rent, the payments made by Tenant shall be reconciled with the actual amounts of Option Rent due, and the appropriate party shall make any corresponding payment to the other party within thirty (30) days after the final determination of the Option Rent.
ARTICLE 3
BASE RENT
3.1    In General. Subject to Section 3.2 below, commencing on the Lease Commencement Date, Tenant shall pay, without prior notice or demand, to 246 First Street (SF) Owner LLC, 4700 Wilshire Blvd, Los Angeles CA 90010, or, at Landlord's option, to such other party or at such other place as Landlord may from time to time designate in writing, by notice to Tenant in accordance with the provisions of Article 28 of this Lease, by a check for currency which, at the time of payment, is legal tender for private or public debts in the United States of America, base rent ("Base Rent") as set forth in Section 4 of the Summary, payable in equal monthly installments as set forth in Section 4 of the Summary in advance on or before the first day of each and every calendar month during the Lease Term, without any setoff or deduction whatsoever, except as expressly provided in this Lease. The Base Rent for the first full month of the Lease Term shall be paid at the time of Tenant's execution of this Lease. If any Rent payment date (including the Lease Commencement Date) falls on a day of the month other than the first day of such month or if any payment of Rent is for a period which is shorter than one month, the Rent for any fractional month shall accrue on a daily basis for the period from the date such payment is due to the end of such calendar month or to the end of the Lease Term at a rate per day which is equal to 1/365 of the applicable annual Rent. All other payments or adjustments required to be made under the terms of this Lease that require proration on a time basis shall be prorated on the same basis.
3.2    Rent Abatement. During the initial six (6) full calendar months of the Lease Term (the "Rent Abatement Period"), Tenant shall not be obligated to pay any Base Rent or Tenant's Share of Building Direct Expenses (as those terms are defined below) otherwise attributable to the Premises during such Rent Abatement Period (the "Rent Abatement"). If the Lease Commencement Date is a date other than the first day of a calendar month, then promptly following expiration of the Rent Abatement Period, Tenant shall pay Base Rent to Landlord for the partial month in which the Lease Commencement Date occurs. Landlord and Tenant
-12-
ONE TEHAMA
[Social Finance, Inc.]


acknowledge that the aggregate amount of the Base Rent component of the Rent Abatement equals Three Million Four Hundred Forty-Nine Thousand Eight Hundred Ten and 00/100 Dollars ($3,449,810.00). If Tenant shall be in monetary default under this Lease, and shall fail to cure such default within the notice and cure period, if any, permitted for cure pursuant to terms and conditions of this Lease, then, as of expiration of the date to cure such default, the dollar amount of the unapplied portion of the Rent Abatement shall be converted to a credit to be applied to the Base Rent applicable at the end of the Lease Term and Tenant shall immediately be obligated to begin paying Base Rent for the Premises in full.
ARTICLE 4
ADDITIONAL RENT
4.1    General Terms. In addition to paying the Base Rent specified in Article 3 of this Lease, Tenant shall pay "Tenant's Share" of the annual "Building Direct Expenses", as those terms are defined in Sections 4.2.5 and 4.2.1 of this Lease, respectively. Such payments by Tenant, together with any and all other amounts payable by Tenant to Landlord pursuant to the terms of this Lease, are hereinafter collectively referred to as the "Additional Rent," and the Base Rent and the Additional Rent are herein collectively referred to as "Rent." All amounts due under this Article 4 as Additional Rent shall be payable for the same periods and in the same manner as the Base Rent. Without limitation on other obligations of Tenant which survive the expiration of the Lease Term, the obligations of Tenant to pay the Additional Rent and of Landlord to refund any over-payment of Additional Rent, as provided for in this Article 4, shall survive the expiration of the Lease Term. Landlord shall make necessary adjustments for differences between actual and estimated Additional Rent in accordance with Section 4.4, below.
4.2    Definitions of Key Terms Relating to Additional Rent. As used in this Article 4, the following terms shall have the meanings hereinafter set forth:
4.2.1    "Building Direct Expenses" shall mean "Operating Expenses" and "Tax Expenses", as those terms are defined in Sections 4.2.3 and 4.2.4.1, below, respectively.
4.2.2    "Expense Year" shall mean each calendar year in which any portion of the Lease Term falls, through and including the calendar year in which the Lease Term expires, provided that Landlord, upon notice to Tenant, may change the Expense Year from time to time to any other twelve (12) consecutive month period, and, in the event of any such change, Tenant's Share of Building Direct Expenses shall be equitably adjusted for any Expense Year involved in any such change.
4.2.3    "Operating Expenses" shall be calculated in accordance with sound real estate management and accounting principles, consistently applied from year to year, and shall mean all expenses, costs and amounts of every kind and nature which Landlord pays or accrues in accordance with sound real estate management and accounting principles, consistently applied from year to year, during any Expense Year because of or in connection with the management, maintenance, repair, replacement or operation of the Project, or any portion thereof, subject to the exclusions and limitations set forth in this Lease. Without limiting the generality of the foregoing, Operating Expenses shall specifically include any and all of the following: (i) the cost of licenses,
-13-
ONE TEHAMA
[Social Finance, Inc.]


certificates, permits and inspections (excluding inspections relating to asbestos and lead performed by Landlord prior to the Lease Commencement Date) and, if such contest is requested by Tenant, the reasonable cost of contesting any governmental enactments which may affect Operating Expenses; (ii) the cost of all insurance carried by Landlord in connection with the Project as reasonably determined by Landlord, and the commercially reasonable deductible portion of any insured loss otherwise covered by such insurance; provided, however, that for purposes of calculating Operating Expenses in connection with any casualty caused by earthquake, such deductible or deductible equivalent under Landlord's policy of earthquake insurance shall be amortized with interest at the Interest Rate over the remainder of the Lease Term and such amortized amounts may be included in Operating Expenses for the remainder of the Lease Term, not to exceed an amount equal to $2.00 per RSF of the Building per Expense Year; (iii) a management fee of One Hundred Fifty Thousand Dollars ($150,000) per year; (iv) costs, fees, charges or assessments imposed by, or resulting from any mandate imposed on Landlord by, any federal, state or local government for fire and police protection, trash removal, community services, or other services which do not constitute "Tax Expenses" as that term is defined in Section 4.2.8, below; (v) payments under any easement, license, operating agreement, declaration, restrictive covenant, or instrument pertaining to the sharing of costs by the Project or related to the use or operation of the Project; and (vi) the following "Reimbursable Capital Improvements": (A) the annual amortization (amortized over the useful life) of costs, including financing costs, if any, incurred by Landlord after the Lease Commencement Date for any capital improvements installed or paid for by Landlord and required by any new (or change in) laws, rules or regulations of any governmental or quasi-governmental authority which are enacted after the Lease Commencement Date; (B) the annual amortization (amortized over the useful life) of costs, including financing costs, if any, of any equipment, device or capital improvement purchased or incurred as a labor-saving measure or to affect other economics in the operation or maintenance of the Building (provided the annual amortized costs does not exceed the actual cost savings realized) and (C) repairs, maintenance or improvements solely pertaining to the Building Systems which are "capital in nature" under Section 7.3 of this Lease. Notwithstanding anything to the contrary in this Lease, the following items shall be excluded from Operating Expenses:
(a)    Landlord's and Landlord's managing agent's general corporate or partnership overhead and general administrative expenses, and all costs associated with the operation of the business of the ownership or entity which constitutes "Landlord," as distinguished from the costs of Building operations, management, maintenance or repair, including, but not limited to, costs of entity accounting and legal matters, costs of any disputes with any ground lessor or mortgagee, costs of acquiring, selling syndicating, financing, mortgaging or hypothecating any of the Landlord's interest in all or any part of the Project;
(b)    any items included in Tax Expenses;
(c)    costs of all items and services for which Tenant reimburses Landlord or pays to third parties;
(d)    payments to subsidiaries or affiliates of Landlord, for management or other services in or to the Project, or for supplies or other materials to the extent that the costs of such services, supplies, or materials exceed the costs that would have been paid had the services,
-14-
ONE TEHAMA
[Social Finance, Inc.]


supplies or materials been provided by parties unaffiliated with the Landlord on a competitive basis;
(e)    interest, principal, points and fees on debt or amortization payment on any mortgages, deeds of trust or other debt instruments;
(f)    cost of repairs or other work incurred by reason of fire, windstorm or other casualty or by the exercise of the right of eminent domain to the extent Landlord is entitled to be compensated through proceeds or insurance or condemnation awards, or would have been so reimbursed if Landlord had in force all of the insurance required to be carried by Landlord under this Lease;
(g)    if the Building shall become a multi-tenant building, leasing commissions, attorneys fees, costs and disbursements and other expenses incurred in connection with negotiations or disputes with tenants or other occupants or prospective tenant or other occupants, or associated with the enforcement of any leases or the defense of Landlord's title to or interest in the Project or any part thereof;
(h)    costs of repair or replacement for any item covered by a warranty to the extent covered by the warranty;
(i)    costs for which Landlord is entitled to be reimbursed by its insurance carrier or by Tenant's insurance carrier or by any other entity;
(j)    fines, costs, penalties or interest resulting from the negligence or fault of other tenants or of Landlord Parties;
(k)    contributions to charitable or political organizations;
(l)    bad debt loss, rent loss, or reserves for bad debt or rent loss;
(m)    the cost incurred to comply with laws relating to the containment, treatment, remediation or removal of “Hazardous Substance,” as that term is defined in Section 5.2, below, which was in existence in the Building or on the Project prior to the Lease Commencement Date (it being understood and agreed that Tenant shall nonetheless be responsible under Section 5.2 of this Lease for all costs of remediation and removal of Hazardous Substance to the extent caused by "Tenant Parties", as that term is defined in Section 10.8, below);
(n)    the wages and benefits of any employee who does not devote substantially all of his or her employed time to the Project unless such wages and benefits are prorated on a reasonable basis to reflect time spent on the operation and management of the Project vis-à-vis time spent on matters unrelated to the operation and management of the Project;
(o)    expense reserves;
(p)    costs of replacements, alterations or improvements necessary to remedy any non-compliance of the Building or the Project with Applicable Laws in effect and applicable to the Building and/or the Project prior to the date of this Lease, except to the extent the need for such
-15-
ONE TEHAMA
[Social Finance, Inc.]


replacements, alterations or improvements is caused by Tenant Parties (in which case Tenant shall nonetheless be responsible for such costs in accordance with Article 24 of this Lease), provided, however, that the provisions of this sub-item (p) shall not preclude the inclusion of costs of compliance with Applicable Laws enacted prior to the date of this Lease if such compliance is required for the first time by reason of any amendment, modification or reinterpretation of an Applicable Law which is imposed after the Lease Commencement Date;
(q)    costs of any mitigation fees, transit fees, impact fees, subsidies, tap-in fees, connection fees or similar one-time charges or costs (however characterized), imposed as a condition of or in connection with the development or renovation of the Project or Building, though any such costs related to the Tenant Improvements shall be Tenant’s sole responsibility;
(r)    any ground lease rental;
(s)    costs of items considered capital repairs, replacements, improvements and equipment under generally accepted accounting principles consistently applied or otherwise ("Capital Items"), except for Reimbursable Capital Improvements;
(t)    costs arising from the negligence or willful misconduct of Landlord, its employees, agents or contractors;
(u)    costs (including in connection therewith all attorneys' fees and costs of settlement judgments and payments in lieu thereof) arising from claims, disputes or potential disputes in connection with potential or actual claims, litigation or arbitration pertaining to Landlord and/or the Building and/or the Project (except as the actions of Tenant may be at issue);
(v)    costs associated with the operation of the business of the entity which constitutes Landlord as the same are distinguished from the costs of operation of the Building, including accounting and legal matters, costs of defending any lawsuits with any mortgagee (except as the actions of Tenant may be at issue), costs of selling, syndicating, financing, mortgaging or hypothecating any of Landlord's interest in the Building, and costs of any disputes between Landlord and its employees, agents or contractors; and
(w)    costs for Landlord to obtain or maintain LEED certification for the Building.
Landlord shall not (1) make a profit by charging items to Operating Expenses that are otherwise also charged separately to tenants of the Project (including Tenant), and (2) subject to Landlord's right to adjust the components of Operating Expenses as set forth above in this paragraph, collect Operating Expenses from tenants in the Project in an amount in excess of those costs actually incurred by Landlord for the items included in Operating Expenses.
4.2.4    Taxes.
4.2.4.1    "Tax Expenses" shall mean all federal, state, county, or local governmental or municipal taxes, fees, charges or other impositions of every kind and nature, whether general, special, ordinary or extraordinary (including, without limitation, real estate taxes, general and special assessments, transit taxes, business taxes, leasehold taxes or taxes based upon
-16-
ONE TEHAMA
[Social Finance, Inc.]


the receipt of rent, including gross receipts or sales taxes applicable to the receipt of rent, unless required to be paid by Tenant, personal property taxes imposed upon the fixtures, machinery, equipment, apparatus, systems and equipment, appurtenances, furniture and other personal property used in connection with the Project, or any portion thereof), which shall be paid or accrued during any Expense Year (without regard to any different fiscal year used by such governmental or municipal authority) because of or in connection with the ownership, leasing and operation of the Project, or any portion thereof.
4.2.4.2    Tax Expenses shall include, without limitation: (i) any tax on the rent, right to rent or other income from the Project, or any portion thereof, or as against the business of leasing the Project, or any portion thereof; (ii) any assessment, tax, fee, levy or charge in addition to, or in substitution, partially or totally, of any assessment, tax, fee, levy or charge previously included within the definition of real property tax, it being acknowledged by Tenant and Landlord that Proposition 13 was adopted by the voters of the State of California in the June 1978 election ("Proposition 13") and that assessments, taxes, fees, levies and charges may be imposed by governmental agencies for such services as fire protection, street, sidewalk and road maintenance, refuse removal and for other governmental services formerly provided without charge to property owners or occupants, and, in further recognition of the decrease in the level and quality of governmental services and amenities as a result of Proposition 13, Tax Expenses shall also include any governmental or private assessments or the Project's contribution towards a governmental or private cost-sharing agreement for the purpose of augmenting or improving the quality of services and amenities normally provided by governmental agencies, including, without limitation, as relates to the Community Facilities District in which the Project is located; (iii) any assessment, tax, fee, levy, or charge allocable to or measured by the area of the Premises, the tenant improvements in the Premises, or the Rent payable hereunder, including, without limitation, any business or gross income tax or excise tax with respect to the receipt of such rent, or upon or with respect to the possession, leasing, operating, management, maintenance, alteration, repair, use or occupancy by Tenant of the Premises, or any portion thereof; (iv) any assessment, tax, fee, levy or charge, upon this transaction or any document to which Tenant is a party, creating or transferring an interest or an estate in the Premises; and (v) all of the real estate taxes and assessments imposed upon or with respect to the Building and all of the real estate taxes and assessments imposed on the land and improvements comprising the Project. All assessments which can be paid by Landlord in installments, shall be paid by Landlord in the maximum number of installments permitted by law (except to the extent inconsistent with the general practice of landlords of the Comparable Buildings) and shall be included as Tax Expenses in the year in which the installment is actually paid.
4.2.4.3    If Tax Expenses for any period during the Lease Term or any extension thereof are increased after payment thereof for any reason, including, without limitation, error or reassessment by applicable governmental or municipal authorities, Tenant shall pay Landlord, within thirty (30) days after demand, Tenant's Share of any such increased Tax Expenses. Similarly, if Tax Expenses for any period during the Lease Term or any extension thereof are decreased after payment thereof for any reason (including a refund under Proposition 8), Landlord shall refund Tenant's Share of such refund or overpayment to Tenant within thirty (30) days after receipt of same. Notwithstanding anything to the contrary contained in this Section 4.2.4.3, there shall be excluded from Tax Expenses (i) all excess profits taxes, franchise taxes, gift taxes, capital stock taxes, inheritance and succession taxes, estate taxes,
-17-
ONE TEHAMA
[Social Finance, Inc.]


federal and state income taxes, and other taxes to the extent applicable to Landlord's general or net income (as opposed to rents, receipts or income attributable to operations at the Project), (ii) any items included as Operating Expenses, (iii) any items paid by Tenant under Section 4.5 of this Lease, and (iv) tax penalties incurred as a result of Landlord’s failure to make payments and/or to file any tax or informational returns when due (except to the extent such penalty is caused by a corresponding late payment by Tenant, in which event Tenant shall be responsible for the full amount of such penalty).
4.2.5    "Tenant's Share" shall mean the percentage set forth in Section 6 of the Summary. Tenant's Share was calculated by multiplying the number of rentable square feet of the Premises, as set forth in Section 2.2 of the Summary, by 100, and dividing the product by the total number of rentable square feet in the office area of the Building.
4.3    Appealable Tax Expenses. Except as set forth in this Section 4.3, only Landlord may institute proceedings to reduce Tax Expenses and the filing of any such proceeding by Tenant without Landlord's consent shall constitute a Default by Tenant. Tenant may request from Landlord whether or not Landlord intends to file an appeal of any portion of Tax Expenses which are appealable by Landlord (the "Appealable Tax Expenses") for any tax fiscal year. Landlord shall deliver written notice to Tenant within ten (10) days after such request indicating whether Landlord intends to file an appeal of Appealable Tax Expenses for such tax fiscal year. If Landlord indicates that Landlord will not file an appeal of such Tax Expenses, then Tenant may provide Landlord with written notice ("Appeals Notice") at least thirty (30) days prior to the final date in which an appeal must be filed, requesting that Landlord file an appeal. Upon receipt of the Appeals Notice, Landlord shall promptly file such appeal and thereafter Landlord shall diligently prosecute such appeal to completion. Tenant may at any time in its sole discretion direct Landlord to terminate an appeal it previously elected pursuant to an Appeals Notice. In the event Tenant provides an Appeals Notice to Landlord and the resulting appeal reduces the Tax Expenses for the tax fiscal year in question as compared to the original bill received for such tax fiscal year and such reduction is greater than the costs for such appeal, then the costs for such appeal shall be included in Tax Expenses and passed through to the tenants of the Project. Alternatively, if the appeal does not result in a reduction of Tax Expenses for such tax fiscal year or if the reduction of Tax Expenses is less than the costs of the appeal, then Tenant shall reimburse Landlord, within thirty (30) days after written demand accompanied by reasonable supporting documentation, for any and all costs reasonably incurred by Landlord which are not covered by the reduction in connection with such appeal. Tenant's failure to timely deliver an Appeals Notice shall waive Tenant's rights to request an appeal of the applicable Tax Expenses for such tax fiscal year. In addition, Tenant's obligations to reimburse Landlord for the costs of the appeal pursuant to this Section shall survive the expiration or earlier termination of this Lease in the event the appeal is not concluded until after the expiration or earlier termination of this Lease. Upon request, Landlord agrees to consult with Tenant and to keep Tenant reasonably apprised of all tax protest filings and proceedings undertaken by Landlord to obtain a reduction or refund of Tax Expenses.
4.4    Calculation and Payment of Building Direct Expenses. Each Expense Year ending or commencing within the Lease Term, Tenant shall pay Tenant's Share of Building Direct Expenses for such Expense Year, in the manner set forth in Section 4.4.1, below.
-18-
ONE TEHAMA
[Social Finance, Inc.]


4.4.1    Statement of Actual Building Direct Expenses and Payment by Tenant. Landlord shall give to Tenant within one hundred eighty (180) days following the end of each Expense Year, a statement (the "Statement"), prepared on a line-item by line-item basis as to general categories, which shall state the Building Direct Expenses incurred or accrued for such preceding Expense Year, and which shall indicate the amount of Tenant's Share of Building Direct Expenses. Upon receipt of the Statement for each Expense Year commencing or ending during the Lease Term, Tenant shall pay, within thirty (30) days, the full amount of Tenant's Share of Building Direct Expenses for such Expense Year, less the amounts, if any, paid during such Expense Year as "Estimated Building Direct Expenses," as that term is defined in Section 4.4.2, below. If the amounts paid by Tenant during an Expense Year as Estimated Building Direct Expenses exceed Tenant's Share of Building Direct Expenses for such Expense Year, then such difference shall be reimbursed by Landlord to Tenant, provided that any such reimbursement, at Landlord's option, may be credited against the Rent next coming due under this Lease unless the Lease Term has expired, in which event Landlord shall promptly refund the appropriate amount to Tenant. Except as set forth in the last sentence of this Section 4.4.1, the failure of Landlord to timely furnish the Statement for any Expense Year shall not prejudice Landlord or Tenant from enforcing its rights under this Article 4. Even though the Lease Term has expired and Tenant has vacated the Premises, when the final determination is made of Tenant's Share of Building Direct Expenses for the Expense Year in which this Lease terminates, if Tenant's Share of Building Direct Expenses is greater than the amount of Estimated Building Direct Expenses previously paid by Tenant to Landlord, Tenant shall pay to Landlord such amount within thirty (30) days following receipt by Tenant of the Statement setting forth the Excess. The provisions of this Section 4.4.1 shall survive the expiration or earlier termination of the Lease Term, provided that, other than Tax Expenses and costs incurred for utilities, Tenant shall not be responsible for Tenant's Share of any Operating Expenses which are first billed to Tenant more than two (2) calendar years after the end of the Expense Year to which such Operating Expenses relate.
4.4.2    Statement of Estimated Building Direct Expenses. In addition, Landlord shall give Tenant a yearly expense estimate statement (the "Estimate Statement") which shall set forth Landlord's reasonable estimate (the "Estimate") of the total amount of Building Direct Expenses for the then-current Expense Year and the estimated Tenant's Share of Building Direct Expenses (the "Estimated Building Direct Expenses"). The failure of Landlord to timely furnish the Estimate Statement for any Expense Year shall not preclude Landlord from enforcing its rights to collect any Estimated Building Direct Expenses under this Article 4, nor shall Landlord be prohibited from revising any Estimate Statement or Estimated Building Direct Expenses theretofore delivered to the extent deemed reasonably necessary by Landlord; provided, however, that (i) Landlord shall not revise the Estimate Statement delivered for an Expense Year more than once during an Expense Year, and (ii) any such subsequent revision shall set forth on a reasonably specific basis any particular expense increase. Thereafter, Tenant shall pay, with its next installment of Base Rent due, a fraction of the Estimated Building Direct Expenses for the then-current Expense Year (reduced by any amounts paid pursuant to the last sentence of this Section 4.4.2). Such fraction shall have as its numerator the number of months which have elapsed in such current Expense Year, including the month of such payment, and twelve (12) as its denominator. Until a new Estimate Statement is furnished (which Landlord shall have the right to deliver to Tenant at any time), Tenant shall pay monthly, with the monthly Base Rent installments, an amount equal to one-twelfth (1/12) of the total Estimated Building Direct Expenses set forth in the previous Estimate Statement delivered by Landlord to Tenant. Throughout the Lease Term
-19-
ONE TEHAMA
[Social Finance, Inc.]


Landlord shall maintain books and records with respect to Building Direct Expenses in accordance with sound real estate management and accounting principles, consistently applied.
4.5    Taxes and Other Charges for Which Tenant Is Directly Responsible.
4.5.1    Tenant shall be liable for and shall pay before delinquency, taxes levied against Tenant's equipment, furniture, fixtures and any other personal property located in or about the Premises. If any such taxes on Tenant's equipment, furniture, fixtures and any other personal property are levied against Landlord or Landlord's property or if the assessed value of Landlord's property is increased by the inclusion therein of a value placed upon such equipment, furniture, fixtures or any other personal property and if Landlord pays the taxes based upon such increased assessment, which Landlord shall have the right to do regardless of the validity thereof but only under proper protest if requested by Tenant, Tenant shall upon demand repay to Landlord the taxes so levied against Landlord or the proportion of such taxes resulting from such increase in the assessment, as the case may be.
4.5.2    Notwithstanding any contrary provision herein, to the extent not included in Tax Expenses, Tenant shall pay prior to delinquency any (i) rent tax or sales tax, service tax, transfer tax or value added tax, business tax or any other applicable tax on the rent or services herein or otherwise respecting this Lease, (ii) taxes assessed upon or with respect to the possession, leasing, operation, management, maintenance, alteration, repair, use or occupancy by Tenant of the Premises or any portion of the Project; or (iii) taxes assessed upon this transaction or any document to which Tenant is a party creating or transferring an interest or an estate in the Premises.
4.6    Tenant Facility Coordinator.  Landlord acknowledges Tenant's concern that Landlord be motivated to limit the amount of Operating Expenses, including but not limited to matters such as insurance and capital expenditures.  Landlord agrees that, if Tenant so elects and appoints a property manager (the "Tenant Facility Coordinator"), Landlord shall permit the Tenant Facility Coordinator to review (but not approve or disapprove) the annual budget for Operating Expenses and proposed capital expenditures and to meet with the Tenant Facility Coordinator, upon request, but not more frequently than on a quarterly basis regarding Operating Expenses. Landlord shall consider in good faith, but without obligation to implement any recommendations made by the Tenant Facility Coordinator.
4.7    Landlord's Books and Records. Following Tenant's receipt of the Statement for any Expense Year, Tenant shall have the right, upon prior written notice to Landlord ("Audit Notice") within ninety (90) days following the delivery of such Statement (the "Review Period"), to commence an audit of Landlord's books and records concerning the Building Direct Expenses for the Landlord's fiscal year that is the subject of such statement (the "Records"). Tenant shall complete any audit within ninety (90) days following the commencement thereof. Following delivery of an Audit Notice, and provided Tenant is not then in monetary or material non-monetary default under this Lease beyond any applicable notice and cure periods expressly set forth in this Lease, Tenant shall have the right, at Tenant's sole cost, during Landlord's regular business hours and on reasonable prior notice to Landlord, to audit the Records at Landlord's principal business office in San Francisco, California (or at any other location in northern California designated by Landlord). Such audit shall occur within thirty (30) days following the delivery of the Audit Notice. Tenant's audit of the Records pursuant to this Section 4.7 shall be conducted only by a
-20-
ONE TEHAMA
[Social Finance, Inc.]


reputable independent nationally or regionally recognized certified public accounting firm, subject to Landlord's reasonable approval, which accounting firm: (i) shall have previous experience in auditing financial operating records of landlords of office buildings; (ii) shall not be retained by Tenant on a contingency fee basis (i.e. Tenant must be billed based on the actual time and materials that are incurred by the accounting firm in the performance of the audit), and a copy of the executed audit agreement between Tenant and auditor shall be provided to Landlord prior to the commencement of the audit; and (iii) at Landlord's option, both Tenant and auditor shall be required to execute a commercially reasonable confidentially agreement prepared by Landlord. Any audit report prepared by Tenant's auditors shall be delivered concurrently to Landlord and Tenant promptly upon completion thereof. If, after such audit of the Records, Tenant disputes the amount of Building Direct Expenses for the Expense Year under audit, Landlord and Tenant shall meet and attempt in good faith to resolve the dispute. If the parties are unable to resolve the dispute within sixty (60) days after completion of Tenant's audit, then, at Tenant's request, a certified public accounting firm selected by Landlord, and reasonably approved by Tenant, shall, at Tenant's cost, conduct an audit of the relevant Building Direct Expenses (the "Neutral Audit"). Tenant shall pay all costs and expenses of the Neutral Audit unless the final determination in such Neutral Audit is that Landlord overstated Building Direct Expenses in the Statement for the Expense Year being audited by more than five percent (5%), in which case Landlord shall pay the actual and reasonable costs and expenses of the Neutral Audit, in an amount not to exceed Ten Thousand and 00/100 Dollars ($10,000.00). In any event, Landlord will promptly reimburse Tenant or provide a credit for any overstatement of Building Direct Expenses, and Tenant shall promptly pay to Landlord any understatement of Building Direct Expenses. To the extent Landlord and Tenant fail to otherwise reach mutual agreement regarding Building Direct Expenses, the foregoing audit and Neutral Audit procedures shall be the sole methods to be used by Tenant to dispute the amount of any Building Direct Expenses payable by Tenant pursuant to the terms of this Lease.
ARTICLE 5
USE OF PREMISES
5.1    Permitted Use. Tenant shall use the Premises solely for the Permitted Use set forth in Section 7 of the Summary and Tenant shall not use or permit the Premises or the Project to be used for any other purpose or purposes whatsoever without the prior written consent of Landlord, which may be withheld in Landlord's sole discretion.
5.2    Prohibited Uses. Tenant further covenants and agrees that Tenant shall not use, or suffer or permit any person or persons to use, the Premises or any part thereof for any use or purpose contrary to the provisions of the Rules and Regulations set forth in Exhibit D, attached hereto. Tenant shall comply with, and Tenant's rights and obligations under this Lease and Tenant's use of the Premises shall be subject and subordinate to, all easements, covenants, conditions, and restrictions affecting the Project which are first recorded after the date of this Lease; provided, however, any such instrument shall not (and could not by its terms) materially and adversely affect Tenant's use or occupancy of the Premises, increase any obligations or decrease any rights of Tenant hereunder, nor shall any such instrument increase the rights or decrease the obligations of Landlord hereunder. Except for small quantities customarily used in business offices, and used in compliance with Applicable Laws, Tenant shall not cause or permit any "Hazardous Substance," as that term is defined below, to be kept, maintained, used, stored,
-21-
ONE TEHAMA
[Social Finance, Inc.]


produced, generated or disposed of (into the sewage or waste disposal system or otherwise) on or in the Premises by Tenant or Tenant's agents, employees, contractors, invitees, assignees or sublessees, without first obtaining Landlord's written consent. Tenant shall promptly notify, and shall direct Tenant's agents, employees contractors, invitees, assignees and sublessees to promptly notify, Landlord of any incident in, on or about the Premises, the Building or the Project that would require the filing of a notice under any federal, state, local or quasi-governmental law (whether under common law, statute or otherwise), ordinance, decree, code, ruling, award, rule, regulation or guidance document now or hereafter enacted or promulgated, as amended from time to time, in any way relating to or regulating any Hazardous Substance. As used herein, "Hazardous Substance" means any substance which is toxic, ignitable, reactive, or corrosive and which is regulated by any local government, the State of California, or the United States government. "Hazardous Substance" includes any and all material or substances which are defined as "hazardous waste," "extremely hazardous waste" or a "hazardous substance" pursuant to state, federal or local governmental law. "Hazardous Substance" also includes asbestos, polychlorobiphenyls (i.e., PCB's) and petroleum.
5.3    Remediation of Hazardous Substance. Landlord, at Landlord's expense, shall remediate any Hazardous Substance to the extent that (a) such Hazardous Substance was not brought onto the Project by, or permitted to be brought onto the Project by, Tenant or a Tenant Party, and (b) Landlord's failure to remediate would be in violation of Applicable Laws and would (1) prevent Tenant from obtaining or maintaining a certificate of occupancy for the Premises, (2) create a material risk to the safety or health of Tenant's employees, (3) otherwise materially and adversely affect Tenant's use of or access to the Premises.
5.4    Tenant's Dogs. Subject to the provisions of this Section 5.4, Tenant and its Transferees shall be permitted to bring non-aggressive, fully domesticated fully-vaccinated, dogs into the Premises (which dogs are owned by Tenant or any Transferee or their respective officers, employees or contractors) ("Tenant's Dogs"). Within ten (10) business days following Tenant's receipt of Landlord's request, Tenant shall provide Landlord with reasonable satisfactory evidence showing that all current vaccinations have been received by Tenant's Dogs. Tenant's Dogs shall not be brought to the Project if such dog is ill or contracts a disease that could potentially threaten the health or wellbeing of any tenant or occupant of the Building (which diseases may include, but shall not be limited to, rabies, leptospirosis and lyme disease). Tenant shall not permit any objectionable dog related odors to emanate from the Premises, and in no event shall Tenant's Dogs be at the Project overnight nor may Tenant operate any kennel, "dog run" or dog park in the Premises. All bodily waste generated by Tenant's Dogs in or about the Project shall be promptly removed and disposed of in trash receptacles designated by Landlord, and any areas of the Project affected by such waste shall be cleaned and otherwise sanitized. No Tenant's Dog shall be permitted to enter the Project if such Tenant's Dog previously exhibited dangerously aggressive behavior. Notwithstanding the foregoing, Landlord shall have the right, at any time, to prevent particular dogs from entering or accessing the Premises if such dogs are in violation of the terms of this Section 5.4, or have previously been in violation of one or more of the terms and conditions of this Section 5.4. Tenant shall pay to Landlord, within ten (10) business days after demand, all costs incurred by Landlord in connection with the presence of Tenant's Dogs in the Building, Premises or Project, including, but not limited to, janitorial, waste disposal, landscaping, signage, repair, and legal costs and expenses. The indemnification provisions of Article 10 of this Lease shall apply to any claims relating to any of Tenant's Dogs.
-22-
ONE TEHAMA
[Social Finance, Inc.]


5.5    Cafeteria. To the extent permitted by Applicable Laws, Tenant may use a portion or portions of the Premises mutually agreed upon by Landlord and Tenant for the operation of a cafeteria (a "Cafeteria"), for the exclusive use of Tenant and its Transferees and their respective employees, guests and invitees (collectively, the "Cafeteria Users"), and Tenant shall not make the Cafeteria available to members of the general public. Tenant may use the Cafeteria for food and beverage preparation, handling, cooking, consumption and other associated facilities. No cooking odors shall be emitted from the Premises other than through ventilation equipment and systems installed therein to service the Cafeteria in accordance with the provisions of this Section 5.5. The Cafeteria(s) shall be of a size permitted by Applicable Laws. Tenant's obligations under this Section 5.5 are cumulative and in addition to all other obligations of Tenant under this Lease.
5.6    Fitness Center. To the extent permitted by Applicable Laws, Tenant may use a portion of the Premises for the operation of a fitness center (the "Fitness Center") which may include, without limitation, the following primary uses: weight and aerobic training, personal training, group training, aerobics, yoga, pilates, free weights, and treadmills, stationary bicycles, elliptical machines, and stair-climbing machines, and shall in no event include installation or operation of a swimming pool, sauna or whirlpool facilities. The Fitness Center shall be for the exclusive use of Tenant's and its Transferees and each of their respective employees, guests and invitees (collectively, the "Fitness Center Users") and Tenant shall not make the Fitness Center available to members of the general public. The Fitness Center shall be of a size permitted by Applicable Laws. Tenant's obligations under this Section 5.6 are cumulative and in addition to all other obligations of Tenant under this Lease.
5.7    General Terms Applicable to Cafeteria, and Fitness Center.
5.7.1    Third Party Operator. Tenant may but shall not be obligated to exercise the right to operate a Cafeteria and/or Fitness Center through retention of a third party to operate the Cafeteria and/or the Fitness Center (a "Third Party Operator"); provided that the Third Party Operator must comply with, all of the terms, covenants, conditions and obligations on Tenant's part to be observed and performed under this Lease relating to its use of the Premises (excluding by way of example, Tenant's obligation to pay Base Rent or Building Direct Expenses under this Lease). All notices required of Landlord under this Lease shall be forwarded only to Tenant in accordance with the terms of this Lease and in no event shall Landlord be required to send any notices to any Third Party Operator. In no event shall any use or occupancy of any portion of the Premises by the Third Party Operator release or relieve Tenant from any of its obligations under this Lease. The Third Party Operator shall be a Tenant Party, and Tenant shall be fully and primarily liable for all acts and omissions of such Third Party Operator as fully and completely as if such Third Party Operator was an employee of Tenant. In no event shall the occupancy of any portion of the Premises by any Third Party Operator be deemed to create a landlord/tenant relationship between Landlord and such Third Party Operator or be deemed to vest in Third Party Operator any right or interest in the Premises or this Lease. Any equipment or other property of the Third Party Operator in the Project shall be subject to Section 8.5 and Article 15 of this Lease. However, nothing in this Section 5.7.1 shall diminish Landlord's rights elsewhere in this Lease or imply that Landlord has any duties to the Third Party Operator. No disputes between Tenant and the Third Party Operator shall in any way affect the obligations of Tenant hereunder.
-23-
ONE TEHAMA
[Social Finance, Inc.]


5.7.2    Licensing; Permits and Operation. If Tenant elects, in Tenant's sole discretion, to construct a Cafeteria and/or Fitness Center, Tenant shall construct such Cafeteria and/or Fitness Center, if at all, as part of the Tenant Improvements or as an Alteration pursuant to Article 8 below. If Tenant elects to operate the Cafeteria and/or Fitness Center, Tenant shall give Landlord prior notice thereof and shall submit to Landlord (i) construction ready plans and specifications for the Cafeteria and/or Fitness Center for Landlord's review and approval (including, any cooking, ventilation, air conditioning, grease traps, kitchen and other equipment in or for the Premises with respect to the Cafeteria) (such submission, review and approval shall be governed by the Tenant Work Letter or Article 8 and this Section 5.7.2), and (ii) all necessary consents, approvals, permits or registrations, required for the construction and operation of the Cafeteria and/or Fitness Center in accordance with Applicable Law. In addition, Landlord, in its reasonable discretion, may require the installation of emergency drainage and leak detection water sensors in connection with the installation of any shower facilities in the Fitness Center, at Tenant's sole cost and expense (or as a deduction from the Tenant Improvement Allowance, if installed as part of the Tenant Improvements). In connection with the construction of the Fitness Center, Tenant shall also install any structural floor reinforcement reasonably required by Landlord.
5.7.3    Personal Rights. The right to operate the Cafeteria and/or Fitness Center in the Premises pursuant to the terms and conditions of Sections 5.5 through 5.7 above is personal to (A) the Original Tenant, (B) any assignee of Tenant's interest in this Lease, (C) any Transferee subleasing at least three (3) full floors of the Premises, and (D) any Third Party Operator.
5.8    Tenant's Bicycles. Tenant's employees shall be permitted to bring their bicycles ("Bicycles") into the Premises, subject to the provisions of this Section 5.8, and such additional reasonable rules and regulations as may be promulgated by Landlord from time to time (in Landlord's reasonable discretion) that do not unreasonably interfere with Tenant's ability to park its Bicycles as contemplated herein and provided to Tenant, and only to the extent such Bicycles are used on a daily basis for commuting to and from work by such employees. Bicycles must be taken directly from the first floor of the Building to other floors of the Premises via the Building's freight elevator or another elevator designated by Landlord, which Tenant's employees shall be entitled to operate at any time. At no time are riders allowed to ride any bicycle in the Premises, the Building, or anywhere else within the Project. Riders must always walk their bicycles within the Project boundaries. Storage of any Bicycle anywhere on the Project other than as expressly set forth in this Section 5.8 is prohibited. Tenant shall keep its employees informed of these rules and regulations and any modifications thereto.
ARTICLE 6
SERVICES AND UTILITIES
6.1    Standard Tenant Services. Tenant shall be responsible for providing all services to the Premises, at Tenant's sole cost and expense, including the services stated below.
6.1.1    HVAC. Subject to limitations imposed by all governmental rules and regulations applicable thereto, Tenant shall operate and control the Building heating, ventilation and air conditioning system ("HVAC").
-24-
ONE TEHAMA
[Social Finance, Inc.]


6.1.2    Other Utilities. Tenant shall be responsible to contract with, and pay directly to, the applicable utility provider for electricity, water, trash and sewer, and gas consumed in the Premises. Tenant shall bear the cost of replacement of lamps, starters and ballasts for lighting fixtures within the Premises.
6.1.3    Elevators. Tenant shall operate all elevators in the Building, including the freight elevator.
6.1.4    Janitorial; Landscaping. Tenant shall perform all janitorial services, landscaping services, and other cleaning to the Premises and Project in a manner generally consistent with the standards of Comparable Buildings, using union providers. Landlord shall not be obligated to provide any janitorial services or landscaping services. Landlord shall provide exterior window washing services in a manner consistent with the practices of landlords of Comparable Buildings (at least twice per calendar year, weather permitting), which costs shall be included in Operating Expenses.
6.1.5    Access Control. Tenant hereby acknowledges that Landlord shall have no obligation to provide guard service or other security measures for the benefit of the Premises or the Project, except as set forth in the Tenant Work Letter. However, Landlord shall immediately notify Tenant if Landlord becomes aware of any threat against the Building or Tenant. Tenant, at Tenant's expense, shall provide such security measures for the Premises as Tenant, in its reasonable discretion, shall deem necessary or desirable, but in any event shall be provided in a manner consistent with the practices of landlords of Comparable Buildings. Such measures may include, without limitation, badge or personal identification access systems, cameras, exterior lighting, and security guards. Tenant shall hire union security personnel ("Tenant's Security Personnel"); provided that (i) Tenant's Security Personnel must not carry a firearm or other weapon while performing duties outside of the Building unless reasonably concealed; provided, that such firearms or weapons shall not be required to be concealed when Tenant's Security Personnel is responding to an emergency circumstance or other incident at the Project in which it would be reasonable for Tenant's Security Personnel to have a firearm or other weapon exposed, (ii) the security contractor (if any) providing Tenant's Security Personnel to Tenant hereunder shall comply with Landlord's reasonable insurance requirements, including carrying a liability policy with a limit of not less than Ten Million Dollars ($10,000,000), and (iii) Tenant's Security Personnel shall be licensed and bonded. Tenant hereby assumes all responsibility for the protection of Tenant and its agents, employees, contractors, invitees and guests, and the property thereof, from acts of third parties, including keeping doors locked and other means of entry to the Premises closed. Landlord shall in no case be liable for personal injury or property damage for any error with regard to the admission to or exclusion from the Building or Project of any person.
6.1.6    Risers. Landlord shall permit Tenant to construct new Building risers, raceways, shafts and conduit, as reasonably necessary.
6.1.7    Telecommunications Work. Notwithstanding anything to the contrary contained in this Lease or the Tenant Work Letter, Tenant shall be entitled to use non-union labor selected by Tenant to perform low voltage electrical work, including, but not limited to, the installation, repair and maintenance of telecommunications equipment and cabling and other Lines (as that term is defined in Section 29.28.1).
-25-
ONE TEHAMA
[Social Finance, Inc.]


6.2    Utility Information; Overstandard Tenant Use. To the extent required to comply with Applicable Laws, Tenant shall promptly provide to Landlord either permission to access Tenant's usage information from the utility service provider or copies of the utility bills for Tenant's usage of such services in a format reasonably acceptable to Landlord. Tenant shall promptly provide Landlord with a copy of all invoices for such services after Landlord's request. Tenant's use of electricity shall never exceed the capacity of the feeders to the Project or the risers or wiring installation. If for any reason Tenant's use exceeds the capacity of the feeders to the Project or the risers or wiring installation, Tenant, in Tenant's sole discretion and at Tenant's expense, shall either promptly take all necessary action to increase the electrical capacity of the Building, in compliance with Article 8, or reduce its usage, so that it does not exceed the capacity of the applicable electrical components.
6.3    Interruption of Use. Tenant agrees that Landlord shall not be liable for damages, by abatement of Rent (except as specifically set forth in Section 19.5.2 of this Lease) or otherwise, for failure to furnish or delay in furnishing any service (including telephone and telecommunication services), or for any diminution in the quality or quantity thereof, when such failure or delay or diminution is occasioned, in whole or in part, by breakage, repairs, replacements, or improvements, by any strike, lockout or other labor trouble, by inability to secure electricity, gas, water, or other fuel at the Building or Project after reasonable effort to do so, by any riot or other dangerous condition, emergency, accident or casualty whatsoever, by act or default of Tenant or other parties, or by any other cause beyond Landlord's reasonable control (provided that the foregoing shall not limit Landlord's liability, if any, pursuant to Applicable Laws for bodily injury and property damage to the extent caused by the negligence or willful misconduct of Landlord, its agents, employees or contractors); and such failures or delays or diminution shall never be deemed to constitute an eviction or disturbance of Tenant's use and possession of the Premises or relieve Tenant from paying Rent (except as specifically set forth in Section 19.5.2 of this Lease) or performing any of its obligations under this Lease. Furthermore, Landlord shall not be liable under any circumstances for a loss of, or injury to, property or for injury to, or interference with, Tenant's business, including, without limitation, loss of profits, however occurring, through or in connection with or incidental to a failure to furnish any of the services or utilities as set forth in this Article 6, provided that the foregoing shall not limit Landlord's liability, if any, pursuant to Applicable Laws for bodily injury and property damage to the extent caused by the negligence or willful misconduct of Landlord, its agents, employees or contractors.
6.4    Fire Stairs. Landlord hereby agrees that Landlord shall not prohibit Tenant from using the fire stairs between contiguous floors of the Premises for the regular travel of employees between such floors, provided such use by Tenant complies with all Applicable Laws (including building codes. Subject to Landlord's prior approval, which approval shall not be unreasonably withheld, conditioned or delayed, and compliance with all Applicable Laws, Tenant shall have the right to install a security system in accordance with Article 8 of this Lease to restrict access to the Premises from the fire stairs and make cosmetic, non-structural alterations to the fire stairs used by Tenant pursuant to this Section 6.4. Landlord makes no representation to Tenant as to whether or not the use of the fire stairs between contiguous floors of the Premises for the regular travel of employees between such floors is allowed under Applicable Laws.
6.5    Rooftop Rights. In accordance with, and subject to, the terms and conditions set forth in Article 8, below, and this Section 6.5, Tenant, on a non-exclusive basis and without the
-26-
ONE TEHAMA
[Social Finance, Inc.]


payment of any additional rent or other license fee, may install, repair and replace, at Tenant's sole cost and expense, satellite dishes/antennae on the roof of the Building which shall be no larger than thirty-six inches (36") in diameter (and reasonable equipment and cabling related thereto), for receiving of signals or broadcasts (as opposed to the generation or transmission of any such signals or broadcasts) servicing the business conducted by Tenant from within the Premises (all such equipment is defined collectively as the "Telecommunications Equipment"). The anticipated location of the Telecommunications Equipment is shown on Exhibit L attached hereto. As part of the construction of the Tenant Improvements, including Landlord's right to review and approve all plans and specifications therefor, Tenant shall have the right to construct new conduits, risers and shafts for Telecommunications Equipment and other equipment on the roof of the Building, including a Generator (as defined in Section 6.7 below). The exact location of any such conduit, risers, and shafts shall be reasonably determined by Landlord and Tenant, in consultation with Landlord's structural engineer. Except as expressly set forth in this Lease, Landlord makes no representation's or warranties whatsoever with respect to the condition of the roof of the Building, or the fitness or suitability of the roof of the Building for the installation, maintenance and operation of the Telecommunications Equipment, including, without limitation, with respect to the quality and clarity of any receptions and transmissions to or from the Telecommunications Equipment and the presence of any interference with such signals whether emanating from the Building or otherwise. The physical appearance and the size of the Telecommunications Equipment shall be subject to Landlord's reasonable approval, the location of any such installation of the Telecommunications Equipment shall be designated by Tenant subject to Landlord's reasonable approval and Landlord may require Tenant to install screening around such Telecommunications Equipment, at Tenant's sole cost and expense, as reasonably designated by Landlord; provided that it shall only be deemed reasonable for Landlord to require such screening if Landlord also requires other similarly situated equipment on the roof of the Building to be screened. Tenant shall maintain such Telecommunications Equipment, at Tenant's sole cost and expense. Tenant shall reimburse to Landlord the reasonable, out-of-pocket costs reasonably incurred by Landlord in approving such Telecommunications Equipment. Tenant shall remove such Telecommunications Equipment upon the expiration or earlier termination of this Lease, and shall return the affected portion of the rooftop and the Premises to the condition the rooftop and the Premises would have been in had no such Telecommunications Equipment been installed (reasonable wear and tear, casualty and condemnation excepted), unless Landlord, in its sole discretion, elects in a written notice to Tenant to keep all or any portion of such Telecommunications Equipment, in which case such Telecommunications Equipment shall be surrendered by Tenant to Landlord, and shall be and become the property of Landlord without the necessity of any further written documentation unless otherwise requested by Landlord or a future occupant, upon the expiration or earlier termination of this Lease, provided Landlord pays to Tenant the fair market value of the Telecommunications Equipment retained by Landlord. Such Telecommunications Equipment shall be installed pursuant to plans and specifications approved by Landlord (specifically including, without limitation, all mounting and waterproofing details), which approval will not be unreasonably withheld, conditioned, or delayed. Notwithstanding any such review or approval by Landlord, Tenant shall remain solely liable for any damage to any portion of the roof or roof membrane, specifically including any penetrations, in connection with Tenant's installation, use, maintenance and/or repair of such Telecommunications Equipment, and Landlord shall have no liability therewith. Such Telecommunications Equipment shall, in all instances, comply with all Applicable Laws and other governmental requirements. Tenant shall
-27-
ONE TEHAMA
[Social Finance, Inc.]


not be entitled to license its Telecommunications Equipment to any unrelated third party, nor shall Tenant be permitted to receive any revenues, fees or any other consideration for the use of such Telecommunications Equipment by an third party. Landlord shall have the right (i) to itself utilize any rooftop space for the use of equipment relating to Landlord's performance of any obligations required to be performed by Landlord under this Lease, and (ii) to re-sell, license or lease any rooftop space to any third party for the use of equipment, provided that any roof rights granted by Landlord prior to or after the date of this Lease shall not unreasonably interfere with Tenant's existing or proposed Telecommunications Equipment or other equipment installed or to be installed on the roof by Tenant and shall not be located within the area designated as reserved for Tenant's equipment on Exhibit L, subject to Tenant's compliance with the terms of this Section 6.5. Landlord will cooperate with Tenant to minimize interference of any telecommunications equipment or signals or services of Landlord or such third parties existing as of the date of this Lease with the operation of Tenant's Telecommunications Equipment. The location of third-party telecommunications equipment, as of the date of this Lease, is shown on Exhibit L attached hereto. Upon request from Landlord, Tenant shall make all reasonable efforts to reduce or eliminate any such interference of the Telecommunications Equipment with the telecommunications equipment or signals or services of Landlord or such third parties.
6.6    Internal Staircase. Landlord hereby agrees that Tenant shall have the right to construct, as part of the Tenant Improvements in accordance with the Tenant Work Letter or as an Alteration in accordance with Article 8 of this Lease, an internal staircase (the "Staircase") between contiguous floors of the Premises. Landlord shall cooperate with Tenant's architect or engineers to identify specific locations within each floor of the Premises that would be best suited for construction of Staircase(s). In addition, without limiting Tenant's obligation to remove other Tenant Improvements or Alterations pursuant to the terms and conditions of this Lease and/or the Tenant Work Letter, unless otherwise requested by Landlord, prior to the expiration or earlier termination of this Lease, Tenant shall remove the Staircase and restore all portions of the Building and finishes affected by such removal, including, without limitation, (i) replacing the pan decking or floor slab between the applicable floors of the Building, (ii) replacing all ceiling components (e.g., drop ceiling, grids, lights, HVAC, fire sprinklers, fire/life safety devices and utilities lines), as applicable, in the affected area(s) and raised flooring systems, (iii) replacing any relocated HVAC main distribution ducts, except for electrical, communication and plumbing lines that were re-routed when the Staircase was installed ("Re-Routed Lines"), which Re-Routed Lines may remain in place, (iv) applying new concrete at the point of connection of the Staircase to the applicable floors of the Building, (v) applying new fire proofing, (vi) retaining a contractor designated by Landlord to perform deputy inspection as required by all applicable building codes, and (vii) if necessary in Landlord's reasonable discretion, providing beam reinforcement to the extent that the installation of the Staircase removed or otherwise adversely modified such reinforcement, or to the extent required in order to comply with applicable Laws then in effect (collectively, the "Staircase Removal Requirements"). Notwithstanding the foregoing, Tenant shall not be required to repair or replace any Building components that were not in place at the time the Staircase was installed. Tenant's obligations under the Staircase Removal Requirements shall survive the expiration or earlier termination of this Lease.
6.7    Tenant's Generator. In accordance with, and subject to, (i) the terms and conditions hereof, (ii) Applicable Laws, and (iii) any requirements of the Bay Area Air Quality Management District, Tenant shall have the right to install, repair, maintain and use, at Tenant's
-28-
ONE TEHAMA
[Social Finance, Inc.]


sole cost and expense but without any additional payment to Landlord to install and operate an emergency generator (the "Generator") of a size and type, and in an area designated by Landlord (the "Generator Area") as depicted on Exhibit L, in order to provide emergency electricity service to the Premises. Landlord shall deliver, and Tenant shall accept, the Generator Area in its "as-is", "where-is" condition. In no event shall Tenant permit the Generator to interfere with normal and customary use or operation of the Project by Landlord (including, without limitation, by means of noise or odor). Tenant shall install the Generator in accordance with Article 8 above, or in accordance with the Tenant Work Letter, including Landlord's right to review and approve Tenant's plans and specifications therefor. If the Generator Area is on the roof of the Building, then at Tenant's cost, Landlord may have the plans and specifications for the Generator reviewed by a structural engineer, and Tenant shall be responsible, at Tenant's cost, for performing any required structural upgrades to the roof to accommodate the Generator. Tenant shall be responsible for all maintenance and repairs in accordance with manufacturer specifications and compliance with Applicable Law obligations related to the Generator and acknowledges and agrees that Landlord shall have no responsibility in connection therewith and that Landlord shall not be liable for any damage that may occur with respect to the Generator. The Generator shall be used by Tenant only during (i) testing and regular maintenance, and (ii) the period of any electrical power outage in the Building. Tenant shall be entitled to operate the Generator, and such connections to the Building, for testing and regular maintenance at times reasonably approved by Landlord. Tenant shall comply with all reasonable requirements imposed by Landlord so that the Building Systems or other components of the Project are not adversely affected by the operation of the Generator. Landlord makes no representations or warranties, and shall have no responsibility or liability to any Tenant Party for any losses, damages, injury to persons or property caused by, related to, arising out of or in connection with, to the condition of the Generator Area, or the fitness or suitability of the Generator Area for the installation, maintenance and operation of the Generator. In the event that Tenant shall fail to comply with the requirements set forth herein, without limitation of Landlord's other remedies, (i) Landlord shall have the right to terminate Tenant's rights with respect to the Generator, and/or (ii) Landlord shall have the right, at Tenant's sole cost and expense, to cure such breach, in which event Tenant shall be obligated to pay to Landlord, within twenty (20) days following demand by Landlord accompanied by reasonable supporting documentation, the reasonable amount expended by Landlord. Tenant shall remove the Generator upon the expiration or earlier termination of this Lease, and shall return the affected portion of the Project to the condition same would have been in had no Generator been installed (reasonable wear and tear, casualty and condemnation excepted), unless Landlord, in its sole discretion, elects in a written notice to Tenant to keep all or any portion of the Generator, in which case the Generator shall be surrendered by Tenant to Landlord, and shall be and become the property of Landlord without the necessity of any further written documentation unless otherwise requested by Landlord or a future occupant, upon the expiration or earlier termination of this Lease, provided Landlord pays to Tenant the fair market value of the Generator retained by Landlord.
ARTICLE 7
-29-
ONE TEHAMA
[Social Finance, Inc.]


PROPERTY MANAGEMENT; REPAIR, MAINTENANCE AND TESTING; CAPITAL IMPROVEMENTS
7.1    Property Management. Landlord and Tenant acknowledge and agree that Tenant shall be responsible for obligations related to the maintenance, repair and improvement of the Premises and the Building Systems in accordance with the following provisions of this Article 7.
7.1.1    Management Standards.
7.1.1.1    Professional Management. Tenant shall manage and perform (or shall cause a third-party property management company to perform) its duties under this Article 7 in a manner consistent with the standards followed by first-class institutional quality owners and management companies that are managing and operating the Comparable Buildings (the "Management Standard"). Any third-party property management company shall be subject to Landlord's approval, not to be unreasonably withheld, conditioned or delayed.
7.1.1.2    Engineering Staff. Tenant shall maintain an engineering staff in numbers, for positions, and of a quality level (collectively, "Tenant's Engineers") as required under Exhibit I, attached hereto, to perform Tenant's duties under this Article 7 as to the Building Systems. The name, address, daytime and evening telephone and email addresses of the lead contact for Tenant's Engineers (the "Site Operations Manager") shall be furnished to Landlord and updated reasonably promptly if the same shall change. All matters pertaining to the employment or retention of such Tenant's Engineers or independent contractors are the responsibility of Tenant, who shall in all respects be the employer of Tenant's Engineers or the contracting party with any independent contractor. At no time shall the Tenant's Engineers and/or independent contractors of Tenant and/or their employees be considered employees or independent contractors of Landlord.
7.1.1.3    Service Agreements. Tenant shall enter into service, repair and maintenance agreements for the Building Systems (collectively, the "Service Agreements"), upon the terms and conditions and with providers as required under Exhibit J of this Lease. Each Service Agreement shall be provided to Landlord prior to finalization and Landlord shall have the reasonable right to approve or disapprove of the form or contents of the Service Agreements or the persons or entities to be engaged thereunder within five (5) business days after receiving a copy of any such agreements from Tenant, provided, however, that Landlord's failure to respond during such period shall be deemed Landlord's approval thereof. Otherwise, within ten (10) business days of Landlord's request, Tenant shall deliver a copy of all current Service Agreements to Landlord.
7.1.2    Meeting Requirements. The Site Operations Manager or Chief Engineer shall be available for quarterly meetings with Landlord at the Building to conduct a full inspection of the condition of the Building Systems and discuss Tenant's performance of its obligations under this Article 7, provided that either party shall have the right to call more frequent meetings to deal with emergency situations or if Landlord reasonably believes that Tenant is in breach of the terms of this Article 7.
7.1.3    Records and Reports Requirements. All plans and specifications maintained by Tenant in connection with the Building Systems, and any warranties and guaranties
-30-
ONE TEHAMA
[Social Finance, Inc.]


and operating manuals relating to the Building Systems (collectively, the "Building System Documents") shall become the property of Landlord, and such documents (but Tenant may retain copies thereof) shall be delivered to Landlord upon the expiration or earlier termination of the Lease Term or any termination of Tenant's management of the Building Systems under this Article 7 or this Lease, to the extent not previously delivered to Landlord.
7.1.4    Tenant's Testing Obligations. Tenant shall operate, maintain, and test the Building Systems including all subsystems in any special areas as designated by Landlord, as required by the terms of this Lease and in a manner consistent with the Management Standard. Tenant shall conduct such testing and maintenance in accordance with applicable Laws.
7.1.5    Landlord's Inspection Rights. From time to time but no more than once per calendar quarter, Landlord shall have the right to inspect Tenant's records (including the Building System Documents) relating to the performance of Tenant's obligations under this Article 7. Tenant shall make such records reasonably available to Landlord within five (5) business days of receipt of a request therefor.
7.1.6    Tenant's Risk Management Obligations. Tenant shall promptly investigate and make a full timely written report to Landlord as to all alleged accidents known to Tenant and/or all claims for damages relating to the Building Systems known to Tenant.
7.1.7    Tenant's Responsibilities Upon Termination of Tenant's Management of the Building Systems under this Article 7. Upon the expiration or earlier termination of this Lease for any reason, or upon any termination of Tenant's management of the Building Systems under this Article 7 or this Lease, Tenant shall within ten (10) business days following receipt of a written request from Landlord, deliver the following to Landlord, or Landlord's appointed agent (except to the extent that any such item has already been delivered to Landlord).
7.1.7.1    At Landlord's option, an assignment to Landlord, or its nominee or designee, of all Service Agreements with third parties, to the extent assignable.
7.1.7.2    The Building System Documents (copies thereof where reasonably acceptable).
7.1.7.3    All keys related to the telephone closets, janitorial closets, electrical closets, riser closets, storage rooms, storage areas, PG&E rooms or areas, rooftop access points, and other areas which would traditionally be characterized as common areas in a multi-tenant building.
7.1.7.4    All tools and equipment originally delivered by Landlord to Tenant, subject to reasonable wear and tear and events of damage or destruction.
7.1.7.5    Copies of any repair and maintenance records.
7.1.7.6    Any other items in Tenant's possession or control which Landlord may reasonably require in taking over the management of the Building Systems.
-31-
ONE TEHAMA
[Social Finance, Inc.]


The obligation of Tenant to deliver the foregoing shall survive the termination of Tenant's obligation to manage the Project.
7.2    Repair and Maintenance.
7.2.1    Tenant's Repair and Maintenance Obligations. Tenant shall, at Tenant's sole cost and expense, in good repair and in a first-class condition consistent with typical practice for Comparable Buildings, (i) maintain, repair and improve, and pursuant to the specifications set forth in Exhibit K, attached hereto, all portions of the Building systems including the mechanical, electrical, fire, fire suppression, life-safety, plumbing, sprinkler and HVAC systems installed by Landlord prior to the Lease Commencement Date (individually, a "Building System," and collectively, the "Building Systems"), (ii) maintain, repair and improve the Premises, including the roof membrane and all improvements, fixtures, equipment, interior window coverings, and flooring, furnishings therein, and (iii) maintain and repair the exterior of the Building and the exterior areas of the Building, including sidewalks and curbcuts, replacement of windows and windows seals, and including graffiti removal and exterior building painting. Upon request by Tenant, Landlord agrees to diligently enforce (or if assignable to Tenant, to assign to Tenant) any warranties relating to the Building Systems and exterior of the Building (e.g., windows) to be maintained by Tenant. Notwithstanding any provision to the contrary contained in this Lease, Tenant's obligations to comply with Applicable Laws are set forth in Section 24.1 below, and not in this Section 7.2. Notwithstanding the foregoing, if any obligation of Tenant in this Section 7.2.1 is "capital in nature", Tenant shall notify Landlord as set forth in Section 7.3 below and Landlord shall perform such modifications pursuant to Section 7.3, and the parties shall be responsible for the respective costs as set forth in Sections 7.3 below. At Landlord's option, if Tenant fails to make such repairs or improvements as required in this Section 7.2 with respect to the Building Systems, Landlord may, after written notice to Tenant, and after affording Tenant a reasonable time period within which to conduct such repair or improvement, and after providing Tenant a second notice setting forth Landlord's intention to engage in self-help (except in the event of an emergency, in which case no notice to Tenant shall be required), but need not, make such repairs and improvements to the Building Systems, and Tenant shall pay Landlord the reasonable cost thereof, including a reasonable percentage of the cost thereof sufficient to reimburse Landlord for all overhead, general conditions, fees and other costs or expenses arising from Landlord's involvement with such repairs and improvements forthwith upon being billed for same. Except as set forth in Section 7.4 below, Tenant hereby waives any and all rights under and benefits of subsection 1 of Section 1932 and Sections 1941 and 1942 of the California Civil Code or under any similar law, statute, or ordinance now or hereafter in effect.
7.2.2    Landlord's Maintenance Obligations. In addition to Landlord's obligations set forth in Sections 1.1.1 and 7.2.1 and the Tenant Work Letter, except to the extent the same is Tenant's obligation pursuant to Section 7.2.1 above, Landlord shall maintain, repair and improve, in good repair and in a first-class condition, the structural portions of the Building, including, without limitation, the foundation, floor/ceiling slabs, exterior slabs, roof (excluding the roof membrane), curtain wall, exterior glass and mullions, columns, beams, shafts, fire stairwells, and Building mechanical, electrical and telephone closets (but not the Building Systems located therein) (collectively, "Building Structure"). If the roof membrane must reasonably be replaced rather than repaired, such replacement shall be considered "capital in nature" and shall be subject to the terms of Section 7.3. Landlord's costs of performing its obligations under this Section 7.2
-32-
ONE TEHAMA
[Social Finance, Inc.]


shall be included in Operating Expenses (except to the extent such costs are otherwise prohibited by the terms of Section 4.2.3 above, or otherwise payable directly by Tenant pursuant to this Lease). Any entry of the Premises by Landlord in connection with the foregoing shall be done consistent with the terms of Article 27 of this Lease.
7.3    Capital Improvements. Except for Alterations made by Tenant pursuant to Article 8, under no circumstances shall Tenant perform any repairs, maintenance or improvements which are "capital in nature" under this Lease, including under Section 7.2.1 above or Section 24.1 below (the "Landlord's Capital Improvements"), even though the responsibility for such Landlord's Capital Improvements may otherwise be allocated to Tenant pursuant to the terms of this Lease, including Sections 7.2.1 above and Section 24.1 below. Rather, Landlord, shall perform and supervise all Landlord's Capital Improvements and the reasonable costs thereof (without mark-up or any administration fee by Landlord) shall be either (i) allocated to Landlord and not as an Operating Expense if such Landlord's Capital Improvements constitute a "Non-Reimbursable Capital Improvement," as defined in Section 7.3.1, below, or (ii) allocated to Tenant if such Landlord's Capital Improvements constitute a "Reimbursable Capital Improvement," as that term is defined in Section 4.2.3, above, or are "Tenant Funded Capital Improvements," as that term is defined in Section 7.3.1, below. Tenant shall provide Landlord with notice ("Capital Improvement Notice") if any obligation of Tenant set forth in Section 7.2.1 above pertaining to Building Systems is "capital in nature", and reasonable evidence of the same, including Tenant's determination of whether the item is a Tenant Funded Capital Improvement, a Reimbursable Capital Improvement, or a Non-Reimbursable Capital Improvement. Within five (5) business days of Landlord's receipt of a Capital Improvement Notice, Landlord shall either provide written notice to Tenant that either (1) Landlord does not believe the proposed work is a Landlord's Capital Improvement (or Landlord does not believe that Tenant has correctly categorized the Landlord's Capital Improvement as a Tenant Funded Capital Improvement, a Reimbursable Capital Improvement, or a Non-Reimbursable Capital Improvement) or (2) confirming that Landlord will perform such Landlord's Capital Improvement in accordance with this Section 7.3. If Landlord and Tenant disagree as to whether the work constitutes a Landlord's Capital Improvement (or whether the Landlord's Capital Improvement is a Tenant Funded Capital Improvement, a Reimbursable Capital Improvement, or a Non-Reimbursable Capital Improvement), Landlord and Tenant shall meet and confer in good faith to attempt to resolve such disagreement. If Landlord and Tenant are not able to resolve the disagreement, either Landlord or Tenant may elect, upon notice to the other, to have the matter proceed to arbitration administered by JAMS or any successor thereto under the Expedited Procedures provisions (Rules 16.1-16.2 in the current edition) of the JAMS Comprehensive Arbitration Rules and Procedures. The determination rendered by the arbitrator shall be binding upon the parties and may be entered in any court having jurisdiction thereof, and the prevailing party shall be awarded its reasonable attorneys’ fees and costs. If the Landlord's Capital Improvements constitute Tenant Funded Capital Improvements, (a) Landlord shall solicit qualified conforming bids from a minimum of two (2) contractors in connection with the completion of such Tenant Funded Capital Improvements and Landlord shall provide such bids to Tenant, and, within ten (10) business days following the receipt of such bids from Landlord, Tenant shall select either one of the bids and Landlord shall, thereafter, retain the contractor specified in such bid to complete the Tenant Funded Capital Improvements (provided that if Tenant fails to timely inform Landlord of its selection, upon the expiration of such ten (10)-business day period, Landlord shall be free to select either one of the bids on Tenant's behalf); and (b) following the selection of such bid by Tenant (or Landlord, in the event Tenant fails to
-33-
ONE TEHAMA
[Social Finance, Inc.]


timely make such selection), Landlord shall complete the Tenant Funded Capital Improvements. Upon completion of any particular Tenant Funded Capital Improvements, Landlord shall provide Tenant with an invoice and reasonable documentation evidencing the costs incurred by Landlord in completion of the Tenant Funded Capital Improvements and Tenant shall pay such amounts within thirty (30) days following receipt of such invoice. All of Landlord's Capital Improvements shall be completed diligently and in a good workmanlike manner. Landlord shall coordinate the performance of Landlord's Capital Improvements with Tenant, and use commercially reasonable efforts to minimize disruption to the conduct of Tenant's business from the Premises. The term "capital in nature" as used in this Lease shall mean any expenditure in excess of Twenty Thousand Dollars ($20,000) which would normally be "capitalized," as opposed to "expensed," under sound real estate accounting and management principles, and is made for (x) the replacement (as opposed to regular maintenance and repair) of all or a portion of an existing Building System that is non-functioning or at the end of its useful life, provided that if it is a replacement of a portion of a Building System, the portion must make-up a significant majority of the Building System and such portion of the Building System must have a useful life of at least fifteen (15) years or (y) any improvement to the Building Structure, which improvement has a useful life of at least fifteen (15) years.
7.3.1    Types of Landlord's Capital Improvements. Landlord shall perform all Landlord's Capital Improvements as stated in Section 7.3, above. Tenant shall reimburse Landlord for the Reimbursable Capital Improvements, as set forth in Article 4 hereof. As set forth in Section 7.3, above, Tenant shall pay Landlord for "Tenant Funded Capital Improvements," which shall be Landlord's Capital Improvements which:
7.3.1.1    are necessitated by the negligence or willful misconduct of the "Tenant Parties" as that term is defined in Section 10.1, below;
7.3.1.2    are necessitated by Tenant's failure to improve, maintain, service, repair or replace the Premises as required in this Lease;
7.3.1.3    are necessitated by Tenant's use of any the Building Systems in a manner that would shorten the reasonable useful life of such Building System;
7.3.1.4    are caused by any breach by Tenant of this Article 7;
7.3.1.5    are necessitated because of any unreasonable failure of Tenant to notify Landlord that Landlord's Capital Improvements are required pursuant to Section 7.3, above, unless Tenant has already notified Landlord of such requirement by describing such situation in the reports required pursuant to the terms of Section 7.1 of this Lease or otherwise; or
7.3.1.6    are modifications required to comply with Applicable Laws, but were triggered solely by Tenant's Alterations, or use of the Premises for non-general office use.
For purposes hereof, the term "Non-Reimbursable Capital Improvements" shall mean all Landlord's Capital Improvements other than Reimbursable Capital Improvements and Tenant Funded Capital Improvements.
-34-
ONE TEHAMA
[Social Finance, Inc.]


7.4    Tenant's Right to Make Repairs. Notwithstanding any of the terms set forth in this Lease to the contrary, if Tenant provides Notice (or oral notice in the event of an "Emergency," as that term is defined, below) to Landlord of an event or circumstance which requires the action of Landlord with respect to repair and/or maintenance required to be performed by Landlord, which event or circumstance materially or adversely affects the conduct of Tenant's business from the Premises or otherwise constitutes an Emergency, and Landlord fails to commence corrective action within a reasonable period of time, given the circumstances, after the receipt of such notice, but in any event not later than ten (10) business days after receipt of such notice and to diligently prosecute the corrective action to completion, then Tenant may proceed to take the required action upon delivery of an additional five (5) days' notice to Landlord specifying that Tenant is taking such required action (provided, however, that the initial ten (10) business day notice and the subsequent five (5) day notice shall not be required in the event of an Emergency) and if such action was required under the terms of this Lease to be taken by Landlord and was not commenced by Landlord within such five (5) day period (or immediately in the event of an Emergency) and thereafter diligently pursued to completion, then Tenant shall have the right to take such corrective action and shall be entitled to prompt reimbursement by Landlord of Tenant's reasonable costs and expenses in taking such action. In the event Tenant takes such action, Tenant shall use only those contractors used by Landlord in the Building for work unless such contractors are unwilling or unable to perform, or timely perform, such work, in which event Tenant may utilize the services of any other qualified contractor which normally and regularly performs similar work in Comparable Buildings. Following completion of any work taken by Tenant pursuant to the terms of this Section 7.4, Tenant shall deliver a detailed invoice of the work completed, the materials used and the costs relating thereto. If Landlord does not deliver a detailed written objection to Tenant within thirty (30) days after receipt of an invoice from Tenant, then Tenant shall be entitled to deduct from Rent next due and owing under this Lease, the amount set forth in such invoice with interest at the Interest Rate from the time of expenditure by Tenant until offset. If, however, Landlord delivers to Tenant, within thirty (30) days after receipt of Tenant's invoice, a written objection to the payment of such invoice, setting forth with reasonable particularity Landlord's reasons for its claim that such action did not have to be taken by Landlord pursuant to the terms of this Lease or that the charges are excessive (in which case Landlord shall pay the amount it contends would not have been excessive), then Tenant shall not be entitled to such deduction from Rent. If Landlord so objects, Tenant may proceed to claim a default by Landlord or, if elected by either Landlord or Tenant, the matter shall proceed to arbitration administered by the JAMS or any successor thereto under the Expedited Procedures provisions (Rules 16.1-16.2 in the current edition) of the JAMS Comprehensive Arbitration Rules and Procedures. If Tenant prevails in the arbitration, the amount of the Arbitration Award (which shall include interest at the Interest Rate from the time of each expenditure by Tenant until the date Tenant receives such amount by payment or offset and attorneys' fees and related costs) may be deducted by Tenant from the Rent next due and owing under this Lease. The determination rendered by the arbitrator shall be binding upon the parties and may be entered in any court having jurisdiction thereof, and the prevailing party shall be awarded its reasonable attorneys’ fees and costs. For purposes of this Section 7.4, an "Emergency" shall mean an event threatening immediate and material danger to people located in or about the Building or immediate, material damage to the Premises, Building, Building Systems, Building Structure, Tenant Improvements, Alterations, trade fixtures or personal property, or creates a realistic possibility of an immediate and material interference with, or immediate and material interruption of, Tenant's business operations. Tenant's rights under this
-35-
ONE TEHAMA
[Social Finance, Inc.]


Section 7.4 shall be in addition to, and not in derogation of, any Rent abatement to which Tenant is entitled pursuant to Section 19.5.2 below.
ARTICLE 8
ADDITIONS AND ALTERATIONS
8.1    Landlord's Consent to Alterations; Permitted Alterations. Tenant may not make or suffer to be made any improvements, alterations, additions, changes, or repairs (pursuant to Article 7 or otherwise) to the Premises or any mechanical, plumbing or HVAC facilities or systems pertaining to the Premises (collectively, the "Alterations") without first procuring the prior written consent of Landlord to such Alterations, which consent shall be requested by Tenant in accordance with the terms and conditions of this Article 8, and which consent shall not be unreasonably withheld, conditioned or delayed by Landlord, provided it shall be deemed reasonable for Landlord to withhold its consent to any Alteration which adversely affects the Building Structure or Building Systems or equipment, or is visible from the exterior of the Building (each, a "Material Alteration" and, collectively, "Material Alterations"). Upon no less than ten (10) days prior notice to Landlord (accompanied by a copy of all plans and specifications relating thereto), but without Landlord's prior consent, Tenant shall be permitted to make Alterations that (i) do not constitute a Design Problem (as that term is defined in Section 3.4 of the Tenant Work Letter), (ii) do not require a construction permit, and (iii) cost less than One Hundred Fifty Thousand Dollars ($150,000.00) per project ("Permitted Alterations"). The construction of the initial improvements to the Premises shall be governed by the terms of the Tenant Work Letter and not the terms of this Article 8.
8.2    Manner of Construction. Prior to the commencement of construction of any Alterations or repairs (including Permitted Alterations), Tenant shall submit to Landlord, for Landlord's review, four (4) copies signed by Tenant of all plans, specifications and working drawings relating thereto. Landlord shall review and approve or disapprove (to the extent such approval or disapproval is required) all such plans, specifications and working drawings within five (5) business days following the date upon which Tenant submits the same to Landlord, except that Landlord shall have ten (10) business days following the date upon which Tenant submits the same to Landlord to review and approve such plans, specifications and working drawings in the event that the nature of the Alterations or repairs is such that (I) review of the plans, specifications and working drawings related thereto cannot reasonably be completed within five (5) business days, or (II) Landlord reasonably needs to send the plans, specifications and working drawings out for third-party review; provided that the parties shall agree in advance upon the reasonable maximum cost of such third-party review. If Landlord disapproves of any such plans, specifications or working drawings, then Landlord shall set forth with reasonable specificity the grounds for such disapproval and recommend any modifications that would make the proposed Alterations acceptable to Landlord. If Landlord fails to respond in writing within five (5) business days or ten (10) business days, as applicable, Tenant may send a second notice to Landlord, which notice must contain the following disclaimer in bold face, capitalized type: "NOTICE – SECOND REQUEST FOR CONSENT TO ALTERATIONS PURSUANT TO ARTICLE 8 OF THE LEASE – FAILURE TO TIMELY RESPOND WITHIN THREE (3) BUSINESS DAYS AFTER RECEIPT OF THIS NOTICE WILL RESULT IN DEEMED APPROVAL OF THE PLANS AND SPECIFICATIONS FOR CERTAIN ALTERATIONS." If Landlord fails to respond in writing
-36-
ONE TEHAMA
[Social Finance, Inc.]


within three (3) business days after delivery of such second notice, then Landlord shall be deemed to have consented to the proposed Alterations. Tenant, at its sole cost and expense, shall retain an architect/space planner subject to Landlord's reasonable approval, to prepare such plans, specifications and working drawings; provided that, unless Tenant is performing the Alterations or repairs on a design-build basis, Tenant shall retain the engineering consultants from a list of at least three (3) names provided by Landlord or other engineering consultants reasonably approved by Landlord to prepare all plans and engineering working drawings, if any, relating to the mechanical, electrical, and plumbing, work of the Alterations. Landlord acknowledges and agrees that Tenant may perform all Alterations on a design-build basis, provided that the mechanical, electrical and plumbing components of such work shall be designed using Landlord's designated engineers, or other engineering consultants approved by Landlord, which approval shall not be unreasonably withheld, conditioned or delayed. In addition, notwithstanding the foregoing, in connection with any Alterations that affect the structural, HVAC, life-safety and sprinkler components of the Base Building, Tenant shall retain the engineering consultants designated by Landlord to prepare all plans and engineering working drawings relating thereto, or other engineering consultants approved by Landlord, which approval shall not be unreasonably withheld, conditioned or delayed. Tenant shall be required to include in its contracts with the architect and the engineers a provision which requires ownership of all architectural and engineering drawings to be transferred to Tenant upon the substantial completion of the Alteration and Tenant hereby grants to Landlord a non-exclusive right to use such drawings, including, without limitation, a right to make copies thereof. Tenant and Tenant's architect/space planner shall verify, in the field, the dimensions and conditions as shown on the relevant portions of the Base Building plans, and Tenant and Tenant's architect/space planner shall be solely responsible for the same, and Landlord shall have no responsibility in connection therewith. In addition, if and to the extent, based on the nature of the mechanical, electrical or plumbing items, or structural items or items affected by Title 24 which are included in the Alterations, Landlord reasonably retains third party consultants, then Tenant shall pay to Landlord an amount equal to any actual and reasonable out-of-pocket third party costs for such third party consultants expended by Landlord in connection with the construction of the Alterations within thirty (30) days after receipt of invoice together with reasonable supporting evidence; provided that Landlord notified Tenant prior to incurring any such costs. Landlord's review of plans, specifications and working drawings as set forth in this Section 8.2, shall be for its sole purpose and shall not imply Landlord's review of the same, or obligate Landlord to review the same, for quality, design, compliance with applicable building codes or other like matters. Accordingly, notwithstanding that any plans, specifications or working drawings are reviewed by Landlord or its space planner, architect, engineers and consultants, and notwithstanding any advice or assistance which may be rendered to Tenant by Landlord or Landlord's space planner, architect, engineers, and consultants, Landlord shall have no liability whatsoever in connection therewith and shall not be responsible for any omissions or errors contained in the plans, specifications and working drawings for the Alterations, and Tenant's waiver and indemnity set forth in Section 10.1 of this Lease, below, shall specifically apply to the plans, specifications and working drawings for the Alterations. Following Landlord's reasonable approval of all plans, specifications and working drawings for the Alterations, a contractor to construct the Alterations shall be selected by Tenant and approved by Landlord, which approval shall not be unreasonably withheld, conditioned or delayed (except that Landlord shall not have the right to approve any contractor performing Permitted Alterations). The foregoing process shall be reasonable adjusted if Tenant constructs Alterations on a design-build
-37-
ONE TEHAMA
[Social Finance, Inc.]


basis as set forth above. As used in this Lease, the "Base Building" shall mean the Building Structure and the Building Systems. All subcontractors used or selected by Tenant performing work relating to the Building Systems shall be subject to Landlord's approval, which approval shall not be unreasonably withheld, conditioned or delayed. If Landlord fails to approve or disapprove a proposed Tenant's Agent within three (3) business days, Landlord shall be deemed to have approved the same. The contractor and all subcontractors, laborers, materialmen, and suppliers are referred to herein as "Tenant Agents." Tenant shall not use (and upon notice from Landlord shall cease using) contractors, services, workmen, labor, materials or equipment that, in Landlord's reasonable judgment, would disturb labor harmony with the workforce or trades engaged in performing other work, labor or services in or about the Building. In addition to Tenant's obligations under Article 9 of this Lease, upon completion of any Alterations, Tenant agrees to cause a Notice of Completion to be recorded in the office of the Recorder of the County in which the Project is located in accordance with Section 8182 of the Civil Code of the State of California or any successor statute, and Tenant shall deliver to the Project construction manager (1) a reproducible copy of the "as built" drawings of the Alterations (provided that in the event that "as built" drawings are not reasonably available, Tenant shall be permitted to provide a copy of the approved drawings for the Alterations, marked with field modifications), (2) a computer disc containing the same (to the extent reasonably available), and (3) all permits, approvals and other documents issued by any governmental agency in connection with the Alterations. Notwithstanding anything set forth in this Article 8 to the contrary, construction of an Alteration shall not commence until (x) a copy of the contract with Tenant's contractor has been fully executed and delivered to Landlord, and (y) Tenant has procured, and delivered to Landlord a copy of, all applicable permits necessary to commence demolition or construction, as the case may be.
8.3    Payment for Improvements. Tenant shall pay to Landlord, as provided in this Section 8.3, the sum of (i) Landlord's standard supervision fee for its involvement with such Alterations, which supervision fee shall be equal to the sum of one percent (1%) of the "hard" costs of each such Alteration; and (ii) all other reasonable, out-of-pocket costs incurred by Landlord in connection with the construction of the Alterations which Landlord notified Tenant of prior to incurring. No supervision fee shall be payable by Tenant in connection with any Permitted Alterations. For purposes of this Lease, "hard" costs means the cost of labor and materials incorporated into the Alterations or the Tenant Improvements, and excludes architectural and engineering fees and costs and permit fees.
8.4    Construction Insurance. In addition to the requirements of Article 10 of this Lease, in the event that any Alterations are made pursuant to this Article 8, prior to the commencement of such Alterations, Tenant shall provide Landlord with evidence that Tenant or Tenant's contractor carries "Builder's All Risk" insurance in an amount reasonably approved by Landlord covering the construction of such Alterations, and such other insurance as Landlord may reasonably require, it being understood and agreed that all of such Alterations shall be insured by Tenant pursuant to Article 10 of this Lease immediately upon completion thereof. In addition, if liens have previously been recorded against the Building in connection with Alterations undertaken by Tenant, and such liens were not removed within the time period specified in Article 9, then Landlord may, in its reasonable discretion, require Tenant to obtain a lien and completion bond or some alternate form of security reasonably satisfactory to Landlord in an amount sufficient to ensure the lien-free completion of such Alterations and naming Landlord as a co-obligee, when the cost of such Alterations exceeds $250,000.00.
-38-
ONE TEHAMA
[Social Finance, Inc.]


8.5    Landlord's Property. All Alterations, improvements, fixtures, equipment and/or appurtenances which may be installed or placed by or on behalf of Tenant in or about the Premises, from time to time, shall be at the sole cost of Tenant and any permanently affixed Alterations, improvements, equipment and/or appurtenances shall be and become the property of Landlord; provided, however, Landlord may, by written notice to Tenant prior to the end of the Lease Term, or given following any earlier termination of this Lease, require Tenant, at Tenant's expense, to remove any "Above Standard Alterations", as that term is defined below, and to repair any damage to the Premises and Building caused by such removal and return the affected portion of the Premises to substantially the same condition existing prior to the installation of such Above Standard Alterations. Notwithstanding the preceding sentence, if at the time Tenant requests Landlord's consent to any Alterations pursuant to this Article 8, Tenant also requests in writing Landlord's determination as to whether Landlord will require the removal of such Alterations upon the expiration or earlier termination of this Lease, then Landlord shall notify Tenant of any such required removal and/or restoration, together with Landlord's consent for such Alterations (if such consent is given), provided that Landlord may only require Tenant to remove Above Standard Alterations. As used in this Lease, "Above Standard Alterations" shall mean any part of any Alterations which do not constitute normal and customary general office improvements as reasonably determined by Landlord, and shall include, without limitation, improvements such as voice, data and other cabling, raised floors, floor penetrations (other than plug-in core drill holes), any installations outside of the Premises, or any areas requiring floor reinforcement, personal baths and showers, the Cafeteria, the Fitness Center, Bicycle storage areas, vaults, rolling file systems and structural alterations of any type. Above Standard Alterations shall not include plug-in core drill holes or rekeying of any of the locks in the Building. The removal of Above Standard Tenant Improvements constructed in the Premises pursuant to the Tenant Work Letter shall be governed by the terms of the Tenant Work Letter. If Tenant fails to complete any required removal and/or to repair any damage caused by the removal of any Above Standard Alterations or Above Standard Tenant Improvements in the Premises and return the affected portion of the Premises to substantially the same condition existing prior to the installation of such Above Standard Alterations or Above Standard Tenant Improvements prior to the expiration or earlier termination of this Lease, then Rent shall continue to accrue under this Lease in accordance with Article 16, below, after the end of the Lease Term until such work shall be completed, and Landlord shall have the right, but not the obligation, on five (5) days' written notice to Tenant, to perform such work and to charge the actual and reasonable cost thereof to Tenant. Tenant hereby protects, defends, indemnifies and holds Landlord harmless from any liability, cost, obligation, expense or claim of lien, court costs and reasonable attorneys' fees, in any manner relating to the installation, placement, removal or financing by or on behalf of Tenant of any such Alterations, improvements, fixtures and/or equipment in, on or about the Premises, which obligations of Tenant shall survive the expiration or earlier termination of this Lease.
ARTICLE 9
COVENANT AGAINST LIENS
Tenant shall keep the Project and Premises free from any liens or encumbrances arising out of the work performed, materials furnished or obligations incurred by or on behalf of Tenant, and shall protect, defend, indemnify and hold Landlord harmless from and against any claims, liabilities, judgments or costs (including, without limitation, reasonable attorneys' fees and costs)
-39-
ONE TEHAMA
[Social Finance, Inc.]


arising out of same or in connection therewith. Tenant shall give Landlord notice at least ten (10) days prior to the commencement of any work on the Premises which may give rise to a lien on the Premises, Building or Project (or such additional time as may be necessary under Applicable Laws) to afford Landlord the opportunity of posting and recording appropriate notices of non-responsibility. Tenant shall remove any such lien or encumbrance by bond or otherwise within thirty (30) days after notice by Landlord, and if Tenant shall fail to do so, Landlord may pay the amount necessary to remove such lien or encumbrance, without being responsible for investigating the validity thereof. The amount so paid shall be deemed Additional Rent under this Lease payable upon demand, without limitation as to other remedies available to Landlord under this Lease. Nothing contained in this Lease shall authorize Tenant to do any act which shall subject Landlord's title to the Building or Premises to any liens or encumbrances whether claimed by operation of law or express or implied contract. Any claim to a lien or encumbrance upon the Building or Premises arising in connection with any such work or respecting the Premises not performed by or at the request of Landlord shall be null and void, or at Landlord's option shall attach only against Tenant's interest in the Premises and shall in all respects be subordinate to Landlord's title to the Project, Building and Premises.
ARTICLE 10
TENANT'S INDEMNITY AND INSURANCE
10.1    Mutual Indemnities.
10.1.1    Indemnity. To the maximum extent permitted by law, Tenant waives any right to contribution against the "Landlord Parties," as that term is defined in Section 10.8, below, and agrees to indemnify and save harmless the Landlord Parties from and against all claims of whatever nature arising from or claimed to have arisen from (i) any act, omission or negligence of the Tenant Parties; (ii) any accident, injury or damage whatsoever caused to any person, or to the property of any person, occurring in or about the Premises from the earlier of (A) the date on which any Tenant Party first enters the Premises for any reason or (B) the Lease Commencement Date, and thereafter throughout and until the end of the Lease Term and after the end of the Lease Term for as long as Tenant or anyone acting by, through or under Tenant is in occupancy of the Premises or any portion thereof; or (iii) any accident, injury or damage whatsoever occurring outside the Premises but within the Project, where such accident, injury or damage results, or is claimed to have resulted, from any act, omission or negligence on the part of any of the Tenant Parties. Tenant shall pay such indemnified amounts as they are incurred by the Landlord Parties. This indemnification shall not be construed to deny or reduce any other rights or obligations of indemnity that a Landlord Party may have under this Lease or the common law. Notwithstanding anything contained herein to the contrary, the terms of the foregoing indemnity and waiver shall not apply to the extent any loss, cost, damage, expense or liability is caused by the negligence or willful misconduct of Landlord or the Landlord Parties. Landlord shall indemnify, defend, protect, and hold harmless the Tenant Parties from and against all claims of whatever nature arising from or claimed to arise from the negligence or willful misconduct of Landlord Parties in, on, or about the Project, except to the extent caused by the negligence or willful misconduct of Tenant Parties. Landlord shall pay such indemnified amounts as they are incurred by Tenant Parties. This indemnification shall not be construed to deny or reduce any other rights or obligations of indemnity that a Tenant Party may have under this Lease or the common law. Notwithstanding
-40-
ONE TEHAMA
[Social Finance, Inc.]


anything to the contrary set forth in this Lease, either party's agreement to indemnify the other party as set forth in this Section 10.1.1 shall be ineffective to the extent the matters for which such party agreed to indemnify the other party are of a nature covered by, or are required to be covered by, insurance required to be carried by the non-indemnifying party pursuant to this Lease (except to the extent of reasonable deductibles). Further, Tenant's agreement to indemnify Landlord Parties and Landlord's agreement to indemnify Tenant Parties pursuant to this Section 10.1.1 are not intended to and shall not relieve any insurance carrier of its obligations under policies required to be carried under this Lease, to the extent such policies cover, or if carried, would have covered the matters, subject to the parties' respective indemnification obligations; nor shall they supersede any inconsistent agreement of the parties set forth in any other provision of this Lease. The provisions of this Section 10.1 shall survive the expiration or earlier termination of this Lease with respect to any claims or liability arising in connection with any event occurring prior to such expiration or earlier termination.
10.1.2    Breach. In the event that either party breaches any of its indemnity obligations hereunder or under any other contractual or common law indemnity: (i) the breaching party shall pay to the non-breaching party all liabilities, loss, cost, or expense (including reasonable attorney's fees) incurred as a result of said breach, and the reasonable value of time expended by the non-breaching party as a result of said breach; and (ii) the non-breaching parties may deduct and offset from any amounts due to the breaching party under this Lease any amounts owed by the breaching party pursuant to this section.
10.1.3    No limitation. The indemnification obligations under this Section shall not be limited in any way by any limitation on the amount or type of damages, compensation or benefits payable by or for Landlord, Tenant or any subtenant or other occupant of the Premises under workers' compensation acts, disability benefit acts, or other employee benefit acts. Tenant waives any immunity from or limitation on its indemnity or contribution liability to the Landlord Parties based upon such acts. Landlord waives any immunity from or limitation on its indemnity or contribution liability to the Tenant Parties based upon such acts.
10.1.4    Subtenants and Other Occupants. Tenant shall require its subtenants and other occupants of the Premises to provide similar indemnities to the Landlord Parties in a form reasonably acceptable to Landlord, or if Tenant's subtenants or other occupants do not provide similar indemnities, then Tenant shall be obligated to provide such indemnities.
10.1.5    Survival. The terms of this section shall survive any termination or expiration of this Lease.
10.1.6    Costs. The foregoing indemnity and hold harmless agreement shall include indemnity for all costs, expenses and liabilities (including, without limitation, reasonable attorneys' fees and disbursements) incurred by the Landlord Parties or the Tenant Parties in connection with any such claim or any action or proceeding brought thereon, and the defense thereof. In addition, in the event that any action or proceeding shall be brought against one or more Landlord Parties or Tenant Parties by reason of any such claim, the indemnifying party, upon request from the indemnified party, shall resist and defend such action or proceeding on behalf of the indemnified party by counsel appointed by indemnifying party's insurer (if such claim is covered by insurance without reservation) or otherwise by counsel reasonably satisfactory to the indemnified party. The
-41-
ONE TEHAMA
[Social Finance, Inc.]


indemnified party shall not be bound by any compromise or settlement of any such claim, action or proceeding without the prior written consent of such indemnified party.
10.2    Tenant's Risk. Except as expressly set forth in this Lease, Tenant agrees to use and occupy the Premises, and to use such other portions of the Building as Tenant is given the right to use by this Lease at Tenant's own risk. The Landlord Parties shall not be liable to the Tenant Parties for any damage, injury, loss, compensation, or claim (including, but not limited to, claims for the interruption of or loss to a Tenant Party's business) based on, arising out of or resulting from any cause whatsoever, including, but not limited to, repairs to any portion of the Premises or the Building or the Project, any fire, robbery, theft, mysterious disappearance, or any other crime or casualty, the actions of any other person or persons, or any leakage in any part or portion of the Premises or the Building or the Project, or from water, rain or snow that may leak into, or flow from any part of the Premises or the Building or the Project, or from drains, pipes or plumbing fixtures in the Building or the Project; provided that the foregoing shall not modify Landlord's liability, if any, pursuant to Applicable Law, for property damage or personal injury to the extent arising from Landlord's negligence or willful misconduct. Any goods, property or personal effects stored or placed in or about the Premises shall be at the sole risk of the Tenant Party, and neither the Landlord Parties nor their insurers shall in any manner be held responsible therefor. Notwithstanding the foregoing, the foregoing waiver and release shall not apply to the extent of any injury, loss, damages or liability caused by the negligence or willful misconduct of the Landlord Parties; provided, however, in no event shall the Landlord Parties have any liability to a Tenant Party based on any loss with respect to or caused by interruption in the operation of Tenant's business; provided that the foregoing shall not limit Landlord's liability, if any, pursuant to Applicable Laws for property damage or personal injury caused by the negligence or willful misconduct of the Landlord Parties. The provisions of this section shall be applicable until the expiration or earlier termination of the Lease Term, and during such further period as Tenant may use or be in occupancy of any part of the Premises or of the Building.
10.3    Tenant's Insurance. From and after Tenant's occupancy and continuing during the Lease Term, Tenant shall, at Tenant's sole expense, procure and maintain the following insurance:
10.3.1    "Special Form" (formerly known as "All Risk") insurance, including fire, extended coverage, sprinkler leakage (including earthquake sprinkler leakage), vandalism and malicious mischief, covering (a) all improvements existing in the Premises as of the first date of Tenant's occupancy (the "Original Improvements"), Alterations, and (b) any and all personal property, in an amount not less than 100% of their actual replacement cost from time to time. The proceeds of such insurance shall be used for the repair or replacement of the Tenant Improvements or Alterations as long as this Lease remains in effect.
10.3.2    Commercial general liability insurance for injury to or death of any person and damage to property of others in connection with the construction of improvements on the Premises and with Tenant's use of and operations in the Premises. Such insurance shall be for $5,000,000 per occurrence and $5,000,000 annual aggregate and include coverage for premises medical payments of at least $5,000. This limit may be achieved by the use of a primary general liability policy combined with an excess or umbrella liability policy; except that the limits of liability shall be adjusted from time to time during the Term to such higher limits as Landlord may
-42-
ONE TEHAMA
[Social Finance, Inc.]


reasonably require under then current conditions consistent with the limit of liability then required for comparable tenants at the Comparable Buildings.
10.3.3    Workers' compensation insurance in the amount required by the state in which the Premises are located, and Employers' liability with limits of $1,000,000 for each accident, each employee, and each illness pertaining to Tenant's employees, which will waive any right of subrogation against Landlord.
10.3.4    Business income (formerly called business interruption insurance) and extra expense coverage with limits of at least one hundred percent (100%) of Tenant's Base Rent for a twelve (12) month period;
Tenant shall carry and maintain during the Lease Term (including any option periods, if applicable) increased amounts of the insurance required to be carried by Tenant pursuant to this Article 10 and such other reasonable types of insurance coverage and in such reasonable amounts covering the Premises and Tenant's operations therein, as may be reasonably required by Landlord from time to time, but in no event shall such increased amounts of insurance or such other reasonable types of insurance be in excess of that generally required by landlords of Comparable Buildings, and in no event shall Tenant be required to carry earthquake or terrorism insurance pursuant to the terms of this Section 10.3 to the extent not available on a commercially reasonable basis, and in no event may Landlord increase the amounts of the insurance required to be carried by Tenant hereunder more than once during the initial Lease Term and each Option Term.
10.4    Tenant's Policies. All insurance required to be carried by Tenant hereunder shall be issued by insurance companies qualified to do business in the State of California and rated A-:VIII or better in the most current issue of "Best's Key Rating Guide." Current, original certificates and applicable endorsements evidencing the existence and amounts of such insurance shall be delivered to Landlord by Tenant prior to Tenant's taking occupancy of the Premises, and at least ten (10) days prior to the expiration of any policy required hereunder. Tenant shall provide Landlord not less than thirty (30) days written notice prior to cancellation or reduction in coverage.
10.5    Tenant's Failure to Insure. If either party fails to maintain any insurance required by this Lease, the party that fails to maintain such insurance shall be liable for any loss or cost resulting from that failure. If Tenant fails to maintain any insurance required to be maintained by Tenant under this Lease, and does not cure such failure within ten (10) days after written notice from Landlord, Landlord may, but shall not be obligated to, provide for such insurance at Tenant's cost. This Section 10.5 shall not waive any of Landlord's other rights and remedies under this Lease. Tenant shall not keep, use, sell or offer for sale in or upon the Premises any article, which may be prohibited by the standard form of any insurance policy required hereunder. Tenant agrees to pay for any increase in premiums for insurance referred to herein that may be charged during the Term on the amount of such insurance which may be carried by Landlord on the Premises or the Project, resulting from any activity on or in connection with the Premises, whether or not Landlord has consented to the same, by Tenant other than general office use consistent with a Class A office building.
10.6    Additional Insureds. The commercial general liability and auto insurance carried by Tenant pursuant to this Lease, and any additional liability insurance carried by Tenant pursuant
-43-
ONE TEHAMA
[Social Finance, Inc.]


to Section 10.3 of this Lease, above, shall name Landlord, Landlord's officers, directors, employees, divisions, subsidiaries, partners, shareholders, affiliated companies, Landlord's managing agent, and such other Mortgagees and other parties as Landlord may reasonably request from time to time as additional insureds with respect to liability arising out of or related to this Lease or the operations of Tenant (collectively "Additional Insureds"). Such insurance shall provide primary coverage without contribution from any other insurance carried by or for the benefit of Landlord, Landlord's managing agent, or other Additional Insureds. Such insurance shall also waive any right of subrogation against each Additional Insured.
10.7    Landlord's Insurance. From and after the date of this Lease and continuing during the Lease Term, Landlord shall carry (i) full replacement cost physical damage insurance of the type commonly referred to as an "all risk of physical loss" or "causes of loss – special form" policy, including fire and extended coverage, vandalism and malicious mischief, sprinkler leakage and water damage covering the Building and Project, which insurance shall include rental loss coverage for a period of at least one (1) year, (ii) commercial general liability insurance with respect to the Project insuring such risks and hazards as are customarily insured against in coverage and in relative amount, in Landlord's reasonable judgment, by others similarly situated and operating Comparable Buildings, but in no event less than One Million Dollars ($1,000,000) per occurrence and Two Million Dollars ($2,000,000) general aggregate, and excess liability insurance with overall limits of Five Million Dollars ($5,000,000), for injuries to non-employees and property damage and (iii) insurance coverage for the risks of earthquake damage, which shall also include coverage for Building standard general office improvements in the Premises. Additionally, at the option of Landlord, such insurance coverage may include the risks of flood damage, terrorist acts and additional hazards (if generally carried by owners of Comparable Buildings and available at commercially reasonable rates), a rental loss endorsement and one or more loss payee endorsements in favor of the holders of any mortgages or deeds of trust encumbering the interest of Landlord in the Building or the ground or underlying lessors of the Building, or any portion thereof. None of the insurance carried by Landlord shall name Tenant as an insured or otherwise be for the benefit of Tenant, as a third party beneficiary or otherwise; provided that the proceeds thereof shall be utilized to repair or restore the Building to the extent required by Article 11 below.
10.8    Waiver Of Subrogation. The parties hereto waive and release any and all rights of recovery against the other, and agree not to seek to recover from the other or to make any claim against the other, and in the case of Landlord, against all Tenant Parties, and in the case of Tenant, against all Landlord Parties, for any loss or damage incurred by the waiving/releasing party to the extent such loss or damage is insured under any insurance policy required by this Lease or which would have been so insured had the party carried the insurance it was required to carry hereunder. Tenant shall obtain from its subtenants and other occupants of the Premises a similar waiver and release of claims against any or all of Tenant or Landlord. In addition, the parties hereto (and in the case of Tenant, its subtenants and other occupants of the Premises) shall procure an appropriate clause in, or endorsement on, any insurance policy required by this Lease pursuant to which the insurance company waives subrogation (so long as no material additional premium is charged for such waiver). The insurance policies required by this Lease shall contain no provision that would invalidate or restrict the parties' waiver and release of the rights of recovery in this section. The parties hereto covenant that no insurer shall hold any right of subrogation against the parties hereto by virtue of such insurance policy.
-44-
ONE TEHAMA
[Social Finance, Inc.]


The term "Landlord Party" or "Landlord Parties" shall mean Landlord, any affiliate of Landlord, Landlord's managing agents for the Building, each Mortgagee, each ground lessor, and each of their respective direct or indirect partners, officers, shareholders, directors, members, trustees, beneficiaries, servants, employees, principals, contractors, licensees, agents or representatives. For the purposes of this Lease, the term "Tenant Party" or "Tenant Parties" shall mean Tenant, any affiliate of Tenant, any permitted subtenant or any other permitted occupant of the Premises, and each of their respective direct or indirect partners, officers, shareholders, directors, members, trustees, beneficiaries, servants, employees, principals, contractors, licensees, agents, invitees or representatives.
10.9    Tenant's Work. During such times as Tenant is performing work or having work or services performed in or to the Premises, Tenant shall require its contractors, and their subcontractors of all tiers, to obtain and maintain commercial general liability, automobile, workers compensation, employer's liability, builder's risk, and equipment/property insurance in such amounts and on such terms as are customarily required of such contractors and subcontractors on similar projects. The amounts and terms of all such insurance are subject to Landlord's written approval, which approval shall not be unreasonably withheld. The commercial general liability and auto insurance carried by Tenant's contractors and their subcontractors of all tiers pursuant to this section shall name Landlord, Landlord's managing agent, and such other persons as Landlord may reasonably request from time to time as Additional Insureds with respect to liability arising out of or related to their work or services. Such insurance shall provide primary coverage without contribution from any other insurance carried by or for the benefit of Landlord, Landlord's managing agent, or other Additional Insureds. Such insurance shall also waive any right of subrogation against each Additional Insured. Tenant shall obtain and submit to Landlord, prior to the earlier of (i) the entry onto the Premises by such contractors or subcontractors or (ii) commencement of the work or services, certificates of insurance evidencing compliance with the requirements of this section.
ARTICLE 11
DAMAGE AND DESTRUCTION
11.1    Repair of Damage to Premises by Landlord. Tenant shall promptly notify Landlord of any damage to the Premises or the Building resulting from fire, earthquake, explosion, flood, wind, civil disturbance, or other event of a sudden, unexpected nature ("Casualty"). If the Premises or the Building shall be damaged by Casualty, within sixty (60) days following Landlord's discovery of the damage or destruction, Landlord shall give notice to Tenant (the "Landlord Casualty Notice") setting forth the estimated time required, in the reasonable opinion of Landlord's designated licensed civil engineer, structural engineer or other appropriate (given the nature of the damage) licensed professional (the "Construction Professional"), for the completion of repairs and restoration. Such repair and restoration shall be to substantially the same condition of the Tenant Improvements, Alterations, Original Improvements, Premises and Base Building prior to the Casualty, except for modifications required by Applicable Laws. If this Lease is not terminated pursuant to Section 11.2 below, upon notice to Tenant from Landlord, Tenant shall assign to Landlord (or to any party designated by Landlord) all insurance proceeds payable to Tenant under Tenant's insurance required under item (a) of Section 10.3.1 of this Lease which pertain to work to be performed by Landlord, and Landlord shall diligently repair any injury or
-45-
ONE TEHAMA
[Social Finance, Inc.]


damage to the Base Building and the Tenant Improvements, Alterations and the Original Improvements installed in the Premises in a good and professional manner. If the cost of repairs to the Tenant Improvements, Alterations and Original Improvements exceeds the amount of insurance proceeds received by Landlord from Landlord's insurance carrier or from Tenant's insurance carrier, as assigned by Tenant, the excess cost of such repairs shall be paid by Tenant to Landlord in accordance with a reasonable progress payment schedule, upon receipt of the appropriate conditional and/or unconditional lien releases, or, in the event Tenant is not the Original Tenant or a Permitted Transferee Assignee, then if reasonably required by Landlord based on the creditworthiness of Tenant, prior to Landlord's commencement of repair of the damage; provided, however, that if the damage was caused by an earthquake, then the amount that Tenant is required to pay to repair uninsured damage to the Tenant Improvements, Alterations and Original Improvements shall only pertain to any non-Building standard, non-general office improvements that Tenant requires to be installed in the Premises. Prior to the commencement of construction, Tenant shall submit to Landlord, for Landlord's review and approval, all plans, specifications and working drawings relating thereto, and Landlord shall, in its reasonable discretion, select the contractors to perform such improvement work. Landlord shall not be liable for any inconvenience or annoyance to Tenant or its visitors, or injury to Tenant's business resulting in any way from such damage or the repair thereof; provided, however, if such Casualty shall have damaged the Premises or a portion thereof necessary to Tenant's access to or occupancy of the Premises, then Landlord shall allow Tenant a proportionate abatement of Rent during the time and to the extent and in the proportion that the Premises or such portion thereof are unfit for occupancy for the purposes permitted under this Lease, and are not occupied by Tenant as a result thereof. For purposes of clarification, the parties agree that the Premises or portions thereof shall not be deemed occupied for purposes of Rent abatement even if workstations and furniture remains therein, so long as persons do not conduct normal business operations in such areas. Landlord shall use commercially reasonable efforts to minimize interference with the conduct of Tenant's business in the Premises in connection with the performance of any repair and restoration work following a Casualty.
11.2    Termination Options.
11.2.1    Landlord's Right to Terminate. Notwithstanding the terms of Section 11.1 of this Lease, Landlord may elect not to rebuild and/or restore the Premises, Building and/or Project, and instead terminate this Lease, by notifying Tenant of such election in an applicable Landlord Casualty Notice, in which event such Landlord Casualty Notice shall include a termination date giving Tenant one hundred twenty (120) days to vacate the Premises, but Landlord may so elect only if the Building or Project shall be damaged by Casualty or cause, and one or more of the following conditions is present: (i) in the reasonable judgment of the Construction Professional, repairs cannot reasonably be completed within twelve (12) months after the date of the Casualty (when such repairs are made without the payment of overtime or other premiums); (ii) the Mortgagee shall require that the insurance proceeds or any material portion thereof be used to retire the mortgage debt, or shall terminate the ground lease, as the case may be; (iii) more than Five Million Dollars ($5,000,000) of the damage to the Premises or Project (other than the Tenant Improvements, Alterations and the Original Improvements) is not fully covered by Landlord's insurance policies or that portion of the proceeds from Landlord's insurance policies allocable to the Building or the Project, as the case may be, unless such shortfall is due to Landlord's failure to carry the insurance required to be carried by Landlord under this Lease
-46-
ONE TEHAMA
[Social Finance, Inc.]


(provided that Landlord shall not be entitled to terminate this Lease if within five (5) business days of receipt of Landlord's termination notice, Tenant commits to fund (and thereafter actually funds) the shortfall of insurance proceeds not due to Landlord's failure to carry required insurance); or (iv) the damage occurs during the last twelve (12) months of the Lease Term (and Tenant has not exercised any option to extend the Lease Term) and repairs will reasonably require in excess of ninety (90) days to repair.
11.2.2    Tenant's Right to Terminate. Subject to the remaining terms of this Section 11.2.2, if Landlord does not elect to terminate this Lease pursuant to Landlord's termination right as provided above, and either (a) the repairs cannot, in the reasonable opinion of the Construction Professional, be completed within twelve (12) months after the Casualty, or (b) the damage occurs during the last twelve (12) months of the Lease Term and Tenant has not exercised any option to extend the Lease Term) and repair will reasonably require in excess of ninety (90) days to complete, then Tenant may elect, within thirty (30) days after Tenant's receipt of the applicable Landlord Casualty Notice, to terminate this Lease by written notice to Landlord effective as of the date specified in the notice, which date shall not be less than thirty (30) days nor more than sixty (60) days after the date such notice is given by Tenant. Furthermore, if neither Landlord nor Tenant has terminated this Lease pursuant to this Section 11.2, and the repairs are not actually completed for any reason (including Force Majeure), other than the fault of Tenant, within ninety (90) days after the later of (a) twelve (12) months after the Casualty and (b) the date specified for completion in Landlord's Casualty Notice, then Tenant shall have the right to terminate this Lease during the first five (5) business days of each calendar month following the expiration of such ninety (90) day period until such time as the repairs are complete, by notice to Landlord (the "Delayed Repair Termination Notice"), effective as of a date set forth in the Delayed Repair Termination Notice (the "Delayed Repair Termination Date"), which Delayed Repair Termination Date shall not be less than ten (10) business days following the date such Delayed Repair Termination Notice was delivered to Landlord. Notwithstanding the foregoing, if Tenant delivers a Delayed Repair Termination Notice to Landlord, then Landlord shall have the right to suspend the occurrence of the Delayed Repair Termination Date for a period ending thirty (30) days after the Delayed Repair Termination Date set forth in the Delayed Repair Termination Notice by delivering to Tenant, within five (5) business days of Landlord's receipt of the Delayed Repair Termination Notice, written notice that it is Landlord's good faith judgment that the repairs shall be substantially completed within thirty (30) days after the Delayed Repair Termination Date. If repairs shall be substantially completed prior to the expiration of such thirty (30)-day period, then the Delayed Repair Termination Notice shall be of no force or effect and this Lease shall continue, but if the repairs shall not be substantially completed within such thirty (30)-day period, then this Lease shall automatically terminate upon the expiration of such thirty (30)-day period. Notwithstanding anything set forth to the contrary in this Section 11.2, Tenant shall have the right to terminate this Lease under this Section 11.2.2 only if each of the following conditions are satisfied: (a) the damage to the Project by Casualty, was not caused by the willful misconduct of Tenant or a Tenant Party; (b) Landlord has not then commenced pursuing its remedies under this Lease (other than the mere delivery of notice) due to Tenant being in economic default under this Lease beyond applicable notice and cure periods; (c) as a result of the damage, Tenant, in its commercially reasonable business judgment, cannot conduct its business from all or a material portion of the Premises; and, (d) as a result of the damage to the Project, Tenant does not in fact occupy or use all or a material portion of the Premises. In the event this Lease is terminated in accordance with the terms of this Section 11.2, Tenant shall assign to Landlord (or to any party
-47-
ONE TEHAMA
[Social Finance, Inc.]


designated by Landlord) all insurance proceeds payable to Tenant under Tenant's insurance required under Section 10.3.1 of this Lease.
11.3    Waiver of Statutory Provisions. The provisions of this Lease, including this Article 11, constitute an express agreement between Landlord and Tenant with respect to any and all damage to, or destruction of, all or any part of the Premises, the Building or the Project, and any statute or regulation of the State of California, including, without limitation, Sections 1932(2) and 1933(4) of the California Civil Code, with respect to any rights or obligations concerning damage or destruction in the absence of an express agreement between the parties, and any other statute or regulation, now or hereafter in effect, shall have no application to this Lease or any damage or destruction to all or any part of the Premises, the Building or the Project.
ARTICLE 12
NONWAIVER
No provision of this Lease shall be deemed waived by either party hereto unless expressly waived in a writing signed thereby. The waiver by either party hereto of any breach of any term, covenant or condition herein contained shall not be deemed to be a waiver of any subsequent breach of same or any other term, covenant or condition herein contained. The subsequent acceptance of Rent hereunder by Landlord shall not be deemed to be a waiver of any preceding breach by Tenant of any term, covenant or condition of this Lease, other than the failure of Tenant to pay the particular Rent so accepted, regardless of Landlord's knowledge of such preceding breach at the time of acceptance of such Rent. No acceptance of a lesser amount than the Rent herein stipulated shall be deemed a waiver of Landlord's right to receive the full amount due, nor shall any endorsement or statement on any check or payment or any letter accompanying such check or payment be deemed an accord and satisfaction, and Landlord may accept such check or payment without prejudice to Landlord's right to recover the full amount due. No receipt of monies by Landlord from Tenant after the termination of this Lease shall in any way alter the length of the Lease Term or of Tenant's right of possession hereunder, or after the giving of any notice shall reinstate, continue or extend the Lease Term or affect any notice given Tenant prior to the receipt of such monies, it being agreed that after the service of notice or the commencement of a suit, or after final judgment for possession of the Premises, Landlord may receive and collect any Rent due, and the payment of said Rent shall not waive or affect said notice, suit or judgment. No payment by Tenant shall be deemed a waiver of Tenant's right to contest the underlying obligation or payment made, whether or not payment is expressly made under protest.
ARTICLE 13
CONDEMNATION
If the whole or more than one-third (1/3) of the rentable square feet of the Premises shall be taken by power of eminent domain or condemned by any competent authority for any public or quasi-public use or purpose, or if any adjacent property or street shall be so taken or condemned, or reconfigured or vacated by such authority in such manner as to require the reconstruction or remodeling of a substantial portion of the Premises, Building or Project, or if Landlord shall grant a deed or other instrument in lieu of such taking by eminent domain or condemnation, Landlord
-48-
ONE TEHAMA
[Social Finance, Inc.]


shall have the option to terminate this Lease effective as of the date possession is required to be surrendered to the authority. If more than one-third (1/3) of the rentable square feet of the Premises is taken, or if all reasonable access to and/or the use of the Premises is substantially impaired, in each case for a period in excess of one hundred eighty (180) days, Tenant shall have the option to terminate this Lease effective as of the date possession is required to be surrendered to the authority. Tenant shall not because of such taking assert any claim against Landlord or the authority for any compensation because of such taking and Landlord shall be entitled to the entire award or payment in connection therewith, except that Tenant shall have the right to file any separate claim available to Tenant for any taking of Tenant's personal property and fixtures belonging to Tenant and removable by Tenant upon expiration of the Lease Term pursuant to the terms of this Lease, and for moving expenses, so long as such claims do not diminish the award available to Landlord, its ground lessor with respect to the Building or Project or its mortgagee, and such claim is payable separately to Tenant. All Rent shall be apportioned as of the date of such termination. If any part of the Premises shall be taken (or if reasonable access to and/or use of the Premises is substantially impaired because of a taking), and this Lease shall not be so terminated, the Rent shall be proportionately abated. Tenant hereby waives any and all rights it might otherwise have pursuant to Section 1265.130 of the California Code of Civil Procedure. Notwithstanding anything to the contrary contained in this Article 13, in the event of a temporary taking of all or any portion of the Premises for a period of one hundred eighty (180) days or less, then this Lease shall not terminate but the Base Rent and the Additional Rent shall be abated for the period of such taking in proportion to the ratio that the amount of rentable square feet of the Premises taken bears to the total rentable square feet of the Premises and otherwise in accordance with Section 19.5.2. Landlord shall be entitled to receive the entire award made in connection with any such temporary taking.
ARTICLE 14
ASSIGNMENT AND SUBLETTING
14.1    Transfers. Except as otherwise specifically provided or permitted in this Article 14, Tenant shall not, without the prior written consent of Landlord, which consent shall not be unreasonably withheld, conditioned or delayed, assign, mortgage, pledge, hypothecate, encumber, or permit any lien to attach to, or otherwise transfer, this Lease or any interest hereunder, permit any assignment, or other transfer of this Lease or any interest hereunder by operation of law, sublet the Premises or any part thereof, or enter into any license or concession agreements or otherwise permit the occupancy of the Premises or any part thereof by any persons other than Tenant and its employees and contractors (all of the foregoing are hereinafter sometimes referred to individually as a "Transfer," and, collectively, as "Transfers" and any person to whom any Transfer is made or sought to be made is hereinafter sometimes referred to as a "Transferee"). If Tenant desires Landlord's consent to any Transfer, Tenant shall notify Landlord in writing, which notice (the "Transfer Notice") shall include (i) the proposed effective date of the Transfer, which shall not be less than thirty (30) days nor more than one hundred eighty (180) days after the date of delivery of the Transfer Notice, (ii) a description of the portion of the Premises to be transferred (the "Subject Space"), (iii) all of the material terms of the proposed Transfer and the consideration therefor, including calculation of the "Transfer Premium", as that term is defined in Section 14.3 below, in connection with such Transfer, the name and address of the proposed Transferee, and a copy of all existing executed and/or proposed documentation pertaining to the
-49-
ONE TEHAMA
[Social Finance, Inc.]


proposed Transfer, including all existing operative documents to be executed to evidence such Transfer or the agreements incidental or related to such Transfer, (iv) current financial statements of the proposed Transferee certified by an officer, partner or owner thereof, business credit and personal references and history of the proposed Transferee and any other information reasonably required by Landlord which will enable Landlord to determine the financial responsibility, character, and reputation of the proposed Transferee, nature of such Transferee's business and proposed use of the Subject Space (provided that Landlord must request such additional information within five (5) business days following the date Tenant delivers the Transfer Notice to Landlord), and (v) upon Landlord's request, an executed estoppel certificate from Tenant in the form attached hereto as Exhibit E (modified as appropriate to make the statements therein true and correct). Any Transfer made without Landlord's prior written consent shall, at Landlord's option, be null, void and of no effect, and shall, at Landlord's option, constitute a default by Tenant under this Lease after notice and expiration of the cure period set forth in Section 19.1.4 of this Lease, below. Whether or not Landlord consents to any proposed Transfer, Tenant shall pay Landlord's review and processing fees, as well as any reasonable professional fees (including, without limitation, reasonable attorneys', accountants', architects', engineers' and consultants' fees) incurred by Landlord, not to exceed Three Thousand Five Hundred Dollars ($3,500.00) in the aggregate for a Transfer in the ordinary course of business, within thirty (30) days after written request by Landlord.
14.2    Landlord's Consent. Landlord shall not unreasonably withhold its consent to any proposed Transfer of the Subject Space to the Transferee on the terms specified in the Transfer Notice, and shall grant or withhold such consent within ten (10) business days following the date upon which Landlord receives a "complete" Transfer Notice from Tenant (i.e., a Transfer Notice that includes all documents and information required pursuant to Section 14.1 of this Lease, above). If Landlord fails to respond to a "complete" Transfer Notice within ten (10) business days, Tenant may send a second notice to Landlord, which notice must contain the following disclaimer in bold face, capitalized type: "NOTICE – SECOND REQUEST FOR APPROVAL OF [ASSIGNMENT/SUBLEASE] PURSUANT TO ARTICLE 14 OF THE LEASE – FAILURE TO TIMELY RESPOND WITHIN THREE (3) BUSINESS DAYS AFTER RECEIPT OF THIS NOTICE WILL RESULT IN DEEMED APPROVAL OF SUCH [ASSIGNMENT/SUBLEASE]." If Landlord fails to respond in writing within three (3) business days after delivery of such second notice, then Landlord shall be deemed to have consented to the proposed assignment or sublease. Without limitation as to other reasonable grounds for withholding consent, the parties hereby agree that it shall be reasonable under this Lease and under any Applicable Law for Landlord to withhold consent to any proposed Transfer where one or more of the following apply:
14.2.1    The Transferee is of a character or reputation or engaged in a business which is not consistent with the quality of the Building or the Project;
14.2.2    The Transferee intends to use the Subject Space for purposes which are not permitted under this Lease;
14.2.3    The Transferee is either a governmental agency or instrumentality thereof; provided, however, that Tenant shall be entitled to assign, sublet, or otherwise transfer to a governmental agency or instrumentality thereof to the extent Landlord has leased or has permitted the lease of space to a comparable (in terms of security, foot traffic, prestige, eminent domain and
-50-
ONE TEHAMA
[Social Finance, Inc.]


function oriented issues) governmental agency or instrumentality thereof in comparably located space of comparable size in other comparable projects owned by Landlord;
14.2.4    The Transferee is not a party of reasonable financial worth and/or financial stability in light of the responsibilities to be undertaken in connection with the Transfer on the date consent is requested, taking into consideration Tenant's continuing liability under this Lease;
If Landlord consents to any Transfer pursuant to the terms of this Section 14.2 (and does not exercise any recapture rights Landlord may have under Section 14.4 of this Lease), Tenant may within six (6) months after Landlord's consent, but not later than the expiration of said six-month period, enter into such Transfer of the Premises or portion thereof, upon substantially the same terms and conditions as are set forth in the Transfer Notice furnished by Tenant to Landlord pursuant to Section 14.1 of this Lease, provided that if there are any material changes in the terms and conditions from those specified in the Transfer Notice such that Landlord would initially have been entitled to refuse its consent to such Transfer under this Section 14.2, Tenant shall again submit the Transfer to Landlord for its approval and other action under this Article 14 (including Landlord's right of recapture, if any, under Section 14.4 of this Lease). Notwithstanding anything to the contrary in this Lease, if Tenant or any proposed Transferee claims that Landlord has unreasonably withheld or delayed its consent under Section 14.2 or otherwise has breached or acted unreasonably under this Article 14, their sole remedies shall be a suit for contract damages (other than damages for injury to, or interference with, Tenant's business including, without limitation, loss of profits, other than profits from the subject Transfer, however occurring) or a declaratory judgment and an injunction for the relief sought, and Tenant hereby waives any right to terminate this Lease pursuant to the provisions of Section 1995.310 of the California Civil Code, or any successor statute, and all other remedies, on its own behalf and, to the extent permitted under all Applicable Laws, on behalf of the proposed Transferee. Tenant shall indemnify, defend and hold harmless Landlord from any and all liability, losses, claims, damages, costs, expenses, causes of action and proceedings involving any third party or parties (including without limitation Tenant's proposed subtenant or assignee) who claim they were damaged by Landlord's wrongful withholding or conditioning of Landlord's consent.
14.3    Transfer Premium. If Landlord's consent is required for, and Landlord consents to, a Transfer, as a condition thereto which the parties hereby agree is reasonable, Tenant shall pay to Landlord fifty percent (50%) of any "Transfer Premium," as that term is defined in this Section 14.3, received by Tenant from such Transferee. "Transfer Premium" shall mean all rent, additional rent or other consideration payable by such Transferee in connection with the Transfer in excess of the Rent and Additional Rent payable by Tenant under this Lease during the term of the Transfer on a per rentable square foot basis if less than all of the Premises is transferred. Notwithstanding anything to the contrary set forth in this Section 14.3, Tenant shall be entitled to retain one hundred percent (100%) of any Transfer Premium until such time as Tenant has recovered the reasonable, actual, out-of-pocket third-party expenses incurred by Tenant in connection with the Transfer, including, without limitation, for (i) any changes, alterations and improvements to the Premises, or improvement allowances given in connection with the Transfer, (ii) any free base rent provided to the Transferee in connection with the Transfer (provided that such free rent shall be deducted only to the extent the same is included in the calculation of total consideration payable by such Transferee), and (iii) any brokerage commissions in connection with the Transfer and (iv) legal fees reasonably incurred in connection with the Transfer
-51-
ONE TEHAMA
[Social Finance, Inc.]


(collectively, "Tenant's Subleasing Costs"). "Transfer Premium" shall also include, but not be limited to, key money, bonus money or other cash consideration paid by Transferee to Tenant in connection with such Transfer, and any payment in excess of fair market value for services rendered by Tenant to Transferee or for assets, fixtures, inventory, equipment, or furniture transferred by Tenant to Transferee in connection with such Transfer. Landlord shall make a determination of the amount of Landlord's applicable share of the Transfer Premium on a monthly basis as rent or other consideration is paid by Transferee to Tenant under the Transfer.
14.4    Landlord's Option as to Subject Space. Notwithstanding anything to the contrary contained in this Article 14, in the event that Tenant contemplates a Transfer of all or substantially all of the Premises (for purposes hereof, substantially all of the Premises shall mean five (5) or more floors of the Premises) for all or substantially all of the remaining Lease Term ("Contemplated Transfer") or such Transfer would otherwise qualify as a Contemplated Transfer, but for subterfuge by Tenant to avoid Landlord's rights under this Section 14.4 (for purposes hereof, a sublease shall be deemed to be for substantially all of the remainder of the Lease Term if, assuming all sublease renewal or extension rights are exercised, such sublease shall expire during the final six (6) months of the Lease Term), Tenant shall give Landlord notice (the "Intention to Transfer Notice") of such contemplated Transfer (whether or not the contemplated Transferee or the terms of such contemplated Transfer have been determined); provided, however, that Landlord hereby acknowledges and agrees that Tenant shall have no obligation to deliver an Intention to Transfer Notice hereunder with respect to an assignment or sublease to a Permitted Transferee. The Intention to Transfer Notice shall specify the contemplated date of commencement of the Contemplated Transfer (the "Contemplated Effective Date"), and shall specify that such Intention to Transfer Notice is delivered to Landlord pursuant to this Section 14.4 in order to allow Landlord, if it so elects, to terminate this Lease. Thereafter, Landlord shall have the option, by giving written notice to Tenant (the "Termination Notice") within thirty (30) days after receipt of any Intention to Transfer Notice. Any recapture under this Section 14.4 shall cancel and terminate this Lease as of the Contemplated Effective Date. If Landlord declines, or fails to elect in a timely manner, to terminate this Lease under this Section 14.4, then, subject to the other terms of this Article 14, for a period of nine (9) months (the "Nine Month Period") commencing on the last day of such thirty (30) day period, Landlord shall not have any right to terminate this Lease with respect to any Contemplated Transfer made during the Nine Month Period; provided however, that any such Transfer shall be subject to the remaining terms of this Article 14. If such a Transfer is not so consummated within the Nine Month Period, Tenant shall again be required to submit a new Intention to Transfer Notice to Landlord with respect any Contemplated Transfer, as provided above in this Section 14.4. If Landlord elects to terminate this Lease under this Section 14.4, Tenant shall have the right, by written notice to Landlord given within five (5) business days after delivery of the Termination Notice, to rescind Tenant's Intention to Transfer Notice and not proceed with the Contemplated Transfer, in which case such Termination Notice shall be ineffective, and Tenant shall continue to directly lease the Premises pursuant to the terms of this Lease.
14.5    Effect of Transfer. If Landlord consents to a Transfer, then (i) the terms and conditions of this Lease shall in no way be deemed to have been waived or modified; (ii) such consent shall not be deemed consent to any further Transfer by either Tenant or a Transferee; (iii) Tenant shall deliver to Landlord, promptly after execution, an original executed copy of the assignment or sublease document pertaining to the Transfer; (iv) Tenant shall furnish upon
-52-
ONE TEHAMA
[Social Finance, Inc.]


Landlord's request a complete statement, certified by an independent certified public accountant, or Tenant's chief financial officer, setting forth in detail the computation of any Transfer Premium Tenant has derived and shall derive from such Transfer; and (v) no Transfer relating to this Lease or agreement entered into with respect thereto, whether with or without Landlord's consent, shall relieve Tenant or any guarantor of the Lease from any liability under this Lease, including, without limitation, in connection with the Subject Space, and, in the event of a Transfer of Tenant's entire interest in this Lease, the liability of Tenant and such Transferee shall be joint and several. Landlord or its authorized representatives shall have the right at all reasonable times upon reasonable prior notice to audit the books, records and papers of Tenant relating to the calculation of the Transfer Premium with respect to any Transfer, and shall have the right to make copies thereof. If the Transfer Premium respecting any Transfer shall be found understated, Tenant shall, within thirty (30) days after demand, pay the deficiency, and if understated by more than five percent (5%), Tenant shall pay Landlord's reasonable costs of such audit.
14.6    Occurrence of Default. Any Transfer hereunder shall be subordinate and subject to the provisions of this Lease, and if this Lease shall be terminated during the term of any Transfer, then Landlord shall have all of the rights set forth in Section 19.3 of this Lease with respect to such Transfer. In addition, if Tenant shall be in default under this Lease beyond applicable notice and cure periods expressly set forth in this Lease, then Landlord is hereby irrevocably authorized to direct any Transferee to make all payments under or in connection with a Transfer directly to Landlord (which payments Landlord shall apply towards Tenant's obligations under this Lease) until such default is cured. Such Transferee shall rely on any representation by Landlord that Tenant is in default hereunder, without any need for confirmation thereof by Tenant. Upon any assignment, the assignee shall assume in writing all obligations and covenants of Tenant thereafter to be performed or observed under this Lease. No collection or acceptance of rent by Landlord from any Transferee shall be deemed a waiver of any provision of this Article 14 or the approval of any Transferee or a release of Tenant from any obligation under this Lease, whether theretofore or thereafter accruing. In no event shall Landlord's enforcement of any provision of this Lease against any Transferee be deemed a waiver of Landlord's right to enforce any term of this Lease against Tenant or any other person. If Tenant's obligations hereunder have been guaranteed, Landlord's consent to any Transfer shall not be effective unless the guarantor also consents to such Transfer.
14.7    Additional Transfers. For purposes of this Lease, the term "Transfer" shall also include (i) if Tenant is a partnership or a limited liability company, the withdrawal or change, voluntary, involuntary or by operation of law, of fifty percent (50%) or more of the partners, officers or members, as applicable, or transfer of fifty percent (50%) or more of partnership, ownership or membership interests (as applicable), within a twelve (12)-month period, or the dissolution of the partnership or limited liability company without immediate reconstitution thereof, and (ii) if Tenant is a closely held corporation (i.e., whose stock is not publicly held and not traded through an exchange or over the counter), (A) the dissolution, merger, consolidation or other reorganization of Tenant or (B) the sale or other transfer of an aggregate of fifty percent (50%) or more of the voting shares of Tenant (other than to existing shareholders or to immediate family members by reason of gift or death), within a twelve (12)-month period, or (C) the sale, mortgage, hypothecation or pledge of an aggregate of fifty percent (50%) or more of the value of the unencumbered assets of Tenant within a twelve (12)-month period.
-53-
ONE TEHAMA
[Social Finance, Inc.]


14.8    Deemed Consent Transfers. Notwithstanding anything to the contrary contained in this Lease, (a) an assignment or subletting of all or a portion of the Premises to an affiliate of Tenant (an entity which is controlled by, controls, or is under common control with, Tenant, (b) an assignment of this Lease by Tenant to an entity which acquires all or substantially all of the assets or interest (partnership, stock or other) of Tenant, or (c) an assignment of this Lease to an entity which is the resulting entity of a merger or consolidation of Tenant (each, a "Permitted Transferee"), shall not be deemed a Transfer requiring Landlord's consent under this Article 14, provided that (i) Tenant notifies Landlord of any such assignment or sublease and promptly supplies Landlord with any documents or information reasonably requested by Landlord regarding such Permitted Transferee as set forth above, (ii) such assignment or sublease is not a subterfuge by Tenant to avoid its obligations under this Lease or to otherwise effectuate any release of Tenant of such obligations, and (iii) any Non-Transferee Assignee (a) has a long term issuer credit rating from Moody's Professional Rating Service ("Moody's") of A3 or better or Standard and Poor's Professional Rating Service ("S&P") of A- or better or (b) has a tangible net worth (excluding goodwill as an asset) of at least equal to One Billion Dollars ($1,000,000,000). An assignee of Tenant's entire interest in this Lease and the Premises who qualifies as a Permitted Transferee may also be referred to herein as a "Non-Transferee Assignee"). "Control," as used in this Section 14.8, shall mean the ownership, directly or indirectly, of more than fifty percent (50%) of the total voting securities of, or possession of the right to vote, in the ordinary direction of its affairs, of more than fifty percent (50%) of the total voting interest in, any person or entity, or the power to direct the policies or operations of any person or entity (by contract or otherwise). The sale of corporate shares of capital stock in Tenant in connection with an initial public offering of Tenant's stock on a nationally-recognized stock exchange, and the subsequent sale of Tenant's capital stock as long as Tenant is a publicly traded company on a nationally-recognized stock exchange shall not be deemed a Transfer under this Article 14 and shall not be subject to this Article 14.
ARTICLE 15
SURRENDER OF PREMISES; OWNERSHIP AND
REMOVAL OF TRADE FIXTURES
15.1    Surrender of Premises. No act or thing done by either party or any agent or employee thereof during the Lease Term shall be deemed to constitute an acceptance by either party of a surrender of the Premises unless such intent is specifically acknowledged in a writing signed by both parties. The delivery of keys to the Premises to Landlord or any agent or employee of Landlord shall not constitute a surrender of the Premises or effect a termination of this Lease, whether or not the keys are thereafter retained by Landlord, and notwithstanding such delivery Tenant shall be entitled to the return of such keys at any reasonable time upon request until this Lease shall have been properly terminated. The voluntary or other surrender of this Lease by Tenant, whether accepted by Landlord or not, or a mutual termination hereof, shall not work a merger, and at the option of Landlord shall operate as an assignment to Landlord of all subleases or subtenancies affecting the Premises or terminate any or all such sublessees or subtenancies.
15.2    Removal of Tenant Property by Tenant. Upon the expiration of the Lease Term, or upon any earlier termination of this Lease, Tenant shall, subject to the provisions of this Article 15, quit and surrender possession of the Premises to Landlord in the condition Tenant is
-54-
ONE TEHAMA
[Social Finance, Inc.]


required to maintain the Premises pursuant to Article 7. Upon such expiration or termination, Tenant shall, without expense to Landlord, remove or cause to be removed from the Premises all debris and rubbish, such items of furniture, equipment, business and trade fixtures, free-standing cabinet work, movable partitions and other articles of personal property owned by Tenant or installed or placed by Tenant at its expense in the Premises, and such similar articles of any other persons claiming under Tenant, and Tenant shall repair at its own expense all damage to the Premises and Building resulting from such removal.
ARTICLE 16
HOLDING OVER
If Tenant holds over after the expiration of the Lease Term or earlier termination thereof, with the express or implied consent of Landlord, such tenancy shall be from month-to-month only, and shall not constitute a renewal hereof or an extension for any further term, and in such case Rent shall be payable at a monthly rate equal to (i) one hundred fifty percent (150%) of the Base Rent applicable during the last rental period of the Lease Term under this Lease, and one hundred percent (100%) of all Additional Rent due, for the first (1st) three (3) months of such holdover, and (ii) two hundred percent (200%) of the Base Rent applicable during the last rental period of the Lease Term under this Lease, and one hundred percent (100%) of all Additional Rent due, thereafter. Such month-to-month tenancy shall be subject to every other applicable term, covenant and agreement contained herein. Nothing contained in this Article 16 shall be construed as consent by Landlord to any holding over by Tenant, and Landlord expressly reserves the right to require Tenant to surrender possession of the Premises to Landlord as provided in this Lease upon the expiration or other termination of this Lease. The provisions of this Article 16 shall not be deemed to limit or constitute a waiver of any other rights or remedies of Landlord provided herein or at law. If Tenant fails to surrender the Premises upon the termination or expiration of this Lease, in addition to any other liabilities to Landlord accruing therefrom, Tenant shall protect, defend, indemnify and hold Landlord harmless from all loss, costs (including reasonable attorneys' fees) and liability resulting from such failure, including, without limiting the generality of the foregoing, any claims made by any succeeding tenant founded upon such failure to surrender and any lost profits to Landlord resulting therefrom; provided, however, upon entering into a third-party lease which affects the Premises, Landlord shall deliver written notice (the "New Lease Notice") of such lease to Tenant and the terms of the foregoing indemnity shall not be effective until the later of (i) the date that occurs thirty (30) days following the date Landlord delivers such New Lease Notice to Tenant, and (ii) the date such holdover commences.
ARTICLE 17
ESTOPPEL CERTIFICATES
Within ten (10) business days following a request in writing by Landlord, Tenant shall execute, acknowledge and deliver to Landlord an estoppel certificate, which, as submitted by Landlord, shall be substantially in the form of Exhibit E, attached hereto (or such other commercially reasonable form as may be required by any prospective mortgagee or purchaser of the Project, or any portion thereof), making any modifications or indicating any exceptions thereto that may exist at that time to make such statements therein true and correct, and shall also contain
-55-
ONE TEHAMA
[Social Finance, Inc.]


any other factual information reasonably requested by Landlord or Landlord's mortgagee or prospective mortgagee. Any such certificate may be relied upon by any prospective mortgagee or purchaser of all or any portion of the Project. Tenant shall execute and deliver whatever other instruments may be reasonably required for such purposes. Unless the same are otherwise reasonably publicly available, at any time during the Lease Term, Landlord may require Tenant to provide Landlord with a current financial statement and financial statements of the two (2) years prior to the current financial statement year, provided that, as a condition to receipt of said financial statements, Landlord shall execute a commercially reasonable confidentiality agreement, which shall include the ability to share the financial statements with parties who have a reasonable need to know of such information, including Landlord's financial and legal consultants, or its directors, officers, employees, attorneys, accountants, prospective lenders, prospective purchasers, and current and potential partners, subject to confidentiality terms set forth in such confidentiality agreement. Such statements shall be prepared in accordance with generally accepted accounting principles and, if such is the normal practice of Tenant, shall be audited by an independent certified public accountant. If Tenant fails to execute, acknowledge and deliver any such estoppel certificate or other instruments within such ten (10) business day period, then Landlord may deliver a written notice (the "Estoppel Reminder Notice") to Tenant stating that Tenant has failed to deliver such estoppel certificate and/or other instruments within the required time period. If Tenant fails to deliver such estoppel certificate and/or other instruments within five (5) days following the date upon which Landlord delivered an Estoppel Reminder Notice, then such failure shall constitute an acceptance and acknowledgment by Tenant that statements included in the estoppel certificate are true and correct, without exception.
ARTICLE 18
MORTGAGE OR GROUND LEASE
18.1    Subordination. Landlord hereby represents and warrants to Tenant, as of the date of this Lease, the only party having a deed of trust affecting the Project or any portion thereof is Deutsche Bank AG. Concurrently with the full execution and delivery of this Lease, Landlord shall provide an "SNDAA" (defined below) form Landlord's current lender for the Project, which SNDAA shall be in the from of Exhibit F. This Lease shall be subject and subordinate to all present and future ground or underlying leases of the Building or Project and to the lien of any mortgage, trust deed or other encumbrances now or hereafter in force against the Building or Project or any part thereof, if any, and to all renewals, extensions, modifications, consolidations and replacements thereof, and to all advances made or hereafter to be made upon the security of such mortgages or trust deeds (collectively, the "Encumbrances"), unless the holders of such Encumbrances, or the lessors under such ground lease or underlying leases (collectively, the "Mortgagee"), require in writing that this Lease be superior thereto; provided, however, that in consideration of and a condition precedent to Tenant's agreement to subordinate this Lease to any future Encumbrances, shall be the receipt by Tenant of a commercially reasonable non-disturbance agreement which requires such Mortgagee to accept this Lease, and not to disturb Tenant's possession, so long as Tenant is not in default under this Lease after any applicable notice and cure period expressly set forth in this Lease (a "SNDAA") executed by Landlord and the appropriate Mortgagee. Subject to Tenant's receipt of an SNDAA, Tenant covenants and agrees in the event any proceedings are brought for the foreclosure of any such mortgage or deed in lieu thereof (or if any ground lease is terminated), to attorn, without any deductions or set-offs whatsoever, to the
-56-
ONE TEHAMA
[Social Finance, Inc.]


lienholder or purchaser or any successors thereto upon any such foreclosure sale or deed in lieu thereof (or to the ground lessor), if so requested to do so by such purchaser or lienholder or ground lessor, and to recognize such purchaser or lienholder or ground lessor as the lessor under this Lease, provided such lienholder or purchaser or ground lessor shall agree to accept this Lease and be bound as Landlord hereunder, and shall further agree not to disturb Tenant's occupancy, so long as Tenant shall not be in default under this Lease after any applicable notice and cure period expressly set forth in this Lease. Landlord's interest herein may be assigned as security at any time to any lienholder. Tenant shall, within ten (10) business days of request by Landlord, execute such further commercially reasonable instruments or assurances as Landlord may reasonably deem necessary to evidence or confirm the subordination or superiority of this Lease to any such mortgages, trust deeds, ground leases or underlying leases.
18.2    Notice to Lienholder or Ground Lessor. Notwithstanding anything to the contrary contained in Article 28, below, or elsewhere in this Lease, upon receipt by Tenant of notice from any Mortgagee, or from Landlord, which notice sets forth the address of such lienholder or ground lessor, and which notice specifically advises Tenant that all notices of default under this Lease, to be effective, must be copied to such lienholder or lessor, no notice of default from Tenant to Landlord shall be effective unless and until a copy of the same is given to such lienholder or ground lessor at the appropriate address therefor (as specified in the above-described notice or at such other places as may be designated from time to time in a notice to Tenant in accordance with Article 28, below). For the purposes of this Article 18, the term "mortgage" shall include a mortgage on a leasehold interest of Landlord (but not a mortgage on Tenant's leasehold interest hereunder).
18.3    Assignment of Rents. With reference to any assignment by Landlord of Landlord's interest in this Lease, or the Rent payable to Landlord hereunder, conditional in nature or otherwise, which assignment is made to any holder of a mortgage, trust deed or other encumbrance in force against the Building or the Project or any part thereof which includes the Premises or to any lessor under a ground lease or underlying lease of the Building or the Project, Tenant agrees as follows:
18.3.1    The execution of any such assignment by Landlord, and the acceptance thereof by such lienholder or ground lessor, shall never be treated as an assumption by such lienholder or ground lessor of any of the obligations of Landlord under this Lease, unless such lienholder or ground lessor shall, by notice to Tenant, specifically otherwise elect.
18.3.2    Notwithstanding delivery to Tenant of the notice required by Section 18.3.1, above, such lienholder or ground lessor, respectively, shall be treated as having assumed Landlord's obligations under this Lease only upon such lienholder's foreclosure of any such mortgage, trust deed or other encumbrance, or acceptance of a deed in lieu thereof, and taking of possession of the Building or the Project or applicable portion thereof, or such ground lessor's termination of any such ground lease or underlying leases and assumption of Landlord's position hereunder, as the case may be. In no event shall such lienholder, ground lessor or any other successor to Landlord's interest in this Lease, as the case may be, be liable for any security deposit paid by Tenant to Landlord, unless and until such lienholder, ground lessor or other such successor, respectively, actually has been credited with or has received for its own account as landlord the amount of such security deposit or any portion thereof (in which event the liability of such
-57-
ONE TEHAMA
[Social Finance, Inc.]


lienholder, ground lessor or other such successor, as the case may be, shall be limited to the amount actually credited or received).
18.3.3    In no event shall the acquisition of title to the Building and the land upon which the Building is located or the Project or any part thereof which includes the Premises by a purchaser which, simultaneously therewith, leases back to the seller thereof the entire Building or the land upon which the Building is located or the Project or the entirety of that part thereof acquired by such purchaser, as the case may be, be treated as an assumption, by operation of law or otherwise, of Landlord's obligations under this Lease, but Tenant shall look solely to such seller-lessee, or to the successors to or assigns of such seller-lessee's estate, for performance of Landlord's obligations under this Lease. In any such event, this Lease shall be subject and subordinate to the lease to such seller-lessee; provided, however, that in consideration of and a condition precedent to Tenant's agreement to subordinate this Lease to any future Encumbrances, shall be the receipt by Tenant of a SNDAA. Subject to Tenant's receipt of a SNDAA in accordance with the immediately preceding sentence, Tenant covenants and agrees in the event the lease to such seller-lessee is terminated to attorn, without any deductions or set-offs whatsoever, to such purchaser-lessor, if so requested to do so by such purchaser-lessor, and to recognize such purchaser-lessor as the lessor under this Lease, provided such purchaser-lessor shall agree to accept this Lease and be bound as Landlord hereunder, and shall further agree not to disturb Tenant's occupancy, so long as Tenant shall not be in default under this Lease beyond applicable notice and cure periods expressly set forth in this Lease. For all purposes, such seller-lessee, or the successors to or assigns of such seller-lessee's estate, shall be the lessor under this Lease unless and until such seller-lessee's position shall have been assumed by such purchaser-lessor.
ARTICLE 19
DEFAULTS; REMEDIES
19.1    Events of Default. The occurrence of any of the following shall constitute a default of this Lease by Tenant:
19.1.1    Any failure by Tenant to pay any Rent or any other charge required to be paid under this Lease, or any part thereof, when due within five (5) business days after Tenant's receipt of written notice from Landlord that the same was not paid when due; or
19.1.2    Except as otherwise specifically set forth in this Section 19.1, any failure by Tenant to observe or perform any other provision, covenant or condition of this Lease to be observed or performed by Tenant where such failure continues for thirty (30) days after written notice thereof from Landlord to Tenant; provided that if the nature of such default is such that the same cannot reasonably be cured within a thirty (30) day period, Tenant shall not be deemed to be in default if it diligently commences such cure within such period and thereafter diligently proceeds to rectify and cure such default; or
19.1.3    Abandonment of the Premises by Tenant under California Civil Code Section 1951.3; or
-58-
ONE TEHAMA
[Social Finance, Inc.]


19.1.4    The (i) failure by Tenant to observe or perform any material provisions of Articles 10, 14, 17 or 18 of this Lease, or any provision of the Tenant Work Letter, (ii) use by Tenant of the Premises in violation of the terms of Article 5 of this Lease, where such use would jeopardize Landlord's interest in the Building or the Project, or (iii) the failure by Tenant to observe or perform any other provision, covenant or condition of this Lease which failure, because of the character of such provision, covenant or condition, would immediately jeopardize Landlord's interest, where any of such failures under clauses (i), (ii) or (iii), of this Section 19.1.4, continues for more than five (5) business days after notice from Landlord.
The notice periods provided in this Section 19.1 are in lieu of, and not in addition to, any notice periods provided by law; provided, however, nothing set forth in this Lease shall be deemed to be a waiver by Tenant of any notice period required pursuant to the terms of Section 1161 of the California Code of Civil Procedure.
19.2    Remedies Upon Default. Upon the occurrence of any event of default by Tenant, Landlord shall have, in addition to any other remedies available to Landlord at law or in equity (all of which remedies shall be distinct, separate and cumulative), the option to pursue any one or more of the following remedies, each and all of which shall be cumulative and nonexclusive.
19.2.1    Terminate this Lease, in which event Tenant shall immediately surrender the Premises to Landlord, and if Tenant fails to do so, Landlord may, without prejudice to any other remedy which it may have for possession or arrearages in rent, enter upon and take possession of the Premises and expel or remove Tenant and any other person who may be occupying the Premises or any part thereof, without being liable for prosecution or any claim or damages therefor; and Landlord may recover from Tenant the following:
19.2.1.1    The worth at the time of award of any unpaid rent which has been earned at the time of such termination; plus
19.2.1.2    The worth at the time of award of the amount by which the unpaid rent which would have been earned after termination until the time of award exceeds the amount of such rental loss that Tenant proves could have been reasonably avoided; plus
19.2.1.3    The worth at the time of award of the amount by which the unpaid rent for the balance of the Lease Term after the time of award exceeds the amount of such rental loss that Tenant proves could have been reasonably avoided; plus
19.2.1.4    Any other amount necessary to compensate Landlord for all the detriment proximately caused by Tenant's failure to perform its obligations under this Lease or which in the ordinary course of things would be likely to result therefrom, specifically including but not limited to, brokerage commissions and advertising expenses incurred, expenses of remodeling the Premises or any portion thereof for a new tenant, whether for the same or a different use, and any special concessions made to obtain a new tenant; plus
19.2.1.5    At Landlord's election, such other amounts in addition to or in lieu of the foregoing as may be permitted from time to time by Applicable Laws.
-59-
ONE TEHAMA
[Social Finance, Inc.]


The term "rent" as used in this Section 19.2 shall be deemed to be and to mean all sums of every nature required to be paid by Tenant pursuant to the terms of this Lease, whether to Landlord or to others. As used in Sections 19.2.1(i) and 19.2.1(ii), above, the "worth at the time of award" shall be computed by allowing interest at the rate set forth in Article 25 of this Lease, but in no case greater than the maximum amount of such interest permitted by law. As used in Section 19.2.1(iii) above, the "worth at the time of award" shall be computed by discounting such amount at the discount rate of the Federal Reserve Bank of San Francisco at the time of award plus one percent (1%).
19.2.2    Landlord shall have the remedy described in California Civil Code Section 1951.4 (lessor may continue lease in effect after lessee's breach and abandonment and recover rent as it becomes due, if lessee has the right to sublet or assign, subject only to reasonable limitations). Accordingly, if Landlord does not elect to terminate this Lease on account of any default by Tenant, Landlord may, from time to time, without terminating this Lease, enforce all of its rights and remedies under this Lease, including the right to recover all rent as it becomes due.
19.2.3    Landlord shall at all times have the rights and remedies (which shall be cumulative with each other and cumulative and in addition to those rights and remedies available under Sections 19.2.1 and 19.2.2, above, or any law or other provision of this Lease), without prior demand or notice except as required by Applicable Laws, to seek any declaratory, injunctive or other equitable relief, and specifically enforce this Lease, or restrain or enjoin a violation or breach of any provision hereof.
19.3    Subleases of Tenant. If Landlord elects to terminate this Lease on account of any default by Tenant, as set forth in this Article 19, then Landlord shall have the right, at Landlord's option in its sole discretion, (i) to terminate any and all assignments, subleases, licenses, concessions or other consensual arrangements for possession entered into by Tenant and affecting the Premises, in which event Landlord shall have the right to repossess such affected portions of the Premises by any lawful means, or (ii) to succeed to Tenant's interest in any or all such assignments, subleases, licenses, concessions or arrangements, in which event Landlord may require any assignees, sublessees, licensees or other parties thereunder to attorn to and recognize Landlord as its assignor, sublessor, licensor, concessionaire or transferor thereunder. In the event of Landlord's election to succeed to Tenant's interest in any such assignments, subleases, licenses, concessions or arrangements, Tenant shall, as of the date of notice by Landlord of such election, have no further right to or interest in the rent or other consideration receivable thereunder.
19.4    Efforts to Relet. No re-entry or repossession, repairs, maintenance, changes, alterations and additions, reletting, appointment of a receiver to protect Landlord's interests hereunder, or any other action or omission by Landlord shall be construed as an election by Landlord to terminate this Lease or Tenant's right to possession, or to accept a surrender of the Premises, nor shall same operate to release Tenant in whole or in part from any of Tenant's obligations hereunder, unless express written notice of such intention is sent by Landlord to Tenant. Tenant hereby irrevocably waives any right otherwise available under any law to redeem or reinstate this Lease.
19.5    Landlord Default.
-60-
ONE TEHAMA
[Social Finance, Inc.]


19.5.1    General. Notwithstanding anything to the contrary set forth in this Lease, Landlord shall not be in default in the performance of any obligation required to be performed by Landlord pursuant to this Lease unless Landlord fails to perform such obligation within thirty (30) days after the receipt of notice from Tenant specifying in detail Landlord's failure to perform; provided, however, if the nature of Landlord's obligation is such that more than thirty (30) days are required for its performance, then Landlord shall not be in default under this Lease if it shall commence such performance within such thirty (30) day period and thereafter diligently pursue the same to completion. Upon any such default by Landlord under this Lease, Tenant may, except as otherwise specifically provided in this Lease to the contrary, exercise any of its rights provided at law or in equity.
19.5.2    Abatement of Rent. Notwithstanding anything to the contrary set forth in this Lease, in the event that Tenant is prevented from using, and does not use, the Premises or any portion thereof, as a result of (i) any repair, maintenance or alteration performed by Landlord, or which Landlord failed to perform, after the Lease Commencement Date and required by this Lease, which substantially interferes with Tenant's use of the Premises, or (ii) any failure to provide services, utilities or access to the Premises as required to be provided by Landlord under this Lease (either such set of circumstances as set forth in items (i) or (ii), above, to be known as an "Abatement Event"), then Tenant shall give Landlord notice of such Abatement Event, and if such Abatement Event continues for five (5) consecutive business days after Landlord's receipt of any such notice (the "Eligibility Period"), the Base Rent, and Tenant's Share of Direct Expenses shall be abated or reduced, as the case may be, after expiration of the Eligibility Period for such time that Tenant continues to be so prevented from using, and does not use for the normal conduct of Tenant's business, the Premises or a portion thereof, in the proportion that the rentable area of the portion of the Premises that Tenant is prevented from using, and does not use, bears to the total rentable area of the Premises; provided, however, in the event that Tenant is prevented from using, and does not use, a portion of the Premises for a period of time in excess of the Eligibility Period and the remaining portion of the Premises is not sufficient to allow Tenant to effectively conduct its business therein, and if Tenant does not conduct its business from such remaining portion, then for such time after expiration of the Eligibility Period during which Tenant is so prevented from effectively conducting its business therein, the Base Rent and Tenant's Share of Direct Expenses for the entire Premises shall be abated for such time as Tenant continues to be so prevented from using, and does not use, the Premises. If, however, Tenant reoccupies any portion of the Premises during such period, the Rent allocable to such reoccupied portion, based on the proportion that the rentable area of such reoccupied portion of the Premises bears to the total rentable area of the Premises, shall be payable by Tenant from the date Tenant reoccupies such portion of the Premises. To the extent an Abatement Event is caused by an event covered by Articles 11 or 13 of this Lease, then Tenant's right to abate rent shall be governed by the terms of such Article 11 or 13, as applicable, and the Eligibility Period shall not be applicable thereto. Such right to abate Base Rent and Tenant's Share of Direct Expenses, and Tenant's obligation to pay for parking shall be Tenant's sole and exclusive remedy for rent abatement at law or in equity for an Abatement Event.
19.5.3    Abatement Event Termination Right. If, as a result of an Abatement Event, Tenant is prevented from using, and does not use, the Premises, for a continuous period of one (1) year after Landlord's receipt of an applicable Abatement Event notice, then Tenant shall have the right to terminate this Lease by notice to Landlord (the "Abatement Event Termination Notice"), effective as of a date set forth in the Abatement Event Termination Notice (the
-61-
ONE TEHAMA
[Social Finance, Inc.]


"Abatement Event Termination Date"), which Abatement Event Termination Date shall not be less than ten (10) business days following the date such Abatement Event Termination Notice was delivered to Landlord. Notwithstanding anything set forth to the contrary in this Section 19.5.3, Tenant shall have the right to terminate this Lease under this Section 19.5.3 only if Tenant is not then in economic or material non-economic default under this Lease beyond any applicable notice and cure periods expressly set forth in this Lease.
ARTICLE 20
COVENANT OF QUIET ENJOYMENT
Landlord covenants that Tenant, on paying the Rent, charges for services and other payments herein reserved and on keeping, observing and performing all the other terms, covenants, conditions, provisions and agreements herein contained on the part of Tenant to be kept, observed and performed prior to the expiration of applicable cure periods following notice of any default, shall, during the Lease Term, peaceably and quietly have, hold and enjoy the Premises subject to the terms, covenants, conditions, provisions and agreements hereof without interference by any persons lawfully claiming by or through Landlord. The foregoing covenant is in lieu of any other covenant express or implied.
ARTICLE 21
LETTER OF CREDIT
21.1    Delivery of Letter of Credit. Within five (5) business days of Tenant's execution of this Lease and confirmation from Landlord that this Lease has been approved by Landlord and will be fully executed and delivered following receipt of the L-C, Tenant shall deliver to Landlord, as protection for the full and faithful performance by Tenant of all of its obligations under this Lease and for all losses and damages Landlord may suffer as a result of any breach or default by Tenant under this Lease, an unconditional, clean, irrevocable negotiable standby letter of credit (the "L-C") in the amount set forth in Section 8 of the Summary (the "L-C Amount"), in the form attached hereto as Exhibit G, payable in the City of San Francisco, California, running in favor of Landlord, drawn on a bank (the "Bank") reasonably approved by Landlord and at a minimum having a long term issuer credit rating from Standard and Poor's Professional Rating Service of A or a comparable rating from Moody's Professional Rating Service (the "Credit Rating Threshold"), and otherwise conforming in all respects to the requirements of this Article 21, including, without limitation, all of the requirements of Section 21.2 below, all as set forth more particularly hereinbelow. Tenant shall pay all expenses, points and/or fees incurred by Tenant in obtaining and maintaining the L-C. In the event of an assignment by Tenant of its interest in the Lease (and irrespective of whether Landlord's consent is required for such assignment), the acceptance of any replacement or substitute letter of credit by Landlord from the assignee shall be subject to Landlord's prior written approval, in Landlord's reasonable discretion, and the reasonable attorney's fees incurred by Landlord in connection with such determination shall be payable by Tenant to Landlord within thirty (30) days of billing.
21.2    In General. The L-C shall be "callable" at sight, permit partial draws and multiple presentations and drawings, and be otherwise subject to the Uniform Customs and Practices for
-62-
ONE TEHAMA
[Social Finance, Inc.]


Documentary Credits (1993-Rev), International Chamber of Commerce Publication #500, or the International Standby Practices-ISP 98, International Chamber of Commerce Publication #590. Tenant further covenants and warrants as follows:
21.2.1    Landlord Right to Transfer. The L-C shall provide that Landlord, its successors and assigns, may, at any time and without notice to Tenant and without first obtaining Tenant's consent thereto, transfer (one or more times) all or any portion of its interest in and to the L-C to another party, person or entity, regardless of whether or not such transfer is separate from or as a part of the assignment by Landlord of its rights and interests in and to this Lease. In the event of a transfer of Landlord's interest in the Building, Landlord shall transfer the L-C, in whole or in part, to the transferee and thereupon Landlord shall, without any further agreement between the parties, be released by Tenant from all liability therefor, and it is agreed that the provisions hereof shall apply to every transfer or assignment of the whole or any portion of said L-C to a new landlord. In connection with any such transfer of the L-C by Landlord, Tenant shall, at Tenant's sole cost and expense, execute and submit to the Bank such applications, documents and instruments as may be necessary to effectuate such transfer, and Tenant shall be responsible for paying the Bank's transfer and processing fees in connection therewith.
21.2.2    No Assignment by Tenant. Tenant shall neither assign nor encumber the L-C or any part thereof. Neither Landlord nor its successors or assigns will be bound by any assignment, encumbrance, attempted assignment or attempted encumbrance by Tenant in violation of this Section.
21.2.3    Replenishment. If, as a result of any drawing by Landlord on the L-C pursuant to its rights set forth in Section 21.3 below, the amount of the L-C shall be less than the L-C Amount, Tenant shall, within five (5) business days thereafter, provide Landlord with (i) an amendment to the L-C restoring such L-C to the L-C Amount or (ii) additional L-Cs in an amount equal to the deficiency, which additional L-Cs shall comply with all of the provisions of this Article 21, and if Tenant fails to comply with the foregoing, notwithstanding anything to the contrary contained in Section 19.1 above, the same shall constitute an incurable default by Tenant under this Lease (without the need for any additional notice and/or cure period).
21.2.4    Renewal; Replacement. If the L-C expires earlier than the date (the "LC Expiration Date") that is sixty (60) days after the expiration of the Lease Term, Tenant shall deliver a new L-C or certificate of renewal or extension to Landlord at least sixty (60) days prior to the expiration of the L-C then held by Landlord, without any action whatsoever on the part of Landlord, which new L-C shall be irrevocable and automatically renewable through the LC Expiration Date upon the same terms as the expiring L-C or such other terms as may be acceptable to Landlord in its sole discretion. In furtherance of the foregoing, Landlord and Tenant agree that the L-C shall contain a so-called "evergreen provision," whereby the L-C will automatically be renewed unless at least sixty (60) days' prior written notice of non-renewal is provided by the issuer to Landlord; provided, however, that the final expiration date identified in the L-C, beyond which the L-C shall not automatically renew, shall not be earlier than the LC Expiration Date.
21.2.5    Bank's Financial Condition. If, at any time during the Lease Term, the Bank's long term credit rating is reduced below the Credit Rating Threshold, or if the financial condition of the Bank changes in any other materially adverse way (either, a "Bank Credit
-63-
ONE TEHAMA
[Social Finance, Inc.]


Threat"), then Landlord shall have the right to require that Tenant obtain from a different issuer a substitute L-C that complies in all respects with the requirements of this Article 21, and Tenant's failure to obtain such substitute L-C within thirty (30) days following Landlord’s written demand therefor (with no other notice or cure or grace period being applicable thereto, notwithstanding anything in this Lease to the contrary) shall entitle Landlord, or Landlord's then managing agent, to immediately draw upon the then existing L-C in whole or in part, without notice to Tenant, as more specifically described in Section 21.3 below. Tenant shall be responsible for the payment of any and all costs incurred with the review of any replacement L-C (including without limitation Landlord's reasonable attorneys' fees), which replacement is required pursuant to this Section or is otherwise requested by Tenant.
21.3    Application of Letter of Credit. Tenant hereby acknowledges and agrees that Landlord is entering into this Lease in material reliance upon the ability of Landlord to draw upon the L-C as protection for the full and faithful performance by Tenant of all of its obligations under this Lease and for all losses and damages Landlord may suffer as a result of any breach or default by Tenant under this Lease. Landlord, or its then managing agent, shall have the right to draw down an amount up to the face amount of the L-C if any of the following shall have occurred or be applicable: (A) such amount is past due to Landlord under the terms and conditions of this Lease, or (B) Tenant has filed a voluntary petition under the U. S. Bankruptcy Code or any state bankruptcy code (collectively, "Bankruptcy Code"), or (C) an involuntary petition has been filed against Tenant under the Bankruptcy Code, or (D) the Bank has notified Landlord that the L-C will not be renewed or extended through the LC Expiration Date, or (E) a Bank Credit Threat or Receivership (as such term is defined in Section 21.6.1 below) has occurred and Tenant has failed to comply with the requirements of either Section 21.2.5 above or 21.6 below, as applicable. If Tenant shall breach any provision of this Lease or otherwise be in default hereunder or if any of the foregoing events identified in Sections 21.3(B) through (E) shall have occurred, Landlord may, but without obligation to do so, and without notice to Tenant, draw upon the L-C, in part or in whole, and the proceeds may be applied by Landlord (i) to cure any breach or default of Tenant and/or to compensate Landlord for any and all damages of any kind or nature sustained resulting from Tenant's breach or default, (ii) against any Rent payable by Tenant under this Lease that is not paid when due and/or (iii) to pay for all losses and damages that Landlord has suffered or that Landlord reasonably estimates that it will suffer as a result of any breach or default by Tenant under this Lease. The use, application or retention of the L-C, or any portion thereof, by Landlord shall not prevent Landlord from exercising any other right or remedy provided by this Lease or by any Applicable Laws, it being intended that Landlord shall not first be required to proceed against the L-C, and shall not operate as a limitation on any recovery to which Landlord may otherwise be entitled. Tenant agrees not to interfere in any way with payment to Landlord of the proceeds of the L-C, either prior to or following a "draw" by Landlord of any portion of the L-C, regardless of whether any dispute exists between Tenant and Landlord as to Landlord's right to draw upon the L-C provided, however, nothing contained herein shall be deemed to prohibit Tenant from challenging the validity of the amount of said draw following the occurrence thereof. No condition or term of this Lease shall be deemed to render the L-C conditional to justify the issuer of the L-C in failing to honor a drawing upon such L-C in a timely manner. Tenant agrees and acknowledges that (i) the L-C constitutes a separate and independent contract between Landlord and the Bank, (ii) Tenant is not a third party beneficiary of such contract, (iii) Tenant has no property interest whatsoever in the L-C or the proceeds thereof, and (iv) in the event Tenant becomes a debtor under any chapter of the Bankruptcy Code, neither Tenant, any trustee, nor Tenant's bankruptcy estate
-64-
ONE TEHAMA
[Social Finance, Inc.]


shall have any right to restrict or limit Landlord's claim and/or rights to the L-C and/or the proceeds thereof by application of Section 502(b)(6) of the U. S. Bankruptcy Code or otherwise.
21.4    Letter of Credit not a Security Deposit. Landlord and Tenant acknowledge and agree that in no event or circumstance shall the L-C or any renewal thereof or any proceeds thereof be (i) deemed to be or treated as a "security deposit" within the meaning of California Civil Code Section 1950.7, (ii) subject to the terms of such Section 1950.7, or (iii) intended to serve as a "security deposit" within the meaning of such Section 1950.7. The parties hereto (A) recite that the L-C is not intended to serve as a security deposit and such Section 1950.7 and any and all other laws, rules and regulations applicable to security deposits in the commercial context ("Security Deposit Laws") shall have no applicability or relevancy thereto and (B) waive any and all rights, duties and obligations either party may now or, in the future, will have relating to or arising from the Security Deposit Laws.
21.5    Proceeds of Draw. In the event Landlord draws down on the L-C pursuant to Section 21.3(D) or (E) above, the proceeds of the L-C may be held by Landlord and applied by Landlord against any Rent payable by Tenant under this Lease that is not paid when due and/or to pay for all losses and damages that Landlord has suffered as a result of any breach or default by Tenant under this Lease. Any unused proceeds shall constitute the property of Landlord and need not be segregated from Landlord's other assets. Tenant hereby (i) agrees that (A) Tenant has no property interest whatsoever in the proceeds from any such draw, and (B) such proceeds shall not be deemed to be or treated as a "security deposit" under the Security Deposit Law, and (ii) waives all rights, duties and obligations either party may now or, in the future, will have relating to or arising from the Security Deposit Laws. Landlord agrees that the amount of any proceeds of the L-C received by Landlord, and not (a) applied against any Rent payable by Tenant under this Lease that was not paid when due or (b) used to pay for any losses and/or damages suffered by Landlord (or reasonably estimated by Landlord that it will suffer) as a result of any breach or default by Tenant under this Lease (the "Unused L-C Proceeds"), shall be paid by Landlord to Tenant (x) upon receipt by Landlord of a replacement L-C in the full L-C Amount, which replacement L-C shall comply in all respects with the requirements of this Article 21, or (y) within thirty (30) days after the LC Expiration Date; provided, however, that if prior to the LC Expiration Date a voluntary petition is filed by Tenant, or an involuntary petition is filed against Tenant by any of Tenant's creditors, under the Bankruptcy Code, then Landlord shall not be obligated to make such payment in the amount of the Unused L-C Proceeds until either all preference issues relating to payments under this Lease have been resolved in such bankruptcy or reorganization case or such bankruptcy or reorganization case has been dismissed.
21.6    Bank Placed Into Receivership.
21.6.1    Bank Placed Into Receivership. In the event the Bank is placed into receivership or conservatorship (any such event, a "Receivership") by the Federal Deposit Insurance Corporation or any successor or similar entity (the "FDIC"), then, effective as of the date such Receivership occurs, the L-C shall be deemed to not meet the requirements of this Article 21, and, within ten (10) business days following Landlord's notice to Tenant of such Receivership (the "LC Replacement Notice"), Tenant shall (i) replace the L-C with a substitute L-C from a different issuer reasonably acceptable to Landlord and that complies in all respects with the requirements of this Article 21, or (ii) in the event Tenant demonstrates to Landlord that Tenant is
-65-
ONE TEHAMA
[Social Finance, Inc.]


reasonably unable to obtain a substitute L-C from a different issuer reasonably acceptable to Landlord and that complies in all respects with the requirements of this Section 21.6.1 within the foregoing ten (10) business-day period, deposit with Landlord cash in the L-C Amount (the "Interim Cash Deposit"); provided, however, that, in the case of the foregoing sub-clause (ii), Tenant shall have the right to replace the L-C with a substitute L-C from a different issuer reasonably acceptable to Landlord, and that complies in all respects with the requirements of this Section 21.6.1. Tenant shall be responsible for the payment of any and all costs incurred with the review of any replacement L- C (including without limitation Landlord’s reasonable attorneys’ fees), which replacement is required pursuant to this Section or is otherwise requested by Tenant.
21.6.2    Interim Cash Deposit. During any period that Landlord remains in possession of the Interim Cash Deposit (any such period, a "Deposit Period"), it is understood by the parties that such Interim Cash Deposit shall be held by Landlord as security for the full and faithful performance of Tenant's covenants and obligations under this Lease. The Interim Cash Deposit shall not constitute an advance of any Rent, an advance payment of any other kind, nor a measure of Landlord’s damages in case of Tenant's default. If, during any such Deposit Period, Tenant defaults with respect to any provisions of this Lease, including, but not limited to, the provisions relating to the payment of Rent, the removal of property and the repair of resultant damage, then Landlord may but shall not be required to, from time to time, without notice to Tenant and without waiving any other remedy available to Landlord, use the Interim Cash Deposit, or any portion of it, to the extent necessary to cure or remedy such default or failure or to compensate Landlord for all damages sustained by Landlord or which Landlord reasonably estimates that it will sustain resulting from Tenant's default or failure to comply fully and timely with its obligations pursuant to this Lease. Tenant shall pay to Landlord within ten (10) days after written demand any amount so applied in order to restore the Interim Cash Deposit to its original amount, and Tenant's failure to do so shall constitute a default under this Lease. In the event Landlord is in possession of the Interim Cash Deposit at the expiration or earlier termination of this Lease, and Tenant is in compliance with the covenants and obligations set forth in this Lease at the time of such expiration or termination, then Landlord shall return to Tenant the Interim Cash Deposit, less any amounts deducted by Landlord to reimburse Landlord for any sums to which Landlord is entitled under the terms of this Lease, within sixty (60) days following both such expiration or termination and Tenant's vacation and surrender of the Premises. Landlord's obligations with respect to the Interim Cash Deposit are those of a debtor and not a trustee. Landlord shall not be required to maintain the Interim Cash Deposit separate and apart from Landlord's general or other funds, and Landlord may commingle the Interim Cash Deposit with any of Landlord's general or other funds. Tenant shall not at any time be entitled to interest on the Interim Cash Deposit. In the event of a transfer of Landlord's interest in the Building, Landlord shall transfer the Interim Cash Deposit, in whole or in part, to the transferee and thereupon Landlord shall, without any further agreement between the parties, be released by Tenant from all liability therefor, and it is agreed that the provisions hereof shall apply to every transfer or assignment of the whole or any portion of said Interim Cash Deposit to a new landlord. Tenant hereby waives the provisions of Section 1950.7 of the California Civil Code, or any successor statute.
21.7    Reduction of L-C Amount. The L-C Amount shall not be reduced during that period commencing on the Lease Commencement Date and ending on the last day of Lease Year 4 (the "Fixed Period"). The Fixed Period shall be automatically extended (without the necessity of notice to Tenant) by four (4) months upon Tenant's second (2nd) failure to pay any Rent or any
-66-
ONE TEHAMA
[Social Finance, Inc.]


other charge required to be paid under this Lease, or any part thereof, beyond applicable notice and cure periods, and shall be extended for an additional four (4) months upon each similar failure by Tenant thereafter. After the expiration of the Fixed Period (as the same may be extended pursuant to the immediately preceding sentence), provided that on or prior to the applicable Reduction Date, Tenant is not then in monetary or material non-monetary default under this Lease beyond applicable notice and cure periods and Tenant tenders to Landlord a certificate of amendment to the existing L-C (or a new L-C), conforming in all respects to the requirements of this Article 21, in the amount of the applicable L-C Amount as of such Reduction Date, then the L-C Amount (as that amount may have been adjusted due to an expansion or reduction of the Premises in accordance with Article 1 of this Lease, the "Adjusted L-C Amount"), shall be reduced as follows:
Date of Reduction Amount of Reduction Remaining L-C Amount
First Day of Lease Year 5 $857,142.86 $5,142,857.14
First Day of Lease Year 6 $857,142.86 $4,285,714.28
First Day of Lease Year 7 $857,142.86 $3,428,571.42
First Day of Lease Year 8 $857,142.86 $2,571,428.56
First Day of Lease Year 9 $857,142.86 $1,714,285.70
First Day of Lease Year 10 $857,142.86 $857,142.86
First Day of Lease Year 11 $857,142.86 $0.00
If Tenant is allowed to reduce the L-C Amount pursuant to the terms of this Section 21.7, then Landlord shall reasonably cooperate with Tenant in order to effectuate such reduction.
In the event Tenant is in monetary or material non-monetary default under this Lease beyond applicable notice and cure periods as of the applicable Reduction Date, or if Tenant fails to deliver a certificate of amendment to the existing L-C (or new L-C) as required by this Section 21.7, then the L-C Amount shall not be reduced upon such applicable Reduction Date, but the terms of this Section 21.7 shall remain effective and the L-C Amount shall thereafter be reduced, to the amount applicable to such Reduction Date, on the date Tenant is no longer in monetary or material non-monetary default under this Lease beyond applicable notice and cure periods and Tenant delivers to Landlord a certificate of amendment to the existing L-C (or a new L-C), conforming in all respects to the requirements of this Article 21, in the amount of the applicable L-C Amount (provided that no such reductions shall be permitted in the event this Lease is terminated early as a result of a Tenant default).
21.8    Remedy for Improper Drafts. Tenant's sole and exclusive remedy in connection with Landlord's improper draw against the L-C or Landlord's improper application or retention of any proceeds of the L-C or the Interim Cash Deposit shall be the right to obtain from Landlord a refund of the amount of any sight draft(s) that were improperly presented or the proceeds of which were misapplied or wrongfully held, together with interest at the Interest Rate and reasonable
-67-
ONE TEHAMA
[Social Finance, Inc.]


actual out-of-pocket attorneys' fees, provided that at the time of such refund, Tenant increases the amount of such L-C to the amount (if any) then required under the applicable provisions of this Lease. Tenant acknowledges that Landlord's draw against the L-C, application or retention of any proceeds thereof, or the Bank's payment under such L-C, could not, under any circumstances, cause Tenant injury that could not be remedied by an award of money damages, and that the recovery of money damages would be an adequate remedy therefor. In the event Tenant shall be entitled to a refund as aforesaid and Landlord shall fail to make such payment within ten (10) business days after demand, Tenant shall have the right to deduct the amount thereof together with interest thereon at the Interest Rate from the next installment(s) of Base Rent.
ARTICLE 22
ROOF DECK
22.1    In General. Tenant shall have the right to use, on an exclusive basis, but subject to "Landlord Use Rights" (as defined hereinbelow), the roof deck to be constructed on the roof of the Building (the "Roof Deck"). Tenant's use of the Roof Deck shall be subject to the rules and regulations attached hereto as Exhibit D. Using only gas-lines installed by Landlord, Tenant shall be entitled to install and maintain heat lamps, fire pits, and barbeques on the Roof Deck. Tenant shall not make any improvements or alterations to the Roof Deck, without Landlord's prior consent, which consent shall not be unreasonably withheld, conditioned or delayed.
22.2    Landlord Use Rights. Upon reasonable prior notice, Landlord shall have the right to temporarily close the Roof Deck or limit access thereto from time to time in connection with Landlord's maintenance or repair of the Roof Deck or Building Structure ("Landlord Use Rights"). Landlord shall diligently complete such maintenance or repairs in a good and workmanlike manner, so as to minimize the period of time that the Roof Deck is not available for use by Tenant.
22.3    Other Terms. Landlord and Tenant acknowledge and agree that (i) Tenant shall be responsible for supervising and controlling access to the Roof Deck by employees, officers, directors, shareholders, agents, representatives, contractors and invitees (the "Roof Deck Users") of Tenant and Landlord shall be responsible for supervising and controlling access to the Roof Deck by Landlord's Roof Deck Users; and (ii) Landlord is not responsible for supervising and controlling access to the Roof Deck. Except to the extent arising as a consequence of the negligence or willful misconduct of Landlord or Landlord's Roof Deck Users: (a) Tenant assumes the risk for any Loss arising out of the use or misuse of the Roof Deck by Tenant's Roof Deck Users, and Tenant releases and discharges Landlord from and against any such loss, claim, damage or liability; (b) Tenant further agrees to indemnify, defend and hold Landlord and the Landlord Parties, harmless from and against any and all losses and claims relating to or arising out of the use or misuse of the Roof Deck by Tenant or Tenant's Roof Deck Users. Neither party shall have any liability or responsibility to monitor the use, or manner of use, by the Roof Deck Users of the other party.
-68-
ONE TEHAMA
[Social Finance, Inc.]


ARTICLE 23
SIGNS
23.1    Interior Signage. Tenant, at its sole cost and expense, may install identification signage anywhere in the Premises, including in the elevator lobby of each full floor of the Premises leased by Tenant. Upon the expiration or earlier termination of this Lease, Tenant shall, at its sole cost and expense, remove all such signage and repair all damage to the Premises and the Building resulting from such removal.
23.2    Intentionally Omitted.
23.3    Exterior Signage. Throughout the Lease Term, as the same may be extended, so long as the Original Tenant or its Permitted Transferee occupies at least two (2) full floors of the Building, Tenant shall have the exclusive right, at its sole cost and expense, to install, repair and maintain sign(s) ("Tenant's South Side Exterior Signage") on the exterior portion of the south side of the Building, and such additional exterior signage at the two entrances to the Building or elsewhere as Tenant shall desire (together with Tenant's South Side Exterior Signage, "Tenant's Exterior Signage"). Landlord shall work with Tenant to obtain approval from the City of San Francisco (the "City") of Tenant's Exterior Signage. Tenant acknowledges that the Building has been identified by the City as having historical significance, and Tenant's right to Tenant's Exterior Signage will be subject to governmental requirements and guidelines as a result. Any such installation, repair and/or maintenance of Tenant's Exterior Signage shall be subject to compliance with Applicable Laws, all governmental requirements, and Landlord's prior approval as to the shape, size and location of such signs, which approval shall not be unreasonably withheld, conditioned or delayed. Landlord hereby approves of the preliminary design, size and location of Tenant's South Side Exterior Signage, which is depicted on Exhibit H attached hereto. Landlord further agrees that, if permitted by applicable governmental authorities, Tenant's Exterior Signage may be illuminated. If Tenant changes its name at any time, Tenant shall have the right, at Tenant's cost, to modify or change Tenant's Exterior Signage as necessary to reflect the changed name. Any such changes or alterations to Tenant's Exterior Signage shall be subject to compliance with Applicable Laws and Landlord's prior approval as to the shape, size and location of any such changes or alterations, which approval shall not be unreasonably withheld, conditioned or delayed. To the extent Tenant desires to change the name and/or logo set forth on Tenant's Exterior Signage, such name and/or logo shall not have a name which relates to an entity which is of a character or reputation, or is associated with a political faction or orientation, which is inconsistent with the quality of the Project, as reasonably determined by Landlord, or which would otherwise reasonably offend a landlord of the Comparable Buildings. Upon the expiration or earlier termination of this Lease, Tenant shall, at its sole cost and expense, remove all Tenant's Exterior Signage and repair all damage to the Building resulting from such removal.
23.4    Prohibited Signage and Other Items. Except as set forth in Section 23.3, above, Tenant may not install any signs on the exterior or roof of the Project. Any signs, window coverings, or other items visible from the exterior of the Premises or Building, shall be subject to the prior approval of Landlord, which approval shall not be unreasonably withheld, conditioned, or delayed.
-69-
ONE TEHAMA
[Social Finance, Inc.]


ARTICLE 24
COMPLIANCE WITH LAW
24.1    Tenant's Obligations. Tenant shall not do anything or suffer (to the extent within Tenant's reasonable control) anything to be done in or about the Premises or the Project which will in any way conflict with any law, statute, ordinance or other governmental rule, regulation or requirement now in force or which may hereafter be enacted or promulgated, including any such governmental regulations related to disabled access (collectively, "Applicable Laws"). At its sole cost and expense, Tenant shall promptly comply with any Applicable Laws which relate to (i) Tenant's use of the Premises, (ii) any Alterations made by Tenant to the Premises, and any Tenant Improvements in the Premises, or (iii) the Base Building, but as to the Base Building, only to the extent such obligations (a) pertain to Applicable Laws that were enacted, modified or initially enforced on or after the Lease Commencement Date and relate to the Building Systems, (b) are triggered by Alterations made by Tenant to the Premises to the extent such Alterations are not normal and customary business office improvements, or triggered by the Tenant Improvements to the extent such Tenant Improvements are not normal and customary business office improvements, or (c) are triggered by Tenant's use of the Premises for non-general office use. Notwithstanding the foregoing, if any obligation for Tenant to comply with Applicable Laws requires modifications to the Base Building are "capital in nature", then Landlord shall perform such modifications pursuant to Section 7.3 above, and the parties shall be responsible for the respective costs as set forth in Section 7.3 above. Should any standard or regulation now or hereafter be imposed on Tenant by a state, federal or local governmental body charged with the establishment, regulation and enforcement of occupational, health or safety standards for employers, employees, landlords or tenants, then Tenant agrees, at its sole cost and expense, to comply promptly with such standards or regulations and to cooperate with Landlord, including, without limitation, by taking such actions as Landlord may reasonably require, in Landlord's efforts to comply with such standards or regulations. The judgment of any court of competent jurisdiction or the admission of Tenant in any judicial action, regardless of whether Landlord is a party thereto, that Tenant has violated any of said governmental measures, shall be conclusive of that fact as between Landlord and Tenant; provided, however, Tenant shall have the right to contest in good faith the interpretation or alleged violation of Applicable Laws as the same relate to Tenant or the Premises, including, without limitation, the right to apply for and obtain a waiver or deferment of compliance, the right to assert any and all defenses and the right to appeal any decisions, judgments or rulings, provided that Tenant shall indemnify and defend Landlord from any and all loss, cost, damage, expense and liability resulting from any such contest by Tenant. Tenant shall promptly pay all fines, penalties and damages that may arise out of or be imposed because of its failure to comply with the provisions of this Article 24.
24.2    Landlord's Obligations. Landlord shall comply with all Applicable Laws relating (i) to the Building Structure, (ii) the Building Systems, but only with respect to Applicable Laws that were enacted, modified or initially enforced prior to the Lease Commencement Date, provided that, in either instance, compliance with such Applicable Laws is not the responsibility of Tenant under this Lease, and provided further that Landlord's failure to comply therewith would prohibit Tenant from obtaining or maintaining a certificate of occupancy for the Premises, or would unreasonably and materially affect the safety of Tenant's employees or create a health hazard for Tenant's employees, or would otherwise materially and adversely affect Tenant's use of or access
-70-
ONE TEHAMA
[Social Finance, Inc.]


to the Premises. In addition to Landlord's obligations set forth in the Tenant Work Letter, Landlord shall remove, remediate, encapsulate or abate any other Hazardous Substances (including, but not limited to, asbestos and lead paint) which were in existence in the Building or on the Project prior to the Delivery Date, and were of such a nature that a federal, state, local or municipal governmental authority, if it had then had knowledge of the presence of such Hazardous Substances, in the state, and under the conditions that it then existed in the Building or on the Project, would have then required the removal of such Hazardous Substances or other remedial or containment action with respect thereto. To the extent required by Applicable Laws, Landlord shall cause an Asbestos Operations and Maintenance Manual to be prepared and delivered to Tenant prior to the Lease Commencement Date, and shall comply with all asbestos disclosure and notification requirements under Applicable Laws.
24.3    Certified Access Specialist. Tenant hereby agrees to use reasonable efforts to notify Landlord if Tenant makes any Alterations or improvements to the Premises that might impact accessibility to the Premises or Building under any disability access laws. Landlord hereby agrees to use reasonable efforts to notify Tenant if Landlord makes any alterations or improvements to the Premises that might impact accessibility to the Premises or Building under any disability access laws. For purposes of Section 1938 of the California Civil Code, Landlord hereby discloses to Tenant, and Tenant hereby acknowledges, that the Premises have not undergone inspection by a Certified Access Specialist ("CASp"). As required by Section 1938(e) of the California Civil Code, Landlord hereby states as follows: "A Certified Access Specialist (CASp) can inspect the subject premises and determine whether the subject premises comply with all of the applicable construction-related accessibility standards under state law. Although state law does not require a CASp inspection of the subject premises, the commercial property owner or lessor may not prohibit the lessee or tenant from obtaining a CASp inspection of the subject premises for the occupancy or potential occupancy of the lessee or tenant, if requested by the lessee or tenant. The parties shall mutually agree on the arrangements for the time and manner of the CASp inspection, the payment of the fee for the CASp inspection, and the cost of making any repairs necessary to correct violations of construction-related accessibility standards within the premises." In furtherance of the foregoing, Landlord and Tenant hereby agree as follows: (a) any CASp inspection requested by Landlord or Tenant shall be conducted, at the requesting party's sole cost and expense, by a CASp approved by Landlord, subject to the non-requesting party's reasonable rules and requirements; and (b) the cost of making any improvements or repairs within the Premises, the Buildings or the Project to correct violations of construction-related accessibility standards shall be allocated as provided in Section 24.1 and 24.2 above or elsewhere in this Lease.
ARTICLE 25
LATE CHARGES
If any installment of Rent or any other sum due from Tenant shall not be received by Landlord or Landlord's designee within five (5) days after said amount is due, then Tenant shall pay to Landlord a late charge equal to four percent (4%) of the overdue amount plus any reasonable attorneys' fees incurred by Landlord by reason of Tenant's failure to pay Rent and/or other charges when due hereunder; provided, however, that no such late charge shall be assessed on the first (1st) occasion in any twelve (12)-month period that any rent or other sum is not received by Landlord or Landlord's designee within five (5) days of the due date. The late charge shall be deemed
-71-
ONE TEHAMA
[Social Finance, Inc.]


Additional Rent and the right to require it shall be in addition to all of Landlord's other rights and remedies hereunder or at law and shall not be construed as liquidated damages or as limiting Landlord's remedies in any manner. In addition to the late charge described above, any Rent or other amounts owing hereunder which are not paid (i) within five (5) days after the date they are due, or (ii) upon the date they are due if any Rent or other amounts owing hereunder by Landlord or Tenant have not been received by Landlord or Landlord's designee within five (5) days after the date due on two (2) or more occasions during any given twelve (12) month period, shall bear interest from the date when due until paid at a rate per annum (the "Interest Rate") equal to the lesser of (x) the annual "Bank Prime Loan" rate cited in the Federal Reserve Statistical Release publication H.15(519), published weekly (or such other comparable index as Landlord and Tenant shall reasonably agree upon if such rate ceases to be published) plus two (2) percentage points, and (y) the highest rate permitted by Applicable Law.
ARTICLE 26
LANDLORD'S RIGHT TO CURE DEFAULT; PAYMENTS BY TENANT
26.1    Landlord's Cure. All covenants and agreements to be kept or performed by Tenant under this Lease shall be performed by Tenant at Tenant's sole cost and expense and without any reduction of Rent, except to the extent, if any, otherwise expressly provided herein. If Tenant shall fail to perform any obligation under this Lease, and such failure shall continue, following notice from Landlord, in excess of the time allowed under Section 19.1.2, above, unless a specific time period is otherwise stated in this Lease, Landlord may, but shall not be obligated to, make any such payment or perform any such act on Tenant's part without waiving its rights based upon any default of Tenant and without releasing Tenant from any obligations hereunder.
26.2    Tenant's Reimbursement. Except as may be specifically provided to the contrary in this Lease, Tenant shall pay to Landlord the following sums (which sums shall bear interest from the date accrued by Landlord until paid by Tenant at a rate per annum equal to interest at the rate set forth in Article 25 of this Lease, but in no case greater than the maximum amount of such interest permitted by law), within thirty (30) days following delivery by Landlord to Tenant of statements therefor: (i) sums equal to expenditures reasonably made and obligations reasonably incurred by Landlord in connection with the remedying by Landlord of Tenant's defaults pursuant to the provisions of Section 26.1; (ii) sums equal to all losses, costs, liabilities, damages and expenses referred to in Article 10 of this Lease; and (iii) sums equal to all expenditures made and obligations incurred by Landlord in collecting or attempting to collect the Rent or in enforcing or attempting to enforce any rights of Landlord under this Lease or pursuant to law, including, without limitation, all legal fees and other amounts so expended. Tenant's obligations under this Section 26.2 shall survive the expiration or sooner termination of the Lease Term.
ARTICLE 27
ENTRY BY LANDLORD
Landlord reserves the right at all reasonable times and upon reasonable notice to Tenant (except no notice shall be required in the case of an emergency) to enter the Premises to (i) inspect them; (ii) show the Premises to prospective purchasers or to current or prospective mortgagees,
-72-
ONE TEHAMA
[Social Finance, Inc.]


ground or underlying lessors or insurers, or to prospective tenants during the last twelve (12) months of the Lease Term; (iii) post notices of nonresponsibility; (iv) to perform Landlord's repair and maintenance obligations under this Lease; or (v) to the extent necessary in order for Landlord to take an action which Landlord has a right or an obligation to take under the terms of this Lease, or as Landlord may be required to do by governmental or quasi-governmental authority or court order or decree. Notwithstanding anything to the contrary contained in this Article 27, Landlord may enter the Premises at any time to (A) take possession due to any breach of this Lease after notice and expiration of applicable cure periods in the manner provided herein; and (B) pursuant to Section 26.1 of this Lease (except in the case of an emergency), perform any covenants of Tenant which Tenant fails to perform. Landlord shall use commercially reasonable efforts to minimize interference with the conduct of Tenant's business in connection with all entries into the Premises. Landlord may make any such entries without the abatement of Rent (except as specifically set forth in Section 19.5.2 of this Lease) and may take such reasonable steps as required to accomplish the stated purposes. Tenant hereby waives any claims for damages or for any injuries or inconvenience to or interference with Tenant's business and/or lost profits occasioned thereby, provided that the foregoing shall not limit Landlord's liability, if any, pursuant to Applicable Law for personal injury and property damage to the extent caused by the negligence or willful misconduct of Landlord, its agents, employees or contractors. Provided that Landlord employs commercially reasonable efforts to minimize interference with the conduct of Tenant's business in connection with entries into the Premises, Tenant hereby waives any claims for any loss of occupancy or quiet enjoyment of the Premises in connection with such entries; provided that Tenant does not waive any claim for actual or constructive eviction as a result of Landlord's entry. For each of the above purposes, Landlord shall at all times have a key with which to unlock all the doors in the Premises, excluding Tenant's vaults, safes and special security areas designated in advance by Tenant. In an emergency, Landlord shall have the right to use any means that Landlord may deem proper to open the doors in and to the Premises. Notwithstanding anything to the contrary set forth in this Article 27, Tenant may designate in writing certain reasonable areas of the Premises as "Secured Areas" should Tenant require such areas for the purpose of securing certain valuable property or confidential information. In connection with the foregoing, Landlord shall not enter such Secured Areas, except in the event of an emergency. Landlord shall only maintain or repair such Secured Areas to the extent (i) such repair or maintenance is required in order to maintain and repair the Building Structure; (ii) as required by Applicable Law, or (iii) in response to specific requests by Tenant and in accordance with a schedule reasonably designated by Tenant, subject to Landlord's reasonable approval. Any entry into the Premises by Landlord in the manner hereinbefore described shall not be deemed to be a forcible or unlawful entry into, or a detainer of, the Premises, or an actual or constructive eviction of Tenant from any portion of the Premises. No provision of this Lease shall be construed as obligating Landlord to perform any repairs, alterations or decorations, except as otherwise expressly agreed to be performed by Landlord herein.
ARTICLE 28
NOTICES
All notices, demands, designations, approvals or other communications (collectively, "Notices") given or required to be given by either party to the other hereunder or by law shall be in writing, shall be (A) sent by United States certified or registered mail, postage prepaid, return
-73-
ONE TEHAMA
[Social Finance, Inc.]


receipt requested ("Mail"), or (B) delivered by a nationally recognized overnight courier, or (C) delivered personally. Any Notice shall be sent, transmitted, or delivered, as the case may be, to Tenant at the appropriate address set forth in Section 9 of the Summary, or to such other place as Tenant may from time to time designate in a Notice to Landlord, or to Landlord at the addresses set forth below, or to such other places as Landlord may from time to time designate in a Notice to Tenant. Any Notice will be deemed given (i) upon receipt if sent by Mail, except that refusal to accept delivery shall be deemed receipt, or (ii) the date the overnight courier delivery is made, except that refusal to accept delivery shall be deemed receipt. Any Notice given by an attorney on behalf of Landlord or by Landlord's managing agent shall be considered as given by Landlord and shall be fully effective. As of the date of this Lease, any Notices to Landlord must be sent, transmitted, or delivered, as the case may be, to the following addresses:
246 First Street (SF) Owner, LLC
c/o CIM
4700 Wilshire Boulevard
Los Angeles, CA 90010
Attention: Terry Wachsner
with copy to:
Allen Matkins Leck Gamble Mallory & Natsis LLP
1901 Avenue of the Stars, Suite 1800
Los Angeles, California 90067
Attention: Anton N. Natsis, Esq.
Notwithstanding the foregoing, notices pursuant to the Tenant Work Letter may be given in accordance with Section 3.6 thereof.
ARTICLE 29
MISCELLANEOUS PROVISIONS
29.1    Terms; Captions. The words "Landlord" and "Tenant" as used herein shall include the plural as well as the singular. The necessary grammatical changes required to make the provisions hereof apply either to corporations or partnerships or individuals, men or women, as the case may require, shall in all cases be assumed as though in each case fully expressed. The captions of Articles and Sections are for convenience only and shall not be deemed to limit, construe, affect or alter the meaning of such Articles and Sections.
29.2    Binding Effect. Subject to all other provisions of this Lease, each of the covenants, conditions and provisions of this Lease shall extend to and shall, as the case may require, bind or inure to the benefit not only of Landlord and of Tenant, but also of their respective heirs, personal representatives, successors or assigns, provided this clause shall not permit any assignment by Tenant contrary to the provisions of Article 14 of this Lease.
29.3    No Light, Air or View Rights. No rights to any view or to light or air over any property, whether belonging to Landlord or any other person, are granted to Tenant by this Lease.
-74-
ONE TEHAMA
[Social Finance, Inc.]


Under no circumstances whatsoever at any time during the Lease Term shall any temporary darkening of any windows of the Premises or any temporary obstruction of the light or view therefrom by reason of any repairs, improvements, maintenance or cleaning in or about the Project, or any diminution, impairment or obstruction (whether partial or total) of light, air or view by any structure which may be erected on any land comprising a part of, or located adjacent to or otherwise in the path of light, air or view to, the Project, in any way impose any liability upon Landlord or in any way reduce or diminish Tenant's obligations under this Lease.
29.4    Modification of Lease. Should any current or prospective mortgagee or ground lessor for the Building or Project require a modification of this Lease, which modification will not cause an increased cost or expense to Tenant or in any other way materially and adversely change the rights and obligations of Tenant hereunder, then and in such event, Tenant agrees that this Lease may be so modified and agrees to execute whatever documents are reasonably required therefor and to deliver the same to Landlord within ten (10) business days following a request therefor, provided that Landlord shall reimburse Tenant for its actual and reasonable costs and attorneys' fees reasonably incurred in connection with such documents. At the request of Landlord or any mortgagee or ground lessor, Tenant agrees to execute a short form of Lease and deliver the same to Landlord within ten (10) days following the request therefor.
29.5    Transfer of Landlord's Interest. Tenant acknowledges that Landlord has the right to transfer all or any portion of its interest in the Project or Building and in this Lease, and Tenant agrees that in the event of any such transfer, Landlord shall automatically be released from all future liability under this Lease and Tenant agrees to look solely to such transferee for the performance of Landlord's obligations hereunder arising after the date of transfer provided that the transferee shall have fully assumed in writing and agreed to be liable for all obligations of this Lease to be performed by Landlord, including the return of the L-C and any unused L-C Proceeds in accordance with Article 21, and the disbursement of any remaining portion of the Tenant Improvement Allowance (to the extent Tenant continues to have the right to use the same), following the date of transfer, and Tenant shall attorn to such transferee (and following request by Tenant, Landlord shall deliver to Tenant reasonable evidence of such assumption by the transferee).
29.6    Prohibition Against Recording. Except as provided in Section 29.4 of this Lease, neither this Lease, nor any memorandum, affidavit or other writing with respect thereto, shall be recorded by Tenant or by anyone acting through, under or on behalf of Tenant.
29.7    Landlord's Title. Landlord's title is and always shall be paramount to the title of Tenant. Nothing herein contained shall empower Tenant to do any act which can, shall or may encumber the title of Landlord.
29.8    Relationship of Parties. Nothing contained in this Lease shall be deemed or construed by the parties hereto or by any third party to create the relationship of principal and agent, partnership, joint venturer or any association between Landlord and Tenant.
29.9    Application of Payments. Landlord shall have the right to apply payments received from Tenant pursuant to this Lease, regardless of Tenant's designation of such payments,
-75-
ONE TEHAMA
[Social Finance, Inc.]


to satisfy any obligations of Tenant hereunder, in such order and amounts as Landlord, in its sole discretion, may elect.
29.10    Time of Essence. Time is of the essence with respect to the performance of every provision of this Lease in which time of performance is a factor, including, without limitation, the giving of any Notice required to be given under this Lease or by law, the time periods for giving any such Notice and the taking of any action with respect to any such Notice.
29.11    Partial Invalidity. If any term, provision or condition contained in this Lease shall, to any extent, be invalid or unenforceable, the remainder of this Lease, or the application of such term, provision or condition to persons or circumstances other than those with respect to which it is invalid or unenforceable, shall not be affected thereby, and each and every other term, provision and condition of this Lease shall be valid and enforceable to the fullest extent possible permitted by law.
29.12    No Warranty. In executing and delivering this Lease, Tenant has not relied on any representations, including, but not limited to, any representation as to the amount of any item comprising Additional Rent or the amount of the Additional Rent in the aggregate, or any warranty or any statement of Landlord which is not set forth herein or in one or more of the exhibits attached hereto.
29.13    Landlord Exculpation. The liability of Landlord or the Landlord Parties to Tenant for any default by Landlord under this Lease or arising in connection herewith or with Landlord's operation, management, leasing, repair, renovation, alteration or any other matter relating to the Project or the Premises shall be limited solely and exclusively to an amount which is equal to the interest of Landlord in the Building and the rents, issues and profits thereof. Neither Landlord, nor any of the Landlord Parties shall have any personal liability therefor, and Tenant hereby expressly waives and releases such personal liability on behalf of itself and all persons claiming by, through or under Tenant. The limitations of liability contained in this Section 29.13 shall inure to the benefit of Landlord's and the Landlord Parties' present and future partners, beneficiaries, officers, directors, trustees, shareholders, agents and employees, and their respective partners, heirs, successors and assigns. Under no circumstances shall any present or future partner of Landlord (if Landlord is a partnership), or trustee or beneficiary (if Landlord or any partner of Landlord is a trust), have any liability for the performance of Landlord's obligations under this Lease. Notwithstanding any contrary provision herein, neither Landlord nor the Landlord Parties shall be liable under any circumstances for any indirect or consequential damages including damages to Tenant's business, loss of profits, loss of business opportunity and loss of goodwill, in each case, however occurring, provided that the foregoing shall not limit Landlord's liability, if any, pursuant to applicable law for bodily injury and property damage to the extent caused by the negligence or willful misconduct of Landlord, its agents, employees or contractors.
29.14    Entire Agreement. It is understood and acknowledged that there are no oral agreements between the parties hereto affecting this Lease and this Lease constitutes the parties' entire agreement with respect to the leasing of the Premises and supersedes and cancels any and all previous negotiations, arrangements, brochures, agreements and understandings, if any, between the parties hereto or displayed by Landlord to Tenant with respect to the subject matter thereof, and none thereof shall be used to interpret or construe this Lease. None of the terms,
-76-
ONE TEHAMA
[Social Finance, Inc.]


covenants, conditions or provisions of this Lease can be modified, deleted or added to except in writing signed by the parties hereto.
29.15    Intentionally Omitted.
29.16    Force Majeure. Any prevention, delay or stoppage due to strikes, lockouts, labor disputes, acts of God, inability to obtain services, labor, or materials or reasonable substitutes therefor, governmental actions, civil commotions, fire or other casualty, and other causes beyond the reasonable control of the party obligated to perform, except with respect to the obligations imposed with regard to Rent and other charges to be paid by Tenant pursuant to this Lease (collectively, a "Force Majeure"), notwithstanding anything to the contrary contained in this Lease, shall excuse the performance of such party for a period equal to any such prevention, delay or stoppage and, therefore, if this Lease specifies a time period for performance of an obligation of either party, that time period shall be extended by the period of any delay in such party's performance caused by a Force Majeure.
29.17    Waiver of Redemption by Tenant. Tenant hereby waives, for Tenant and for all those claiming under Tenant, any and all rights now or hereafter existing to redeem by order or judgment of any court or by any legal process or writ, Tenant's right of occupancy of the Premises after any termination of this Lease.
29.18    REIT Representations. In the event Landlord or any of its direct or indirect members or partners or any successor to any of the above needs to qualify as a real estate investment trust Tenant agrees to cooperate in good faith with Landlord, but at no cost to Tenant (other than deminimus cost) to ensure that the Rent qualifies as "rents from real property," within the meaning of Section 856(d) of the Internal Revenue Code and/or any similar or successor provisions thereto (the "REIT Requirements"), including, without limitation, the following requirements:
29.18.1    Personal Property Limitation. Anything contained in this Lease to the contrary notwithstanding, the average of the fair market values of the items of personal property that are leased to Tenant under this Lease at the beginning and at the end of any Lease Year shall not exceed fifteen percent (15%) of the average of the aggregate fair market values of the leased property at the beginning and at the end of such Lease Year (the "Personal Property Limitation"). If Landlord reasonably anticipates that the Personal Property Limitation will be exceeded with respect to the leased property for any Lease Year, Landlord shall notify Tenant, and Tenant either (i) shall purchase at fair market value any personal property anticipated to be in excess of the Personal Property Limitation ("Excess Personal Property") either from Landlord or a third party or (ii) shall lease the Excess Personal Property from third party. In either case, Tenant's Rent obligation shall be equitably adjusted. Notwithstanding anything to the contrary set forth above, Tenant shall not be responsible in any way for determining whether Tenant has exceeded or will exceed the Personal Property Limitation and shall not be liable to Landlord or any of its shareholders in the event that the Personal Property Limitation is exceeded, as long as Tenant meets its obligation to acquire or lease any Excess Personal Property as provided above. This Section 29.18 is intended to ensure that the Rent qualifies as "rents from real property," within the meaning of Section 856(d) of the Internal Revenue Code, or any similar or successor provisions thereto, and shall be interpreted in a manner consistent with such intent.
-77-
ONE TEHAMA
[Social Finance, Inc.]


29.18.2    Subletting/Assignment. Anything contained in this Lease to the contrary notwithstanding, Tenant shall not sublet the Premises on any basis such that the rent or other amounts to be paid by the sublessee thereunder would be based, in whole or in part, on either (a) the net income or profits derived by the business activities of the proposed sublessee, or (b) any other formula such that any portion of the Rent would fail to qualify as "rents from real property" within the meaning of Section 856(d) of the Internal Revenue Code, or any similar or successor provision hereto.
29.18.3    REIT Requirements. Tenant agrees, at no cost or expense to Tenant, to cooperate reasonably and in good faith with Landlord to ensure that the terms of this Section 29.18 are satisfied. Tenant agrees upon request by Landlord to take reasonable action necessary to ensure compliance with all REIT Requirements and to ensure that Rent, at all times qualifies as "rents from real property" with the meaning of Section 856(d) of the Internal Revenue Code. If Tenant becomes aware that the REIT Requirements are not, or will not be, satisfied, Tenant shall notify Landlord of such noncompliance.
29.19    Joint and Several. If there is more than one Tenant, the obligations imposed upon Tenant under this Lease shall be joint and several.
29.20    Authority. If Tenant is a corporation, trust or partnership, Tenant hereby represents and warrants that Tenant is a duly formed and existing entity qualified to do business in California and that Tenant has full right and authority to execute and deliver this Lease and that each person signing on behalf of Tenant is authorized to do so. Similarly, Landlord hereby represents and warrants that Landlord is a duly formed and existing entity qualified to do business in California, that Landlord has full right and authority to execute and deliver this Lease and that each person signing on behalf of Landlord is authorized to do so.
29.21    Attorneys' Fees. In the event that either Landlord or Tenant should bring suit for the possession of the Premises, for the recovery of any sum due under this Lease, or because of the breach of any provision of this Lease or for any other relief against the other, then all costs and expenses, including reasonable attorneys' fees, incurred by the prevailing party therein shall be paid by the other party, which obligation on the part of the other party shall be deemed to have accrued on the date of the commencement of such action and shall be enforceable whether or not the action is prosecuted to judgment.
29.22    Governing Law; WAIVER OF TRIAL BY JURY. This Lease shall be construed and enforced in accordance with the laws of the State of California. IN ANY ACTION OR PROCEEDING ARISING HEREFROM, LANDLORD AND TENANT HEREBY CONSENT TO (I) THE JURISDICTION OF ANY COMPETENT COURT WITHIN THE STATE OF CALIFORNIA, (II) SERVICE OF PROCESS BY ANY MEANS AUTHORIZED BY CALIFORNIA LAW, AND (III) TO THE EXTENT PERMITTED BY LAW, IN THE INTEREST OF SAVING TIME AND EXPENSE, TRIAL WITHOUT A JURY IN ANY ACTION, PROCEEDING OR COUNTERCLAIM BROUGHT BY EITHER OF THE PARTIES HERETO AGAINST THE OTHER OR THEIR SUCCESSORS IN RESPECT OF ANY MATTER ARISING OUT OF OR IN CONNECTION WITH THIS LEASE, THE RELATIONSHIP OF LANDLORD AND TENANT, TENANT'S USE OR OCCUPANCY OF THE PREMISES, AND/OR ANY CLAIM FOR INJURY OR DAMAGE, OR ANY
-78-
ONE TEHAMA
[Social Finance, Inc.]


EMERGENCY OR STATUTORY REMEDY. IN THE EVENT LANDLORD COMMENCES ANY SUMMARY PROCEEDINGS OR ACTION FOR NONPAYMENT OF BASE RENT OR ADDITIONAL RENT, TENANT SHALL NOT INTERPOSE ANY COUNTERCLAIM OF ANY NATURE OR DESCRIPTION (UNLESS SUCH COUNTERCLAIM SHALL BE MANDATORY) IN ANY SUCH PROCEEDING OR ACTION, BUT SHALL BE RELEGATED TO AN INDEPENDENT ACTION AT LAW.
29.23    Submission of Lease. Submission of this instrument for examination or signature by Tenant does not constitute a reservation of, option for or option to lease, and it is not effective as a lease or otherwise until execution and delivery by both Landlord and Tenant.
29.24    Brokers. Landlord and Tenant hereby warrant to each other that they have had no dealings with any real estate broker or agent in connection with the negotiation of this Lease, excepting only the real estate brokers or agents specified in Section 11 of the Summary (the "Brokers"), and that they know of no other real estate broker or agent who is entitled to a commission in connection with this Lease. Each party agrees to indemnify and defend the other party against and hold the other party harmless from any and all claims, demands, losses, liabilities, lawsuits, judgments, costs and expenses (including without limitation reasonable attorneys' fees) with respect to any leasing commission or equivalent compensation alleged to be owing on account of any dealings with any real estate broker or agent, other than the Brokers, occurring by, through, or under the indemnifying party. Landlord shall pay any and all fees due to the Brokers in connection with this Lease pursuant to a separate written agreement.
29.25    Independent Covenants. Except as expressly set forth in this Lease to the contrary, including Section 19.5, this Lease shall be construed as though the covenants herein between Landlord and Tenant are independent and not dependent and Tenant hereby expressly waives the benefit of any statute to the contrary and agrees that if Landlord fails to perform its obligations set forth herein, Tenant shall not be entitled to make any repairs or perform any acts hereunder at Landlord's expense or to any setoff of the Rent or other amounts owing hereunder against Landlord.
29.26    Project or Building Image; Intellectual Property. Tenant may use pictures or illustrations of the exterior of the Project or Building, as well as the address of the Building, in advertising or other publicity or for any purpose. Landlord agrees that Tenant's and its Affiliates' trademarks and other intellectual property (including name/logo) and the goodwill associated therewith are the sole and exclusive property of Tenant and may not be used by Landlord for any purpose, except with the express prior written consent of Tenant. Notwithstanding the foregoing, with respect to any efforts by Landlord or Landlord's agents to market, sell or refinance the Project, offering materials, including, but not limited to, offering memorandums and email solicitations, may include: Tenant's name, Tenant's logo, images of the interior of the Premises; characteristics of the Premises and Building, including, without limitation, information regarding the tenant improvements, the square footage, the age of the Premises, the number of stories and the location.
29.27    Counterparts. This Lease may be executed in counterparts with the same effect as if both parties hereto had executed the same document. Both counterparts shall be construed together and shall constitute a single lease.
-79-
ONE TEHAMA
[Social Finance, Inc.]


29.28    No Violation. Tenant hereby warrants and represents that neither its execution of nor performance under this Lease shall cause Tenant to be in violation of any agreement, instrument, contract, law, rule or regulation by which Tenant is bound, and Tenant shall protect, defend, indemnify and hold Landlord harmless against any claims, demands, losses, damages, liabilities, costs and expenses, including, without limitation, reasonable attorneys' fees and costs, arising from Tenant's breach of this warranty and representation.
29.28.1    Communications and Computer Lines. Tenant may install, maintain, replace, remove or use any electrical, communications or computer wires and cables (collectively, the "Lines") at the Project in or serving solely the Premises, provided that (i) Tenant shall obtain Landlord's prior written consent, which consent shall not be unreasonably withheld, conditioned or delayed, use an experienced and qualified contractor approved in writing by Landlord, and comply with all of the other provisions of Articles 7 and 8 of this Lease to the extent reasonably applicable, (ii) the Lines therefor (including riser cables) shall be appropriately insulated to prevent excessive electromagnetic fields or radiation, and shall be surrounded by a protective conduit reasonably acceptable to Landlord, (iii) any new or existing Lines servicing the Premises shall comply with all applicable governmental laws and regulations, and (iv) Tenant shall pay all costs in connection therewith. Landlord reserves the right to require that Tenant remove any Lines located in or serving the Premises which are installed in violation of these provisions, or which are at any time in violation of any laws or represent a dangerous or potentially dangerous condition. Landlord further reserves the right to require that Tenant remove any and all Lines located in or serving the Premises upon the expiration of the Lease Term or upon any earlier termination of this Lease, provided that upon Tenant's request at the time of requesting Landlord's consent to the installation of any Lines, Landlord shall notify Tenant (concurrently with Landlord's consent) as to whether any Lines to be installed based upon such consent will be required to be removed pursuant to the terms of this sentence.
29.29    No Discrimination. There shall be no discrimination against, or segregation of, any person or persons on account of sex, marital status, race, color, religion, creed, national origin or ancestry in the Transfer of the Premises, or any portion thereof, nor shall the Tenant itself, or any person claiming under or through it, establish or permit any such practice or practices of discrimination or segregation with reference to the selection, location, number, use or occupancy of tenants, lessees, subtenants, sublessees, or vendees of the Premises, or any portion thereof.
29.30    Tenant's OFAC Compliance.  Tenant hereby warrants and represents that:  (i) neither Tenant nor, to Tenant's actual knowledge, any of its affiliates does business with, sponsors, or provides assistance or support to, the government of, or any person located in, any country, or with any other person, targeted by any of the economic sanctions of the United States administered by The Office of Foreign Assets Control ("OFAC"); Tenant is not owned or controlled (within the meaning of the regulations promulgating such sanctions or the laws authorizing such promulgation) by any such government or person; and any payments and/or proceeds received by Tenant under the terms of this Lease will not be used to fund any operations in, finance any investments or activities in or make any payments to, any country, or to make any payments to any person, targeted by any of such sanctions; (ii) no funds tendered to Landlord by Tenant under the terms of this Lease are or will be directly or indirectly derived from activities that may contravene U.S. federal, state or international laws and regulations, including "Anti-Money Laundering Laws," as that term is defined below; (iii) neither Tenant, nor, to Tenant's
-80-
ONE TEHAMA
[Social Finance, Inc.]


actual knowledge, any person controlling, controlled by, or under common control with, Tenant, nor, to Tenant's actual knowledge, any person having a beneficial interest in Tenant, nor, to Tenant's actual knowledge, any person for whom Tenant is acting as agent or nominee, nor any person providing funds to Tenant in connection with this Lease (a) is under investigation by any governmental authority for, or has been charged with, or convicted of, money laundering, drug trafficking, terrorist related activities, any crimes which in the United States would be predicate crimes to money laundering, or any violation of any Anti-Money Laundering Laws; (b) has been assessed civil or criminal penalties under any Anti-Money Laundering Laws; (c) has had any of its funds seized or forfeited in any action under any Anti-Money Laundering Laws; (d) is a person or entity that resides or has a place of business in a country or territory which is designated as a Non-Cooperative Country or Territory by the Financial Action Task Force on Money Laundering, or whose subscription funds are transferred from or through such a jurisdiction; (e) is a "Foreign Shell Bank" within the meaning of the Patriot Act (i.e., a foreign bank that does not have a physical presence in any country and that is not affiliated with a bank that has a physical presence and an acceptable level of regulation and supervision); (f) is a person or entity that resides in, or is organized under the laws of, a jurisdiction designated by the Secretary of the Treasury under Section 311 or 312 of the Patriot Act as warranting special measures due to money laundering concerns; (g) is an entity that is designated by the Secretary of the Treasury as warranting such special measures due to money laundering concerns; or (h) is a person or entity that otherwise appears on any US.-government provided list of known or suspected terrorists or terrorist organizations.  For purposes of this representation, the term "Anti-Money Laundering Laws" shall mean all laws, regulations and executive orders, state and federal, criminal and civil, that (1) limit the use of and/or seek the forfeiture of proceeds from illegal transactions; (2) limit commercial transactions with designated countries or individuals believed to be terrorists, narcotics dealers or otherwise engaged in activities contrary to the interests of the United States; (3) require identification and documentation of the parties with whom a financial institution conducts business; or (4) are designed to disrupt the flow of funds to terrorist organizations.  Such laws, regulations, and sanctions shall include, without limitation, the USA PATRIOT Act of 2001, Pub. L. No. 107-56 (the "Patriot Act"), Executive Order 13224, the Bank Secrecy Act, 31 U.S.C. Section 531 et. seq., the Trading with the Enemy Act, 50 U.S.C. App. Section 1 et. seq., the International Emergency Economic Powers Act, 50 U.S.C. Section 1701 et. seq., the OFAC-administered economic sanctions, and laws relating to prevention and detection of money laundering in 18 U.S.C. Sections 1956 and 1957.  Tenant has reviewed the OFAC website, and conducted such other investigation as it deems necessary or prudent, prior to making these representations and warranties.
29.31    Landlord's OFAC Compliance. Landlord hereby warrants and represents that: (i) neither Landlord nor any of its affiliates does business with, sponsors, or provides assistance or support to, the government of, or any person located in, any country, or with any other person, targeted by any of the economic sanctions of the United States administered by OFAC; Landlord is not owned or controlled (within the meaning of the regulations promulgating such sanctions or the laws authorizing such promulgation) by any such government or person; and any payments and/or proceeds received by Landlord under the terms of this Lease will not be used to fund any operations in, finance any investments or activities in or make any payments to, any country, or to make any payments to any person, targeted by any of such sanctions, (ii) no funds tendered to Landlord by Tenant under the terms of this Lease are or will be directly or indirectly derived from activities that may contravene U.S. federal, state or international laws and regulations, including
-81-
ONE TEHAMA
[Social Finance, Inc.]


"Anti-Money Laundering Laws," as that term is defined below; or (iii) neither Landlord, nor any person controlling, controlled by, or under common control with, Landlord, nor any person having a beneficial interest in Landlord, nor any person for whom Landlord is acting as agent or nominee, nor any person providing funds to Landlord in connection with this Lease (a) is under investigation by any governmental authority for, or has been charged with, or convicted of, money laundering, drug trafficking, terrorist related activities, any crimes which in the United States would be predicate crimes to money laundering, or any violation of any Anti-Money Laundering Laws; (b) has been assessed civil or criminal penalties under any Anti-Money Laundering Laws; (c) has had any of its funds seized or forfeited in any action under any Anti-Money Laundering Laws; (d) is a person or entity that resides or has a place of business in a country or territory which is designated as a Non-Cooperative Country or Territory by the Financial Action Task Force on Money Laundering, or whose subscription funds are transferred from or through such a jurisdiction; (e) is a "Foreign Shell Bank" within the meaning of the Patriot Act (i.e., a foreign bank that does not have a physical presence in any country and that is not affiliated with a bank that has a physical presence and an acceptable level of regulation and supervision); (f) is a person or entity that resides in, or is organized under the laws of, a jurisdiction designated by the Secretary of the Treasury under Section 311 or 312 of the Patriot Act as warranting special measures due to money laundering concerns; (g) is an entity that is designated by the Secretary of the Treasury as warranting such special measures due to money laundering concerns; or (h) is a person or entity that otherwise appears on any US.-government provided list of known or suspected terrorists or terrorist organizations. Landlord has reviewed the OFAC website, and conducted such other investigation as it deems necessary or prudent, prior to making these representations and warranties. Notwithstanding anything contained herein to the contrary, for the purposes of this Section 29.31 the phrases "Landlord nor any of its affiliates" and "any person controlling, controlled by, or under common control with, Landlord", "having a beneficial interest in Landlord" and all similar such phrases shall not include (y) any holder of a direct or indirect interest in a publicly traded company whose shares are listed and traded on a United States national stock exchange or (z) any limited partner, unit holder or shareholder owning an interest of five percent (5%) or less in Landlord or any related entity.
29.32    Consequential Damages. Tenant shall have no liability for any loss of profits or other consequential damages suffered either by Landlord or by any party claiming through Landlord in connection with this Lease; provided, however, that the foregoing shall not limit Tenant's liability for consequential damages that may be suffered by Landlord in connection with any holding over in the Premises after the expiration or earlier termination of this Lease, subject to provisions of Article 16 above. Further, nothing contained in this Section 29.32 shall affect the remedy afforded Landlord by California Civil Code Section 1951.2(a)(4).
[signatures follow on next page]
-82-
ONE TEHAMA
[Social Finance, Inc.]


IN WITNESS WHEREOF, Landlord and Tenant have caused this Lease to be executed the day and date first above written.
"Landlord":
246 FIRST STREET (SF) OWNER, LLC,
a Delaware limited liability company
By: /s/ Terry Wachsner 8/6/18
Name: Terry Wachsner
Title: Vice President
"Tenant":
SOCIAL FINANCE, INC.,
a Delaware corporation
By:
Name:
Title:
By:
Name:
Title:
-83-
ONE TEHAMA
[Social Finance, Inc.]


IN WITNESS WHEREOF, Landlord and Tenant have caused this Lease to be executed the day and date first above written.
"Landlord":
246 FIRST STREET (SF) OWNER, LLC,
a Delaware limited liability company
By:
Name:
Title:
"Tenant":
SOCIAL FINANCE, INC.,
a Delaware corporation
By: /s/ Michelle Gill
Name: Michelle Gill
Title: Chief Financial Officer
By: /s/ Robert Lavet
Name: Robert Lavet
Title: Secretary
-84-
ONE TEHAMA
[Social Finance, Inc.]


EXHIBIT A
OUTLINE OF PREMISES

EXHIBIT A
-1-
ONE TEHAMA
[Social Finance, Inc.]


EXHIBIT B
TENANT WORK LETTER
This Tenant Work Letter shall set forth the terms and conditions relating to the construction of the tenant improvements in the Premises. This Tenant Work Letter is essentially organized chronologically and addresses the issues of the construction of the Premises, in sequence, as such issues will arise during the actual construction of the Premises. All references in this Tenant Work Letter to Articles or Sections of "this Lease" shall mean the relevant portion of Articles 1 through 29 of the Office Lease to which this Tenant Work Letter is attached as Exhibit B and of which this Tenant Work Letter forms a part, and all references in this Tenant Work Letter to Sections of "this Tenant Work Letter" shall mean the relevant portion of Sections 1 through 6 of this Tenant Work Letter.
SECTION 1
LANDLORD'S INITIAL CONSTRUCTION IN THE PREMISES
1.1    Base Building. Except as set forth on Schedule 1 attached hereto, Landlord has constructed, at its sole cost and expense, the Base Building. Tenant shall accept the Base Building from Landlord in its presently existing, "as-is" condition, except for the Landlord Work described below.
1.2    Landlord Work. Landlord shall, at Landlord's sole cost, substantially complete the work set forth in Schedule 1 attached hereto (collectively, the "Landlord Work"). Landlord shall perform the Landlord Work in a good and workmanlike manner, and, to the extent necessary for Tenant to pull any necessary construction permits or for Tenant to legally occupy the applicable Premises for the Permitted Use, in accordance with Applicable Laws.
1.2.1    Pre-Delivery Landlord Work. Landlord's delivery of the Premises to Tenant, with the Landlord Work substantially complete that is described on Schedule 1 as required to be completed prior to delivery ("Pre-Delivery Landlord Work"), shall be the "Delivery Condition" and the date of Landlord's delivery of the Premises to Tenant in the Delivery Condition is the "Delivery Date". When the Pre-Delivery Landlord Work is substantially complete, Landlord shall so notify Tenant in writing (such notice, the "Delivery Notice"), and Landlord and Tenant shall set a mutually convenient time for Landlord, Landlord's architect and Tenant and Tenant's Architect to walk through the Premises and prepare a list of "punch-list" items. Promptly following completion of the foregoing walk through, Landlord shall deliver to Tenant a notice, as a confirmation only of the exact date of the Delivery Date, which Tenant shall execute and return to Landlord within ten (10) business days of receipt thereof; provided that if such notice is not factually correct, then Tenant shall make such changes as are necessary to make such notice factually correct and shall thereafter return such notice to Landlord within said ten (10) business day period. Tenant's failure to execute and return such notice to Landlord within such time shall be conclusive upon Tenant that the Delivery Date set forth in such notice is as specified therein. After such walk-through, Landlord shall diligently complete such punch-list items in a good workmanlike manner.

EXHIBIT B
-1-
ONE TEHAMA
[Social Finance, Inc.]


1.2.2    Remaining Landlord Work. The remainder of the Landlord Work that is not required to be completed as part of the Delivery Condition (the "Remaining Landlord Work") shall be substantially completed after the Delivery Date, using reasonable diligence. For purposes of clarification, the parties agree that the term "Landlord Work" means both the Pre-Delivery Landlord Work and the Remaining Landlord Work. Following substantial completion of the Remaining Landlord Work, Landlord will provide Tenant with copies of as-built drawings, warranty manuals, and signed off job cards for all of the Landlord Work. From and after the date Landlord delivers the Premises to Tenant in the Delivery Condition, neither party shall unreasonably interfere with or delay the work of the other party and/or its contractors or consultants, and both parties shall mutually coordinate and cooperate with each other, and shall cause their respective employees, vendors, contractors, and consultants to work in harmony with and to mutually coordinate and cooperate with the other's employees, vendors, contractors and consultants, respectively, to minimize any interference or delay by either party with respect to the other party's work. Notwithstanding the foregoing, in the event of any irreconcilable conflict between the work of Landlord's workers, mechanics and contractors and the work of Tenant's workers, mechanics and contractors, Landlord and Tenant shall resolve such conflict or interference by a reasonable resequencing or rescheduling of Tenant's remaining work as necessary to avoid the conflict or interference. In addition, Tenant and Tenant's Agents shall have access to the Premises after the mutual execution and delivery of this Lease, so long as such access does not interfere with the completion of Landlord Work.
1.2.3    Warranties and Guaranties. In addition to Landlord's obligations set forth in Section 1.1.1 of the Lease, Landlord's general contractor performing the Landlord Work shall, on commercially reasonable terms, guarantee to Landlord that the Landlord Work is free from any defects in workmanship and materials for a period of not less than one (1) year from the date of completion of the applicable portion thereof. Landlord's general contractor shall be responsible, on commercially reasonable terms, for the replacement or repair, without additional charge, of all work done or furnished in accordance with its contract that shall become defective within one (1) year after the completion of the work performed by such contractor. All such warranties or guarantees as to materials or workmanship of or with respect to the Landlord Work shall be contained in the contract or subcontract, on commercially reasonable terms. Upon request by Tenant, Landlord shall assign all such guaranties and warranties to Tenant, or if any such guaranties or warranties are not assignable to Tenant, Landlord agrees to enforce the same.
1.3    Delays in Substantial Completion of Landlord Work.
1.3.1.    Delay in Pre-Delivery Work. Landlord anticipates causing the Delivery Date to occur on October 1, 2018 (the "Anticipated Delivery Date"). If Landlord has not caused the Delivery Date to occur within three (3) months of the Anticipated Delivery Date ("Rent Abatement Date"), subject to extension by virtue of Force Majeure Delays, and any Tenant Delays, then Tenant shall be entitled to a day-for-day abatement of Base Rent attributable to the Premises for each day following the Rent Abatement Date until the Delivery Date (the Base Rent abatements described herein are referred to herein, collectively, as the "Late Delivery Date Abatements"). Tenant shall immediately apply any accrued Late Delivery Date Abatements against payments of Rent as they become due.

EXHIBIT B
-2-
ONE TEHAMA
[Social Finance, Inc.]


1.3.2    Delivery Date Termination Right. Further, if the Delivery Date has not occurred within nine (9) months of the Anticipated Delivery Date (the "Delivery Delay Termination Date"), subject to extension by virtue of Force Majeure Delays, and any Tenant Delays, Tenant shall have the right to terminate this Lease by written notice to Landlord ("Delivery Delay Termination Notice") effective upon the date occurring five (5) business days following receipt by Landlord of the Delivery Delay Termination Notice (the "Termination Effective Date"), in which event, Landlord shall return any prepaid rent and the L-C forthwith to Tenant. Should the Delivery Date occur prior to Tenant's exercise of the foregoing termination right, however, such termination right shall, in such event, expire and be of no further force or effect upon such occurrence of the Delivery Date (provided that Tenant shall be entitled to receive all of the Late Delivery Date Abatements). If Tenant delivers a Delivery Delay Termination Notice to Landlord, then Landlord shall have the right to suspend the occurrence of the Termination Effective Date for a period ending thirty (30) days after the Termination Effective Date by delivering written notice to Tenant, prior to the Termination Effective Date, that, in Landlord's reasonable, good faith judgment, the Delivery Date will occur within thirty (30) days after the Termination Effective Date. If the Delivery Date is satisfied within such thirty (30) day suspension period, then the Delivery Date Termination Notice shall be of no force or effect, but if the Delivery Date does not occur within such thirty (30) day suspension period, then this Lease shall terminate upon the expiration of such thirty (30) day suspension period. The Termination Effective Date shall be extended to the extent of any Force Majeure Delays, and, at Landlord's sole option, any Tenant Delays. Upon any termination as set forth in this Section 1.3.2, Landlord and Tenant shall be released from any and all liability to each other resulting under this Lease. Tenant's rights to the Late Delivery Abatements and the right to terminate this Lease, as set forth in Section 1.3.1 above and this Section 1.3.2, shall be Tenant's sole and exclusive remedies at law or in equity for the failure of the Delivery Date to occur prior to or after any particular date.
1.3.3    Delay in Remaining Landlord Work. Landlord anticipates causing substantial completion of the Remaining Landlord Work by the Lease Commencement Date. When the Remaining Landlord Work is substantially complete, Landlord shall so notify Tenant in writing, and Landlord and Tenant shall set a mutually convenient time for Landlord, Landlord's architect and Tenant and Tenant's Architect to walk through the Premises and prepare a list of "punch-list" items. After such walk-through, Landlord shall diligently complete such punch-list items in a good workmanlike manner. If Tenant has substantially completed the construction of the Tenant Improvements by the Lease Commencement Date, but Landlord has failed to substantially complete the Remaining Landlord Work by the Lease Commencement Date other than as a result of Tenant Delay, then the Lease Commencement Date shall be extended on a day-for-day-basis to until the date that Landlord has substantially completed the Remaining Landlord Work. Notwithstanding the foregoing, Tenant may elect, in its sole and absolute discretion, to occupy the Premises prior to the date the Remaining Landlord Work is substantially complete, in which event the Lease Commencement Date shall occur on the date Tenant commences to conduct business from the Premises.
1.3.4    Tenant Delay. For purposes hereof, any delay caused by the unreasonable (when judged in accordance with industry custom and practice) interference by Tenant, its agents or Tenant Parties (except as otherwise allowed by this Tenant Work Letter) with the substantial completion of the Landlord Work and which objectively preclude or delay the construction of the Landlord Work shall constitute a "Tenant Delay". If Landlord contends that a Tenant Delay has

EXHIBIT B
-3-
ONE TEHAMA
[Social Finance, Inc.]


occurred, Landlord shall notify Tenant in writing (a "Tenant Delay Notice") of (a) the event which constitutes such Tenant Delay and (b) the date upon which such Tenant Delay is anticipated to end. If such actions, inaction or circumstance described in the Tenant Delay Notice are not cured by Tenant within one (1) business day of Tenant's receipt of the Tenant Delay Notice and if such action, inaction or circumstance otherwise qualifies as a Tenant Delay, then a Tenant Delay shall be deemed to have occurred commencing as of the date of Tenant's receipt of the Tenant Delay Notice and ending as of the date such delay ends.
SECTION 2
TENANT IMPROVEMENTS
2.1    Tenant Improvement Allowance. Tenant shall be entitled to a one-time tenant improvement allowance for the Premises (the "Tenant Improvement Allowance"), in the amount set forth in Section 12 of the Summary, for the costs relating to the initial design and construction of Tenant's improvements which are permanently affixed to the Premises (the "Tenant Improvements"). In addition to the Tenant Improvement Allowance, Landlord shall provide Tenant with an allowance of up to Two Hundred Thousand Dollars ($200,000) to be used by Tenant for the costs of installing window coverings (the "Window Covering Costs") on all new and existing exterior windows in the Premises (the "Window Covering Allowance"). The Window Covering Allowance shall be disbursed by Landlord as part of the Tenant Improvement Allowance; provided that Landlord shall not be obligated to disburse the Window Covering Allowance for costs that are unrelated to the Window Covering Costs. Except as set forth in Sections 2.4 and 2.5 of this Tenant Work Letter, in no event shall Landlord be obligated to make disbursements pursuant to this Tenant Work Letter in a total amount which exceeds the Tenant Improvement Allowance. In the event that the Tenant Improvement Allowance is not fully disbursed by Landlord to, or on behalf of, Tenant on or before the date that is eighteen (18) months after the Lease Commencement Date, then such unused amounts shall revert to Landlord, and Tenant shall have no further rights with respect thereto; provided, however, that said eighteen (18) month period shall be extended to the extent Tenant's construction of the Tenant Improvements is delayed due to Force Majeure Delay or Landlord Caused Delay.
2.2    Disbursement of the Tenant Improvement Allowance.
2.2.1    Tenant Improvement Allowance Items. Except as otherwise set forth in this Tenant Work Letter, the Tenant Improvement Allowance shall be disbursed by Landlord (each of which disbursements shall be made pursuant to Landlord's disbursement process) only for the following items and costs (collectively, the "Tenant Improvement Allowance Items"):
2.2.1.1    Payment of the fees of the "Architect" and the "Engineers," as those terms are defined in Section 3.1 of this Tenant Work Letter, together with the fees of any project manager, which fees shall, notwithstanding anything to the contrary contained in this Tenant Work Letter, not exceed an aggregate amount equal to $7.00 per rentable square foot of the Premises, and payment of the fees incurred by, and the cost of documents and materials supplied by, Landlord and Landlord's consultants in connection with the preparation and review of the "Construction Drawings," as that term is defined in Section 3.1 of this Tenant Work Letter;

EXHIBIT B
-4-
ONE TEHAMA
[Social Finance, Inc.]


2.2.1.2    The payment of plan check, permit and license fees relating to construction of the Tenant Improvements;
2.2.1.3    The cost of construction of the Tenant Improvements, including, without limitation, testing and inspection costs, hoisting and trash removal costs, and contractors' fees and general conditions;
2.2.1.4    The cost of any changes to the Base Building when such changes are required by the Construction Drawings (including if such changes are due to the fact that such work is prepared on an unoccupied basis), such cost to include all direct architectural and/or engineering fees and expenses incurred in connection therewith;
2.2.1.5    The cost of any changes to the Construction Drawings or Tenant Improvements required by all applicable building codes (the "Code");
2.2.1.6    The cost of connection of the Premises to the Building's energy management systems;
2.2.1.7    Intentionally omitted;
2.2.1.8    The cost of the "Coordination Fee," as that term is defined in Section 4.2.2.1 of this Tenant Work Letter;
2.2.1.9    Sales and use taxes and Title 24 fees; and
2.2.1.10    All other costs reasonably expended by Landlord in connection with the construction of the Tenant Improvements (provided that Landlord shall provide Tenant with prior written notice of any such other costs prior to incurring the same).
Landlord and Tenant hereby acknowledge and agree that in no event shall the Tenant Improvement Allowance Items include, and Landlord shall be solely responsible for, any and all costs to the extent (i) related to and arising from the negligence or willful misconduct of Landlord or Landlord's contractor or subcontractors, or (ii) the same are recovered from third parties.
2.2.2    Disbursement of Tenant Improvement Allowance. During the construction of the Tenant Improvements, Landlord shall make monthly disbursements of the Tenant Improvement Allowance for Tenant Improvement Allowance Items for the benefit of Tenant and shall authorize the release of monies for the benefit of Tenant as follows, and as set forth in Section 4.2.1 below.
2.2.2.1    Monthly Disbursements. On or before the tenth (10th) day of each calendar month during the construction of the Tenant Improvements (or prior to the commencement of construction of the Tenant Improvements with respect to architectural and engineering fees and costs incurred prior to said date), Tenant shall deliver to Landlord: (i) a request for reimbursement of the payment of the "Contractor," as that term is defined in Section 4.1 of this Tenant Work Letter, approved by Tenant and its project manager, in an industry standard form, showing the schedule, by trade, of percentage of completion of the Tenant Improvements in the Premises, detailing the portion of the work completed and the portion not completed; (ii) paid

EXHIBIT B
-5-
ONE TEHAMA
[Social Finance, Inc.]


invoices from all of "Tenant's Agents," as that term is defined in Section 4.1.2 of this Tenant Work Letter, for labor rendered and materials delivered to the Premises; (iii) executed conditional mechanic's lien releases from all of Tenant's Agents included in the current disbursement request and unconditional mechanic's lien releases from all of Tenant's Agents paid from prior disbursement requests, which shall comply with the appropriate provisions, as reasonably determined by Landlord, of both California Civil Code Sections 8134 and 8138 (the "Releases"); and (iv) all other information relating to the construction of the Tenant Improvements as is reasonably requested by Landlord. As between Tenant and Landlord only (and not as between Tenant and any contractor, vendor or service provider), Tenant's request for reimbursement shall be deemed Tenant's acceptance and approval of the work furnished and/or the materials supplied as set forth in Tenant's payment request. Thereafter, within thirty (30) days after receipt and approval of such items, Landlord shall deliver a check to Tenant made payable to Tenant in payment of the lesser of: (A) the amounts so requested by Tenant, as set forth in this Section 2.2.2.1, above, less a ten percent (10%) retention (the aggregate amount of such retentions to be known as the "Final Retention"), and (B) the balance of any remaining available portion of the Tenant Improvement Allowance (not including the Final Retention); provided that, to the extent Tenant is already retaining ten percent (10%) under its construction contracts relating to the Tenant Improvements, Landlord shall not withhold an additional ten percent (10%). Landlord's payment of such amounts shall not be deemed Landlord's approval or acceptance of the work furnished or materials supplied as set forth in Tenant's payment request. If any work which is the subject of a request for payment creates a Design Problem, Tenant shall correct and eliminate such Design Problem as soon as reasonably possible.
2.2.2.2    Final Retention. Subject to the provisions of this Tenant Work Letter, a check for the Final Retention payable to Tenant shall be delivered by Landlord to Tenant following the completion of construction of the Premises, provided that (i) Tenant delivers to Landlord properly executed unconditional, final Releases, (ii) Landlord has determined that no Design Problem exists, and (iii) Architect delivers to Landlord a certificate, in a form reasonably acceptable to Landlord, certifying that the construction of the Tenant Improvements in the Premises has been substantially completed and (iv) Tenant delivers to Landlord the "Record Set" of documents, as defined in Section 4.3 below.
2.2.2.3    Other Terms. Landlord shall only be obligated to make disbursements from the Tenant Improvement Allowance to the extent costs are incurred by Tenant for Improvement Allowance Items. Except as expressly set forth in the Lease, all Tenant Improvement Allowance Items for which the Tenant Improvement Allowance has been made available shall be deemed Landlord's property upon the expiration or earlier termination of this Lease under the terms of this Lease.
2.2.2.4    One Disbursement. Notwithstanding the foregoing, Tenant may elect by written notice to Landlord to receive the Tenant Improvement Allowance in a one-time disbursement upon satisfaction of the conditions set forth above for disbursements of the Final Retention.
2.3    Removal of Tenant Improvements. Other than with respect to Above Standard Tenant Improvements as set forth in this Section 2.3, Landlord shall not require Tenant to remove from the Premises any Tenant Improvements (to the extent the same are constructed in the

EXHIBIT B
-6-
ONE TEHAMA
[Social Finance, Inc.]


Premises in accordance with the terms of this Tenant Work Letter) upon the expiration or any earlier termination of the Lease. "Above Standard Tenant Improvements" shall mean any part of the Tenant Improvements which do not constitute normal and customary general office improvements as reasonably determined by Landlord, and shall include, without limitation, improvements such as voice, data and other cabling, raised floors, any installations outside the Premises, or any areas requiring floor reinforcement, personal baths and personal showers (but not showers in the basement or 2nd floor, or in the Fitness Center, if any), vaults, rolling file systems and structural alterations of any type. Kitchen pantry improvements shall not be considered Above-Standard Tenant Improvements, so long as such improvements do not include commercial grade cooking equipment. Landlord may require that Tenant, upon the expiration or any earlier termination of this Lease, remove at Tenant’s cost any Above Standard Tenant Improvements and to repair any damage to the Premises and Building caused by such removal in accordance with the terms and conditions of Section 8.5 of the Lease which are otherwise applicable to the removal of Above Standard Alterations. Tenant, upon notice to Landlord delivered concurrently with a request for approval of any Tenant Improvements, may require Landlord to identify, in writing, any Tenant Improvements which constitute Above Standard Tenant Improvements.
2.4    Failure to Disburse Tenant Improvement Allowance. If Landlord fails to timely fulfill its obligation to fund any portion of the Tenant Improvement Allowance, Tenant shall be entitled to deliver notice (the "Payment Notice") thereof to Landlord and to any mortgage or trust deed holder of the Building whose identity and address have been previously provided to Tenant. If Landlord still fails to fulfill any such obligation within fifteen (15) business days after Landlord's receipt of the Payment Notice from Tenant and if Landlord fails to deliver notice to Tenant within such fifteen (15) business day period explaining Landlord's proper good-faith reasons that Landlord believes that the amounts described in Tenant's Payment Notice are not due and payable by Landlord ("Refusal Notice"), Tenant shall be entitled to offset the amount so owed to Tenant by Landlord but not paid by Landlord (or if Landlord delivers a Refusal Notice but only with respect to a portion of the amount set forth in the Payment Notice and Landlord fails to pay such undisputed amount as required by the next succeeding sentence, the undisputed amount so owed to Tenant) with interest at the Interest Rate from the date due (i.e. the date payable under Sections 2.2.2.1 or 2.2.2.2 above) until the date of offset, against Tenant's next obligations to pay Rent. Notwithstanding the foregoing, Landlord hereby agrees that if Landlord delivers a Refusal Notice disputing a portion of the amount set forth in Tenant's Payment Notice, in order for the Refusal Notice to be valid, Landlord shall pay to Tenant, concurrently with the delivery of the Refusal Notice, the undisputed portion of the amount set forth in the Payment Notice. However, if Tenant is in monetary default under Section 19.1 of the Lease at the time that such offset would otherwise be applicable, Tenant shall not be entitled to such offset until such default is cured. If Landlord delivers a Refusal Notice, and if Landlord and Tenant are not able to agree on the disputed amounts to be so paid by Landlord, if any, within ten (10) days after Tenant's receipt of a Refusal Notice, Tenant may submit such dispute to arbitration under the commercial arbitration rules of JAMS (and Landlord and Tenant hereby submit to arbitration of such matter by JAMS and the determination of such arbitrator shall be final and binding upon both Landlord and Tenant).

EXHIBIT B
-7-
ONE TEHAMA
[Social Finance, Inc.]


SECTION 3
CONSTRUCTION DRAWINGS
3.1    Selection of Architect/Construction Drawings. Tenant shall retain an architect/space planner (the "Architect") to prepare the "Construction Drawings," as that term is defined in this Section 3.1. Landlord hereby approves of Gensler as the Architect. If Tenant changes the Architect, the new Architect shall be subject to Landlord's approval, which approval shall not be unreasonably withheld, conditioned or delayed. Unless Tenant is performing Tenant Improvements on a design-build basis pursuant to Section 3.7 below, Tenant shall retain the engineering consultants selected by Tenant (the "Engineers") to prepare all plans and engineering working drawings relating to the Tenant Improvements. Landlord has the right to approve the Engineers, which approval shall not be unreasonably withheld, conditional or delayed. Notwithstanding the foregoing, Tenant shall retain Engineers and subcontractors designated by Landlord for performance of the work affecting the structural, HVAC, fire-life safety and sprinkler components of the Base Building; provided that such Engineers and subcontractors charge reasonably competitive rates. The plans and drawings to be prepared by Architect and the Engineers hereunder shall be known collectively as the "Construction Drawings." Tenant shall be required to include in its contracts with the Architect and the Engineers a provision which requires ownership of all Construction Drawings to be transferred to Tenant upon the Substantial Completion of the Tenant Improvements and Tenant hereby grants to Landlord a non-exclusive right to use such Construction Drawings, including, without limitation, a right to make copies thereof. All Construction Drawings shall comply with the drawing format and specifications as determined by Landlord, and shall be subject to Landlord's reasonable approval. Tenant and Architect shall verify, in the field, the dimensions and conditions as shown on the relevant portions of the Base Building plans, and Tenant and Architect shall be solely responsible for the same, and Landlord shall have no responsibility in connection therewith. Landlord's review of the Construction Drawings as set forth in this Section 3, shall be for its sole purpose and shall not imply Landlord's review of the same, or obligate Landlord to review the same, for quality, design, Code compliance or other like matters; provided, however, Landlord's approval of such Construction Drawings shall be deemed to mean that the same comply with the Specifications. Accordingly, notwithstanding that any Construction Drawings are reviewed by Landlord or its space planner, architect, engineers and consultants, and notwithstanding any advice or assistance which may be rendered to Tenant by Landlord or Landlord's space planner, architect, engineers, and consultants, Landlord shall have no liability whatsoever in connection therewith and shall not be responsible for any omissions or errors contained in the Construction Drawings, and Tenant's waiver set forth in the Lease shall specifically apply to the Construction Drawings. Landlord shall, concurrently with Landlord's approval of the Construction Drawings, inform Tenant if the Construction Drawings require changes to the Base Building.
3.2    Final Space Plan. Following the full execution and delivery of this Lease, Tenant and the Architect shall prepare the final space plan for Tenant Improvements in the Premises (collectively, the "Final Space Plan"), which Final Space Plan shall include a layout and designation of all offices, rooms and other partitioning, their intended use, and equipment to be contained therein, and shall deliver four (4) copies signed by Tenant of the Final Space Plan to Landlord for Landlord's approval, not to be unreasonably withheld, and given or withheld within five (5) business days after the date Tenant submits the Final Space to Landlord for approval. If

EXHIBIT B
-8-
ONE TEHAMA
[Social Finance, Inc.]


Landlord disapproves of the Final Space Plan, Landlord shall set forth with reasonable specificity the grounds for such disapproval and recommend any modifications that would make the Final Space Plan acceptable to Landlord.
3.3    Final Working Drawings. Following Landlord's approval of the Final Space Plan, Tenant, the Architect and the Engineers shall complete the architectural and engineering drawings for the Premises, and the final architectural working drawings in a form which is complete to allow subcontractors to bid on the work and to obtain all applicable permits (collectively, the "Final Working Drawings") and shall submit two (2) copies signed by Tenant of the same to Landlord for Landlord's approval, not to be unreasonably withheld, and given or withheld within five (5) business days after submission to Landlord. If Landlord disapproves of the Final Working Drawings, Landlord shall set forth with reasonable specificity the grounds for such disapproval and recommend any modifications that would make the Final Working Drawings acceptable to Landlord. Once approved by Landlord, the Final Working Drawings are "Approved Working Drawings".
3.4    Procedure for Approval. Landlord may only withhold consent to the Final Space Plan or the Final Working Drawings if a "Design Problem" exists, as reasonably determined by Landlord. For purposes of this Tenant Work Letter, a "Design Problem" shall mean a condition that will (a) affect the Building Structure, (b) not be in compliance with Applicable Laws (including building codes, electrical codes, plumbing codes, etc.), (c) have an adverse effect on Building Systems or are materially incompatible with the existing Building Systems, (d) have an adverse effect on the exterior appearance of the Building, (e) vitiate or otherwise negatively affect any warranty, guaranty, or insurance maintained by Landlord, (f) materially increase Landlord's maintenance obligations pursuant to this Lease (or would materially increase Landlord's maintenance obligations at any time that Tenant is not the sole direct Tenant), (g) would be unusually difficult or expensive to remove, unless Tenant agrees to remove such items (repair any damage caused by such removal, and restore the affected areas to a Building standard condition) at Tenant's sole expense. If Landlord timely disapproves the Final Space Plan or Final Working Drawings, Tenant shall have a reasonable period after receiving Landlord's comments to revise and resubmit the Final Space Plan or the Final Working Drawings, as the case may be, to Landlord. Landlord shall have five (5) business days after receiving the revised Final Space Plan or the revised Final Working Drawings to approve or disapprove the same. If Landlord reasonably determines that a Design Problem continues to exist, the process in the preceding two sentences shall be repeated until Landlord and Tenant have mutually agreed on the Final Space Plan or the Final Working Drawings, as applicable. Notwithstanding the mutual approval of the parties, the Final Working Drawings shall incorporate, without Landlord's approval, any modifications required by governmental authorities as a condition to obtaining a building permit or other governmental approvals.
3.5    Permits; Permit Contingency; Tenant Improvement Changes.
3.5.1    Permits. The Final Working Drawings shall be approved by Landlord (the "Approved Working Drawings") prior to the commencement of the construction of the Tenant Improvements. All applicable building permits necessary to construct and fully complete the construction of the Tenant Improvements are the "Permits", which Permits may include the transfer of the existing Building permits and/or the receipt of new tenant improvement Permits.

EXHIBIT B
-9-
ONE TEHAMA
[Social Finance, Inc.]


The Permits pertaining to general office Tenant Improvements are the "Office Permits" and all other Permits are the "Non-Office Permits".
3.5.1.1    Landlord's Obligation to Submit For Office Permits. On or prior to November 1, 2018, Tenant shall submit to Landlord ninety percent (90%) design development drawings (excluding drawings for mechanical, electrical, plumbing, fire sprinkler, and fire/life safety, obtaining the approval of which shall be Tenant's responsibility) (the "Permit Drawings") in two (2) tranches (one tranche consisting of the Permit Drawings for the basement, ground level and floor 2 of the Building and the second tranche consisting of the Permit Drawings for floors 3, 4, 5 and 6 of the Building), which Permit Drawings shall be in compliance with then applicable Code and in a form which will permit Landlord, on behalf of Tenant, to obtain the Office Permits. Promptly after Landlord's receipt of all of the Permit Drawings, Landlord shall submit the Permit Drawings to the appropriate municipal authorities on an over the counter ("OTC") basis, and Tenant hereby designates Landlord as Tenant's agent for such purposes. Tenant shall cooperate with Landlord, as necessary, to obtain the Office Permits, including promptly responding to any plan check comments and revising the Permit Drawings to accommodate any plan check comments. Landlord agrees that it will submit the Permit Drawings to appropriate authorities on an OTC basis prior to Landlord's approval of the Final Working Drawings, but that such obligation shall not affect Landlord's rights to approve the Final Working Drawings, and Landlord's disapproval of the same in accordance with Landlord's rights under this Tenant Work Letter shall not constitute a Landlord Caused Delay or the termination of the Permit Contingency Date.
3.5.1.2    Tenant's Obligation to Submit for Non-Office Permits. Tenant, and not Landlord, shall submit the Approved Working Drawings to the appropriate municipal authorities for all Non-Office Permits, and Landlord shall have no obligations with respect to the Non-Office Permits. However, Landlord shall execute permit applications and perform other ministerial acts reasonably necessary to enable Tenant to obtain the Non-Office Permits. Tenant shall not submit the Approved Working Drawings to appropriate municipal authorities for any Non-Office Permits, until Landlord has obtained all of the Office Permits required to be obtained by Landlord pursuant to this Section 3.5.1. Furthermore, except as is strictly necessary to obtain the Non-Office Permits, or approvals for painting the exterior of the Building, Tenant's Signage, the Telecommunications Equipment and/or any access control system installed by Tenant, in no event, at any time, may Tenant contact the City and County of San Francisco (the "City"), the City building department, or any other municipal or governmental authority to discuss the historical designation of the Building, or the zoning designation of the Building, which may be granted or withheld in Landlord sole discretion. Tenant's breach of the preceding sentence shall constitute a default under this Lease and waiver of Tenant's termination right set forth in Section 3.5.2 below.
3.5.2    Permit Contingency. If Landlord is unable to obtain the Office Permits by the date (the "Permit Contingency Date") that is the later to occur of (a) one month following the Delivery Date and (b) midnight on November 23, 2018, and such inability is solely attributable to a determination by the applicable municipal authorities that the Building may not be utilized for general office use as regulated by the City Planning Code, Tenant shall have the right to deliver a notice to Landlord (a "Permit Notice") on or before the Permit Contingency Date, electing to terminate this Lease effective upon the date occurring fifteen (15) business days following receipt

EXHIBIT B
-10-
ONE TEHAMA
[Social Finance, Inc.]


by Landlord of the Permit Notice, unless Landlord delivers the Office Permits within such fifteen (15) business day period, in which event the Permit Notice shall be deemed null and void, and this Lease shall continue in full force and effect. If Tenant delivers the Permit Notice and this Lease is terminated following such fifteen (15) business day period, then Landlord shall reimburse Tenant for Tenant's actual, reasonable, out-of-pocket costs incurred in designing the Tenant Improvements, not to exceed Four Hundred Thousand Dollars ($400,000). This Section 3.5.2 shall survive the expiration or termination of this Lease. Tenant's termination right set forth in this Section 3.5.2 shall terminate upon the earlier to occur of (a) Tenant's failure to submit all of the Permit Drawings to Landlord by November 1, 2018, subject to extension for Landlord Caused Delay, (b) receipt of the Office Permits (and the lapse of the fifteen (15) day appeal period for filing an administrative challenge to such Office Permits without any appeal having been filed), and (c) the Permit Contingency Date occurring without Tenant's delivery (or without Tenant being entitled to deliver) a Permit Notice. Notwithstanding the foregoing, if an administrative challenge to an Office Permit is timely filed, then the Permit Contingency Date shall be extended until the date that is three (3) business days after the final, binding resolution of such appeal. Prior to the expiration or earlier termination of Tenant's termination right set forth in this Section 3.5.2, Tenant shall not be permitted to perform any demolition, construction, or other Tenant Improvement work in the Premises. Notwithstanding anything to the contrary in the Lease or this Tenant Work Letter, the Permit Contingency Date shall be extended by the number of days of delay in obtaining the Office Permits that Landlord is required to obtain hereunder due to Landlord Caused Delay, and the Lease Commencement Date shall be extended by the number of days of delay of the Substantial Completion of the Tenant Improvements caused by the Permit Contingency Date occurring after November 23, 2018 (i.e., due to a failure to cause the Delivery Date to occur one month prior to November 23, 2018). For clarification, the parties confirm that for purposes of this Section 3.5.2, the term "Office Permits" means permits for architectural drawings for the basement, ground level, and floors 2, 3, 4, 5 and 6 of the Building.
3.5.3    Landlord Defense of Enforcement Action. Immediately after any receipt thereof, Tenant or Landlord shall provide the other party with a copy (or notify the other party in writing if verbal notice is received) of all notices received from the City, or any agency, division or department thereof regarding any City Planning Code violations relating to the use of the Premises for general office purposes. If at any time during the Lease Term, the City notifies either Landlord or Tenant that use of the Premises for general office purposes is in violation of any applicable provision of the City Planning or Administrative Codes, and that it intends to initiate an enforcement action against Landlord or Tenant due to any such use, then Landlord will use diligent efforts to contest any such allegations and any enforcement action in connection therewith, at no cost to Tenant; provided, however, that Landlord will keep Tenant reasonably apprised of the status of any such enforcement action. In addition, prior to submitting any documents and/or emails to the City regarding such enforcement action, Landlord will provide Tenant a minimum of five (5) business days to review and comment upon such documents and/or emails and will give due consideration to Tenant's comments. Landlord shall promptly pay all fines, penalties, time and material costs incurred by the City, and judgments arising from any enforcement action. Landlord shall also promptly pay all application fees, time and material costs incurred by the City, and development impact or any other costs or fees that are due in order to comply with any enforcement action.

EXHIBIT B
-11-
ONE TEHAMA
[Social Finance, Inc.]


3.5.4    Tenant Improvement Changes. No material changes, modifications or alterations in the Approved Working Drawings ("Tenant Improvement Changes") may be made without the prior written consent of Landlord, which consent shall not be unreasonably withheld; provided, that Tenant shall have the right to modify the Approved Working Drawings without Landlord's consent if such modifications do not constitute a Design Problem. Landlord shall advise Tenant within five (5) business days after Landlord's receipt of an Improvement Change request if there is a Design Problem with respect to such Improvement Change request otherwise Landlord shall approve such Improvement Change Request within such five (5) business day period. If Landlord advises Tenant that a Design Problem exists with respect to a Tenant Improvement Change request, Tenant shall cause the applicable Tenant Improvement Change request to be revised to correct such Design Problem. Landlord shall approve any re-submittal of a Tenant Improvement Change Request within three (3) business days after receipt thereof.
3.6    Electronic Approvals. Notwithstanding any provision to the contrary contained in the Lease or this Work Letter, Landlord may, in Landlord's sole and absolute discretion, transmit or otherwise deliver any of the approvals required under this Tenant Work Letter via electronic mail to Tenant's representative identified in Section 6.2 of this Tenant Work Letter, or by any of the other means identified in Article 28 of the Lease. Similarly, Tenant and Landlord each may, in their sole discretion, transmit or otherwise deliver any notice or other communications required or desired under this Tenant Work Letter via electronic email to the other party's representative identified in this Tenant Work Letter, or by any other means identified in Article 28 of the Lease.
3.7    Design Build. Notwithstanding anything to the contrary contained in this Tenant Work Letter, Landlord agrees that Tenant shall have the right to construct portions of the Tenant Improvements on a design-build basis if using Bay City Mechanical, CBF Electric, or Broadway Mechanical, or other company reasonably approved by Landlord, in which event the approval process for plans and specifications shall be appropriately modified. If not using these vendors, then MEP drawings will need to be prepared by Engineers.
SECTION 4
CONSTRUCTION OF THE TENANT IMPROVEMENTS
4.1    Tenant's Selection of Contractor.
4.1.1    The Contractor. A general contractor ("TI Contractor") shall be retained by Tenant to construct the Tenant Improvements.
4.1.2    Tenant's Agents. All subcontractors and laborers used by Tenant together with the TI Contractor, Architect, Engineers and any other consultants retained by Tenant shall be referred to herein collectively as "Tenant's Agents". Landlord shall have the right to reasonably approve the subcontractors to perform work which will affect the elevators, roof, HVAC, electrical, plumbing, fire/life safety, exterior, foundation, and load bearing elements. Landlord shall approve or reasonably disapprove any such subcontractors proposed by Tenant within three (3) business days. It shall be reasonable for Landlord to withhold approval of Tenant's subcontractors based on the proposed subcontractor's inadequate financial status, reputation for

EXHIBIT B
-12-
ONE TEHAMA
[Social Finance, Inc.]


poor quality work, inability or unwillingness to obtain performance or completion bonds or insurance, non-union status, or lack of experience with Comparable Buildings.
4.2    Construction of Improvements by Tenant's Agents.
4.2.1    Construction Contract; Cost Budget. Tenant shall submit a copy of the construction contract and general conditions with Contractor (the "Contract"), as well as copies of Tenant's contracts with all other Tenant's Agents, to Landlord for Landlord's records. Prior to the commencement of the construction of the Tenant Improvements, and after Tenant has accepted all bids for the Tenant Improvements, Tenant shall provide Landlord with a detailed breakdown, by trade, of the final costs to be incurred or which have been incurred, as set forth more particularly in Sections 2.2.1.1 through 2.2.1.10, above, in connection with the design and construction of the Tenant Improvements to be performed by or at the direction of Tenant or the Contractor, which costs form a basis for the amount of the Contract (the "Final Costs"). Prior to the commencement of construction of the Tenant Improvements, Tenant shall inform Landlord of the amount (the "Over-Allowance Amount") equal to the difference between the amount of the Final Costs and the amount of the Tenant Improvement Allowance (less any portion thereof already disbursed by Landlord, or in the process of being disbursed by Landlord, on or before the commencement of construction of the Tenant Improvements). Tenant shall be responsible to make payments in connection with each disbursement (for this purpose disbursement means the amount to be disbursed from the Tenant Improvement Allowance plus the amount to be paid by Tenant) under this Tenant Work Letter (the "Over-Allowance Payments"), in an amount equal to the percentage of such disbursement obtained by dividing the Over-Allowance Amount by the amount of the Final Costs and multiplying such quotient by the total amount of the disbursement request, and such Over-Allowance Payment by Tenant shall be a condition to Landlord's obligation to pay any further amounts of the Tenant Improvement Allowance. In no event shall the percentage of total Tenant Improvement Allowance disbursed exceed the percentage of work completed as shown on the TI Contractor's payment application for which reimbursement is being requested. In the event that the costs relating to the design and construction of the Tenant Improvements shall be in excess of the estimated amount as set forth in the Final Costs, any such excess shall be paid by Tenant out of its own funds, but Tenant shall continue to provide Landlord with the documents described in Sections 2.2.2.1 (i), (ii), (iii) and (iv) of this Tenant Work Letter, above, for Landlord's approval, prior to Tenant paying such costs. Tenant shall provide Landlord with updated construction schedules and budgets on a regular basis during the course of construction of the Tenant Improvements, and in any event within fifteen (15) days after request by Landlord. In no event shall Tenant or the TI Contractor be required to obtain a payment or performance bond in connection with the Tenant Improvements.
4.2.2    Tenant's Agents.
4.2.2.1    Landlord's General Conditions for Tenant's Agents and Tenant Improvement Work. The Tenant Improvements shall be constructed substantially in accordance with the Approved Working Drawings (as the same may be modified under this Tenant Work Letter. Tenant shall pay a logistical coordination fee (the "Coordination Fee") to Landlord in an amount equal to the sum of (A) the product of (i) two percent (2%), and (ii) the Tenant Improvement Allowance and (B) the product of (i) one percent (1%), and (ii) any of the hard costs of constructing the Tenant Improvements that are in excess of the Tenant Improvement Allowance,

EXHIBIT B
-13-
ONE TEHAMA
[Social Finance, Inc.]


which Coordination Fee shall be for all services relating to the coordination of the construction of the Improvements and shall be deducted from the Improvement Allowance on a monthly basis based upon the amount of the draw request. In addition, if and to the extent, based on the nature of the mechanical, electrical or plumbing items, or structural items or items affected by Title 24 which are included in the Tenant Improvements, Landlord reasonably retains third party consultants, then Tenant shall pay to Landlord an amount equal to any actual and reasonable out-of-pocket third party costs for such third party consultants expended by Landlord in connection with the construction of the Tenant Improvements within thirty (30) days after receipt of invoice together with reasonable supporting evidence; provided that Landlord notified Tenant prior to incurring any such costs.
4.2.2.2    Requirements of TI Contractor. TI Contractor shall guarantee to Tenant and for the benefit of Landlord that the Tenant Improvements shall be free from any defects in workmanship and materials for a period of not less than one (1) year from the date of completion thereof. TI Contractor shall be responsible for the replacement or repair, without additional charge, of all work done or furnished in accordance with its contract that shall become defective within one (1) year after the completion of the work performed by TI Contractor. All such warranties or guarantees as to materials or workmanship of or with respect to the Improvements shall be contained in the Contract or subcontract and shall be written such that such guarantees or warranties shall inure to the benefit of both Landlord and Tenant, as their respective interests may appear, and can be directly enforced by either. Tenant covenants to give to Landlord any assignment or other assurances which may be necessary to effect such right of direct enforcement.
4.2.2.3    Insurance Requirements.
4.2.2.3.1    General Coverages. All of Tenant's Agents shall carry worker's compensation insurance covering all of their respective employees, and shall also carry public liability insurance, including property damage, all with limits, in form and with companies as are customarily required of such contractors and subcontractors on similar projects.
4.2.2.3.2    Special Coverages. Tenant shall carry "Builder's All Risk" insurance in commercially reasonable amounts covering the construction of the Tenant Improvements, it being understood and agreed that the Tenant Improvements shall be insured by Tenant pursuant to the Lease immediately upon completion thereof. Such insurance shall be in amounts and shall include such extended coverage endorsements as may be reasonably required by Landlord including, but not limited to, the requirement that the TI Contractor shall carry excess liability and Products and Completed Operation Coverage insurance, each in amounts not less than $5,000,000 per incident, $5,000,000 in aggregate, and with companies as are required to be carried by Tenant as set forth in the Lease.
4.2.2.3.3    General Terms. Certificates for all insurance carried pursuant to this Section 4.2.2.3 shall be delivered to Landlord before the commencement of construction of the Tenant Improvements and before the TI Contractor's equipment is moved onto the site. Tenant's Agents shall endeavor to cause all such policies of insurance to contain a provision that the company writing said policy will give Landlord thirty (30) days prior written notice (ten (10) days in the event of non-payment of premium) of any cancellation or lapse of the

EXHIBIT B
-14-
ONE TEHAMA
[Social Finance, Inc.]


effective date or any reduction in the amounts of such insurance. Subject to the terms of Article 11 of the Lease, to the extent applicable, in the event that the Tenant Improvements are damaged by any cause during the course of the construction thereof, Tenant shall repair the same at Tenant's sole cost and expenses. Tenant's Agents shall maintain all of the foregoing insurance coverage in force until the Tenant Improvements are fully completed and accepted by Landlord, except for any Products and Completed Operation Coverage insurance required by Landlord, which is to be maintained for ten (10) years following completion of the work and acceptance by Landlord and Tenant. All policies carried under this Section 4.2.2.3 shall insure Landlord and Tenant, as their interests may appear, as well as TI Contractor and Tenant's Agents. All insurance, except Workers' Compensation, maintained by Tenant's Agents shall preclude subrogation claims by the insurer against anyone insured thereunder. Such insurance shall provide that it is primary insurance as respects the owner and that any other insurance maintained by owner is excess and noncontributing with the insurance required hereunder.
4.2.3    Governmental Compliance. The Tenant Improvements shall comply in all respects with all Applicable Laws.
4.2.4    Inspection by Landlord. During construction, upon reasonable prior notice, Landlord shall have the right to inspect the Tenant Improvements at reasonable times, provided however, that Landlord's failure to inspect the Tenant Improvements shall in no event constitute a waiver of any of Landlord's rights hereunder nor shall Landlord's inspection of the Tenant Improvements constitute Landlord's approval of the same. Should Landlord identify any defect or reasonably disapprove any portion of the Tenant Improvements as not being substantially in accordance with the Approved Working Drawings, Landlord shall notify Tenant in writing of such disapproval and shall specify the items disapproved. Any such defects or deviations reasonably disapproved by Landlord shall be rectified by Tenant at no expense to Landlord (other than by payment of the Tenant Improvement Allowance), provided however, that in the event Landlord reasonably determines that such defect or deviation in connection with any portion of the Tenant Improvements or matter materially adversely affects the mechanical, electrical, plumbing, heating, ventilating and air conditioning or life-safety systems of the Building, the structure or exterior appearance of the Building, following notice to Tenant and Tenant's right to cure the same within the time periods set forth in the Lease, Landlord may, take such action as Landlord reasonably deems necessary, at Tenant's expense and without incurring any liability on Landlord's part, to correct any such defect, deviation and/or matter, including, without limitation, if reasonably necessary, causing the cessation of performance of the construction of the Tenant Improvements until such time as the defect, deviation and/or matter is corrected to Landlord's satisfaction. Notwithstanding anything to the contrary set forth above, if Landlord's disapproval pursuant to this Section 4.2.4 shall be unreasonable, any delay in Substantial Completion of the Tenant Improvements resulting from such disapproval shall constitute a Landlord Delay.
4.2.5    Meetings. Commencing approximately one month prior to the Anticipated Delivery Date, Landlord and Tenant shall hold weekly meetings at mutually agreeable times, with the Architect and the TI Contractor regarding the progress of the preparation of the Construction Drawings and the construction of Landlord Work and the Tenant Improvements, which meetings shall be held at a location reasonably designated by Landlord. Tenant and/or its agents shall receive prior notice of, and shall attend, all such meetings. In addition, minutes shall be taken at all such meetings, a copy of which minutes shall be promptly delivered to the parties.

EXHIBIT B
-15-
ONE TEHAMA
[Social Finance, Inc.]


4.3    Notice of Completion; Copy of Record Set of Plans. Within fifteen (15) days after completion of construction of the Tenant Improvements, Tenant shall cause a Notice of Completion to be recorded in the office of the Recorder of the county in which the Building is located in accordance with Section 8182 of the Civil Code of the State of California or any successor statute, and shall furnish a copy thereof to Landlord upon such recordation. If Tenant fails to do so, Landlord may execute and file the same as Tenant's agent for such purpose, at Tenant's sole cost and expense. At the conclusion of construction of the Tenant Improvements, (i) Tenant shall cause the Architect and TI Contractor (A) to update the Approved Working Drawings as necessary to reflect all changes made to the Approved Working Drawings during the course of construction, (B) to certify to the best of their knowledge that the "record-set" of as-built drawings are true and correct, which certification shall survive the expiration or termination of this Lease, (C) to deliver to Landlord two (2) sets of copies of such record set of drawings within ninety (90) days following issuance of a signed off job card or "finaled" Permits for the Premises, and (ii) Tenant shall deliver to Landlord a copy of all warranties, guaranties, and operating manuals and information relating to the improvements, equipment, and systems in the Premises, and (D) copies of signed-off Permits, certificates of occupancy for the Premises, if any, and a stamped set of final approved plans evidencing governmental approval of the completion of the Tenant Improvements.
SECTION 5
LEASE COMMENCEMENT DATE
5.1    Lease Commencement Date Delays. The Lease Commencement Date shall occur as provided in Section 2.1 of the Lease, provided that the Lease Commencement Date shall be extended by the number of days of delay of the Substantial Completion of the Tenant Improvements (as defined below) to the extent caused by a "Lease Commencement Date Delay," as that term is defined below, but only to the extent such Lease Commencement Date Delay causes the Substantial Completion of the Tenant Improvements to occur after the date which is the later of (a) the Lease Commencement Date and (b) seven (7) months following the Delivery Date. As used herein, the term "Lease Commencement Date Delay" shall mean only a "Force Majeure Delay" or a "Landlord Caused Delay," as those terms are defined below in this Section 5.1 of this Work Letter. As used herein, the term "Force Majeure Delay" shall mean only an actual delay resulting from industry-wide strikes, fire, wind, damage or destruction to the Building, explosion, casualty, flood, hurricane, tornado, the elements, acts of God or the public enemy, sabotage, war, invasion, insurrection, rebellion, civil unrest, riots, earthquakes, or actual, industry-wide delay affecting all similar works of construction in the vicinity of the Building, including by reason of regulation or order of any governmental agency. As used in this Tenant Work Letter, "Landlord Caused Delay" shall mean actual delays in achieving the Substantial Completion of the Tenant Improvements to the extent resulting from (i) the failure of Landlord to timely approve or disapprove the Final Space Plan, Final Working Drawings, Tenant Improvement Changes, TI Contractor or Tenant's other Agents or to otherwise timely act in accordance with the deadlines set forth in this Tenant Work Letter; (ii) unreasonable (when judged in accordance with industry custom and practice) interference by Landlord, its agents or Landlord Parties (except as otherwise allowed by this Tenant Work Letter) with the Substantial Completion of the Tenant Improvements and which objectively preclude or delay the construction of the Tenant Improvements; (iii) the acts or failures to act of Landlord or Landlord Parties with respect to payment of the Tenant

EXHIBIT B
-16-
ONE TEHAMA
[Social Finance, Inc.]


Improvement Allowance (except as otherwise allowed under this Tenant Work Letter), but the same shall only constitute a delay until Tenant is entitled to offset the Tenant Improvement Allowance pursuant to Section 2.5 above; (iv) the failure of Landlord Work to be constructed in accordance with Applicable Laws or any defects or deficiencies in the Landlord Work; (v) any deficiency in the path of travel drawings provided by Landlord that delays the issuance of any Permit; (vi) any other act or omission of Landlord, its contractors, subcontractors, agents or any Landlord Party; or (vii) Landlord's failure to cause (or be deemed to have caused) the Delivery Date to occur seven (7) months prior to the Lease Commencement Date.
5.2    Determination of Lease Commencement Date Delay. If Tenant contends that a Lease Commencement Date Delay has occurred, Tenant shall notify Landlord in writing of (i) the event which constitutes such Lease Commencement Date Delay and (ii) the date upon which such Lease Commencement Date Delay is anticipated to end. If such actions, inaction or circumstance described in the Notice set forth in (i) above of this Section 5.2 of this Work Letter (the "Delay Notice") are not cured by Landlord within two (2) business days of Landlord's receipt of the Delay Notice and if such action, inaction or circumstance otherwise qualify as a Lease Commencement Date Delay, then a Lease Commencement Date Delay shall be deemed to have occurred commencing as of the date of Landlord's receipt of the Delay Notice and ending as of the date such delay ends.
5.3    Definition of Substantial Completion of the Tenant Improvements. For purposes of this Section 5, "Substantial Completion of the Tenant Improvements" shall mean completion of construction of the Tenant Improvements in the Premises pursuant to the Approved Working Drawings, with the exception of any punch list items.
SECTION 6
MISCELLANEOUS
6.1    Freight Elevators. Tenant shall have the right to use the freight elevator, at no charge, in connection with initial constructing, decorating, furnishing and moving into the Premises.
6.2    Tenant's Representative. Tenant has designated Tim Maechling, tmaechling@sofi.org; cell (925) 900-8252, and David Gonzales of Avison Young, david.gonzales@avisonyoung.com; cell (415) 225-3568, as its sole representatives with respect to the matters set forth in this Tenant Work Letter, who, until further notice to Landlord, shall have full authority and responsibility to act on behalf of the Tenant as required in this Tenant Work Letter.
6.3    Landlord's Representatives. Landlord has designated Andre Herring (AHerring@cimgroup.com 510.992.6190) and Peter Banshaf (pbanzhaf@cimgroup.com 415.515.7506) as its sole representatives with respect to the matters set forth in this Tenant Work Letter, who, until further notice to Tenant, shall each have full authority and responsibility to act on behalf of the Landlord as required in this Tenant Work Letter.

EXHIBIT B
-17-
ONE TEHAMA
[Social Finance, Inc.]


6.4    Tenant's Agents. All contractors, subcontractors, laborers, materialmen, and suppliers retained directly by Tenant shall be union labor in compliance with the then existing master labor agreements.
6.5    Time of the Essence in This Tenant Work Letter. Unless otherwise indicated, all references herein to a "number of days" shall mean and refer to calendar days.
6.6    Tenant's Lease Default. Notwithstanding any provision to the contrary contained in this Lease, if an event of default as described in the Lease, following applicable notice and cure periods expressly set forth in this Lease, or a default by Tenant under this Tenant Work Letter, following applicable notice and cure periods expressly set forth in the Lease, has occurred at any time on or before the Substantial Completion of the Premises, or Tenant has failed to deliver the L-C pursuant to the terms of Article 21 of the Lease, then (i) in addition to all other rights and remedies granted to Landlord pursuant to the Lease, Landlord shall have the right to withhold payment of all or any portion of the Tenant Improvement Allowance and/or Landlord may cause Contractor to cease the construction of the Premises (in which case, Tenant shall be responsible for any delay in the Substantial Completion of the Premises caused by such work stoppage as set forth in Section 5 of this Tenant Work Letter), and (ii) all other obligations of Landlord under the terms of this Tenant Work Letter shall be forgiven until such time as such default is cured pursuant to the terms of the Lease.
6.7    Temporary Power. Until permanent electrical power is supplied to the Building by PG&E, Landlord, at Landlord's expense, shall provide all electrical power necessary for Tenant and Tenant's Agents to complete the Tenant Improvement Work.

EXHIBIT B
-18-
ONE TEHAMA
[Social Finance, Inc.]


SCHEDULE 1 TO EXHIBIT B
LANDLORD WORK
The following Landlord Work shall be constructed in accordance with the plans and specifications prepared by Landlord and referenced on Schedule 2 to Exhibit B (the "Landlord Work Plans").
Pre-Delivery Landlord Work:
1.    Construction of a new Building lobby with access from Tehama Street in accordance with the Landlord Work Plans.
2.    Cosmetic refurbishment of the Building lobby with access from 246 First Street in accordance with the Landlord Work Plans.
3.    Installation of a new passenger elevator servicing all floors of the Building (including the roof and the lower level) in accordance with the Landlord Work Plans.
4.    Building standard electric service stubbed to each floor of the Premises via subpanel installation, with Tenant's distribution of electrical throughout the Premises as part of the Tenant Improvements.
5.    Installation of Code compliance fire sprinklers throughout the Premises, designed to accommodate only an open-ceiling plan. Reconfiguration of the fire sprinklers to accommodate any other plan will be Tenant's responsibility as part of the construction of the Tenant Improvements.
6.    If not previously delivered, then within five (5) business days after the mutual execution and delivery of this Lease, Landlord shall cause Landlord's architect to provide Tenant with three (3) sets of "wet-stamped" ADA drawings and path of travel documents for the Base Building, to the extent necessary for Tenant to obtain its building permits for the construction of the Tenant Improvements.
7.    Landlord to patch damage to walls of Building core stairs existing prior to the Delivery Date.
Remaining Landlord Work:
1.    To the extent required in order to allow Tenant to legally occupy the Premises for the Permitted Use or obtain permits for the construction of the Tenant Improvements (and assuming the Tenant Improvements are general office improvements with an occupancy density consistent with single-tenant buildings in the Comparable Area), Landlord shall, at Landlord's sole cost and expense, cause (i) the Base Building, elevators (including call buttons and lanterns) and entry doors to the Building to comply with the "Code", as that term is defined in Section 2.2.15 of this Tenant Work Letter, and Applicable Laws in effect as of the date that Landlord approves the "Final Working Drawings", as that term is defined in Section 3.3 of this Tenant Work Letter, (ii) remove, encapsulate or abate all asbestos

SCHEDULE 1 TO EXHIBIT B
-1-
ONE TEHAMA
[Social Finance, Inc.]


within the Premises in Tenant accessible areas and, including beneath flooring in the restrooms to be updated by Landlord pursuant to item 5 below, if any, to the extent required to comply with Applicable Laws, and (iii) test and encapsulate all lead paint surrounding existing interior windows in the Building, to the extent required to comply with Applicable Laws.
2.    Install new roof membrane under Roof Deck, install pavers per the Landlord Work Plans, and install general infrastructure for the Roof Deck that is compliance with Code, including elevator access and electrical, gas and water hook-ups, in accordance with the Landlord Work Plans. Installation of any finishes, increased surface area, and furniture, fixtures and equipment shall be Tenant's responsibility as part of the Tenant Improvements.
3.    Replace existing perimeter broken windows and clean, repair or replace existing perimeter inoperable window latches, so that all windows are functional.
4.    Raise or relocate all plumbing or waste lines in the basement that are below the permitted Code height.
5.    Landlord to construct restrooms on every floor of the Building, and update all existing restrooms of the Building (including, but not limited to, new flooring, fixtures, and countertops), using finishes and in a design consistent with the Landlord Work Plans. Landlord to demolish existing shower room on 2nd floor of the Building. In addition, Landlord Work Plans shall be modified to reflect showers to be installed in the basement level, at Tenant's expense.
6.    Landlord to install a fire panel in the basement, as required by Code; provided, however, if the City Fire Marshal requires construction of a fire control room, then (i) such fire control room shall be constructed by Tenant as part of the Tenant Improvements, and (ii) in addition to the Tenant Improvement Allowance, and the Window Covering Allowance, Landlord will provide an additional allowance of up to Eighty Thousand Dollars ($80,000) to be used by Tenant for the costs of designing and constructing the fire control room (the "Fire Control Room"), which additional allowance shall be distributed as part of the Tenant Improvement Allowance, but solely for the Fire Control Room Costs.
7.    Installation by PG&E of new electrical vault and electrical service to the Building (the "PG&E Work"). If the PG&E Work is not completed on or before the Lease Commencement Date, such failure shall constitute a Landlord Delay. Landlord agrees to use reasonable efforts to ensure that the vault door is located a reasonable distance from the First Street entry doors.
8.    Landlord to replace the existing skylight(s) and to repair or replace, as reasonably necessary, the windows, and entry doors, so all are watertight and in good working order, condition and repair, including, but not limited to, repairing or replacing window latches.
9.    Landlord to seal existing penetrations in the floors, ceilings, and walls with one or two hour-rated materials.

SCHEDULE 1 TO EXHIBIT B
-2-
ONE TEHAMA
[Social Finance, Inc.]


10.    Landlord to re-key the perimeter and roof doors of the Building and provide keys to Tenant for such areas at no additional cost to Tenant.
11.    Landlord to clean the interior and exterior surfaces of all windows no earlier than thirty (30) days prior to Tenant's move into the Premises, so long as Tenant provides Landlord with thirty-five (35) days prior written notice of the date that Tenant plans to start moving in (this includes, FF&E and low voltage wiring).
12.    Landlord to purchase, install and configure a Johnson Controls Metasys Base Building management system (BMS) per Tenant specifications and connect the system to all existing Landlord-installed HVAC equipment.
13.    Landlord to refurbish the existing elevators, so that they are in good working order, condition and repair.
14.    Landlord to install card reader panels (but not the operating system) approved by Tenant in all elevators, both refurbished and new.
15.    Landlord to repair or replace, if necessary, the sheet metal roof on the penthouse of the Building.
16.    Landlord to install traveler cable and point of connection for a card reader in both the Tehama and North 1st Street elevators. Card reader device and associated cabling to be installed by Tenant.
17.    Landlord to install empty conduits and mounting point to receive Tenant's card readers at Tehama and both North 1st entry doors. Card reader device and associated cabling to installed by Tenant.

SCHEDULE 1 TO EXHIBIT B
-3-
ONE TEHAMA
[Social Finance, Inc.]


SCHEDULE 2 TO EXHIBIT B
LANDLORD WORK PLANS

SCHEDULE 2 TO EXHIBIT B
-1-
ONE TEHAMA
[Social Finance, Inc.]


EXHIBIT C
FORM OF NOTICE OF LEASE TERM DATES


EXHIBIT C
-1-
ONE TEHAMA
[Social Finance, Inc.]


EXHIBIT D
RULES AND REGULATIONS
Tenant shall faithfully observe and comply with the following Rules and Regulations. Landlord shall not be responsible to Tenant for the nonperformance of any of said Rules and Regulations by or otherwise with respect to the acts or omissions of any other tenants or occupants of the Project. In the event of any conflict between the Rules and Regulations and the other provisions of this Lease, the latter shall control.
1.    Landlord and its agents shall in no case be liable for damages for any error with regard to the admission to or exclusion from the Building of any person. In case of invasion, mob, riot, public excitement, or other commotion, Landlord reserves the right to prevent access to the Building or the Project during the continuance thereof by any means it deems appropriate for the safety and protection of life and property.
2.    Landlord shall have the right to prescribe the weight, size and position of all safes and other heavy property brought into the Building and also the times and manner of moving the same in and out of the Building. Safes and other heavy objects shall, if considered necessary by Landlord, stand on supports of such thickness as is necessary to properly distribute the weight. Landlord will not be responsible for loss of or damage to any such safe or property in any case. Any damage to any part of the Building, its contents, occupants or visitors by moving or maintaining any such safe or other property shall be the sole responsibility and expense of Tenant.
3.    Tenant shall not overload the floor of the Premises beyond the Building standard floor loading specifications.
4.    Except as set forth in Section 5.8 of this Lease, Tenant shall not bring into or keep within the Project, the Building or the Premises any animals, birds, aquariums, or, except in areas designated by Landlord, bicycles or other vehicles.
5.    No awnings or other projection shall be attached to the outside walls of the Building without the prior written consent of Landlord, and no curtains, blinds, shades or screens shall be attached to or hung in, or used in connection with, any window or door of the Premises, without Landlord's prior approval, which approval shall not be unreasonably withheld, conditioned or delayed. Neither the interior nor exterior of any windows shall be coated or otherwise sunscreened without the prior written consent of Landlord.
6.    Tenant must comply with the State of California "No-Smoking" law set forth in California Labor Code Section 6404.5, and any local "No-Smoking" ordinance which may be in effect from time to time and which is not superseded by such State law.
7.    No auction, liquidation, fire sale, going-out-of-business or bankruptcy sale shall be conducted in the Premises without the prior written consent of Landlord.
8.    No tenant shall use or permit the use of any portion of the Premises for living quarters, sleeping apartments or lodging rooms.

EXHIBIT D
-1-
ONE TEHAMA
[Social Finance, Inc.]


Rules and Regulations Specific to the Roof Deck
1.    All items installed for use on the Roof Deck (furniture, trash receptacles, landscaping, etc.) shall be securely fastened or heavy enough to withstand wind load. Cushions must be attached to furniture.
2.    No installation of umbrellas, awnings, flags, and banners, which are capable of being blown from the Roof Deck.
3.    Flammable, toxic or otherwise Hazardous Materials are prohibited. Tenant may only place on the Roof Deck heat lamps, fire pits and barbeques that are permitted under Code, and may not place on the Roof Deck any such items that utilize charcoal.
4.    No items can be affixed, hung, or mounted to the perimeter glass. Standing or sitting on the perimeter ledges, Base Building planters, and structural barriers or elements is strictly prohibited.
5.    Smoking cigarettes, pipes, cigars, or e-cigarettes or other similar electronic products on the Roof Deck is prohibited.
6.    No throwing or tossing or items can be hung over the side of the Roof Deck. Games that include throwing or hitting an object are prohibited.
7.    Use of music, recorded or live, and amplified voice devices shall be limited to not disturb other occupants or tenants in the Building, if any.
8.    Tenant shall have the right to use the Roof Deck for the sole purposes (i) of employee leisure space, including the consumption of food and beverages, (ii) space for business functions for Tenant and Tenant Parties in the nature of special events (including social business functions) being held at Tenant’s sole expense, and (iii) other purposes relating to Tenant's business in the Premises. In no event shall Tenant be permitted to use the Roof Deck for any other purpose.
9.    Tenant shall provide appropriate supervision and security for use of the Roof Deck.
10.    Tenant agrees to control the number of people having access to the Roof Deck, to ensure safety, and to avoid any disruptive or dangerous behavior in the Roof Deck. Number of occupants shall not exceed posted value allowed by Code.
11.    Tenant's use of the Roof Deck may not damage the Building or the Building roof. Tenant shall be responsible for any damage to the roof or Roof Deck which may be caused (whether by Tenant or by any other Tenant Parties) by Tenant's use of the Roof Deck.
12.    Tenant agrees to maintain all of Tenant’s furniture and property placed on or about the Roof Deck in satisfactory condition as to appearance and safety, replacing the same from time to time as consistent with and appropriate for the first-class nature of the Building. Tenant agrees that at all times it will keep the Roof Deck free of all trash or waste materials

EXHIBIT D
-2-
ONE TEHAMA
[Social Finance, Inc.]


unless kept in a trash or waste container. Trash and waste cans will not be permitted on the Roof Deck unless installed as part of furniture / personal property.
13.    Tenant shall provide Landlord with prior notice of any maintenance or repair of the Roof Deck and coordinate such work with Landlord in order to avoid voiding or otherwise adversely affecting any warranties granted to Landlord with respect to the roof or perimeter glass enclosure. If necessary, Tenant, at its sole cost and expense, shall retain any contractor having a then existing warranty in effect on the roof to perform such work (to the extent that it involves the roof).
Tenant shall be deemed to have read these Rules and Regulations and to have agreed to abide by them as a condition of its occupancy of the Premises. Landlord shall not be entitled to supplement these Rules and Regulations.

EXHIBIT D
-3-
ONE TEHAMA
[Social Finance, Inc.]


EXHIBIT E
FORM OF TENANT'S ESTOPPEL CERTIFICATE
The undersigned, as Tenant under that certain Office Lease (the "Lease") made and entered into as of ___________, 20__ by and between _______________, as Landlord, and the undersigned, as Tenant, for Premises on the ______________ floor(s) of the office building located at ______________, certifies as follows:
1.    Attached hereto as Exhibit A is a true and correct copy of the Lease and all amendments and modifications thereto. The documents contained in Exhibit A represent the entire agreement between the parties as to the Premises.
2.    The undersigned currently occupies the Premises described in the Lease, the Lease Term commenced on __________, and the Lease Term expires on ___________, and the undersigned has no option to terminate or cancel the Lease or to purchase all or any part of the Premises, the Building and/or the Project, except as follows: ______________________________.
3.    Base Rent became payable on ____________.
4.    The Lease is in full force and effect and has not been modified, supplemented or amended in any way except as provided in Exhibit A.
5.    Tenant has not transferred, assigned, or sublet any portion of the Premises nor entered into any license or concession agreements with respect thereto except as follows:
6.    All monthly installments of Base Rent, all Additional Rent and all monthly installments of estimated Additional Rent have been paid through ___________. The current monthly installment of Base Rent is $_____________________.
7.    To the undersigned's current, actual knowledge, Landlord is not in default under the Lease. The undersigned has not delivered any notice to Landlord regarding a default by Landlord thereunder.
8.    No rental has been paid more than thirty (30) days in advance and no security has been deposited with Landlord except the letter of credit in the current amount of $_____________________, subject to any reduction as provided in the Lease.
9.    To the undersigned's current, actual knowledge, no offsets or credits are due from Landlord as of the date hereof.

EXHIBIT E
-1-

ONE TEHAMA
[Social Finance, Inc.]


10.    If Tenant is a corporation, limited liability company, partnership or limited liability partnership, Tenant hereby represents and warrants that Tenant is a duly formed and existing entity qualified to do business in California and that Tenant has full right and authority to execute and deliver this Estoppel Certificate and that each person signing on behalf of Tenant is authorized to do so.
11.    There are no actions pending against the undersigned under the bankruptcy or similar laws of the United States or any state.
12.    Other than in compliance with all applicable laws and incidental to the ordinary course of the use of the Premises, the undersigned has not used or stored any hazardous substances in the Premises.
13.    To the undersigned's current, actual knowledge, the initial tenant improvement work to be performed by Landlord under the Lease has been completed in accordance with the Lease and has been accepted by the undersigned and all reimbursements and allowances due to the undersigned under the Lease in connection with any the initial improvement work have been paid in full, except: ____________________________.
All references to the undersigned's "current actual knowledge" shall mean, and shall be limited to, the actual (as distinguished from implied, imputed or constructive) knowledge of _____________________, without any obligation to make independent inquiry or investigation. Tenant hereby represents and warrants that _____________________ is the person who is most qualified to have knowledge of the matters above without any independent inquiry or investigation.
The undersigned acknowledges that this Estoppel Certificate may be delivered to Landlord or to a prospective mortgagee or prospective purchaser, and acknowledges that said prospective mortgagee or prospective purchaser will be relying upon the statements contained herein in making the loan or acquiring the property of which the Premises are a part and that receipt by it of this certificate is a condition of making such loan or acquiring such property.
Executed at ______________ on the ____ day of ___________, 20__.
"Tenant":
,
a
By:
Its:
By:
Its:

EXHIBIT E
-2-

ONE TEHAMA
[Social Finance, Inc.]


EXHIBIT F
FORM OF SNDAA
RECORDING REQUESTED BY
AND WHEN RECORDED RETURN TO:
This SUBORDINATION, NON-DISTURBANCE, AND ATTORNMENT AGREEMENT (the “Agreement”) is dated as of _____________, 2018 and is by and among DEUTSCHE BANK AG, NEW YORK BRANCH, having an address at 60 Wall Street, 10th Floor, New York, New York 10005 (together with its successors and assigns, “Lender”), 246 FIRST STREET (SF) OWNER, LLC, a Delaware limited liability company, having an office at c/o CIM Group, LLC, 4700 Wilshire Boulevard, Los Angeles, CA 90010 (“Landlord”), and SOCIAL FINANCE, INC., a Delaware corporation, having an office at 10701 Parkridge Blvd., Suite 120, Reston, VA 20191 (“Tenant”).
WHEREAS, Lender has made a loan to Landlord (the “Loan”), which Loan is evidenced by that certain Loan Note, dated as of December 28, 2017 (as the same may be amended, modified, restated, severed, consolidated, renewed, replaced, or supplemented from time to time, the “Promissory Note”), and secured by, among other things, that certain Deed of Trust, Assignment of Rents and Leases, Security Agreement and Fixture Filing (as the same may be amended, restated, replaced, severed, split, supplemented or otherwise modified from time to time, the “Mortgage”), dated December 28, 2017, and recorded on December 29, 2017, in the Officer of the Assessor-Recorder of San Francisco encumbering the real property located in San Francisco, California, as more particularly described on Exhibit A annexed hereto and made a part hereof (the “Property”);
WHEREAS, by a lease agreement (the “Lease”) dated ___________, _____, between Landlord and Tenant, Landlord leased to Tenant a portion of the Property, as said portion is more particularly described in the Lease (such portion of the Property hereinafter referred to as the “Premises”);
WHEREAS, Tenant acknowledges that Lender will rely on this Agreement in making the Loan to Landlord; and

EXHIBIT F
-1-

ONE TEHAMA
[Social Finance, Inc.]


WHEREAS, Lender and Tenant desire to evidence their understanding with respect to the Mortgage and the Lease as hereinafter provided.
NOW, THEREFORE, in consideration of the mutual agreements hereinafter set forth, the parties hereto hereby agree as follows:
1.    Tenant covenants, stipulates and agrees that the Lease and all of Tenant's right, title and interest in and to the Property thereunder (including but not limited to any option to purchase, right of first refusal to purchase or right of first offer to purchase the Property (or any portion thereof)) is hereby, and shall at all times continue to be, subordinated and made secondary and inferior in each and every respect to the Mortgage and the lien thereof, and subject to the provisions of this Agreement, to all of the terms, conditions and provisions thereof and to any and all advances made or to be made thereunder, so that at all times the Mortgage shall be and remain a lien on the Property prior to and superior to the Lease for all purposes, subject to the provisions set forth herein. Subordination is to have the same force and effect as if the Mortgage and any renewals, modifications, consolidations, replacements and extensions had been executed, acknowledged, delivered and recorded prior to the Lease, any amendments or modifications thereof and any notice thereof. Tenant hereby acknowledges and agrees that any option to purchase, right of first refusal to purchase or right of first offer to purchase the Property (or any portion thereof) in the Lease, shall not be exercisable in connection with any exercise of remedies pursuant to the Mortgage or any mezzanine loan secured by the membership interests in Landlord, including: (i) a purchase of the Property (or any portion thereof) at a foreclosure sale, (ii) a transfer of the Property (or any portion thereof) to Lender or its designee pursuant to a deed-in-lieu of foreclosure, (iii) a transfer of the membership interests in Landlord pursuant to a foreclosure of any such mezzanine loan, or (iv) any subsequent sale of the Property (or any portion thereof) by Lender or its designee after such foreclosure or deed-in-lieu of foreclosure or by any mezzanine lender or its designee after such foreclosure of such mezzanine loan. The holder of any such mezzanine loan shall be a third party beneficiary of the foregoing sentence.
2.    Lender agrees that if Lender exercises any of its rights under the Mortgage, including entry or foreclosure of the Mortgage or exercise of a power of sale under the Mortgage, Lender will not disturb Tenant's right to use, occupy and possess the Premises under the terms of the Lease so long as Tenant is not in default beyond any applicable notice and cure period under any term, covenant or condition of the Lease, and, subject to the terms hereof, Lender shall assume the obligations of Landlord and be bound to Tenant in accordance with all of the provisions of the Lease for the balance of the term thereof, including any extension term, except as provided hereinbelow.
3.    If, at any time Lender (or any person, or such person's successors or assigns, who acquires the interest of Landlord under the Lease through foreclosure of the Mortgage or otherwise) shall succeed to the rights of Landlord under the Lease as a result of a default or event of default under the Mortgage, upon Tenant's receipt of written notice of such succession, Tenant shall attorn to and recognize such person so succeeding to the rights of Landlord under the Lease (herein sometimes called "Successor Landlord") as Tenant's landlord under the Lease, said attornment to be effective and self-operative without the execution of any further instruments. Although said attornment shall be self-operative, Tenant agrees to execute and deliver to Lender or to any Successor Landlord, such other instrument or instruments as Lender or such other person

EXHIBIT F
-2-

ONE TEHAMA
[Social Finance, Inc.]


shall from time to time request in order to confirm said attornment. Subject to the terms hereof, Lender or any Successor Landlord shall recognize the leasehold estate of Tenant under all of the terms, covenants and conditions of the Lease for the remaining balance of the Lease term and any extensions thereof with the same force and effect as if Lender or such Successor Landlord were the original landlord under the Lease, and Tenant's rights and privileges under the Lease shall not be disturbed or terminated by Lender's exercise of its rights or remedies under the Mortgage, except for any such disturbance incidental to Lender's exercise of its rights and remedies under the Mortgage. Lender will not join Tenant as a party defendant for the purpose of terminating Tenant's interest and estate under the Lease in any proceeding for foreclosure, unless such joinder shall be legally required.
4.    Landlord authorizes and directs Tenant to honor any written demand or notice from Lender instructing Tenant to pay rent or other sums to Lender rather than Landlord (a "Payment Demand"), regardless of any other or contrary notice or instruction which Tenant may receive from Landlord before or after Tenant's receipt of such Payment Demand. Tenant may rely upon any notice, instruction, Payment Demand, certificate, consent or other document from, and signed by, Lender and shall have no duty to Landlord to investigate the same or the circumstances under which the same was given. Any payment made by Tenant to Lender or in response to a Payment Demand shall be deemed proper payment by Tenant of such sum pursuant to the Lease. Landlord, by its execution of this Agreement, consents to the foregoing and waives any right, claim or demand which Landlord may have against Tenant by reason of such payments to Lender or as Lender directs pursuant to the terms of the Mortgage.
5.    If Lender shall become the owner of the Property or the Property shall be sold by reason of foreclosure or other proceedings brought to enforce the Mortgage or if the Property shall be transferred by deed in lieu of foreclosure, Lender or any Successor Landlord shall not be:
(a)    except as set forth in clauses 5(c) and 5(d) hereof, liable for any act or omission of any prior landlord (including Landlord) or bound by any obligation to make any payment to Tenant which was required to be made prior to the time Lender succeeded to any prior landlord (including Landlord); or
(b)    obligated to cure any defaults of any prior landlord (including Landlord) which occurred, or to make any payment to Tenant which was required to be paid by any prior landlord (including Landlord), prior to the time that Lender or any Successor Landlord succeeded to the interest of such landlord under the Lease, except that the foregoing that not limit Successor Landlord's liability to (i) cure any default of such prior landlord (including Landlord) that is continuing in nature but only for the period from and after Lender or any Successor Landlord holds title or has possession of the Property, or (ii) disburse the Tenant Improvement Allowance in accordance with Exhibit B to the Lease; or
(c)    obligated to perform any construction obligations of any prior landlord (including Landlord) under the Lease, except that Lender agrees to perform the Landlord Work and Remaining Landlord Work as defined in Exhibit B to the Lease, or liable for any defects (latent, patent or otherwise) in the design, workmanship, materials, construction or otherwise with respect to improvements and buildings constructed on the Property, other than improvements constructed by Lender, if any; or

EXHIBIT F
-3-

ONE TEHAMA
[Social Finance, Inc.]


(d)    except as set forth in Section 7.4 of the Lease (Tenant's Right to Make Repairs) and Section 2.4 of the Work Letter (Failure to Disburse Tenant Improvement Allowance), subject to any offsets, defenses or counterclaims which Tenant may have been entitled to assert against any prior landlord (including Landlord) prior to the time any Successor Landlord succeeded to the interest of such landlord under the Lease; or
(e)    bound by any payment of rent or additional rent by Tenant to any prior landlord (including Landlord) for more than one month in advance (except that Tenant may pay the amounts requested by Landlord as representing estimated Tenant's Share of Additional Rent (as such terms are defined in the Lease); or
(f)    bound by any amendment, modification, termination (other than termination rights expressly set forth in the Lease) or surrender of the Lease made without the written consent of Lender (except with respect to execution of Exhibit C to the Lease and Tenant's exercise of an extension option in accordance with Section 2.2 of the Lease); or
(g)    liable or responsible for or with respect to the retention, application and/or return to Tenant of any security deposit paid to any prior landlord (including Landlord), whether or not still held by such prior landlord, unless and until Lender or any Successor Landlord has actually received said deposit for its own account as the landlord under the Lease as security for the performance of Tenant's obligation under the Lease (which deposit shall, nonetheless, be held subject to the provisions of the Lease).
6.    Tenant hereby represents, warrants, covenants and agrees to and with Lender:
(a)    to deliver to Lender, at the addresses provided below, by certified mail, return receipt requested, a duplicate of each notice of default delivered by Tenant to Landlord at the same time as such notice is given to Landlord and no such notice of default shall be deemed given by Tenant under the Lease unless and until a copy of such notice shall have been so delivered to Lender. Lender shall have the right (but shall not be obligated) to cure such default. Tenant shall accept performance by Lender of any term, covenant, condition or agreement to be performed by Landlord under the Lease with the same force and effect as though performed by Landlord. Provided that Lender has delivered to Tenant written notice that Lender intends to cure a default, Tenant further agrees to afford Lender a period of thirty (30) days beyond any period afforded to Landlord for the curing of such default, during which period Lender shall seek to cure such default, or, if such default cannot be cured within that time, then such additional time as may be necessary so long as Lender diligently proceeds to cure such default (including but not limited to commencement of foreclosure proceedings) during which period Lender may elect (but shall not be obligated to) to seek to cure such default, prior to taking any action to terminate the Lease. Notwithstanding the foregoing, the provisions of Section 7.4 of the Lease (Tenant's Right to Make Repairs) shall prevail over the foregoing provisions of this Section 6(a). If the Lease shall terminate due to any default or bankruptcy of Landlord, as a result of foreclosure proceedings or otherwise in connection with enforcement of the Mortgage or in or in connection with Lender’s or its nominee’s acceptance of a deed in lieu of foreclosure, upon Lender's written request given within thirty (30) days after such termination, Tenant, within fifteen (15) days after such request, shall execute and deliver to Lender a new lease of the Premises for the remainder of the term of the Lease and upon all of the same terms, covenants and conditions of the Lease;

EXHIBIT F
-4-

ONE TEHAMA
[Social Finance, Inc.]


(b)    that Tenant is the sole owner of the leasehold estate created by the Lease; and
(c)    to promptly certify in writing to Lender, in connection with any proposed assignment of the Mortgage, whether or not, to Tenant's current actual knowledge, any default on the part of Landlord then exists under the Lease and to deliver to Lender any tenant estoppel certificates required under the Lease.
7.    Tenant acknowledges that the interest of Landlord under the Lease is assigned to Lender solely as security for the Promissory Note, and Lender shall have no duty, liability or obligation under the Lease or any extension or renewal thereof, unless Lender shall specifically undertake such liability in writing or Lender becomes and then only with respect to periods in which Lender becomes, the fee owner of the Property.
8.    This Agreement shall be governed by and construed in accordance with the laws of the State in which the Premises is located (excluding the choice of law rules thereof).
9.    This Agreement and each and every covenant, agreement and other provisions hereof shall be binding upon and shall inure to the benefit of the parties hereto and their respective successors and assigns (including, without limitation, any successor holder of the Promissory Note) and may be amended, supplemented, waived or modified only by an instrument in writing executed by the party against which enforcement of the termination, amendment, supplement, waiver or modification is sought.
10.    All notices to be given under this Agreement shall be in writing and shall be deemed served upon receipt by the addressee if served personally or, if mailed, upon the first to occur of receipt or the refusal of delivery as shown on a return receipt, after deposit in the United States Postal Service certified mail, postage prepaid, addressed to the address of Landlord, Tenant or Lender appearing below. Such addresses may be changed by notice given in the same manner. If any party consists of multiple individuals or entities, then notice to any one of same shall be deemed notice to such party.
Lender's Address:    Deutsche Bank AG, New York Branch
60 Wall Street, 10th Floor
New York, New York 10005
Attn: Scott Speer, Vice President
with copies to:    Skadden, Arps, Slate, Meagher & Flom LLP
Four Times Square
New York, New York 10036
Attn: Audrey Sokoloff
Deutsche Bank AG, New York Branch
60 Wall Street, 10th Floor
New York, New York 10005
Attn: General Counsel

EXHIBIT F
-5-

ONE TEHAMA
[Social Finance, Inc.]


Tenant's Address:    Social Finance, Inc.
246 1st Street
San Francisco, CA 94105
Attention: Chief Financial Officer
and:    Social Finance, Inc.
246 1st Street
San Francisco, CA 94105
Attention: Director of Facilities & Real Estate
and    Social Finance, Inc.
10701 Parkridge Blvd., Suite 120
Reston, VA 20191
Attention: General Counsel
Landlord’s Address:    CIM Group, LLC
4700 Wilshire Boulevard
Los Angeles, California 90010
Attention: General Counsel; and Nicholas Breyer
With a copy to:    Paul, Weiss, Rifkind, Wharton & Garrison LLP
1285 Avenue of the Americas
New York, NY 10019-6064
Attention: Harris B. Freidus
11.    If this Agreement conflicts with the Lease, then this Agreement shall govern as between the parties and any Successor Landlord, including upon any attornment pursuant to this Agreement. This Agreement supersedes, and constitutes full compliance with, any provisions in the Lease that provide for subordination of the Lease to, or for delivery of nondisturbance agreements by the holder of, the Mortgage. As between Landlord and Tenant, nothing in this Agreement shall constitute or be deemed to constitute an amendment, modification, or waiver of any term or condition of the Lease or any right or remedy of Tenant thereunder.
12.    In the event Lender shall acquire Landlord's interest in the Premises, Tenant shall look only to the estate and interest, if any, of Lender in the Property for the satisfaction of Tenant's remedies for the collection of a judgment (or other judicial process) requiring the payment of money in the event of any default by Lender as a Successor Landlord under the Lease or under this Agreement, and no other property or assets of Lender shall be subject to levy, execution or other enforcement procedure for the satisfaction of Tenant's remedies under or with respect to the Lease, the relationship of the landlord and tenant under the Lease or Tenant's use or occupancy of the Premises or any claim arising under this Agreement.
13.    Upon payment in full of the Loan, this Agreement shall terminate and be of no further force and effect.
14.    If any provision of this Agreement is held to be invalid or unenforceable by a court of competent jurisdiction, such provision shall be deemed modified to the extent necessary to be

EXHIBIT F
-6-

ONE TEHAMA
[Social Finance, Inc.]


enforceable, or if such modification is not practicable, such provision shall be deemed deleted from this Agreement, and the other provisions of this Agreement shall remain in full force and effect, and shall be liberally construed in favor of Lender.
15.    This Agreement may be executed in any number of counterparts, each of which shall be deemed an original and all of which together shall constitute one and the same instrument.
[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK]

EXHIBIT F
-7-

ONE TEHAMA
[Social Finance, Inc.]


IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be executed as of the date first above written.
TENANT:
SOCIAL FINANCE, INC.,
a Delaware corporation
By:
Name:
Title:
LANDLORD:
246 FIRST STREET (SF) OWNER, LLC
By:
Name:
Title:
LENDER:
DEUTSCHE BANK AG, NEW YORK BRANCH
By:
Name:
Title:
By:
Name:
Title:
[ADD APPROPRIATE ACKNOWLEDGMENT (one for each Signatory)]

EXHIBIT F
-8-

ONE TEHAMA
[Social Finance, Inc.]


Exhibit A
Legal Description of Property
(Attached)

EXHIBIT F
-9-

ONE TEHAMA
[Social Finance, Inc.]


EXHIBIT G
FORM OF LETTER OF CREDIT
DRAFT OF STANDBY LETTER OF CREDIT
Date:
Beneficiary:
246 First Street (SF) Owner, LLC
c/o CIM
4700 Wilshire Boulevard
Los Angeles, CA 90010
Attention: Terry Wachsner
Letter of Credit No.
By order of our client, SOCIAL FINANCE, INC., a Delaware corporation (the “Applicant”), we hereby open our irrevocable Standby Letter of Credit No. ________, in your favor for an amount not to exceed in aggregate USD Six Million Dollars ($6,000,000.00), effective immediately and expiring at the office of [INSERT OFFICE IN CALIFORNIA - _______________________] Attn. Standby Letter of Credit Unit or such other office as we may advise you from time to time (the “Office”), on _______________.
Funds hereunder are available to you against presentation of written and dated Statement in the form Annex A, attached hereto, which draws may be made by hand delivery, courier service, overnight mail, or facsimile. Presentation by facsimile transmission shall be by transmission of the above required sight draft drawn on us together with this Letter of Credit to our facsimile number, [__________], Attention: [____________], with telephonic confirmation of our receipt of such facsimile transmission at our telephone number [________] or to such other facsimile or telephone numbers, as to which Beneficiary has received written notice from us as being the applicable such number. Our receipt of telephone call will not be condition for payment hereunder.
It is a condition of this Letter of Credit that its expiry date shall be automatically extended, without amendment, for additional period(s) of one year from the expiry date hereof, or any future expiration date, but not beyond March 31, 2030, unless at least 60 (sixty) days prior to any expiration date we notify you by certified mail (return
EXHIBIT G
-1-
ONE TEHAMA
[Social Finance, Inc.]


receipt requested) or by any other receipted means that we elect not to consider this expiry date of this Letter of Credit extended for any such additional period.
It is a condition of this letter of credit that it is transferable and may be transferred in its entirety, but not in part, and may be successively transferred by you or any transferee hereunder to a successor transferee(s). Transfer under this letter of credit to such transferee shall be effected upon presentation to us of the original of this Letter of Credit and any amendments hereto accompanied by a request designating the transferee in the form of Annex B attached hereto appropriately completed, along with payment of 1/4 of one percent (minimum $300, maximum $1,000) as a transfer fee. Applicant shall be solely responsible for payment of the transfer fee. All banking charges are for the Applicant's account.
Partial drawings and multiple presentations may be made under this Letter of Credit, provided, however, that each such demand that is paid by us shall reduce the amount available under this Letter of Credit.
The amount available to be drawn under this Letter of Credit shall be reduced, automatically and without amendment upon our receipt from the beneficiary Reduction Certificate stating thereon amount of reduction and available amount after such reduction
We hereby agree to honor each drawing under and in compliance with the terms and conditions of this Letter of Credit if presented, as specified, at our Office on or before expiration date.
We hereby agree with you that payments shall be initiated within two (2) business days of when drafts are presented to us in compliance with the terms of this Letter of Credit. "Business day" shall mean any day other than a Saturday, Sunday or a day on which banking institutions in New York are authorized or required by Law to close. If the expiration date of this Letter of Credit shall ever fall on a day which is not a business day, then such expiration date shall automatically be extended to the date which is the next business day.
In the event that the original of this Letter of Credit is lost, stolen, mutilated or otherwise destroyed, we hereby agree to issue a duplicate original hereof upon receipt of a written request from you and a certification by you of the loss, theft, mutilation or other destruction of the original hereof and satisfactory indemnity letter.
Should you have occasion to communicate with us regarding this Letter of Credit, please direct your correspondence to our Office, making specific mention of the Letter of Credit number indicated above.
Except as otherwise expressly stated herein, this Standby Letter of Credit is subject to the International Standby Practices, International Chamber of Commerce, Publication No. 590 (“ISP98”), and as to matters not addressed by the ISP98, shall be governed by and construed in accordance with the laws of the Province of Ontario.
All parties to this Letter of Credit are advised that the U.S. Government has in place certain sanctions against certain countries, individuals, entities, and vessels. Citigroup entities, including branches and, in certain circumstances, subsidiaries, are/will be prohibited from engaging in transactions or other activities within the scope of applicable sanctions.
EXHIBIT G
-2-
ONE TEHAMA
[Social Finance, Inc.]


ANNEX A
FORM OF WRITTEN STATEMENT
To:
Date: [ ]
Dear Sirs,
Irrevocable Letter of Credit No. [___________________]
We refer to the above referenced Letter of Credit.
The undersigned, the beneficiary of the above referenced Letter of Credit hereby certifies (check whatever is applicable):
( ) Beneficiary, either (a) under that certain Office Lease made by and between Beneficiary, as Landlord, and Applicant, as Tenant has the right to draw down the amount of USD _____________ in accordance with the terms of the Lease or (b) such amount constitutes damages owing by Applicant to Beneficiary from the breach of such Lease by Applicant thereunder, or the termination of such Lease, and such amount remains unpaid at the time of this drawing.
( ) Beneficiary is entitled to draw down the full available amount of the Letter of Credit as the result of the filing of a voluntary petition under the U.S. Bankruptcy Code or a State Bankruptcy Code by Applicant, as Tenant, under that certain Office Lease, with Beneficiary, as Landlord, which filing has not been dismissed at the time of this drawing.
( ) Beneficiary is entitled to draw down the full available amount of the Letter of Credit as the result of the filing of an involuntary petition having been filed under the U.S. Bankruptcy Code or a State Bankruptcy Code against Applicant, as Tenant, under that certain Office Lease, with Beneficiary, as Landlord, which filing has not been dismissed at the time of this drawing.
( ) Beneficiary is entitled to draw down the full available amount of the Letter of Credit as the result of the rejection or deemed rejection of that certain Office Lease, with Beneficiary, as Landlord, and Applicant, as tenant under Section 365 of the U.S. Bankruptcy Code.
( ) We hereby certify that we received a notice of non-renewal of expiry date of Letter of Credit No. _____________________, issued by Citibank, N.A. and substitute Letter of Credit or security has not been provided, and therefore we are entitled to draw down on the full available Letter of Credit amount.
EXHIBIT G
-3-
ONE TEHAMA
[Social Finance, Inc.]


Payment under the above referenced Letter of Credit in the amount specified above should be made to our account No. [_____________] with [_________________].
Beneficiary:
[Print name of Beneficiary]
By: [Signature of Beneficiary]
Name: [Print name of signatory]
EXHIBIT G
-4-
ONE TEHAMA
[Social Finance, Inc.]


ANNEX B
REQUEST FOR FULL TRANSFER
RELINQUISHING ALL RIGHTS AS BENEFICIARY
To: [issuing bank]
Re: L/C
No.
Issued by: CITIBANK, N.A.
Citibank, N.A. Ref:
Gentlemen:
Receipt is acknowledged of the original instrument which you forwarded to us relative to the issuance of a Letter of Credit (herein called the “Credit”) bearing your reference number as above in favor of ourselves and/or Transferees and we hereby request you to transfer the said Letter of Credit, in its entirety, to:
whose address
is
(Optional) Please advise Beneficiary through the below-indicated Advising Bank:
EXHIBIT G
-5-
ONE TEHAMA
[Social Finance, Inc.]


We are returning the original instrument to you herewith in order that you may deliver it to the Transferees together with your customary letter of transfer.
It is understood that any amendments to the Letter of Credit which you may receive are to be advised by you directly to the Transferee and that the drafts and documents of the Transferee, if issued in accordance with the conditions of the Letter of Credit, are to be forwarded by you directly to the party for whose account the credit was opened (or any intermediary) without our intervention.
EXHIBIT G
-6-
ONE TEHAMA
[Social Finance, Inc.]


Page 2    Request for Full Transfer relinquishing all Rights as Beneficiary
Citibank, N.A. reference _________________________
We understand that the Transfer charge is 1/4 of 1% on the amount being transferred (minimum $300.00, maximum of $1,000), which transfer fee and all other expenses that may be incurred by you in connection with this transfer shall be for the Applicants account.
SIGNATURE GUARANTEED Sincerely yours,
The First Beneficiary’s signature(s) with
title(s) conforms to that on file
with us and such is/are authorized
for the execution of this instrument.
(Name of Bank) (Name of First Beneficiary)
(Bank Address) (Telephone Number)
(City, State, Zip Code) (Authorized Name and Title)
(Telephone Number) (Authorized Signature)
(Authorized Name and Title) (Authorized Name and Title)
(If applicable)
EXHIBIT G
-7-
ONE TEHAMA
[Social Finance, Inc.]


(Authorized Signature) (Authorized Signature)
(If applicable)
EXHIBIT G
-8-
ONE TEHAMA
[Social Finance, Inc.]


EXHIBIT H
TENANT'S EXTERIOR SIGNAGE

EXHIBIT H
-1-
ONE TEHAMA
[Social Finance, Inc.]


EXHIBIT I
ENGINEERING STAFF REQUIREMENTS
Chief Engineer:
Tenant shall employ a chief engineer, who shall be subject to Landlord's reasonable approval. Tenant shall use commercially reasonable efforts, but shall not be obligated, to retain a chief engineer with not less than five (5) years' experience as a chief engineer for commercial office buildings similar to the Project.
Engineering Staff:
In addition to the Chief Engineer, Tenant shall employee a certified journeyman, non-certified journeyman and utility engineer, who shall each be subject to Landlord's reasonable approval. Tenant shall consider retaining Landlord's preferred engineers and shall use commercially reasonable efforts, but shall not be obligated, to retain such engineers with not less than three (3) years' experience as journeyman or utility engineer for commercial office buildings similar to the Project.
Engineering staff shall be members of the local operating engineers union.
EXHIBIT I
-1-
ONE TEHAMA
[Social Finance, Inc.]


EXHIBIT J
LIST OF QUALIFICATIONS OF SERVICE PROVIDERS AND AGREEMENTS
1.    General Qualifications. Tenant shall enter into and maintain Service Agreements with reputable, certified (if certification in such service area is required) and professionally licensed, if applicable, service vendors and/or providers (each a "Service Provider" and collectively, the "Service Providers") who are qualified to perform the applicable services, repair and maintenance work described in Exhibit K to this Lease, and the terms and conditions of such Service Agreements shall require each Service Provider's compliance with the applicable terms and schedules set forth in Exhibit K. Landlord shall have the right to approve Service Providers, such approval not to be unreasonably withheld, conditioned or delayed. Tenant shall consider retaining Landlord's preferred vendors as Service Providers.
2.    Levels of Experience. The 'lead' on site employee for each of the Service Providers providing service, repair and/or maintenance for the Building Systems shall have appropriate experience for the position held and the services to be performed; and have obtained all licenses and certifications (if applicable) that are required by any governmental or quasi-governmental authority having jurisdiction over the Project.
EXHIBIT J
-1-
ONE TEHAMA
[Social Finance, Inc.]


EXHIBIT K
REPAIR AND MAINTENANCE SPECIFICATIONS
1.    FIRE/LIFE/SAFETY.
1.1    General Standards. Tenant shall cause all fire/life/safety panels and equipment to be inspected quarterly, and arrange for semi-annual testing and maintenance of such panels and equipment.
1.2    Monthly Maintenance. Tenant shall conduct monthly extinguisher inspections, and keep a records of such inspections.
1.3    Quarterly Maintenance. Tenant shall ensure that an inspection is conducted at least quarterly of all exit and emergency lights and a 30second functional test be conducted on all battery powered fixtures. If deficiencies are noted, immediate corrective action must be taken. Personnel making inspections must keep records of all units inspected, including those found to require corrective action. The inspection must include at least the following.
1.3.1    Test the integrity of the lamp and battery through test button for 30 seconds.
1.3.2    Sprinkler flow switch test
1.3.3    Check each light for physical damage.
1.3.4    Align beams and tighten if necessary.
1.3.5    Check AC and charge lamps if applicable.
1.3.6    Replace burnt out bulbs.
1.4    Annual Maintenance. All battery powered exit and emergency lights must be maintained at least annually in accordance with applicable code requirements and the manufacturer's directions, and must include a full function test on every battery powered exit and emergency lighting system. Equipment shall be fully operational for the duration of the test. Steps include, but are not limited to the following.
1.4.1    90 Minute full function test.
1.4.2    Disconnect AC power supply to each unit.
1.4.3    Check battery and lens for sulfation/corrosion.
1.4.4    Clean unit and lens.
1.4.5    Adjust beam for proper alignment.
EXHIBIT K
-1-
ONE TEHAMA
[Social Finance, Inc.]


1.4.6    Check charging system voltage.
1.4.7    Check battery voltage output.
1.4.8    Annual FLS (Fire Life Safety Panel) battery, horn and strobe audibles, smoke detectors and water flow switch testing.
1.4.9    Conduct annual Fire Life Safety Floor warden training and evacuation exercises.
1.4.10    Troubleshooting/repair, which may include, but is not limited to, checking charging system voltage and adjusting to correct level, checking battery output voltage and checking line voltage to remote fixtures.
1.5    Recordkeeping. Tenant or its Service Providers shall keep written records of all inspections and tests.
1.6    Removal and Disposition of Old Batteries. Tenant shall ensure that all discarded batteries are disposed of in an appropriate manner, and in keeping with applicable laws and regulations dealing with rechargeable batteries.
2.    HVAC and MEP SYSTEMS. Tenant shall cause the performance of the following services and maintenance specification in connection with the HVAC and mechanical, electrical and plumbing portions of the Building Systems.
2.1    Tenant shall employ a staff or Service Provider which shall operate, monitor and maintain in good working order and condition, the HVAC, plumbing and electrical systems, and all other equipment related to the mechanical and electrical plant of the building.
2.2    Tenant shall engage contractors when required and shall purchase replacement parts and equipment.
2.3    Develop and maintain in operation, a program for preventative maintenance of the mechanical equipment in the Building, which program shall include, without limitation, the annual servicing of all HVAC chillers.
2.4    Establish a program of inventory control for replacement parts, supplies, removable tools and equipment.
2.5    Prepare, maintain and regularly review logs having to do with the service, repair and operation of the mechanical Building Systems.
2.6    Develop and implement a comprehensive program of preventive maintenance for the mechanical and electrical equipment contained in the Building.
2.7    Develop and implement a comprehensive engineering personnel training program addressing: Safety at the Workplace, Preventive Maintenance, Agency Compliance and Quality Customer Service.
EXHIBIT K
-2-
ONE TEHAMA
[Social Finance, Inc.]


2.8    Conduct testing and acquire required permits by local and state agencies to operate Boilers, Back Flows, Generators, pressurized tanks and sprinkler systems to include fire pumps.
3.    ELEVATOR. Tenant shall cause its designated elevator contractor to cause the elevators to be maintained in compliance with the following standards.
3.1    Motor Rooms. The motor room and secondary space floors and equipment are to be painted, kept free of dust, lint, oil residue, carbon dust and debris. Code authorities prohibit the storage of equipment and parts not relative to the operation and maintenance of the elevators in the motor rooms. Spare parts, lubricants and wiring diagrams will be kept orderly in storage cabinets. Metal rag pails with covers will be provided for the storage of clean rags only. All waste materials will be removed from the area immediately and disposed of properly. Up to date maintenance charts, callback logs, job stamps and material safety data sheets will be readily accessible. All chemicals must be properly labeled. Equipment rooms shall be locked to prevent unauthorized access.
3.2    Hoistway, Pit and Car Tops. These areas must be kept free of debris and accumulation or storage of materials such as parts, lubricants, etc. Pits shall be maintained in a reasonably dry condition as directed by Code authorities. Oil spills shall be cleaned up immediately. All covers shall be secured in place.
3.3    Cab Enclosure. All covers and accessory boxes shall be secured in place and if lockable, locked at all times. All fastenings and screws will be secured and tightened. Missing screws shall be replaced. Car operating panels, indicators and markings shall be maintained as installed.
3.4    Safety Requirement. Safety awareness is of the utmost importance. Barricades, proper tools and safety equipment shall be used to minimize risk or exposure to danger to employees and the public. Under no circumstances shall work be performed in unbarricaded open hoistways. If continuous work is being performed, hoistway doors shall be closed when the immediate area is unattended.
3.4.1    Strict adherence to applicable lockout/tagout procedures shall be enforced.
3.4.2    All safety devices and circuits shall operate as intended. They shall not be overridden and must operate in compliance with applicable Codes. Unsafe equipment or conditions will be corrected immediately. Under no circumstances shall unsafe equipment be put into operation. Periodic checks shall be performed to ensure the proper operation of all safety devices.
3.4.3    Lighting in the work areas shall be sufficient so as not to endanger maintenance personnel. Unique or adverse job conditions and deviation from applicable Codes with respect to the elevator spaces or work areas shall be documented and discussed with Landlord. Environmental conditions must be suitable for the safe operation of equipment by the public and Tenant employees.
EXHIBIT K
-3-
ONE TEHAMA
[Social Finance, Inc.]


3.4.4    Adjustments to the operating systems, which may affect the safety of passengers, shall not be made while the passengers have access to riding the elevators. Doors should be disabled and/or barricades affixed to prevent use during adjustment.
3.5    Door Operation. Doors shall be smooth, quiet and positive without noticeable bumps. Car and hall door rollers and gibs shall be replaced and hanger tracks cleaned when required. Upthrusts shall be adjusted and door alignment checked periodically to ensure proper operation and adherence to clearance requirements as set forth in Applicable Law. Consistent operation shall be maintained from floor to floor and with similar cars within a group. The doors will be maintained per the speed, force and time adjustments specified by the manufacturer or Applicable Law. An annual check of horizontal power operated doors shall be made to ensure that the force necessary to prevent the closing of the doors does not exceed 30 pounds. Particular attention shall be paid to reopening features and safety devices such as door open buttons, safety edges, photocells, detector edges, nudging and other related features, which shall be maintained as installed and checked during each visit to the site. Door pre-opening shall be eliminated when possible.
3.6    Signals. Hall stations, lobby panels, car operating panels, machine room panels, and special feature fixtures such as concealed risers shall be maintained in good operating condition with all markings intact. Lamps, gongs, chimes, etc. shall operate as designed. Emergency communications devices shall be checked as required by applicable Codes. Any failures or malfunctions must be corrected.
3.7    Car Ride. Ride quality must not include a condition of excessive sway and rattle, door shimmy, hoistway noises nor any other unusual conditions experienced within the cab during transit. The car ride shall be consistent and where applicable, smooth. Inherent noise generated by elevator equipment shall be maintained within normal limits and corrected accordingly when the noise level exceeds such limits.
Floor leveling accuracy must be checked regularly and adjustments made to guarantee the optimum floor level. Unusual conditions or intermittent failures shall be corrected immediately. The condition of speed control devices shall be checked periodically to ensure proper operation. Under no circumstances shall a car be allowed to operate with a potential tripping hazard.
3.8    Hoist Machines. The hoist machine, rotating equipment and hydraulic power units shall be kept clean and painted for ease of maintenance and housekeeping. Leaks shall be properly sealed when detected. Cables shall be free of lint and heavy accumulation of dirt, and shall be lubricated at recommended intervals. Brush rigging and windings shall be free of carbon dust, oil and dirt and proper brush tension maintained. Carbon brushes shall be replaced after no more than 50% wear with the proper grade brush. Brush grade and manufacturers products shall not be mixed. Oil levels, seals, tension and adjustments shall be maintained to ensure safe, reliable operation. Brakes shall be systematically inspected for proper operation. Periodically the brake pins shall be rotated to make sure they are free from binds. All components shall be maintained in accordance with the manufacturer's recommended maintenance guidelines at the prescribed intervals.
EXHIBIT K
-4-
ONE TEHAMA
[Social Finance, Inc.]


3.9    Controllers and Other Equipment. Controllers, selectors, governors and other operational apparatus shall be kept clean, properly lubricated and adjusted as required. Relays and contactors shall be kept clean and operating without excessive arc. All electrical connections shall be tight, taped and tagged when not in use. Coils, contacts, relays and resistors showing signs of deterioration shall be repaired or replaced. Controller filters and fans if provided shall be repaired or replaced as necessary. Care shall be exercised when handling printed circuit boards. Proper grounding is necessary when handling some versions of solid state devices. All modes, programs and operations such as loadweighing, dispatching, etc., shall be maintained as manufactured.
3.10    Maintenance Contract. Tenant shall retain a reputable elevator service company to conduct, at a minimum, the following services upon each visit to the Project.
3.10.1    Check in with Tenant and note and correct all complaints.
3.10.2    Ride all cars and check for unusual operation and noises. Pay particular attention to door operation and leveling. Doors should be smooth, quiet and positive, without noticeable bumps. Correct any malfunctions observed.
3.10.3    Replace/repair non-functional signal devices.
3.10.4    Check emergency communications devices.
3.10.5    Check door protection devices. Correct any malfunctions.
3.10.6    Have Tenant (or its Agent) sign the service ticket when complete with all work.
3.11    Monthly by Vendor. Vendor shall perform the following services on a monthly basis.
3.11.1    Check hoist motor, generator brushes, commutators and exercise brushes. Clean carbon residue from brush rigging. Renew brushes as required. (50% maximum wear).
3.11.2    Check hoist motor and generator sleeve bearings. Lubricate as required. Observe clearance between rotor and bottom stator field pieces.
3.11.3    Check hoist machine worm gear oil for proper level. Add lubricant as required. Most geared machines have standpipes to gauge gear oil level, however the level should be no higher than the center point of the worm shaft. Confirm that oil is carrying in both directions on the ring gear. Clean up oil residue around machine and bedplate.
3.12    Quarterly by Vendor. Vendor shall perform the following services on a quarterly basis.
3.12.1    Inspect car door operator. Adjust belts and/or chains as necessary. Apply lubricant to phenolic or micarta cams.
EXHIBIT K
-5-
ONE TEHAMA
[Social Finance, Inc.]


3.12.2    Inspect and clean car gate switch, main landing door and interlock contacts. Adjust as required. Maintain code requirements for settings.
3.12.3    Clean car top and car top devices.
3.12.4    Inspect leveling units.
3.12.5    Clean, adjust and lubricate car and main landing door hangers and tracks. Check and adjust upthrusts. Inspect door alignment and adjust as required.
3.12.6    Clean, adjust and lubricate car door clutch or bayonet assembly.
3.12.7    Dust debris from mechanism located on hoistway side of car and main landing doors and sills.
3.12.8    Clean pit and pit equipment. Report any abnormal conditions such as the presence of water.
3.12.9    Inspect, clean and lubricate governor and selector tail sheaves if provided.
3.12.10    Lubricate car and counterweight guide rails if slipper shoes are provided. Pull mainline disconnect switch. Inspect and clean controller. Check power and supervisory relays, shunts and contacts. Operate each relay manually and check for contact wipe and binding. Replace any contact, shunt, spring or spring retainer, which shows indications of excessive wear. Replace controller filters. Check operation of muffin fans if provided.
3.12.11    Clean and lubricate selector chains, guides, drums and couplings if provided. Clean carbon dust accumulation from crossbars. Replace carbons, contacts and switches as required. Inspect broken tape switch. Check and fill selector drive gearbox with gear oil if provided. Clean and wipe up excess oil and grease.
3.12.12    Clean and inspect governor. Lubricate as required. Manually extend weights and check for free movement.
3.12.13    Check brake arms and rotate pins. Lubricate and check for freeness. Verify that brake sets and holds car at floor. Inspect brake drum for signs of abrasion. Clean foreign debris that may be present.
3.12.14    Clean and lubricate selector chains, guides, drums and couplings. Clean carbon dust accumulation from crossbars. Replace carbons, contacts and switches as required. Inspect broken tape switch. Check and fill selector drive gearbox with gear oil. Clean and wipe excess oil and grease.
3.12.15    Check compensating chain and hitches.
3.12.16    Lubricate cup-type sheave bearings.
EXHIBIT K
-6-
ONE TEHAMA
[Social Finance, Inc.]


3.13    Semi-Annually by Vendor. Vendor Shall perform the following services on a semi-annual basis.
3.13.1    Inspect car and counterweight guide shoes or roller guides. Lubricate as required.
3.13.2    Grease roller bearings.
3.13.3    Inspect and clean counterweight rope fastenings, hitch springs and cotter pins.
3.13.4    Check car operating panel controls and switches. Clean and lubricate as required. Dust out panel box.
3.14    Annually by Vendor. Vendor Shall perform the following services on a annual basis
3.14.1    Clean hoistway.
3.14.2    Clean, lubricate and adjust hoistway door equipment. Burnish door interlock contacts and shorting bars. Replace worn parts as necessary.
3.14.3    Vacuum and clean the car safety mechanism. Operate moveable parts and ascertain that they move freely.
3.14.4    Change oil in sleeve bearings.
3.14.5    Clean and lubricate the deflector and secondary sheaves. Check grooves for wear. Report abnormal conditions.
3.14.6    Clean and lubricate the car and counterweight 2:1 sheaves. Check grooves for wear. Report abnormal conditions.
3.14.7    Clean, examine and lubricate compensating sheave. Check switch setting and tie-down mechanism.
3.14.8    Inspect car and counterweight oil buffers. Check for proper oil level. Actuate switches and reset.
3.14.9    Check car and counterweight run-by.
3.14.10    Check for abrasions or wear on traveling cables.
3.14.11    Inspect cab enclosure steadying devices.
3.14.12    Check and adjust car door pressure and speed. Log on maintenance chart.
3.14.13    Check car and main landing door gibs. Replace if worn.
EXHIBIT K
-7-
ONE TEHAMA
[Social Finance, Inc.]


3.14.14    Lubricate hoist ropes.
3.14.15    Blowout/vacuum hoist motor and motor generator.
3.14.16    Tighten mainline connections and check fuse sizing. Replace any fuses that appear damaged or unmarked.
3.14.17    Clean and check controller fuses and fuse holders. Ascertain that the proper fuse is installed. Replace any fuses that appear damaged or unmarked.
3.14.18    Test emergency power system.
3.14.19    Test earthquake device.
3.14.20    Activate Firemen's Return.
3.14.21    Perform other tests required by local code authorities.
4.    LIGHTING.
4.1    Omitted. Scheduled Maintenance Services.
4.1.1    Replace failed lamps.
4.1.2    Replace failed ballasts.
4.1.3    Replace failed sockets / lampholders.
4.1.4    Repair defective wiring within fixture.
5.    EMERGENCY GENERATOR. If Tenant elects to install any emergency generator(s), Tenant shall engage a Service Provider for the regular maintenance (as needed) and annual servicing of the emergency generator(s) located at the Project and schedules for regular testing and inspection, which Service Provider is registered with the Bay Area Air Quality Management District.
6.    PERIODIC REVIEW. Landlord and Tenant shall periodically review and reasonably adjust the foregoing specifications so as to ensure compliance with the Management Standard while allowing Tenant the flexibility to effectively manage and maintain the Building Systems.
EXHIBIT K
-8-
ONE TEHAMA
[Social Finance, Inc.]


EXHIBIT L
LOCATION OF TELECOMMUNICATIONS EQUIPMENT, THIRD-PARTY ROOF EQUIPMENT, AND GENERATOR

EXHIBIT L
-1-
ONE TEHAMA
[Social Finance, Inc.]
Exhibit 10.15
FIRST AMENDMENT TO OFFICE LEASE
This FIRST AMENDMENT TO OFFICE LEASE (the "First Amendment") is made and entered into as of the 28th day of March, 2019, by and between 246 FIRST STREET (SF) OWNER, LLC, a Delaware limited liability company ("Landlord"), and SOCIAL FINANCE, INC., a Delaware corporation ("Tenant").
R E C I T A L S :
A.    Landlord and Tenant entered into that certain Office Lease dated July 24, 2018 (the "Lease"), whereby Landlord leases to Tenant and Tenant leases from Landlord certain premises (the "Premises") containing a total of 98,566 rentable square feet of space and consisting of the entire building, excluding the building structure, located at 246 1st Street, San Francisco, CA 94105 (the "Building").
B.    Landlord and Tenant desire to amend the Lease to memorialize that the Delivery Date (as defined in Section 1.2.1 of the Tenant Work Letter (the "Tenant Work Letter") attached to the Lease as Exhibit B) has occurred, and to otherwise amend the Lease on the terms and conditions contained herein.
A G R E E M E N T :
NOW, THEREFORE, in consideration of the foregoing Recitals and the mutual covenants contained herein, and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the parties hereto hereby agree as follows:
1.    Capitalized Terms. All capitalized terms when used herein shall have the same respective meanings as are given such terms in the Lease, unless expressly provided otherwise in this First Amendment.
2.    Delivery Condition. Notwithstanding any provision to the contrary contained in the Lease, Landlord and Tenant hereby agree that (A) as of December 21, 2018, Landlord (i) substantially completed the Pre-Delivery Landlord Work, (ii) fully satisfied the Delivery Condition, and (iii) delivered the Premises to Tenant, and (B) the Delivery Date occurred on December 21, 2018.
3.    Amendment of Section 1.1.1. The phrase "work required to satisfy the "Delivery Condition" in clause (ii) in the seventh (7th) sentence of Section 1.1.1 of the Lease is hereby deleted and replaced with the phrase "Landlord Work". The term "Delivery Date" in the eighth (8th) sentence of Section 1.1.1 of the Lease is hereby deleted and replaced with the term "Lease Commencement Date".
4.    Lease Commencement Date. Notwithstanding any provision to the contrary contained in the Lease, Landlord and Tenant hereby agree that the Lease Commencement Date shall be the earlier of (i) the date upon which Tenant first commences to conduct business from the Premises and (ii) July 20, 2019, subject to extension to the extent caused by a Lease Commencement Date Delay (as defined in Section 5.1 of the Tenant Work Letter).
ONE TEHAMA
First Amendment to Office Lease
[Social Finance, Inc.]
 -1-


5.    Form of Tenant's Estoppel Certificate. Notwithstanding any provision to the contrary contained in the Lease, the Form of Tenant's Estoppel Certificate attached to the Lease as Exhibit E shall be deleted in its entirety and replaced with the Form of Tenant's Estoppel Certificate attached hereto as Exhibit A.
6.    Remaining Landlord Work. Landlord and Tenant hereby agree that all Landlord Work set forth in Schedule 1 attached to the Tenant Work Letter has been completed and satisfied by Landlord, except for the Additional Drainage Work, the Landlord Roofing Work, the Painting Work, and the Sewer Work, as set forth in Sections 9, 10 11, and 12, respectively, below, the items set forth on the final punch list attached hereto as Exhibit B (the "Final Punch List"), and the work set forth in the following sentence, if any. To the extent required in order to allow Tenant to legally occupy the Premises for the Permitted Use or obtain permits for the construction of the Tenant Improvements (and assuming the Tenant Improvements are general office improvements with an occupancy density consistent with single-tenant buildings in the Comparable Area), Landlord shall, at Landlord's sole cost and expense, cause the Base Building, elevators (including call buttons and lanterns) and entry doors to the Building to comply with the "Code", as that term is defined in Section 2.2.1.5 of the Tenant Work Letter, and Applicable Laws in effect as of the date that Landlord approves the "Final Working Drawings", as that term is defined in Section 3.3 of the Tenant Work Letter (collectively, "Landlord's Compliance Work").
7.    Window Covering Allowance. Notwithstanding any provision to the contrary contained in the Lease, Tenant shall be permitted to convert any remaining undisbursed portion of the Window Covering Allowance to an additional Tenant Improvement Allowance, which converted amount shall be used towards upsizing the Building's sprinkler risers, mains or branch lines to accommodate Tenant's approved sprinkler permit drawings (the "Pipe Work").
8.    Landlord Contribution to Pipe Work. Notwithstanding any provision to the contrary contained in the Lease, Landlord shall contribute an amount not to exceed Thirty-Nine Thousand Dollars ($39,000.00) towards the Pipe Work (the "Pipe Work Allowance"), provided that Tenant shall also pay at least Thirty-Nine Thousand Dollars ($39,000.00) towards the Pipe Work. Tenant shall be responsible for any additional cost of the Pipe Work in excess of the Pipe Work Allowance and the portion of the Tenant Improvement Allowance applied to the Pipe Work, if any. The Pipe Work Allowance shall be paid by Landlord to Tenant at the same times and in the same manner as the Tenant Improvement Allowance. In the event that the Pipe Work Allowance is not fully disbursed by Landlord to, or on behalf of, Tenant on or before the date that is eighteen (18) months after the Lease Commencement Date, then such unused amounts shall revert to Landlord, and Tenant shall have no further rights with respect thereto; provided, however, that such eighteen (18) month period shall be extended to the extent Tenant's construction of the Pipe Work is delayed due to Force Majeure Delay or Landlord Caused Delay. Landlord and Tenant hereby acknowledge and agree that the Pipe Work shall be considered (i) as part of the Building Systems for purposes of Tenant's repair and maintenance obligations pursuant to Section 7.2.1 of the Lease, (ii) as part of the Tenant Improvements for purposes of Tenant's compliance with Applicable Laws pursuant to Section 24.1 of the Lease, and (iii) as part of the Building for purposes of Landlord's insurance obligations pursuant to Section 10.7 of the Lease. In no event shall Tenant be obligated to pay any Coordination Fee (as defined in Section
ONE TEHAMA
First Amendment to Office Lease
[Social Finance, Inc.]
 -2-


4.2.2.1 of the Tenant Work Letter attached to the Lease as Exhibit B) or other similar fee in connection with the Pipe Work.
9.    Additional Drainage Work. Landlord shall furnish and install new plumbing drain and drain lines, connecting the same to existing plumbing lines, and sealing the new roof drains to the existing roofing (collectively, the "Additional Drainage Work"). Tenant shall pay for one-half of the final cost of the Additional Drainage Work, provided that in no event shall Tenant be obligated to pay an amount in excess of Twenty Thousand Dollars ($20,000.00) for the Additional Drainage Work, and Landlord shall pay the excess cost of the Additional Drainage Work over such amount. Tenant may apply the Tenant Improvement Allowance toward the portion of the Additional Drainage Work to be funded by Tenant. Tenant shall pay for its portion of the Additional Drainage Work, at Tenant's election, either by cash or application of the Tenant Improvement Allowance, within thirty (30) days after the later of (i) completion of the Additional Drainage Work or (ii) submittal to Tenant of invoices or other reasonable supporting documentation. Landlord and Tenant hereby acknowledge and agree that the Additional Drainage Work shall be considered "Remaining Landlord Work" under the Lease, except as is inconsistent with the terms of this Section 9.
10.    Landlord Roofing Work. Landlord, at its sole cost and expense, shall install Enduris 3400 Silicon Coating system over 10,000 square feet of the existing accessible roofing of the Building and install a new GSM metal roof parapet cap on all found Building elevations (collectively, the "Landlord Roofing Work"). Landlord and Tenant hereby acknowledge and agree that the Landlord Roofing Work shall be considered "Remaining Landlord Work" under the Lease, except as is inconsistent with the terms of this Section 10.
11.    Painting Work. Landlord, at its sole cost and expense, except as set forth below, shall paint the exterior of the Building in color "SW2848 Roycroft Pewter", and otherwise in accordance with the proposal from Schaper Company, Inc., dated October 18,, 2018, as modified by Request for Change Order No. 1, dated February 12, 2019 (including the hand-marked change on page 1), attached hereto as Exhibit C (the "Painting Work"). Landlord and Tenant acknowledge and agree that Landlord may apply a portion of the Tenant Improvement Allowance, in an amount not to exceed Two Hundred Thousand and 00/100 Dollars ($200,000.00), towards the cost of the Painting Work, and Landlord shall be responsible for any excess cost of the Painting Work over such amount. Landlord and Tenant hereby acknowledge and agree that the Painting Work shall be considered "Remaining Landlord Work" under the Lease, except as is inconsistent with the terms of this Section 11.
12.    Sewer Work. Landlord shall complete the sewer work described in the proposal attached hereto as Exhibit D (the "Sewer Work"). Tenant shall pay fifteen percent (15%) of the final cost of the Sewer Work, and Landlord shall pay eighty-five percent (85%) of the final cost of the Sewer Work. Tenant may apply the Tenant Improvement Allowance toward the portion of the Sewer Work to be funded by Tenant. Tenant shall pay for its portion of the Sewer Work, at Tenant's election, either by cash or application of the Tenant Improvement Allowance, within thirty (30) days after the later of (i) completion of the Sewer Work or (ii) submittal to Tenant of invoices or other reasonable supporting documentation. Landlord and Tenant hereby
ONE TEHAMA
First Amendment to Office Lease
[Social Finance, Inc.]
 -3-


acknowledge and agree that the Sewer Work shall be considered "Remaining Landlord Work" under the Lease, except as is inconsistent with the terms of this Section 12.
13.    Standards and Timing for Performance of Landlord's Work. The Additional Drainage Work, the Landlord Roofing Work, the Painting Work, the Sewer Work, the completion of the Final Punch List, and Landlord's Compliance Work shall be performed in a good and workmanlike manner, and to the extent necessary for Tenant to pull any necessary construction permits or for Tenant to legally occupy the applicable Premises for the Permitted Use, in accordance with all Applicable Laws. Landlord's contracts to perform the foregoing work shall contain industry standard warranties, which in the case of the Landlord Roofing Work, shall be of at least ten (10) years. Landlord shall use commercially reasonable efforts to complete the Additional Drainage Work and Sewer Work by April 30, 2019, and the Landlord Roofing Work and the Painting Work by May 10, 2019, which dates shall be subject to extension by virtue of Force Majeure Delays and any Tenant Delays; provided, however, it shall not be a default by Landlord under the Lease (as amended) should Landlord fail to complete the Landlord Roofing Work by May 10, 2019. The parties acknowledge and agree that "Force Majeure Delays" for purposes of this First Amendment, shall include delays caused by rain and other inclement weather, and that Landlord shall not be required to send Tenant a notice or wait for the lapse of a cure period for any delay to constitute a Force Majeure Delay.
14.    Amendments to Tenant Work Letter.
14.1.    Delay in Remaining Landlord Work. Section 1.3.3 of the Tenant Work Letter is amended in its entirety to read as follows:
"1.3.3 Delay in Remaining Landlord Work. Landlord anticipates causing substantial completion of the Remaining Landlord Work to occur by the respective dates set forth in the First Amendment to this Lease, or if no dates are set forth therein, then by July 20, 2019. When each portion of the Remaining Landlord Work is substantially complete, Landlord shall so notify Tenant in writing, and Landlord and Tenant shall set a mutually convenient time for Landlord, Landlord's architect and Tenant and Tenant's Architect to walk through the Premises and prepare a list of "punch-list" items. After such walk-through, Landlord shall diligently complete such punch-list items in a good workmanlike manner. Landlord's failure to substantially complete the Remaining Landlord Work by the respective dates specified herein, or if no dates are specified in the First Amendment to this Lease, then by July 20, 2019, other than as a result of Tenant Delay or Force Majeure, then such failure by Landlord shall constitute a Landlord Caused Delay to the extent such failure causes Substantial Completion of the Tenant Improvements to occur after July 20, 2019."
14.2.    Definition of Lease Commencement Date. The first sentence of Section 5.1 of the Tenant Work Letter is amended to read as follows: "The Lease Commencement Date shall occur as provided in Section 4 of the First Amendment to this Lease, provided that the Lease Commencement Date shall be extended by the number of days of delay of the Substantial Completion of the Tenant Improvements (as defined below) to the extent caused by a "Lease Commencement Date Delay," as that term is defined below, but only to the extent such Lease
ONE TEHAMA
First Amendment to Office Lease
[Social Finance, Inc.]
 -4-


Commencement Date Delay causes the Substantial Completion of the Tenant Improvements to occur after July 20, 2019."
15.    Modification to Lease Provision. Notwithstanding anything in the Lease to the contrary, the security contractor (if any) providing Tenant's Security Personnel to Tenant under the Lease shall comply with Landlord's reasonable insurance requirements, including carrying a liability policy with a limit of not less than Five Million Dollars ($5,000,000), in lieu of the Ten Million Dollars ($10,000,000) requirement originally set forth in the Lease.
16.    Above Standard Tenant Improvements. Landlord hereby confirms that none of the Tenant Improvements approved by Landlord prior to the date hereof, nor the Pipe Work, constitute "Above Standard Tenant Improvements".
17.    Conflict; No Further Modification. In the event of any conflict between the Lease and this First Amendment, the terms and provisions of this First Amendment shall prevail. Except as specifically set forth in this First Amendment, all of the terms and provisions of the Lease shall remain unmodified and in full force and effect.
[signatures appear on following page]
ONE TEHAMA
First Amendment to Office Lease
[Social Finance, Inc.]
 -5-


IN WITNESS WHEREOF, this First Amendment has been executed as of the day and year first above-written.
"LANDLORD":
246 FIRST STREET (SF) OWNER, LLC,
a Delaware limited liability company
By: /s/ Terry Wachsner
Name: Terry Wachsner
Title: Vice President
"TENANT":
SOCIAL FINANCE, INC.,
a Delaware corporation
By: /s/ Chris Lapointe
Name: Chris Lapointe
Title: Vice President
ONE TEHAMA
First Amendment to Office Lease
[Social Finance, Inc.]
 -6-


EXHIBIT A
FORM OF TENANT'S ESTOPPEL CERTIFICATE
The undersigned, as Tenant under that certain Office Lease (the "Lease") made and entered into as of July 24, 2018 by and between 246 First Street (SF) Owner, LLC, as Landlord, and the undersigned, as Tenant, for the entire building (excluding the Building Structure) located at 246 1st Street, San Francisco, California certifies as follows:
1.    Attached hereto as Exhibit A is a true and correct copy of the Lease and all amendments and modifications thereto. The documents contained in Exhibit A represent the entire agreement between the parties as to the Premises.
2.    The undersigned currently occupies the Premises described in the Lease, the Lease Term [will commence] [commenced] on__________, the Lease Term expires on_____________, and the undersigned has no option to terminate or cancel the Lease or to purchase all or any part of the Premises, the Building and/or the Project, except as follows:_____________________.
3.    The Delivery Date (i.e., the date of Landlord's delivery of the Premises to Tenant with the Pre-Delivery Landlord Work substantially complete) occurred on December 21, 2018.
4.    Base Rent [will become] [became] payable on____________.
5.    The only Remaining Landlord Work required to be performed by Landlord under the Lease is as follows:____________________________ .
6.    The remaining undisbursed balance of any Tenant Improvement Allowance and/or other Landlord allowances to Tenant under the Lease is $_________________in the aggregate [break down by category].
7.    The Lease is in full force and effect and has not been modified, supplemented or amended in any way except as provided in Exhibit A.
8.    Tenant has not transferred, assigned, or sublet any portion of the Premises nor entered into any license or concession agreements with respect thereto except as follows:
9.    All monthly installments of Base Rent, all Additional Rent and all monthly installments of estimated Additional Rent have been paid through___________. The current monthly installment of Base Rent is $_______________________.
10.    To the undersigned's current, actual knowledge, Landlord is not in default under the Lease. The undersigned has not delivered any notice to Landlord regarding a default by Landlord thereunder.
11.    No rental has been paid more than thirty (30) days in advance, except for Base Rent for the first full month that Base Rent is payable in the amount of $574,968.33, which was prepaid by Tenant upon execution of the Lease, and no security has been deposited with Landlord except the letter of credit in the current amount of $_______________________, subject to any reduction as provided in the Lease.
EXHIBIT A ONE TEHAMA
First Amendment to Office Lease
[Social Finance, Inc.]
 -1-


12.    To the undersigned's current, actual knowledge, no offsets or credits are due from Landlord as of the date hereof.
13.    If Tenant is a corporation, limited liability company, partnership or limited liability partnership, Tenant hereby represents and warrants that Tenant is a duly formed and existing entity qualified to do business in California and that Tenant has full right and authority to execute and deliver this Estoppel Certificate and that each person signing on behalf of Tenant is authorized to do so.
14.    There are no actions pending against the undersigned under the bankruptcy or similar laws of the United States or any state.
15.    Other than in compliance with all applicable laws and incidental to the ordinary course of the use of the Premises, the undersigned has not used or stored any hazardous substances in the Premises.
16.    To the undersigned's current, actual knowledge, the initial improvement work to be performed by Landlord under the Lease, including the Pre-Delivery Landlord Work and the Remaining Landlord Work, has been completed in accordance with the Lease and has been accepted by the undersigned and all reimbursements and allowances due to the undersigned under the Lease in connection with any of the initial improvement work have been paid in full, except as provided in Sections 5 and 6 above.
All references to the undersigned's "current actual knowledge" shall mean, and shall be limited to, the actual (as distinguished from implied, imputed or constructive) knowledge of____________________, without any obligation to make independent inquiry or investigation. Tenant hereby represents and warrants that________________is the person who is most qualified to have knowledge of the matters above without any independent inquiry or investigation.
The undersigned acknowledges that this Estoppel Certificate may be delivered to Landlord or to an existing or prospective mortgagee or prospective purchaser, and acknowledges that said existing or prospective mortgagee or prospective purchaser will be relying upon the statements contained herein in making the loan or acquiring the property of which the Premises are a part and that receipt by it of this certificate is a condition of making such loan or acquiring such property.
EXHIBIT A ONE TEHAMA
First Amendment to Office Lease
[Social Finance, Inc.]
 -2-


Executed at___________________on the______day of_____________ , 20__.
"Tenant":
,
a
By:
Its:
By:
Its:
EXHIBIT A ONE TEHAMA
First Amendment to Office Lease
[Social Finance, Inc.]
 -3-


EXHIBIT B
FINAL PUNCH LIST
246 1st Street Punch List
EXHIBIT B ONE TEHAMA
First Amendment to Office Lease
[Social Finance, Inc.]
 -1-


EXHIBIT C
PAINTING WORK PACKAGE
EXHIBIT C ONE TEHAMA
First Amendment to Office Lease
[Social Finance, Inc.]
 -1-


EXHIBIT D
DESCRIPTION OF SEWER WORK
EXHIBIT D ONE TEHAMA
First Amendment to Office Lease
[Social Finance, Inc.]
 -1-
Exhibit 10.16
EXECUTION VERSION
SOCIAL FINANCE, INC.
Letterman Digital Arts Center
One Letterman Drive, Building A
Suite 4700
San Francisco, CA 94129
February 26, 2018
Mr. Anthony Noto
Re: Amended & Restated Offer of Employment
Sent via email:
Dear Mr. Noto
Social Finance, Inc., a Delaware corporation (the "Company"), is pleased to offer you employment with the Company on the terms described below. As further set forth in Section 12 hereof, this offer letter amends, restates and supersedes in its entirety your offer letter dated January 23, 2018, with the Company.
1.    Position.  You started in a full-time position as Chief Executive Officer on February 26, 2018 (your "Start Date"). You will report directly to the Board of Directors and all officers and employees of the Company will report directly or indirectly to you. You will serve as a member of the Company's Board of Directors while you are employed by the Company as Chief Executive Officer and you agree that you will automatically resign from the Board of Directors without further action on termination of your employment as Chief Executive Officer with the Company. By signing this letter, you confirm with the Company that you are under no contractual or other legal obligations that would prohibit you from performing your duties with the Company.
2.    Compensation and Employee Benefits.  You will be paid a starting salary of $600,000 per year, payable on the Company's regular payroll dates. As a senior executive officer and regular employee of the Company, you will be eligible to participate in a number of Company- sponsored benefits, which are described in the employee benefit summary that will be sent to you under separate cover and which will be commensurate with those of the Company's other senior executive officers.
In addition to the above, while you are employed at the Company, you will receive an annual incentive bonus based on Company performance metrics to be reasonably agreed upon by you and the Company, with a target of 100 percent of your annual base salary and a cap of 200 percent of your annual base salary. The confirmation of the criteria for evaluation of individual and Company performance and the amount of the annual incentive bonus will be decided upon by the Compensation Committee of the Board of Directors, and will be based on a combination of your individual performance and Company performance. The Compensation Committee of the Board of Directors will set the relevant metrics within 45 days of the Start Date and confirm achievement of those metrics within 45 days of the end of the relevant performance period. For



the year of your Start Date, bonus achievement will, in no event, be deemed achieved at any level less than 100%.
3.    Stock Options and Restricted Stock.  You will be granted an option to purchase 3,000,000 shares of the Company's common stock at the current 409A value which will not be more than $10.78 per share (such option, the First Option"). The vesting commencement date for the option will be your Start Date. You will vest in 20% of the option shares on the 12-month anniversary of your vesting commencement date, and 1/60th of the total option shares will vest in monthly installments thereafter during continuous service, as described in the applicable stock option agreement. The exercise price per share will be equal to the fair market value per share on the date the option is granted, as determined by the Company's Board of Directors in good faith compliance with applicable guidance in order to avoid having the option be treated as deferred compensation under Section 409A of the Internal Revenue Code of 1986, as amended. There is no guarantee that the Internal Revenue Service will agree with this value. You should consult with your own tax advisor concerning the tax risks associated with accepting an option to purchase the Company's common stock.
In addition, you will be granted an option to purchase 3,700,000 shares of the Company's common stock with an exercise price of $17.18 per share which is the price per share of the Company's Series G equity raise (such option, the "Second Option"). The vesting commencement date for the options will be your Start Date. You will vest in 20% of the option shares on the 12 month anniversary of your vesting commencement date, and 1/60th of the total option shares will vest in monthly installments thereafter during continuous service, as defined in the applicable stock option agreement.
Both the First Option and the Second Option shall be subject to the terms and conditions of the Company's standard form of award agreement applicable to options granted to the Company's other senior executive officers under the Company's 2011 Stock Plan, as amended (the "Plan"), as described in the Plan and the applicable stock option agreement, which you will be required to sign. Notwithstanding anything in the Company's standard form of award agreement or the Plan to the contrary, however, all of your option grants (including, but not limited to, the First Option and the Second Option) will provide for: (i) a 10-year expiration date, (ii) the acceleration of vesting described in Section 5 below (and remaining outstanding in the entirety (including the unvested and unexercisable portion) for three months following the termination of your employment to the extent required to permit such acceleration of vesting or until the earlier expiration of the award); (iii) immediate exercisability in full, subject to a right of the Company to repurchase any then-unvested shares (to the extent no longer eligible to vest) at no less than the original exercise price within 90 days after the vesting is no longer possible; (iv) exercisability as to then-vested shares under the options for the longer of three years following the termination of your service for any reason other than termination for Cause as defined in Section 5 below, (in which case you will have 90 days after termination of employment to exercise then-vested shares), and such period post-termination that may apply to the Company's other senior executives or employee population generally (but not exceeding the 10-year expiration date); and (v) net exercisability, at your election, to cover the aggregate exercise price, taxes and withholding due upon exercise (such that you will not be required to make any cash payment in connection with the exercise of your option to cover the aggregate amount of taxes and withholding (if any) due upon exercise of the option).
-2-


Separately, you will be granted 3,500,000 restricted stock units ("RSUs"). You will vest in 20% of the RSUs on the 12-month anniversary of your vesting commencement date, which shall be your Start Date, and 1/60th of the total RSUs will vest in monthly installments thereafter during continuous service, as described in the applicable RSU agreement. The RSU grant will be subject to the terms and conditions of the Company's standard form of award agreement applicable to RSUs granted to the Company's other senior executive officers granted under the Plan, as described therein and in the applicable RSU agreement, which you will be required to sign. Notwithstanding anything in the Company's standard form of award agreement or the Plan to the contrary, however, your RSU agreement will provide for: (i) the acceleration of vesting described below (and remaining outstanding in the entirety (including the unvested and unsettled portion) for three months following the termination of your employment to the extent required to permit such acceleration of vesting or until the earlier expiration of the award), (ii) settlement of the shares corresponding to each vesting tranche of your RSUs within 30 days of the applicable vesting date, and (iii) net settlement, at your election, to cover the aggregate taxes and withholding due upon settlement (such that you will not be required to make any cash payment in connection with the settlement of your RSUs).
Notwithstanding anything in the Plan or the Company's standard forms of award agreements thereunder, if any of your then-outstanding equity incentives (including, without limitation, the First Option, the Second Option, and the RSUs) would be cancelled for no consideration in connection with a Change of Control (as defined in the Plan), such equity incentives will be deemed vested in full and will be settled for shares or automatically exercised, as applicable, immediately prior to the consummation of the transaction (with any performance- based vesting conditions deemed to have been met at maximum achievement levels).
The equity awards described in this Section 3 will be granted to you promptly following your Start Date and prior to any increase in the Company's 409A value. In the event of any stock split, extraordinary dividend, or similar transaction, including if prior to the relevant grant date(s), all of the equity incentives in this Section 3 shall be appropriately and equitably adjusted.
4.    Pro-Rata Participation Right.  For so long as you remain employed by the Company, the Company will give you the right to purchase, on the same terms as apply to other purchasers, in each Company financing and offering (including any public offering), up to that number of shares, or number or amount of other securities, such that, assuming maximum participation in each transaction, your percentage ownership of the Company's fully diluted capitalization (including shares issuable upon conversion, exercise and/or settlement of all Company securities then outstanding and shares reserved for issuance under all Company equity incentive plans then in existence) would be no less after the final closing of such transaction than your percentage ownership was as of immediately before the initial closing of such transaction.
5.    Severance.
If at any time you are subject to a Qualifying Termination (as defined below), then (i) the Company or its successor (as applicable) shall pay you a lump-sum cash payment on the Company's first regular payroll date following your termination date equal to the sum of (a) twelve months of your base salary and (b) 100% of your annual bonus amount at the higher of (1) the
-3-


target level of achievement and (2) the actual level of achievement reasonably projected as of the termination of your employment, (ii) you will continue to receive health, dental, and vision coverage under the Company's group insurance benefits (including your covered dependents) at no cost to you for 12 months, in each of the foregoing cases (i) and (ii), as in effect immediately preceding your termination or, if applicable, immediately preceding the event that first gave rise to Good Reason, and (iii) you will receive vesting acceleration of each of your then-outstanding Company equity incentives (including, but not limited to, the First Option, Second Option, and RSUs) as if you had remained in continuous service to the Company for an additional 12 months following your actual termination date and as if all applicable performance-based vesting conditions (if any) were met at the target achievement level or, if higher, the actual level of achievement reasonably projected as of the termination of your employment, with such acceleration effective as of immediately prior to the termination of your employment.
If you experience a Qualifying Termination at any time after, or within three months prior to, a Change of Control, then, Company or its successor (as applicable) shall pay you, in lieu of the benefits described in the paragraph immediately above, a lump-sum cash payment on the Company's first regular payroll date following your termination date equal to the sum of (i) of (a) 18 months of your base salary and (b) 150% of your annual bonus amount at the higher of (1) the target level of achievement and (2) the actual level of achievement reasonably projected as of the termination of your employment, (ii) you will continue to receive health, dental, and vision coverage under the Company's group insurance benefits (including your covered dependents) at no cost to you for 18 months, in each of the foregoing cases (i) and (ii), as in effect immediately preceding your termination or, if applicable, immediately preceding the event that first gave rise to Good Reason, and (iii) 100% of your then-outstanding equity incentives (including, but not limited to, the First Option, Second Option, and RSUs) shall accelerate (including as to all applicable performance-based vesting conditions (if any), which will be deemed satisfied at maximum achievement), with such acceleration effective as of immediately prior to the later of your Qualifying Termination (as defined below) and the Company's Change of Control (as defined below).
For purposes of this letter, the following definitions shall apply:
"Cause" shall mean (i) your commission of any act of fraud, embezzlement, material dishonesty or other willful and material misconduct that has caused material injury to the Company, (ii) your unauthorized use or disclosure of any proprietary information or trade secrets of the Company or any party to whom you owe an obligation of nondisclosure due to your relationship with the Company, which unauthorized use or disclosure has caused material injury to the Company, or (iii) your material breach of any of your obligations under any written agreement or covenant with the Company, provided that such material breach shall not constitute Cause unless you have first received notice of the breach and failed reasonably to cure the material breach (to the extent curable) within 30 days of such notice.
"Change of Control" shall have the meaning given to that term in the Plan, provided, however, that solely for purposes of the benefits described in this letter, the occurrence of "all" in clause (iii) of the Plan's definition of "Change of Control" shall be replaced with "a majority" and provided, furthermore, that a Change of Control shall not include any transaction or
-4-


series of related transactions by which SoftBank or the SoftBank Vision Fund (inclusive of any successor or any affiliate under common control with, or controlled by, SoftBank or the SoftBank Vision Fund, collectively, "SoftBank") comes to hold a majority of the voting interests of the Company's capital stock without purchasing any shares thereof (this date, the "SoftBank Acquisition Date"), but notwithstanding this proviso, a Change of Control shall be still be deemed to occur on or after the SoftBank Acquisition Date if and when (x) a majority of the Board ceases to consist of directors who are not affiliates of SoftBank and were not nominated by SoftBank or any affiliate of SoftBank, (y) any of the Company's governing documents (including its charter, bylaws, voting agreement, and similar agreement) are materially amended without your prior written consent and/or (z) SoftBank's ownership of a majority of the voting interests has continued for a period of six months after the SoftBank Acquisition Date.
"Good Reason" shall mean the occurrence of any of the following conditions without your written consent, provided that the below clauses (I), (II) and (III) are satisfied (as applicable): (i) a reduction to a level of 10% or more off the maximum base salary that you have received from the Company at any time (other than as part of an across-the-board, proportional salary reduction applicable to all executive officers), (ii) a material reduction in your title, authority, duties and/or responsibilities, (iii) not becoming or remaining the Chief Executive Officer of the acquirer, or if the acquirer is a subsidiary of another company, Chief Executive Officer of the ultimate parent company of the acquirer, (iv) not becoming or remaining a member of the Company's Board of Directors, (v) a material breach by the Company of any agreement then in effect between you and the Company, or (vi) the Company requiring you to relocate to a facility or location more than 50 miles away from the location at which you were working immediately prior to the required relocation, in each of the foregoing cases (i) through (vi), if and only if (I) you provide the Company's board of directors written notice of such condition within 60 days following the latest occurrence thereof, (II) if such condition is curable, either the Company fails to cure such condition within 30 days following your delivery of the written notice to the Company's board of directors or a representative of the Company duly authorized by the Company's board of directors provides you earlier written notice that the Company does not intend to cure such condition and (III) you resign from your employment with the Company, or the Company terminates your employment without Cause, within 10 days following your delivery of the written notice to the Company's board of directors, if such condition is incurable, or following the expiration of such 30-day cure period or the provision of the written notice that the Company does not intend to cure such condition, if such condition is curable.
"Qualifying Termination" shall mean termination of your employment by the Company without Cause (as defined above ) or by you for Good Reason (as defined above ).
For purposes of the definitions in this Section 5, "Company" shall include any affiliate of the Company or its successor who is then employing you.
6.    Confidential Information and Invention Assignment Agreement.  Like all Company employees, you have been required, as a condition of your employment with the Company, to sign the Company's standard Confidential Information and Invention Assignment Agreement, which is enclosed herewith as Attachment A.
-5-


7.    Employment Relationship.  Employment with the Company is for no specific period of time. Your employment with the Company will be "at will," meaning that either you or the Company may terminate your employment at any time and for any reason, with or without cause. Any contrary representations which may have been made to you are superseded by this offer. This is the full and complete agreement between you and the Company on this term. Although your job duties, title, compensation and benefits, as well as the Company's personnel policies and procedures, may change from time to time consistent with this offer letter, the "at will" nature of your employment may only be changed in an express written agreement signed by you and the Company's Chairman of the Board of Directors. This letter agreement shall be binding upon any successor (whether direct or indirect and whether by purchase, lease, merger, consolidation, liquidation or otherwise) to all or substantially all of the Company's business and/or assets.
8.    Outside Activities.  While you render services to the Company, you agree that you will not engage in any other employment, consulting or other business activity without the written consent of the Board of Directors of the Company, except that you shall be permitted to serve on the boards of directors (and any committees thereof) of up to two for-profit companies, to serve on any number of boards of directors or trustees (and any committees thereof) of nonprofit organizations and to additionally engage in those activities set forth on Attachment B enclosed herewith, in each of the foregoing cases, so long as the Board of Directors determines that such commitments, in the aggregate, do not materially interfere with your duties and responsibilities to the Company. In addition, while you render services to the company, you will not assist any person or entity in competing with the Company, in preparing to compete with the Company or in hiring any employees or consultants of the Company, provided, however, that those activities set forth on Attachment B enclosed herewith shall be permitted and shall not violate this letter agreement.
9.    Withholding Taxes.  All forms of compensation referred to in this letter are subject to applicable withholding and payroll taxes.
10.    Section 409A.  To the extent that any provision of this letter is ambiguous as to its exemption or compliance with Section 409A, the provision will be read in such a manner so that (i) all payments hereunder are exempt from Section 409A to the maximum permissible extent and, (ii) for any payments where such construction is not tenable, those payments comply with Section 409A to the maximum permissible extent. Payments pursuant to this letter (or referenced herein), and each installment thereof, are intended to constitute separate payments for purposes of Section 1.409A-2(b)(2) of the regulations under Section 409A.
11.    Indemnification Agreement.  Concurrently with the execution of your original offer letter dated January 23, 2018, you and the Company entered into the Company's standard Indemnification Agreement applicable to the Company's executive officers, which Indemnification Agreement is enclosed herewith as Attachment C and which shall at all times, beginning on your Start Date, be covered by a director/officer insurance policy maintained by the Company for the benefit of, and at a level of coverage commensurate with that of, the Company's similarly situated directors and officers.
12.    Entire Agreement.  This letter supersedes and replaces any prior understandings or agreements, whether oral, written or implied, between you and the Company regarding the
-6-


matters described in this letter, including that certain employment offer letter dated January 23, 2018, by and between you and the Company.
13.    Attorneys' Fees.  The Company shall pay the aggregate amount of your reasonable attorneys' fees in connection with the negotiation and preparation of this letter and the attachments, agreements and other documents referenced herein between you and the Company, provided, however, that you or your attorneys shall notify the Company as soon as reasonably practicable after the aggregate amount of such fees theretofore incurred first equals or exceeds $20,000.
14.    Background Check.  We are extending this offer contingent upon successful completion of our routine background and reference check. More information and consent to the background check will be provided in a separate letter.
-7-


If you wish to accept this offer, please sign and date both the enclosed duplicate original of this letter and the enclosed Confidential Information and Invention and Assignment Agreement and return them to me. As required, by law, your employment with the Company is also contingent upon your providing legal proof of your identity and authorization to work in the United States. This amended and restated offer, if not accepted, will expire at the close of business on March 1, 2018; otherwise, this amended and restated offer will be effective as of your Start Date.
Very truly yours,
SOCIAL FINANCE, INC.
By: /s/ Tom Hutton
Name: Tom Hutton
Title: Interim Chief Executive Officer and Chairman of the Board of Directors
ACCEPTED AND AGREED:
ANTHONY NOTO
/s/ Anthony Noto
(Signature)
Date
Start Date: February 26, 2018
Exhibit A: Confidential Information and Invention Assignment Agreement
Exhibit B: Permitted Outside Activities
Exhibit C: Indemnification Agreement
-8-

EXECUTION VERSION
ATTACHMENT A
CONFIDENTIAL INFORMATION AND
INVENTION ASSIGNMENT AGREEMENT
(Separately attached.)

Exhibit 10.17
SOCIAL FINANCE, INC.
Letterman Digital Arts Center
One Letterman Drive, Building A
Suite 4700
San Francisco, CA 94129
May 29, 2018
Chris Lapointe
Sent via email:
Dear Chris,
Social Finance, Inc., a Delaware corporation (the "Company"), is pleased to offer you employment with the Company on the terms described below.
1.    Position. You will start in a full-time position as Vice President, Head of Business Operations and you will report to the Company's Chief Executive Officer, Anthony Noto. By signing this letter, you confirm with the Company that you are under no contractual or other legal obligations that would prohibit you from performing your duties with the Company.
2.    Compensation and Employee Benefits. You will be paid a starting salary of $300,000.00 per year, payable on the Company's regular payroll dates. You are eligible for a discretionary bonus of 70%, paid quarterly, dependent upon company as well as individual performance. In addition, we will provide you with a sign-on bonus of $173,000. If you voluntarily terminate employment within 24 months of your start date you agree to repay the Company 100% of the amount of the sign-on bonus that you received, which must be paid back to the Company on or before your last day of employment. As a regular employee of the Company you will be eligible to participate in a number of Company-sponsored benefits, which are described in the employee benefit summary that will be sent to you under separate cover.
3.    Restricted Stock Units. Subject to the approval of the Company's Board of Directors, you will be granted 250,000 restricted stock units ("RSUs"). You will vest in 25% of the RSU on the 12-month anniversary of your vesting commencement date of June 14, 2018. 1/16 of the total RSUs will vest in quarterly installments thereafter, provided that you remain employed with the Company. The RSU grant will be subject to the terms and conditions of the Company's standard form of award agreement applicable to RSUs granted under the 2011 Stock Plan, as described therein and in the applicable RSU agreement, which you will be required to sign.
4.    Confidential Information and Invention Assignment Agreement. Like all Company employees, you will be required, as a condition of your employment with the Company, to sign the Company's enclosed standard Confidential Information and Invention Assignment Agreement.



5.    Employment Relationship. Employment with the Company is for no specific period of time. Your employment with the Company will be "at will," meaning that either you or the Company may terminate your employment at any time and for any reason, with or without cause. Any contrary representations which may have been made to you are superseded by this offer. This is the full and complete agreement between you and the Company on this term. Although your job duties, title, compensation and benefits, as well as the Company's personnel policies and procedures, may change from time to time, the "at will" nature of your employment may only be changed in an express written agreement signed by you and the Company's Chief Executive Officer.
6.    Outside Activities. While you render services to the Company, you agree that you will not engage in any other employment, consulting or other business activity without the written consent of the Company. In addition, while you render services to the company, you will not assist any person or entity in competing with the Company, in preparing to compete with the Company or in hiring any employees or consultants of the Company.
7.    Withholding Taxes. All forms of compensation referred to in this letter are subject to applicable withholding and payroll taxes.
8.    Entire Agreement. This letter supersedes and replaces any prior understandings or agreements, whether oral, written or implied, between you and the Company regarding the matters described in this letter.
9.    Background Check. This employment offer is contingent upon our satisfaction with the results a reference check and criminal history and background checks.
[Signature Page Follows]
-2-


If you wish to accept this offer, please sign and date both the enclosed duplicate original of this letter and the enclosed Confidential Information and Invention Assignment Agreement and return them to me. As required, by law, your employment with the Company is also contingent upon your providing legal proof of your identity and authorization to work in the United States. This offer, if not accepted, will expire at the close of business on May 30, 2018.
We look forward to having you join us, with an anticipated start date of June 11, 2018.
Very truly yours,
SOCIAL FINANCE, INC.
By: /s/ Jing Liao
(Signature)
Name: Jing Liao
Title: Chief Human Resources Officer
ACCEPTED AND AGREED:
Chris Lapointe
/s/ Chris Lapointe
(Signature)
5/29/2018
Date
Anticipated Start Date: June 11, 2018
Attachment A: Confidential Information and Invention Assignment Agreement
-3-


ATTACHMENT A
CONFIDENTIAL INFORMATION AND INVENTION ASSIGNMENT AGREEMENT
(See Attached)
-4-
Exhibit 10.18
SOFILOGO.JPG
Chris Lapointe,
In recognition of your continued growth and success at SoFi, I am happy to inform you that you are being promoted. The details of your promotion are as follows:
Effective Date: September 14, 2020
Business Title: Chief Financial Officer
Base Pay: $450,000 per year
Bonus Target: 100%, paid annually and dependent on Company and individual performance in accordance with the annual bonus plan
Equity Award: 500,000 RSUs
Your restricted stock units (“RSUs”) grant is subject to the approval of the Company’s Compensation Committee of the Board of Directors. The RSU grant will vest over a seventeen quarter schedule, provided you remain employed with the Company. The vesting commencement date of your new award is September 14, 2020.
Vest Date
# of RSUs
12/14/2020
20,096
3/14/2021
18,509
6/14/2021
18,510
9/14/2021
18,510
12/14/2021
18,510
3/14/2022
26,322
6/14/2022
26,322
9/14/2022
26,322
12/14/2022
26,322
3/14/2023
34,759
6/14/2023
34,760
9/14/2023
34,760
12/14/2023
34,760
3/14/2024
40,384
6/14/2024
40,385
9/14/2024
40,385
12/14/2024
40,384
SoFi, Inc., 234 1st  Street, San Francisco, CA  94105  www.sofi.com

SOFILOGO.JPG
If at any time you are subject to a Qualifying Termination (as defined below), then (i) the Company or its successor (as applicable) shall pay you a lump-sum cash payment on the Company’s first regular payroll date following your termination date equal to the sum of (a) twelve (12) months of your Base Salary and (b) one hundred percent (100%) of your annual bonus amount at the higher of (1) the target level of achievement and (2) the actual level of achievement reasonably projected as of the termination of your employment as determined by the CEO in his sole discretion, (ii) you will continue to receive health, dental, and vision coverage under the Company’s group insurance benefits (including your covered dependents) at no cost to you for twelve (12) months, in each of the foregoing cases (i) and (ii), as in effect immediately preceding your termination or, if applicable, immediately preceding the event that first gave rise to your termination for Good Reason, and (iii) you will receive vesting acceleration of each of your then-outstanding RSUs as if you had remained in continuous service to the Company for an additional twelve (12) months following your actual termination date, with such acceleration effective as of immediately prior to the termination of your employment.
If you experience a Qualifying Termination (i) at any time after, or (ii) within three (3) months prior to, a Change of Control, the Company or its successor (as applicable) shall pay you, in lieu of the benefits described in the paragraph immediately above, a lump-sum cash payment on the Company’s or its successor’s first regular payroll date following your termination date equal to the sum of (i) of (a) eighteen 18 months of your base salary and (b) one hundred fifty percent (150%) of your annual incentive bonus amount at the higher of (1) the target level of achievement and (2) the actual level of achievement reasonably projected as of the termination of your employment as determined by the CEO in his sole discretion, (ii) you will continue to receive health, dental, and vision coverage under the Company’s group insurance benefits (including your covered dependents) at no cost to you for eighteen (18) months, in each of the foregoing cases (i) and (ii), as in effect immediately preceding the event that first gave rise to your termination or, if applicable, immediately preceding the event that first gave rise to your termination for Good Reason, and (iii) full accelerated vesting of your then-outstanding RSUs, with such acceleration effective as of immediately prior to the later of your Qualifying Termination (as defined below) and the Change of Control (as defined below).
For purposes of this letter, the following definitions shall apply:
a.    “Cause” shall mean (i) your commission of any act of fraud, embezzlement, material dishonesty or other willful and material misconduct that has caused material injury to the Company; (ii) your unauthorized use or disclosure of any proprietary
SoFi, Inc., 234 1st  Street, San Francisco, CA  94105  www.sofi.com

SOFILOGO.JPG
information or trade secrets of the Company or any party to whom you owe an obligation of nondisclosure due to your relationship with the Company; or (iii) your material breach of any of your obligations under any written agreement or covenant with the Company, provided that such material breach shall not constitute Cause unless you have first received notice of the breach and failed reasonably to cure the material breach (to the extent curable) within 30 days of such notice.
b.    “Change of Control” shall have the meaning given to that term in the 2011 Stock Plan, provided, however, that solely for purposes of the benefits described in this letter, the occurrence of “all” in clause (iii) of the Plan’s definition of “Change of Control” shall be replaced with “a majority” and provided, furthermore, that a Change of Control shall not include any transaction or series of related transactions by which SoftBank or the SoftBank Vision Fund (inclusive of any successor or any affiliate under common control with, or controlled by, SoftBank or the SoftBank Vision Fund, collectively, “SoftBank”) comes to hold a majority of the voting interests of the Company’s capital stock without purchasing any shares thereof (this date, the “SoftBank Acquisition Date”), but notwithstanding this proviso, a Change of Control shall still be deemed to occur on or after the SoftBank Acquisition Date if and when: (x) a majority of the Board ceases to consist of directors who are not affiliates of SoftBank and were not nominated by SoftBank or any affiliate of SoftBank; (y) any of the Company’s governing documents (including its charter, bylaws, voting agreement, and similar agreement) are materially amended without your prior written consent and/or (z) SoftBank’s ownership of a majority of the voting interests has continued for a period of six months after the SoftBank Acquisition Date.
c.    “Good Reason” shall mean the occurrence of any of the following conditions without your written consent, provided that the below clauses (I), (II) and (III) are satisfied (as applicable): (i) a reduction of ten percent (10%) or more of the maximum base salary that you have received from the Company at any time (other than as part of an across the board, proportional salary reduction applicable to all executive officers), (ii) a material reduction in your title, authority, duties and/or responsibilities, (iii) not reporting to the Company’s Chief Executive Officer (the “CEO”), (iv) a material breach by the Company of any agreement then in effect between you and the Company, or (v) the Company requiring you to relocate to a facility or location more than fifty (50) miles away from the location at which you were working immediately prior to the required relocation, in each of the foregoing cases (i) through (v), if and only if (I) you provide the CEO written notice of such condition within sixty (60) days following the latest occurrence thereof, (II) if such condition is curable, either the Company fails to cure such condition within thirty (30) days following your delivery of the written notice to the CEO or the CEO provides you earlier written notice that the Company does not intend to cure such condition and (III) you resign from your
SoFi, Inc., 234 1st  Street, San Francisco, CA  94105  www.sofi.com

SOFILOGO.JPG
employment with the Company, or the Company terminates your employment without Cause, within ten (10) business days following the expiration of such thirty (30)-day cure period or the provision of the written notice that the Company does not intend to cure such condition, if such condition is curable.
d.    “QualifyingTermination” shall mean termination of your employment by the Company without Cause (as defined above) or by you for Good Reason (as defined above).
Thank you for your contributions, hard work, and dedication. We are pleased that you are part of SoFi and are appreciative of all the work you have done.
Best Regards,
Anthony Noto
Chief Executive Officer
SoFi, Inc., 234 1st  Street, San Francisco, CA  94105  www.sofi.com
Exhibit 10.19
EXECUTION VERSION
SOCIAL FINANCE, INC.
Letterman Digital Arts Center
One Letterman Drive, Building A
Suite 4700
San Francisco, CA 94129
March 27, 2018
Ms. Michelle Gill
Re: Offer of Employment
Sent via email:
Dear Ms. Gill
Social Finance, Inc., a Delaware corporation (the "Company"), is pleased to offer you employment with the Company on the terms described below.
1.    Position.
You will start in a full-time position as Chief Financial Officer on [           ] (your "Start Date"). You will report directly to the Chief Executive Officer. By signing this letter, you confirm with the Company that you are under no contractual or other legal obligations that would prohibit you from performing your duties with the Company.
2.    Compensation and Employee Benefits.
You will be paid a starting salary of $500,000 per year, payable on the Company's regular payroll dates, which salary may be increased from time to time (the "Base Salary"). As a senior executive officer and regular employee of the Company, you will be eligible to participate in a number of Company-sponsored benefits, which are described in the employee benefit summary that will be sent to you under separate cover and which will be commensurate with those of the Company's other senior executive officers.
In addition to the above, while you are employed at the Company, you will receive an annual incentive bonus based on Company performance metrics to be reasonably agreed upon by you and the Company, with a target of one hundred percent (100%) of your Base Salary. The confirmation of the criteria for evaluation of individual and Company performance and the amount of the annual incentive bonus will be decided upon by the Chief Executive Officer, and will be based on a combination of your individual performance and Company performance. The Chief Executive Officer will set the relevant metrics for the 2018 annual incentive bonus within forty- five (45) days of the Start Date, and within forty-five (45) days of the beginning of the applicable fiscal year thereafter and confirmation of achievement of annual performance metrics will occur within forty-five (45) days of the end of the relevant performance period.
3.    Stock Options and Restricted Stock.



Subject to approval by the Company's Board of Directors (the "Board"), you will be awarded an option to purchase one million one hundred fifty thousand (1,150,000) shares of the Company's common stock (such option, the First Option"). The grant date of and vesting commencement date for the First Option will be your Start Date. You will vest in 25% of the First Option on the twelve (12)-month anniversary of your vesting commencement date, and 1/48th of the First Option will vest in monthly installments thereafter during continuous service (a four (4)- year vesting schedule from State Date, as described in the applicable stock option agreement. The exercise price per share will be equal to the fair market value per share on the date the option is granted, which at the date of this letter is ten dollars and seventy-eight cents ($10.78) per share, as reasonable determined by the Board in compliance with applicable guidance in order to avoid having the option be treated as deferred compensation under Section 409A of the Internal Revenue Code of 1986, as amended ("Section 409A"). There is no guarantee that the Internal Revenue Service will agree with this value. You should consult with your own tax advisor concerning the tax risks associated with accepting an option to purchase the Company's common stock.
In addition, subject to Board Approval, you will be awarded an option to purchase one million four hundred thousand (1,400,000) shares of the Company's common stock with an exercise price of seventeen dollars and eighteen cents ($17.18) per share which is the price per preferred share of the Company's Series G equity financing (such option, the "Second Option"). The grant date of and vesting commencement date for the Second Option will be your Start Date. You will vest in 25% of the Second Option on the twelve (12)-month anniversary of your vesting commencement date, and 1/48th of the Second Option shares will vest in monthly installments thereafter during continuous service (a four (4)-year vesting schedule from the State Date), as defined in the applicable stock option agreement.
Both the First Option and the Second Option shall be subject to the terms and conditions of the Company's standard form of award agreement applicable to options granted to the Company's other senior executive officers under the Company's 2011 Stock Plan, as amended (the "Plan"), as described in the Plan and the applicable stock option agreement, which you will be required to sign. Notwithstanding anything in the Company's standard form of award agreement or the Plan to the contrary, however, all of your option grants (including, but not limited to, the First Option and the Second Option) will provide for: (i) a ten (10)-year expiration date, (ii) the acceleration of vesting described in this Section below (and remaining outstanding in the entirety (including the unvested and unexercisable portion) for three (3) months following the termination of your employment to the extent required to permit such acceleration of vesting or until the earlier expiration of the award); (iii) immediate exercisability in full, subject to a right of the Company to repurchase any then-unvested shares (to the extent no longer eligible to vest) at no less than the original exercise price within ninety (90) days after the vesting is no longer possible; (iv) exercisability as to then-vested shares under the options for the longer of three (3) years following the termination of your service for any reason other than termination for Cause as defined in Section 3 below, (in which case you will have ninety (90) days after termination of employment to exercise then-vested shares), and such post-termination period that may apply to the Company's other senior executives or employee population generally (but not exceeding the ten (10)-year expiration date); and (v) net exercisability, at your election, to cover the aggregate exercise price, taxes and withholding due upon exercise (such that you will not be required to make any cash payment in connection with the exercise of your option to cover the aggregate amount of taxes and withholding (if any) due upon exercise of an option).
-2-


Separately, subject to Board approval, you will receive a grant of one million three hundred fifty thousand (1,350,000) restricted stock units ("RSUs"). You will vest in twenty-five percent (25%) of the RSUs on the twelve (12)-month anniversary of your vesting commencement date and grant date, which shall be your Start Date, and 1/48th of the RSUs will vest in monthly installments thereafter during continuous service (a four (4)-year vesting schedule from the Start Date), as described in the applicable RSU agreement. The RSUs will be subject to the terms and conditions of the Company's standard form of award agreement applicable to RSUs granted to the Company's other senior executive officers granted under the Plan, as described therein and in the applicable RSU agreement, which you will be required to sign. Notwithstanding anything in the Company's standard form of award agreement or the Plan to the contrary, however, your RSU agreement will provide for: (i) the acceleration of vesting described in this Section below (and remaining outstanding in the entirety (including the unvested and unsettled portion) for three (3) months following the termination of your employment to the extent required to permit such acceleration of vesting or until the earlier expiration of the award), (ii) settlement of the shares corresponding to each vesting tranche of your RSUs within thirty (30) days of the applicable vesting date, and (iii) net settlement, at your election, to cover the aggregate taxes and withholding due upon settlement (such that you will not be required to make any cash payment in connection with the settlement of your RSUs).
Notwithstanding anything in the Plan or the Company's standard forms of award agreements thereunder, if any of your then-outstanding equity incentives (including, without limitation, the First Option, the Second Option, and the RSUs) would be cancelled for no consideration or below the value received by common stockholders in connection with a Change of Control (as defined in the Plan), such equity incentives will be deemed vested in full and will be settled for shares or automatically exercised, as applicable, immediately prior to the consummation of the transaction (with any performance-based vesting conditions deemed to have been met at maximum achievement levels).
The grant date of the First Option, Second Option and RSUs described in this Section 3 will be your Start Date. In the event of any stock split, extraordinary dividend, or similar transaction, including if prior to the relevant grant date(s), all of the equity incentives in this Section 3 shall be appropriately and equitably adjusted.
Severance.
If at any time you are subject to a Qualifying Termination (as defined below), then (i) the Company or its successor (as applicable) shall pay you a lump-sum cash payment on the Company's first regular payroll date following your termination date equal to the sum of (a) twelve (12) months of your Base Salary and (b) one hundred percent (100%) of your annual bonus amount at the higher of (1) the target level of achievement and (2) the actual level of achievement reasonably projected as of the termination of your employment, (ii) you will continue to receive health, dental, and vision coverage under the Company's group insurance benefits (including your covered dependents) at no cost to you for twelve (12) months, in each of the foregoing cases (i) and (ii), as in effect immediately preceding your termination or, if applicable, immediately preceding the event that first gave rise to Good Reason, and (iii) you will receive vesting acceleration of each of your then-outstanding Company equity incentives (including, but not
-3-


limited to, the First Option, Second Option, and RSUs) as if you had remained in continuous service to the Company for an additional twelve (12) months following your actual termination date and as if all applicable performance-based vesting conditions (if any) were met at the target achievement level or, if higher, the actual level of achievement reasonably projected as of the termination of your employment, with such acceleration effective as of immediately prior to the termination of your employment.
If you experience a Qualifying Termination at any time after, or within three (3) months prior to, a Change of Control, then, Company or its successor (as applicable) shall pay you, in lieu of the benefits described in the paragraph immediately above, a lump-sum cash payment on the Company's first regular payroll date following your termination date equal to the sum of (i) of (a) eighteen 18 months of your Base Salary and (b) one hundred fifty percent (150%) of your annual incentive bonus amount at the higher of (1) the target level of achievement and (2) the actual level of achievement reasonably projected as of the termination of your employment, (ii) you will continue to receive health, dental, and vision coverage under the Company's group insurance benefits (including your covered dependents) at no cost to you for eighteen (18) months, in each of the foregoing cases (i) and (ii), as in effect immediately preceding your termination or, if applicable, immediately preceding the event that first gave rise to Good Reason, and (iii) full accelerated vesting of your then-outstanding equity incentives (including, but not limited to, the First Option, Second Option, and RSUs, and as to all applicable performance-based vesting conditions (if any), which will be deemed satisfied at maximum achievement), with such acceleration effective as of immediately prior to the later of your Qualifying Termination (as defined below) and the Change of Control (as defined below).
For purposes of this letter, the following definitions shall apply:
"Cause" shall mean (i) your commission of any act of fraud, embezzlement, material dishonesty or other willful and material misconduct that has caused material injury to the Company, (ii) your unauthorized use or disclosure of any proprietary information or trade secrets of the Company or any party to whom you owe an obligation of nondisclosure due to your relationship with the Company, which unauthorized use or disclosure has caused material injury to the Company, or (iii) your material breach of any of your obligations under any written agreement or covenant with the Company, provided that such material breach shall not constitute Cause unless you have first received notice of the breach and failed reasonably to cure the material breach (to the extent curable) within thirty (30) days of such notice.
"Change of Control" shall have the meaning given to that term in the Plan, provided, however, that solely for purposes of the benefits described in this letter, the occurrence of "all" in clause (iii) of the Plan's definition of "Change of Control" shall be replaced with "a majority" and provided, furthermore, that a Change of Control shall not include any transaction or series of related transactions by which SoftBank or the SoftBank Vision Fund (inclusive of any successor or any affiliate under common control with, or controlled by, SoftBank or the SoftBank Vision Fund, collectively, "SoftBank") comes to hold a majority of the voting interests of the Company's capital stock without purchasing any shares thereof (this date, the "SoftBank Acquisition Date"), but notwithstanding this proviso, a Change of Control shall be still be deemed to occur on or after the SoftBank Acquisition Date if and when (x) a majority of the Board ceases
-4-


to consist of directors who are not affiliates of SoftBank and were not nominated by SoftBank or any affiliate of SoftBank, (y) any of the Company's governing documents (including its charter, bylaws, voting agreement, and similar agreement) are materially amended without your prior written consent and/or (z) SoftBank's ownership of a majority of the voting interests has continued for a period of six (6) months after the SoftBank Acquisition Date.
"Good Reason" shall mean the occurrence of any of the following conditions without your written consent, provided that the below clauses (I), (II) and (III) are satisfied (as applicable): (i) a reduction to a level of ten percent (10%) or more off the maximum Base Salary that you have received from the Company at any time (other than as part of an across-the-board, proportional salary reduction applicable to all executive officers), (ii) a material reduction in your title, authority, duties and/or responsibilities, (iii) not becoming or remaining the Chief Financial Officer of the acquirer, or if the acquirer is a subsidiary of another company, Chief Financial Officer of the ultimate parent company of the acquirer, (iv) reporting to the Company's Chief Executive Officer (the "CEO"), (v) a material breach by the Company of any agreement then in effect between you and the Company, or (vi) the Company requiring you to relocate to a facility or location more than fifty (50) miles away from the location at which you were working immediately prior to the required relocation, in each of the foregoing cases (i) through (vi), if and only if (I) you provide the CEO written notice of such condition within sixty (60) days following the latest occurrence thereof, (II) if such condition is curable, either the Company fails to cure such condition within thirty (30) days following your delivery of the written notice to the CEO or the CEO provides you earlier written notice that the Company does not intend to cure such condition and (III) you resign from your employment with the Company, or the Company terminates your employment without Cause, within ten (10) days following the expiration of such thirty (30)-day cure period or the provision of the written notice that the Company does not intend to cure such condition, if such condition is curable.
"Qualifying Termination" shall mean termination of your employment by the Company without Cause (as defined above ) or by you for Good Reason (as defined above ).
For purposes of the definitions in this Section 3, except for the definition of "Change of Control," "Company" shall include any affiliate of the Company or its successor who is then employing you.
4.    Confidential Information and Invention Assignment Agreement.
Like all Company employees, you have been required, as a condition of your employment with the Company, to sign the Company's standard Confidential Information and Invention Assignment Agreement, which is enclosed herewith as Attachment A.
5.    Employment Relationship.
Employment with the Company is for no specific period of time. Your employment with the Company will be "at will," meaning that either you or the Company may terminate your employment at any time and for any reason, with or without cause. Any contrary representations which may have been made to you are superseded by this offer. This is the full and complete agreement between you and the Company on this term. Although your job duties, title,
-5-


compensation and benefits, as well as the Company's personnel policies and procedures, may change from time to time consistent with this offer letter, the "at will" nature of your employment may only be changed in an express written agreement signed by you and the CEO. This letter agreement shall be binding upon any successor (whether direct or indirect and whether by purchase, lease, merger, consolidation, liquidation or otherwise) to all or substantially all of the Company's business and/or assets.
6.    Outside Activities.
While you render services to the Company, you agree that you will not engage in any other employment, consulting or other business activity without the written consent of the CEO, except that you shall be permitted to serve on the boards of directors (and any committees thereof) of up to two for-profit companies, to serve on any number of boards of directors or trustees (and any committees thereof) of nonprofit organizations and to additionally engage in those activities set forth on Exhibit D enclosed herewith, in each of the foregoing cases, so long as the CEO determines that such commitments, in the aggregate, do not materially interfere with your duties and responsibilities to the Company. In addition, while you render services to the Company, you will not assist any person or entity in competing with the Company, in preparing to compete with the Company or in hiring any employees or consultants of the Company, provided, however, that those activities set forth on Attachment B enclosed herewith shall be permitted and shall not violate this letter agreement.
7.    Withholding Taxes.
All forms of compensation referred to in this letter are subject to applicable withholding and payroll taxes.
8.    Section 409A.
To the extent that any provision of this letter is ambiguous as to its exemption or compliance with Section 409A, the provision will be read in such a manner so that (i) all payments hereunder are exempt from Section 409A to the maximum permissible extent and, (ii) for any payments where such construction is not tenable, those payments comply with Section 409A to the maximum permissible extent. Payments pursuant to this letter (or referenced herein), and each installment thereof, are intended to constitute separate payments for purposes of Section 1.409A-2(b)(2) of the regulations under Section 409A.
For purposes of Section 3, the phrase "termination of employment," and correlative phrases, mean a "separation from service" as defined in Section 1.409A-1(h) of the regulations under Section 409A. For purposes of Section 3, if you are a "specified employee," as defined in Section 409A, at the time of your separation from service, except due to death, and some or any portion of the amounts payable to you, if any, when considered together with any other severance payments or separation benefits which may be considered deferred compensation under Section 409A and would result in the imposition of additional tax under Section 409A if paid to you on or within the six (6) month period following your separation from service, then such payments shall be delayed and will instead become payable on the first payroll date that occurs on or after the date six (6) months and one (1) day following the separation from service (or such longer period as is
-6-


required to avoid the imposition of additional tax under Section 409A). Any subsequent separation benefits, if any, will be payable in accordance with the original payment schedule applicable to each payment or benefit.
9.    Entire Agreement.
This letter supersedes and replaces any prior understandings or agreements, whether oral, written or implied, between you and the Company regarding the matters described in this letter by and between you and the Company.
10.    Background Check.   We are extending this offer contingent upon successful completion of our routine background and reference check. More information and consent to the background check will be provided in a separate letter.
-7-


If you wish to accept this offer, please sign and date both the enclosed duplicate original of this letter and the enclosed Confidential Information and Invention and Assignment Agreement and return them to me. As required, by law, your employment with the Company is also contingent upon your providing legal proof of your identity and authorization to work in the United States. This amended and restated offer, if not accepted, will expire at the close of business on April 6, 2018; otherwise, this amended and restated offer will be effective as of your Start Date.
Very truly yours,
SOCIAL FINANCE, INC.
By:
Name: Anthony Noto
Title: Chief Executive Officer
ACCEPTED AND AGREED:
/s/ Michelle Gill
(Signature)
4/12/2018
Date
Start Date: [      ], 2018
Exhibit A: Confidential Information and Invention Assignment Agreement
Exhibit B: California Labor Code Section 2870 Disclosure
Exhibit C: Termination Certification
Exhibit D: Permitted Outside Activities
-8-
Exhibit 10.20
SOCIAL FINANCE, INC.
Letterman Digital Arts Center
One Letterman Drive, Building A
Suite 4700
San Francisco, CA 94129
May 15, 2019
Jennifer Nuckles
Sent via email:
Dear Jennifer,
Social Finance, Inc., a Delaware corporation (the "Company"), is pleased to offer you employment with the Company on the terms described below.
1.    Position. You will start in a full-time position as Head of Lantern Partnerships and Content, and you will report directly to the Company's Chief Executive Officer, Anthony Noto. By signing this letter, you confirm with the Company that you are under no contractual or other legal obligations that would prohibit you from performing your duties with the Company.
2.    Compensation and Employee Benefits. You will be paid a starting salary of $350,000 per year, payable on the Company's regular payroll dates. You are eligible for a discretionary bonus of 80% of your base salary, dependent upon Company as well as individual performance, in accordance with the Company's annual bonus plan. As a regular employee of the Company you will be eligible to participate in a number of Company-sponsored benefits, which are described in the employee benefit summary that will be sent to you under separate cover.
3.    Restricted Stock Units. Subject to the approval of the Company's Board of Directors, you will be granted 180,000 restricted stock units ("RSUs"). The vesting commencement date for your RSUs will be the next Stock Committee approval date following your start date; approval dates are quarterly on the 14th of the third month. You will vest in 25% of the RSU on the 12-month anniversary of your vesting commencement date. 1/16 of the total RSUs will vest in quarterly installments thereafter, provided you remain employed with the Company. The RSU grant will be subject to the terms and conditions of the Company's standard form of award agreement applicable to RSUs granted under the 2011 Stock Plan, as described therein and in the applicable RSU agreement, which you will be required to sign. Your grant will include language stating that 50% of the then unvested RSUs will vest and become exercisable upon the occurrence of a Change of Control as defined in the Company's Stock Plan and such other terms as stated in the grant agreement.
4.    Confidential Information and Invention Assignment Agreement. Like all Company employees, you will be required, as a condition of your employment with the



Company, to sign the Company's enclosed standard Confidential Information and Invention Assignment Agreement.
5.    Employment Relationship. Employment with the Company is for no specific period of time. Your employment with the Company will be "at will," meaning that either you or the Company may terminate your employment at any time and for any reason, with or without cause. Any contrary representations which may have been made to you are superseded by this offer. This is the full and complete agreement between you and the Company on this term. Although your job duties, title, compensation and benefits, as well as the Company's personnel policies and procedures, may change from time to time, the "at will" nature of your employment may only be changed in an express written agreement signed by you and the Company's Chief Executive Officer.
6.    Outside Activities. While you render services to the Company, you agree that you will not engage in any other employment, consulting or other business activity without the written consent of the Company. In addition, while you render services to the company, you will not assist any person or entity in competing with the Company, in preparing to compete with the Company or in hiring any employees or consultants of the Company.
7.    Withholding Taxes. All forms of compensation referred to in this letter are subject to applicable withholding and payroll taxes.
8.    Entire Agreement. This letter supersedes and replaces any prior understandings or agreements, whether oral, written or implied, between you and the Company regarding the matters described in this letter.
9.    Background Check. This employment offer is contingent upon our satisfaction with the results a reference check and criminal history and background checks.
[Signature Page Follows]
-2-


If you wish to accept this offer, please sign and date both the enclosed duplicate original of this letter and the enclosed Confidential Information and Invention Assignment Agreement and return them to me. As required, by law, your employment with the Company is also contingent upon your providing legal proof of your identity and authorization to work in the United States. This offer, if not accepted, will expire at the close of business on May 17, 2019.
We look forward to having you join us, with an anticipated start date of TBD.
Very truly yours,
SOCIAL FINANCE, INC.
By: /s/ Anna Avalos
(Signature)
Name: Anna Avalos
Title: Head of People
ACCEPTED AND AGREED:
Jennifer Nuckles
/s/ Jennifer Nuckles
(Signature)
5/16/2018
Date
Anticipated Start Date: June 3, 2019
Attachment A: Confidential Information and Invention Assignment Agreement
-3-


ATTACHMENT A
CONFIDENTIAL INFORMATION AND INVENTION ASSIGNMENT AGREEMENT
(See Attached)
-4-
Exhibit 10.21
SOFIA.JPG
March 6, 2020
Jennifer Nuckles,
In recognition of your continued growth and success at SoFi, effective March 11, 2020, I am happy to inform you that you are being promoted into the role of Executive Vice President and Group Business Unit Leader - Relay, Lantern, Content @ Work & Partnerships.
In recognition of your promotion, your base pay will increase to $400,000 per year. Your discretionary bonus target will be 100% paid annually, dependent upon company as well as your individual performance. In addition, you will be granted 200,000 stock units (“RSUs”) subject to the approval of the Company’s Board of Directors.
1/16 of the total Number of Shares subject to the RSU Award will vest 3 months after the vest commencement date of March 14th, 2020, and 1/16th of the total Number of Shares subject to the RSU Award will vest on each 3 month anniversary of such date thereafter (and if there is no corresponding day, on the last day of the month) subject to the recipient’s Continuous Service Status (as defined in the Plan) through each vesting date.
Thank you for your contributions, hard work and dedication. We are pleased that you are part of SoFi and are appreciative of all the work you have done. We look forward to your continued contributions as SoFi grows.
Best Regards,
Anthony Noto
Chief Executive Officer
SoFi, Inc., 234 1st Street, San Francisco, CA 94105 www.sofi.com

Exhibit 10.22
SOCIAL FINANCE, INC.
Letterman Digital Arts Center
One Letterman Drive, Building A
Suite 4700
San Francisco, CA 94129
February 14, 2020
Maria Renz
Sent via email:
Dear Maria,
Social Finance, Inc. a Delaware corporation (the “Company”), is pleased to offer you employment with the Company on the terms described below.
1.    Position. You will start in a full-time position as Executive Vice President and you will report to the Company's Chief Executive Officer. By signing this letter, you confirm with the Company that you are under no contractual or other legal obligations that would prohibit you from performing your duties with the Company.
2.    Compensation and Employee Benefits. You will be paid a starting salary of $450,000 per year, payable on the Company's regular payroll dates. For 2020, you will be guaranteed a bonus at 100% of your base pay, which will be paid out quarterly in accordance with the timing of the Company's quarterly bonus plan payouts, provided you are employed with the Company on the date the quarterly bonus is paid out. Effective on January 1, 2021, you will become eligible for an annual discretionary bonus of 100% of your base salary, dependent upon Company as well as individual performance, in accordance with the Company's annual bonus plan, a copy of which will be provided to you under separate cover. As a regular employee of the Company you will be eligible to participate in a number of Company-sponsored benefits, which are described in the employee benefit summary that will be sent to you under separate cover.
3.    Restricted Stock Units. Subject to the approval of the Compensation Committee of the Company's Board of Directors, you will be granted 1,296,000 restricted stock units (“RSUs”). The vesting commencement date for your RSUs will be the next Stock Committee approval date following your start date; approval dates are quarterly on the 14th of the third month. You will vest in 25% of the RSU on the 12-month anniversary of your vesting commencement date. 1/16 of the total RSUs will vest in quarterly installments thereafter, provided you remain employed with the Company. The RSU grant will be subject to the terms and conditions of the Company's standard form of award agreement applicable to RSUs granted under the 2011 Stock Plan, as described therein and in the applicable RSU agreement, which you will be required to sign.
4.    Severance. If at any time you are subject to a Qualifying Termination (as defined below), then (i) the Company or its successor (as applicable) shall pay you a lump-sum cash payment on the Company's first regular payroll date following your termination date equal to the sum of (a) twelve (12) months of your Base Salary and (b) one hundred percent (100%) of your annual bonus amount at the higher of (1) the target level of achievement and (2) the actual level



of achievement reasonably projected as of the termination of your employment as determined by the CEO in his sole discretion, (ii) you will continue to receive health, dental, and vision coverage under the Company's group insurance benefits (including your covered dependents) at no cost to you for twelve (12) months, in each of the foregoing cases (i) and (ii), as in effect immediately preceding your termination or, if applicable, immediately preceding the event that first gave rise to your termination for Good Reason, and (iii) you will receive vesting acceleration of each of your then-outstanding RSUs as if you had remained in continuous service to the Company for an additional twelve (12) months following your actual termination date, with such acceleration effective as of immediately prior to the termination of your employment.
If you experience a Qualifying Termination (i) at any time after, or (ii) within three (3) months prior to, a Change of Control, the Company or its successor (as applicable) shall pay you, in lieu of the benefits described in the paragraph immediately above, a lump-sum cash payment on the Company's or its successor's first regular payroll date following your termination date equal to the sum of (i) of (a) eighteen 18 months of your base salary and (b) one hundred fifty percent (150%) of your annual incentive bonus amount at the higher of (1) the target level of achievement and (2) the actual level of achievement reasonably projected as of the termination of your employment as determined by the CEO in his sole discretion, (ii) you will continue to receive health, dental, and vision coverage under the Company's group insurance benefits (including your covered dependents) at no cost to you for eighteen (18) months, in each of the foregoing cases (i) and (ii), as in effect immediately preceding the event that first gave rise to your termination or, if applicable, immediately preceding the event that first gave rise to your termination for Good Reason, and (iii) full accelerated vesting of your then-outstanding RSUs, with such acceleration effective as of immediately prior to the later of your Qualifying Termination (as defined below) and the Change of Control (as defined below).
For purposes of this letter, the following definitions shall apply:
“ Cause” shall mean (i) your commission of any act of fraud, embezzlement, material dishonesty or other willful and material misconduct that has caused material injury to the Company; (ii) your unauthorized use or disclosure of any proprietary information or trade secrets of the Company or any party to whom you owe an obligation of nondisclosure due to your relationship with the Company; or (iii) your material breach of any of your obligations under any written agreement or covenant with the Company, provided that such material breach shall not constitute Cause unless you have first received notice of the breach and failed reasonably to cure the material breach (to the extent curable) within 30 days of such notice.
“ Change of Control” shall have the meaning given to that term in the 2011 Stock Plan, provided, however, that solely for purposes of the benefits described in this letter, the occurrence of “all” in clause (iii) of the Plan's definition of “Change of Control” shall be replaced with “a majority” and provided, furthermore, that a Change of Control shall not include any transaction or series of related transactions by which SoftBank or the SoftBank Vision Fund (inclusive of any successor or any affiliate under common control with, or controlled by, SoftBank or the SoftBank Vision Fund, collectively, “SoftBank”) comes to hold a majority of the voting interests of the Company's capital stock without purchasing any shares thereof (this date, the “SoftBank Acquisition Date”), but notwithstanding this proviso, a Change of Control shall still be deemed



to occur on or after the SoftBank Acquisition Date if and when: (x) a majority of the Board ceases to consist of directors who are not affiliates of SoftBank and were not nominated by SoftBank or any affiliate of SoftBank; (y) any of the Company's governing documents (including its charter, bylaws, voting agreement, and similar agreement) are materially amended without your prior written consent and/or (z) SoftBank's ownership of a majority of the voting interests has continued for a period of six months after the SoftBank Acquisition Date.
“ Good Reason” shall mean the occurrence of any of the following conditions without your written consent, provided that the below clauses (I), (II) and (III) are satisfied (as applicable): (i) a reduction of ten percent (10%) or more of the maximum base salary that you have received from the Company at any time (other than as part of an across the board, proportional salary reduction applicable to all executive officers), (ii) a material reduction in your title, authority, duties and/or responsibilities, (iii) not reporting to the Company's Chief Executive Officer (the “CEO”), (iv) a material breach by the Company of any agreement then in effect between you and the Company, or (v) the Company requiring you to relocate to a facility or location more than fifty (50) miles away from the location at which you were working immediately prior to the required relocation, in each of the foregoing cases (i) through (v), if and only if (I) you provide the CEO written notice of such condition within sixty (60) days following the latest occurrence thereof, (II) if such condition is curable, either the Company fails to cure such condition within thirty (30) days following your delivery of the written notice to the CEO or the CEO provides you earlier written notice that the Company does not intend to cure such condition and (III) you resign from your employment with the Company, or the Company terminates your employment without Cause, within ten (10) business days following the expiration of such thirty (30)-day cure period or the provision of the written notice that the Company does not intend to cure such condition, if such condition is curable.
“ Qualifying Termination” shall mean termination of your employment by the Company without Cause (as defined above) or by you for Good Reason (as defined above).
For purposes of the definitions in this Section 4, “Company” shall include any affiliate of the Company or its successor who is then employing you.
5. Confidential Information and Invention Assignment Agreement. Like all Company employees, you will be required, as a condition of your employment with the Company, to sign the Company's enclosed standard Confidential Information and Invention Assignment Agreement.
6.    Employment Relationship. Employment with the Company is for no specific period of time. Your employment with the Company will be “at will”, meaning that either you or the Company may terminate your employment at any time and for any reason, with or without cause. Any contrary representations which may have been made to you are superseded by this offer. This is the full and complete agreement between you and the Company on this term.
Although your job duties, title, compensation and benefits, as well as the Company's personnel policies and procedures, may change from time to time, the “at will” nature of your employment may only be changed in an express written agreement signed by you and the Company's Chief Executive Officer.



7.    Outside Activities. While you render services to the Company, you agree that you will not engage in any other employment, consulting or other business activity without the written consent of the Company. Notwithstanding the foregoing, with the consent of the Company's Chief Executive Officer, which consent shall not be unreasonably withheld, delayed or conditioned, you may serve on up to two (2) boards of directors or advisors of any company (whether publicly or privately held) that is not in competition with the Company so long as such service does not materially interfere with your duties to the Company. In addition, while you render services to the Company, you will not assist any person or entity in competing with the Company, in preparing to compete with the Company or in hiring any employees or consultants of the Company.
8.    Withholding Taxes. All forms of compensation referred to in this letter are subject to applicable withholding and payroll taxes.
9.    Entire Agreement. This letter supersedes and replaces any prior understandings or agreements, whether oral, written or implied, between you and the Company regarding the matters described in this letter.
10.    Background Check. This employment offer is contingent upon our satisfaction with the results a reference check and criminal history and background checks.
[Signature Page Follows]



If you wish to accept this offer, please sign and date both the enclosed duplicate original of this letter and the enclosed Confidential Information and Invention Assignment Agreement and return them to me. As required, by law, your employment with the Company is also contingent upon your providing legal proof of your identity and authorization to work in the United States. This offer, if not accepted, will expire at the close of business on 2/21/20.
We look forward to having you join us, with an anticipated start date of 3/11/2020
Very truly yours,
SOFI
By: /s/ Anna Avalos
(Signature)
Name: Anna Avalos
Title: Head of People
ACCEPTED AND AGREED:
Maria Renz
/s/ Jennifer Nuckles
(Signature)
2/18/2020
Date
Anticipated Start Date: March 11, 2020
Attachment A: Confidential Information and Invention Assignment Agreement



ATTACHMENT A
CONFIDENTIAL INFORMATION AND INVENTION ASSIGNMENT AGREEMENT
(See Attached)

DEREKWHITESIGNEDOFFER_004.JPG
Exhibit 10.23
May 17th, 2021
Derek White
Anticipated Start Date: May 31st, 2021
Position.
You will start in a full-time position as CEO of Galileo and Head of SoFi International, and you will initially report to Anthony Noto, Chief Executive Officer. By signing this letter, you confirm with Galileo Financial Technologies, LLC. (the "Company") that you are under no contractual or other legal obligations that would prohibit you from performing your duties with the Company.
Compensation and Employee Benefits.
You will be paid a starting salary of $500,000 per year, payable on the Company’s regular payroll dates.
You are eligible for an annual discretionary bonus of 100% of your annual base salary, dependent upon company as well as individual performance. The bonus, if earned, will be paid out no later than Q1 of the following year.
Sign On Bonus. In addition, we will provide you with a sign-on bonus in the amount of $2,000,000 which will be advanced to you within your first 30-days. The sign-on bonus is being provided in anticipation of your working at the Company for at least two years, and is not earned until the second anniversary of your employment. If you voluntarily terminate your employment within 24 months of your start date or are terminated for Cause (which is defined as (i) a willful failure to perform your duties and responsibilities to the Company or your violation of any written Company policy; (ii) your commission of any act of fraud, embezzlement, dishonesty or any other willful misconduct that has caused or is reasonably expected to result in injury to the Company; (iii) your unauthorized use or disclosure of any proprietary information or trade secrets of the Company or any other party to whom you owe an obligation of nondisclosure as a result of your relationship with the Company; or (iv) a material breach of any of your obligations under any written agreement or covenant with the Company), you agree to repay the Company 100% of the amount of the sign-on advance that you received, which must be repaid to the Company on or before your last day of employment.
Restricted Stock Units. Subject to the approval of the Company’s Board of Directors, you will be granted $20,000,000 in restricted stock (“RSUs”). These RSUs will vest to you over time with 25% of the RSUs granted vesting on the 6-month anniversary of your vesting commencement date. Vesting commencement dates are on the 14th of the third month of each quarter. The remainder will vest in equal amounts over the next 14 quarters, provided you remain employed with the Company. The RSU grant will be subject to the terms and conditions of the Company’s
4

DEREKWHITESIGNEDOFFER_004.JPG
standard form of award agreement that is applicable to RSUs granted under the stock plan then in effect (“Stock Plan”) as described therein and in the applicable RSU agreement, which you will be required to sign. Your grant will include language stating that 100% of the then unvested RSUs will vest and become exercisable upon the occurrence of a Change of Control, as defined in the Company’s applicable Stock Plan and such other terms as stated in the grant agreement. In the event that you voluntarily resign or your employment is terminated for Cause as defined in the applicable Stock Plan within 12 months of your start date, you agree to repay the Company 50% of the value of your then-vested RSUs at the value of the date of grant, which must be repaid to the Company on or before your last day of employment.
Additionally, subject to the approval of the Board of Directors, you will be granted 750,000 performance stock units under the 2021 SoFi Technologies Stock Plan, which will be subject to the terms and conditions of that Plan.
Benefits. As a regular employee of the Company, you will be eligible to participate in a number of Company-sponsored benefits, which are described in the employee benefit summary that will be sent to you under separate cover.
Confidential Information and Invention Assignment Agreement. Like all Company employees, you will be required, as a condition of your employment with the Company, to sign the Company’s enclosed standard Confidential Information and Invention Assignment Agreement.
Employment Relationship. Your employment with the Company will be “at will,” meaning that either you or the Company may terminate your employment at any time and for any reason, with or without cause. Although your job duties, title, compensation and benefits, as well as the Company’s personnel policies and procedures, may change from time to time, the “at will” nature of your employment may only be changed in an express written agreement signed by the Company’s Chief Executive Officer.
Outside Activities. While you render services to the Company, you agree that you will not engage in any other employment, consulting or other business activity without the written consent of the Company. In addition, while you render services to the company, you will not assist any person or entity in competing with the Company, in preparing to compete with the Company or in hiring any employees or consultants of the Company. The outside activities outlined in Exhibit A to the confidential information and invention assignment agreement are attached.
Withholding Taxes. All forms of compensation referred to in this letter are subject to applicable withholding and payroll taxes.
Pre-Employment Check. We are extending this offer contingent upon our satisfaction with the results of a reference check and career, educational and criminal history background checks,
5

DEREKWHITESIGNEDOFFER_004.JPG
depending on your position and location. Please note that due to COVID-19, we may be unable to complete those checks prior to your anticipated start date. We will complete those checks as soon as we are able to, but your future employment with Galileo remains contingent upon our satisfaction with the results of those checks.
Entire Agreement. This letter supersedes and replaces any prior understandings or agreements, whether oral, written or implied, between you and the Company regarding the matters described in this letter.
If you wish to accept this offer, please sign and date both this letter and the enclosed Confidential Information and Invention Assignment Agreement. As required, by law, your employment with the Company is also contingent upon your providing legal proof of your identity and authorization to work in the United States. This offer, if not accepted, will expire at the close of business on May 21st, 2021.
We look forward to having you join us, with an anticipated start date of May 31st, 2021.
Very truly yours,
Galileo Financial Technologies, LLC.
By: /s/ Anna Avalos
Anna Avalos
Head of People
ACCEPTED AND AGREED:
Derek White
/s/ Derek White
(Signature)
May 17, 2021
Date
6

DEREKWHITESIGNEDOFFER_004.JPG
Attachment A: Sign-On Bonus Agreement
As stated in your offer letter, Galileo Financial Technologies, LLC. has agreed to pay you a sign-on bonus in the amount of $2,000,000 in anticipation of your working at the Company for at least two years, which is not earned until the second anniversary of your employment. If you voluntarily terminate your employment within 24 months of your start date or are terminated for Cause (which is defined as (i) a willful failure to perform your duties and responsibilities to the Company or your violation of any written Company policy; (ii) your commission of any act of fraud, embezzlement, dishonesty or any other willful misconduct that has caused or is reasonably expected to result in injury to the Company; (iii) your unauthorized use or disclosure of any proprietary information or trade secrets of the Company or any other party to whom you owe an obligation of nondisclosure as a result of your relationship with the Company; or (iv) a material breach of any of your obligations under any written agreement or covenant with the Company), you agree to repay the Company 100% of the amount of the sign-on advance that you received, which must be repaid to the Company on or before your last day of employment.
I acknowledge that I have read and understand this Agreement, and agree to its terms.
ACCEPTED AND AGREED:
Derek White
/s/ Derek White
(Signature)
May 17, 2021
Date
7


DEREKWHITESIGNEDOFFER_005.JPG

Exhibit 23.1
INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM’S CONSENT
We consent to the inclusion in this Registration Statement of SoFi Technologies, Inc. (f/k/a Social Capital Hedosophia Holdings, Corp V) (the “Company”) on Form S-1 of our report dated March 17, 2021, except for the effects of the restatement discussed in Notes 2 and 10 as to which the date is April 22, 2021, which includes an explanatory paragraph as to the Company’s ability to continue as a going concern, with respect to our audits of the consolidated financial statements of Social Capital Hedosophia Holdings Corp. V as of December 31, 2020 and for the period from July 10, 2020 (inception) through December 31, 2020, which report appears in the Prospectus, which is part of this Registration Statement. We were dismissed as auditors on June 1, 2021 and, accordingly, we have not performed any audit or review procedures with respect to any financial statements appearing in such Prospectus for the periods after the date of our dismissal. We also consent to the reference to our Firm under the heading “Experts” in such Prospectus.
/s/ Marcum LLP
Marcum LLP
New York, NY
June 14, 2021

Exhibit 23.2
CONSENT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
We consent to the use in this Registration Statement on Form S-1 of our report dated March 17, 2021, relating to the financial statements of Social Finance, Inc. We also consent to the reference to us under the heading "Experts" in such Registration Statement.
/s/ Deloitte & Touche LLP
San Francisco, California
June 14, 2021