Following the combination, the resulting company (the “Combined Entity”) is expected to be named ‘Mogo Inc.’.

Under the terms of the Arrangement Agreement, each common share of Mogo (a “Mogo Share”) will be exchanged for one (the “Exchange Ratio”) Difference common share (a “Difference Share”). Upon completion of the Transaction, former Mogo shareholders will own approximately 80% of the Combined Entity on a fully diluted basis. Following completion of the Transaction, all of Mogo’s outstanding convertible securities will become exercisable or convertible, as the case may be, for shares of the Combined Entity in accordance with the Exchange Ratio.

The Transaction is subject to Mogo shareholder approval, regulatory approval and satisfaction of other customary conditions. The Transaction is expected to close in the second quarter of 2019.
Transaction Highlights

Following the combination, the Combined Entity is expected to be named ‘Mogo Inc.’. Mogo shareholders will own approximately 80% of the Combined Entity and Dave Feller will be Chairman and CEO and Greg Feller will be President, CFO and Director of the Combined Entity.
The Combined Entity will continue to execute on Mogo’s vision of building the leading fintech platform in Canada. The combination will give Mogo immediate access to approximately $9 - $10 million in cash, which reflects proceeds from Difference’s two recently announced monetizations. In addition, Mogo will have control of Difference’s portfolio of investments in some of the premier private technology companies in Canada, including Hootsuite and Vision Critical, which collectively have an estimated fair market value of approximately $24 million.
The Transaction has received the unanimous recommendation of both Mogo’s and Difference’s special committees and respective boards of directors, with voting and support agreements representing approximately 21.8% of outstanding Mogo Shares and approximately 49.8% of outstanding Difference Shares executed in support of the Transaction.

"This transaction enables Mogo to continue to invest in new products and innovation, building on our leadership position in the Canadian fintech space,” said David Feller, Mogo’s Founder and CEO. “We are excited by the opportunity that the Transaction presents for shareholders of Mogo and Difference and are very pleased to have the support of the Difference board. We look forward to working closely with the leadership team at Difference to complete the Transaction.”

“The merger with Difference strengthens our financial position and represents a significant opportunity to create value for shareholders of the combined entity,” added Greg Feller, Mogo’s President. “Difference has invested in many of Canada’s leading technology companies and Mogo has built a valuable distribution platform. Shareholders of both companies will benefit from improved financial flexibility as we execute on our strategy of partnering to bring best-in-class products to our more than 800,000 members.”
Transaction Summary

The proposed transaction will be completed pursuant to a plan of arrangement under the Business Corporations Act (British Columbia) and, in addition to other customary closing conditions, is subject to regulatory and court approvals. The Transaction will need to be approved by: (i) two-thirds of the votes cast by Mogo shareholders at its shareholder meeting; and (ii) if required, a simple majority of the votes cast by Mogo shareholders at its shareholder meeting, excluding the votes held by certain persons as required by Multilateral Instrument 61-101. The directors and certain shareholders of Mogo, representing approximately 21.8% of Mogo’s outstanding shares, have entered into support agreements pursuant to which they agreed to vote their Mogo Shares in favor of the Transaction.

The annual general and special meeting of Mogo is expected to be held in June 2019. An information circular detailing the terms and conditions of the Transaction will be filed with regulatory authorities and mailed to the shareholders of Mogo in accordance with applicable securities laws. The Arrangement Agreement includes customary deal-protection provisions, including non-solicitation of alternative transactions and break fees payable by Mogo and Difference, respectively, under certain circumstances.

Mogo’s Board of Directors and Special Committee have determined that the proposed transaction is in the best interest of the shareholders, having taken into account advice from their financial advisors, and have unanimously approved the Transaction. Mogo’s Board of Directors recommends that their shareholders vote in favor of the proposed transaction.
Advisors and Counsel

Mogo’s financial advisor is Raymond James Ltd. and its legal counsel in Canada is Stikeman Elliott LLP. Raymond James Ltd. provided an opinion to Mogo’s Board of Directors that, as of the date thereof and subject to the assumptions, limitations and qualifications set out therein, the transaction is fair, from a financial point of view, to the shareholders of Mogo.