EXHIBIT 10.1

GOVERNANCE AND INVESTOR RIGHTS AGREEMENT
This governance and investor rights agreement is made as of this 1st day of
February, 2018.
BETWEEN:
INVESQUE INC., a corporation incorporated under the laws of the Province of
British Columbia
(the “Corporation”);
- and -
TIPTREE OPERATING COMPANY, LLC, a limited liability company formed under the
laws of the State of Delaware.
(the “Investor”).
WHEREAS:
A.
The Parties are party to the Purchase Agreement (as such term is defined
herein).

B.
Upon completion of the Transaction (as such term is defined herein), the
Investor will own 16,647,236 Common Shares (as such term is defined herein),
which represent approximately 33.9% of the issued and outstanding Common Shares
as of the date hereof.

C.
The Corporation and the Investor desire to undertake the actions and agreements
contained herein.

NOW THEREFORE in consideration of the mutual covenants and agreements contained
in this Agreement and other good and valuable consideration (the receipt and
sufficiency of which are hereby acknowledged), the Parties agree as follows:
Article 1
INTERPRETATION AND GENERAL MATTERS
1.1
Definitions

In this Agreement, including the recitals, unless otherwise stated, capitalized
terms used will have the meanings specified below:
“Affiliate” means, with respect to any Person, a Person that, directly or
indirectly, through one or more intermediaries, controls, is controlled by, or
is under common control with the specified Person; provided, however, (i) the
Investor shall not be considered an Affiliate of the Corporation or the
Partnership, and (ii) the Corporation and the Partnership shall not be
considered an Affiliate of the Investor. For the purposes of this definition,
“control” (including, with correlative meanings, the terms “controlled by” and
“under common control with”), as used with respect to any Person, shall mean the
possession, directly or indirectly, of the power to direct or cause the
direction of the

 

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management or policies of such Person, whether through the ownership of voting
securities, by agreement or otherwise;
“Agreement” means this document, together with any schedules attached hereto and
made a part hereof, all as amended, supplemented or modified from time to time
in accordance with the provisions hereof;
“Board” means the board of directors of the Corporation;
“Bought Deal” means a fully underwritten offering on a bought deal basis
pursuant to which an underwriter has committed to purchase securities of the
Corporation pursuant to a “bought deal” letter or a Distribution pursuant to an
overnight marketed offering;
“Business Day” means any day that is not a Saturday, Sunday or legal holiday in
the Province of Ontario or the State of New York;
“Canadian Securities Regulatory Authorities” means, collectively, the securities
regulatory authority in each of the provinces and territories of Canada;
“Closing Date” has the meaning ascribed thereto in the Purchase Agreement;
“Common Shares” means the common shares in the capital of the Corporation;
“Consideration Shares” means the Common Shares comprising the Share
Consideration and any other Common Shares issued to the Investor pursuant to the
Purchase Agreement;
“Control Transaction” has the meaning given to it in Section 3.3(b);
“Demand Notice” has the meaning given to it in Section 4.1;
“Demand Registration” has the meaning given to it in Section 4.1;
“Distribution” means an offer or sale or other disposition or distribution of
Shares to the public by way of a Prospectus under Securities Laws;
“Distribution Expenses” means, without duplication, any and all fees and
expenses incurred in connection with or incidental to the Corporation's
performance of, or compliance with, the terms of a Demand Registration or a
Piggy-Back Registration hereunder, including without limitation: (i) securities
regulators' and stock exchange registration listing and filing fees, (ii) fees
and expenses of compliance with Securities Laws, (iii) printing, copying,
translation and delivery expenses, (iv) expenses incurred in connection with any
“road show” or other marketing activities, (v) fees, expenses and disbursements
of legal counsel to the Corporation, (vi) fees, expenses and disbursements of
legal counsel to the Investor, (vii) fees, expenses and disbursements of legal
counsel retained by the Corporation in connection with a Demand Registration or
a Piggy-Back Registration, other than any such fees and expenses of legal
counsel to the Corporation or the Investor that are otherwise addressed by item
(v) or item (vi) above, (viii) fees, expenses and disbursements of the
Corporation's auditors and any other special experts retained by the Corporation
in connection with or incidental to such Demand Registration or Piggy-Back
Registration, (ix) all

 

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transfer agents', depositaries' and registrars' fees, and (x) any other fees,
expenses and/or commissions payable to an underwriter, investment banker,
manager or agent, other than Selling Expenses of the Corporation or Selling
Expenses of the Investor, as applicable, customarily paid by issuers or sellers
of securities;
“Governmental Authority” means any: (a) multinational, federal, state,
provincial, municipal, local or other governmental or public department, central
bank, court, commission, board, bureau, agency or instrumentality, domestic or
foreign; (b) any subdivision or authority of any of the foregoing; (c) any
quasi-governmental, self-regulatory organization or private body exercising any
regulatory, expropriation or taxing authority under or for the account of its
members or any of the above, including any stock exchange; or (d) any arbitrator
exercising jurisdiction over the affairs of the applicable Person, asset,
obligation or other matter;
“Hold Restrictions” has the meaning given to it in Section 3.3(a);
“including” or any variation thereof means including, without limitation, and
the words following “include”, “includes” or “including” shall not be considered
to set forth an exhaustive list;
“Investor Designee” has the meaning given to it in Section 2.1(a);
“Laws” means any and all laws, including all federal, provincial, state and
local statutes, codes, ordinances, guidelines, decrees, rules, regulations and
municipal by-laws and all judicial, arbitral, administrative, ministerial,
departmental or regulatory judgments, orders, directives, decisions, rulings or
awards or other requirements of any other Governmental Authority, binding on or
affecting the Person referred to in the context in which the term is used;
“Observer” has the meaning given to it in Section 2.1(e);
“Parties” means the Corporation, the Investor and their respective successors
and permitted assigns, and “Party” means any one of them;
“Partnership” means Invesque Holdings, LP;
“Person” means an individual, partnership, corporation, limited liability
company, joint venture, association, trust, unincorporated organization or other
entity, or a government or agency or political subdivision thereof;
“Prospectus” means a “preliminary prospectus” and/or a “prospectus” as those
terms are used in applicable Securities Laws, including all amendments and
supplements thereto, prepared and filed in the English language and, if
required, in the French language;
“Purchase Agreement” means the purchase agreement dated as of November 16, 2017
by and among the Corporation, the Partnership and the Investor;
“Securities Act” means the Securities Act (Ontario) or the U.S. Securities Act
of 1933, as amended, as applicable;

 

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“Securities Laws” includes the Securities Act and any other similar legislation
in any other province or territory of Canada or in the United States in which
the Corporation is or becomes a reporting issuer (or the equivalent thereof) and
the respective rules, regulations, instruments and published policies, policy
statements and notices thereunder, and the rules and regulations of the TSX;
“Selling Expenses of the Corporation” means any and all underwriting discounts,
fees and commissions attributable to the Common Shares to be sold by the
Corporation in a Demand Registration or Piggy-Back Registration;
“Selling Expenses of the Investor” means any and all underwriting discounts,
fees and commissions attributable to the Common Shares to be sold by the
Investor in a Demand Registration or a Piggy-Back Registration;
“Share Consideration” has the meaning given to it in the Purchase Agreement;
“Standstill Period” has the meaning given to it in Section 3.1.
“Transaction” means the transactions contemplated by the Purchase Agreement,
including for greater certainty the issuance by the Corporation of the Share
Consideration to the Investor as consideration for the Investor’s sale of the
Purchased Interests (as defined in the Purchase Agreement) to the Partnership;
“Transfer” has the meaning given to it in Section 3.3(a); and
“TSX” means the Toronto Stock Exchange.
1.2
References and Headings

The references “hereunder”, “herein” and “hereof” refer to the provisions of
this Agreement, and references to Articles and Sections herein refer to
articles, sections, or subsections of this Agreement. The headings of the
Articles and Sections and any other headings, captions or indices herein are
inserted for convenience of reference only and shall not be used in any way in
construing or interpreting any provision hereof.
1.3
Singular/Plural; Derivatives

Whenever the singular or masculine or neuter is used in this Agreement, it shall
be interpreted as meaning the plural or feminine or body politic or corporate,
and vice versa, as the context requires. Where a term is defined herein, a
capitalized derivative of such term shall have a corresponding meaning unless
the context otherwise requires.
1.4
Statutory References

Unless stated otherwise, any reference to a statute shall include and shall be
deemed to be a reference to such statute and to the regulations made pursuant
thereto, and all amendments made thereto and enforced from time to time, and to
any statute or regulation that may be passed which has the effect of
supplementing the statute so referred to or the regulations made pursuant
thereto.

 

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1.5
Business Days

Whenever any action to be taken pursuant to this Agreement would otherwise be
required to be taken or made on a day that is not a Business Day, such action
shall be taken on the first Business Day following such day.
1.6
Calculation of Equity Interests/Share Ownership

References to shareholding percentages of the Investor in the Corporation in
this Agreement shall, unless specifically indicated otherwise herein, be
calculated based upon the number of shares held by the Investor and its
Affiliates as a percentage of the total number of issued and outstanding Common
Shares (on a non-diluted basis) of the Corporation at the relevant time. The
Corporation shall be entitled to rely on the public filings of the Investor with
respect to the number of Common Shares held by the Investor unless and until
such time as the Investor provides evidence satisfactory to the Corporation,
acting reasonably, as to the number of Common Shares held by the Investor. Upon
reasonable request of the Corporation from time to time, the Investor shall
provide evidence as to the number of Common Shares held by it. The Investor
shall promptly notify the Company in writing from time to time if, to its
knowledge, it ceases to beneficially own at least 15% or 10%, as applicable, of
the outstanding Common Shares. The Investor shall be entitled to rely on the
public filings of the Corporation with respect to the number of Common Shares
outstanding unless and until such time as the Corporation provides evidence
satisfactory to the Investor, acting reasonably, as to the number of Common
Shares outstanding as of a particular time.

Article 2    
CORPORATE GOVERNANCE
2.1
Board Representation and Observer Rights

(a)
Concurrently with the completion of the Transaction, the Corporation shall cause
one (1) individual designated by the Investor to be appointed to the Board (the
“Investor Designee”).

(b)
From and after the Closing Date, for so long as the Investor holds at least 15%
of the Corporation’s outstanding Common Shares, the Corporation will nominate
for election to the Board, and solicit proxies in favour of, the Investor
Designee (who need not be the same individual as the Investor Designee appointed
to the Board pursuant to Section 2.1(a)) at the next annual general or special
meeting of the Corporation’s shareholders at which directors of the Corporation
are elected and at each annual general or special meeting of the Corporation’s
shareholders at which directors of the Corporation are elected, thereafter.

(c)
The Corporation shall provide reasonable notice (not less than 40 days prior to
the date of the meeting) to the Investor of any upcoming shareholders’ meetings
at which directors will be nominated for election and shall request that the
Investor designate the Investor Designee to be elected as a director at such
meeting. If the Investor fails to provide notice to the Corporation of the
Investor Designee to be nominated for

 

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election within 10 days following the request for such designation by the
Corporation, then the incumbent Investor Designee designated by the Investor
shall be deemed to be the person designated by the Investor for the purposes of
the applicable shareholders’ meeting.
(d)
The Investor may from time to time designate a successor for any Investor
Designee appointed or elected as a director on the Board in accordance with this
Section 2.1 from time to time, in the event such director ceases to be a
director between shareholders’ meetings for any reason. In such event, the
Corporation will cause the appointment of such successor director to fill the
vacancy in the Board caused by such appointee or elected director ceasing to be
a director of the Corporation.

(e)
From and after the Closing Date, for so long as the Investor holds at least 15%
of the Corporation’s outstanding Common Shares, the Investor may at its
discretion also designate one (1) individual to attend all meetings of the Board
in a non-voting observer capacity (the “Observer”) and, in this respect, the
Corporation shall give such individual copies of all notices, minutes, consents
and other materials that it provides to the members of the Board at the same
time and in the same manner as provided to the members of the Board; provided,
however, that such individual shall, as a condition to his or her appointment,
be required to enter into an undertaking or agreement of confidentiality
satisfactory to the Corporation, acting reasonably, binding such individual to
the same obligations of confidentiality as the members of the Board. The
Investor may designate a different individual to act as the Observer at its sole
discretion.

(f)
As a condition to being nominated as a director or designated as an Observer to
the Board, any person so nominated or designated under Sections 2.1(a), 2.1(b),
2.1(d) or 2.1(e) shall be independent (as determined in accordance with sections
1.3 and 1.4 of National Instrument 52-110 Audit Committees), shall not be
disqualified from so serving under any applicable Law or stock exchange
requirement and, in the case of an Investor Designee, shall have consented in
writing to serve as a director of the Corporation.

(g)
Neither the Investor Designee nor the Observer shall be entitled to receive any
board fees or other compensation from the Corporation for services rendered in
that Person’s capacity as a director of the Corporation or Observer.
Notwithstanding the foregoing, the Corporation shall reimburse each Investor
Designee and Observer that serves as a director for the reasonable and
documented out-of-pocket expenses that he or she may incur in connection with
the business of the Corporation.

(h)
For certainty, if the Investor ceases to own at least 15% of the outstanding
Common Shares, its right to nominate an Investor Designee and an Observer shall
immediately terminate.

Article 3    
STANDSTILL, VOTING AND TRANSFER RESTRICTIONS

 

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3.1
Standstill

For a period of two (2) years following the Closing Date (the “Standstill
Period”), the Investor shall not, and shall cause its Affiliates (including
Tiptree Inc.) not to directly or indirectly, or jointly or in concert with any
other person:
(a)
acquire or agree to acquire or make any proposal to acquire or engage in any
discussions or negotiations to acquire, directly or indirectly, alone or
together with joint actors, by means of purchase, merger, consolidation,
take-over bid, business combination or in any other manner, any ownership
interest in, or any securities or assets of, the Corporation;

(b)
solicit proxies from holders of Common Shares, requisition a meeting of
shareholders of the Corporation, or otherwise attempt to influence the conduct
of the Corporation’s shareholders or the voting of any of the Corporation’s
securities,

(c)
advise or encourage any person proposing any of the foregoing. or

(d)
make any public announcement or take any action in furtherance of the foregoing,

in each case without the prior approval of the majority of the directors of the
Board.
3.2
Voting

For a period of two (2) years following the Closing Date, and provided that the
current Chief Executive Officer of the Corporation as of the Closing Date is the
then Chief Executive Officer of the Corporation, the Investor shall not vote
against (or withhold from voting in respect of) and shall not take any actions
which have the effect of voting against (including voting in favour of nominees
to the Board of Directors that were not nominated by the Board of Directors or
management of the Corporation) or withholding from voting in respect of, and
will cause its Affiliates (including Tiptree Inc.) not to vote against (or
withhold from voting in respect of) and not to take any actions which have the
effect of voting against (including voting in favour of nominees to the Board of
Directors that were not nominated by the Board of Directors or management of the
Corporation) or withholding from voting in respect of the resolutions that the
Board of Directors or management recommend for approval by shareholders in
respect of Board nominees and the auditor of the Corporation; provided that, in
the case of voting in respect of the appointment of the auditor, such auditor is
one of KPMG LLP, Ernst & Young LLP, Deloitte LLP or PricewaterhouseCoopers LLP.
Notwithstanding the foregoing, the Investor or its Affiliates (including Tiptree
Inc.) may vote against the Board of Directors recommendation (or withhold from
voting in respect thereof) if the Investor or its Affiliates (including Tiptree
Inc.) determines that the failure to vote against the Board of Directors
recommendation (or withhold from voting in respect thereof) would reasonably be
likely to be inconsistent with its fiduciary duties under applicable law.

 

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3.3
Restrictions on Transfer

(a)
Following the Closing Date, except as specifically required pursuant to the
Purchase Agreement or as permitted in Section 3.3(c) or 3.3(e), the Investor
agrees that the Consideration Shares and the beneficial ownership of or any
interest in them and in any certificate evidencing them shall not, in any
manner, directly or indirectly, be sold, assigned, transferred, hypothecated,
pledged or otherwise encumbered, alienated, monetized (including entering into
any agreement, arrangement or understanding that would require reporting under
Multilateral Instrument 55-103 – Insider Reporting for Certain Derivative
Transactions (Equity Monetization)), or otherwise dealt with in any manner which
has the economic effect of any of the foregoing acts, on a current or
prospective basis (all of the foregoing, being a “Transfer”). The foregoing
restrictions are referred to herein as the “Hold Restrictions”).

(b)
Notwithstanding the foregoing, the Investor shall be permitted to tender any of
the Consideration Shares to a Person making a formal take-over bid for all
outstanding securities of the Corporation, a purchase of all or substantially
all of the assets of the Purchaser, plan of arrangement, merger or similar
material transaction which results in those shareholders that control the
Purchaser prior to the Transaction not controlling the Purchaser following the
Transaction (each a “Control Transaction”); provided that if the Control
Transaction is not completed for any reason, such Consideration Shares shall
continue to be subject Section 3.3(a); or

(c)
From and after the date that is:

(i)
six (6) months following the Closing Date, the Hold Restrictions shall not apply
with respect to 10% of the Consideration Shares;

(ii)
nine (9) months following the Closing Date, the Hold Restrictions shall not
apply with respect to 30% of the Consideration Shares;

(iii)
twelve (12) months following the Closing Date, the Hold Restrictions shall not
apply with respect to 50% of the Consideration Shares;

(iv)
fifteen (15) months following the Closing Date, the Hold Restrictions shall not
apply with respect to 75% of the Consideration Shares; and

(v)
eighteen (18) months following the Closing Date, the Hold Restrictions shall not
apply with respect 100% of the Consideration Shares.

 

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(d)
During the Standstill Period, the Investor shall not without the prior consent
of the Board Transfer any Common Shares to any Person who, together with its
Affiliates and joint actors, owns or exercises control or direction over (or
would own or exercise control or direction over as a consequence of such
Transfer) 10% or more of the Common Shares of the Corporation unless, prior to
such Transfer, the transferee (and, if applicable, its Affiliates and joint
actors) enters into a standstill agreement in favour of the Corporation, on
substantially the same terms as contained in Section 3.1 and for the same
duration as set forth in Section 3.3(c).

(e)
Notwithstanding the foregoing, the Investor shall be permitted to Transfer the
Consideration Shares or the beneficial ownership of or any interest in the
Consideration Shares or in any certificate evidencing the Consideration Shares
to any controlled Affiliate of the Investor, provided that the Affiliate agrees
with the Corporation in writing prior to the Transfer to be bound by the terms
of this agreement.

Article 4    
REGISTRATION RIGHTS
4.1
Demand Registration Rights

(a)
The Investor may request the Corporation to file a Prospectus under Securities
Laws and take such other steps as may be necessary to facilitate a Distribution
of all or part of the Consideration Shares held by the Investor and its
Affiliates (a “Demand Registration”) that are not on the date of the Demand
Notice subject to the Hold Restrictions pursuant to Section 3.3, by giving
written notice of such Demand Registration to the Corporation (the “Demand
Notice”). Subject to the limitations of this Article 4, the Corporation shall
use its commercially reasonable efforts to prepare, file and obtain a receipt
under Securities Laws for a final Prospectus to effect the qualification of all
Consideration Shares that the Investor desires to be qualified, as specified in
the Demand Notice, in order to permit the Distribution of such Consideration
Shares. The Corporation and the Investor shall cooperate in a timely manner in
connection with any such Demand Registration and in accordance with the
procedures set forth in Schedule A hereto in connection with each such
Distribution.

(b)
The Corporation will not file any Prospectus (other than the Prospectus filed in
connection with the Demand Notice), whether for its own account or that of
another security holder, from the date of a Demand Notice until the completion
of the distribution period under applicable Securities Laws contemplated by the
applicable Demand Registration (unless the Investor withdraws its request for
qualification of the Distribution of its Consideration Shares pursuant to such
Demand Registration pursuant to the terms hereof).

(c)
The Corporation shall not be obliged to:

(i)
effect more than two (2) Demand Registrations within any 12 month period;

 

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(ii)
effect more than five (5) Demand Registrations in the aggregate;

(iii)
effect a Demand Registration within 120 days of any receipt for a final
prospectus filed in respect of a previous Distribution;

(iv)
effect a Demand Registration other than in a province or territory of Canada;

(v)
effect a Demand Registration in the event the Board of Directors of the
Corporation determines in its good faith judgment within five (5) Business Days
of a Demand Notice that either (A) the effect of the filing of a Prospectus
would reasonably materially and adversely impede the ability of the Corporation
to consummate a financing, acquisition, corporate reorganization, merger or
other material transaction involving the Corporation; or (B) there exists, at
the time of receipt of the Demand Notice, material non-public information
relating to the Corporation, the disclosure of which the Corporation reasonably
believes would be detrimental to the Corporation and the Corporation has a bona
fide business purpose for preserving such information as confidential, and, in
either case, the Corporation's obligations under this Section 4.1 will be
deferred until the earlier of (x) the date on which the applicable condition
described in (A) or (B) no longer exist, and (y) the date that is 90 days from
the date of receipt of the Demand Notice; provided that such right of deferral
may not be exercised more than twice in any 12-month period. The Corporation
shall give prompt notice to the Investor of the existence and nature of any
deferral event, and the Investor hereby agrees to maintain the confidentiality
of such information and the Corporation shall advise the Investor forthwith
after such condition in (A) or (B) ceases to exist; or

(vi)
effect a Demand Registration unless the Distribution would reasonably be
expected to result in aggregate gross proceeds of at least $30 million to the
Investor.

(d)
A Demand Notice shall:

(i)
specify the approximate number of Consideration Shares that the Investor intends
to offer and sell;

(ii)
specify the number of Common Shares then held by the Investor;

(iii)
the number of Consideration Shares that are not on the date of the Demand Notice
subject to the Hold Restrictions;

(iv)
express the intention of the Investor to offer or cause the offering of such
Consideration Shares;

(v)
describe the nature or methods of the proposed offer and sale thereof and the
provinces and territories of Canada in which such offer shall be made;

 

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(vi)
contain the undertaking of the Investor to provide all such information
regarding its Consideration Shares and the proposed manner of distribution
thereof as may be required in order to permit the Corporation to comply with all
Securities Laws; and

(vii)
specify whether such offer and sale shall be made by an underwritten offering.

(e)
If the Investor intends to dispose of Consideration Shares covered by the Demand
Notice by means of an underwritten offering, the Investor shall have the right
to select the managing underwriter or underwriters to effect the Distribution
contemplated by such Demand Registration; provided, however, that such selection
shall also be satisfactory to the Corporation, acting reasonably, and if
required, the Corporation and the Investor shall enter into an underwriting
agreement in customary form with the managing underwriter or underwriters
satisfactory in substance and form to each of the Corporation and the Investor.
The Corporation shall have the right to retain counsel of its choice to assist
it in fulfilling its obligations under this Article 4. The Investor shall have
the right to retain counsel of its choice to assist it in fulfilling its
obligations under this Article 4.

(f)
Notwithstanding anything to the contrary contained herein, a Demand Registration
will not be considered as having been effected until a receipt has been issued
for a final prospectus by the Canadian Securities Regulatory Authorities or a
prospectus supplement to a base shelf prospectus has been filed with the
Canadian Securities Regulatory Authorities in accordance with National
Instrument 44-102 – Shelf Distributions, in each case, pursuant to which the
Consideration Shares requested by the Investor to be qualified are to be sold;
and provided further that at any time prior to the issuance of such a receipt or
filing of such a prospectus supplement, the Investor may withdraw its request
for Demand Registration by advising the Company in writing that it has
determined to withdraw such request, in which case (i) such Demand Registration
and the request therefor will be deemed to be withdrawn, and (ii) such request
will be deemed not to have been given for purposes of determining whether the
Investor has exercised its right to a Demand Registration, provided that this
provision shall only apply to one such withdrawal in a calendar year and,
thereafter, subsequent withdrawals in such calendar year will count as an
exercise of the Demand Registration right.

(g)
If at any time the Investor requests a Demand Registration, the Corporation
shall have the right, exercisable within five (5) Business Days (except in the
case of a Bought Deal, in which case the Corporation shall have one (1) Business
Day) of receipt of such request, to notify the Investor of its intention to
qualify or register for distribution to the public under such Distribution an
offering of Common Shares from treasury. The Investor shall use all commercially
reasonable efforts to include in the proposed distribution such number of Common
Shares as the Corporation shall request, upon the same terms (including the
method of distribution) as such Demand Registration; provided that the Investor
shall not be required to include any such Common Shares in any such Demand
Registration if the managing underwriter or underwriters advise the Investor
that, in its good faith opinion, the inclusion of

 

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such securities should be limited (i) due to market conditions, or (ii) because
the number of Common Shares proposed to be distributed may materially and
adversely affect the successful marketing of the distribution (including the
price range acceptable to the Investor), then the Common Shares to be
underwritten shall be allocated in the following priority: (i) first, the Common
Shares to be qualified by the Investor for its own account, and (ii) second, if
there are any additional Common Shares that may be underwritten after allowing
for the inclusion of all of the Common Shares required under (i) above, the
Common Shares requested to be qualified by the Corporation.
4.2
Piggy-Back Registration Rights

(a)
If the Corporation proposes to make a Distribution for its own account the
Corporation will promptly and not less than 10 days prior to the filing of the
related preliminary prospectus (except in the case of a Bought Deal, in which
case not less than one (1) Business Day prior to the signing of the “bought deal
letter” to be entered into in connection therewith), give the Investor written
notice (the “Piggy-Back Notice”) of the proposed Distribution. Upon the written
request of the Investor to the Corporation, given within five (5) Business Days
(except in the case of a Bought Deal, in which case the Investor shall have one
(1) Business Day) after receipt of the Piggy-Back Notice, that the Investor
wishes to include a specified number of the Consideration Shares in the
Distribution, and provided no such Consideration Shares that the Investor wishes
to include are on the date of the Piggy-Back Notice subject to the Hold
Restrictions pursuant to Section 3.3, the Corporation will use commercially
reasonable efforts to, in conjunction with the proposed Distribution, cause the
Consideration Shares requested to be qualified by the Investor to be included in
the Distribution in accordance with the procedures set forth in Schedule A
hereto (a “Piggy-Back Registration”). Notwithstanding the foregoing, if the
managing underwriter or underwriters advise the Corporation that, in its good
faith opinion, the inclusion of such securities should be limited (i) due to
market conditions, or (ii) because the number of Common Shares proposed to be
distributed may materially and adversely affect the successful marketing of the
distribution (including the price range acceptable to the Corporation), then the
Common Shares to be underwritten shall be allocated in the following priority:
(i) first, the Common Shares to be qualified by the Corporation for its own
account, and (ii) second, if there are any additional Shares that may be
underwritten after allowing for the inclusion of all of the Shares required
under (i) above, the Consideration Shares requested to be qualified by the
Investor. It shall be a condition to the Investor’s right to effect a Piggy-Back
Registration that the Investor shall enter into an underwriting agreement in
customary form with the underwriters and provide such other instruments or other
documentation as the underwriters may request.

(b)
The Corporation may at any time, and without the consent of the Investor,
abandon the proposed offering in which the Investor has requested to
participate;

(c)
The Investor shall have the right to withdraw its request for inclusion of its
Consideration Shares in any Distribution pursuant to this Section 4.2 without

 

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incurring any liability to the Corporation or any other Person by giving written
notice to the Corporation of its request to withdraw; provided, however, that:
(i)
such request must be made in writing five (5) Business Days prior to the
execution of the underwriting agreement (or such other similar agreement) with
respect to such offering; and

(ii)
such withdrawal will be irrevocable and, after making such withdrawal, the
Investor will no longer have any right to include its Consideration Shares in
the offering pertaining to which such withdrawal was made.

4.3
Expenses

(a)
In the case of a Demand Registration, all Distribution Expenses shall be paid by
the Corporation.

(b)
In the case of a Piggy-Back Registration, all Distribution Expenses shall be
paid by the Corporation.

(c)
The Investor will pay all Selling Expenses of the Investor, in proportion to the
gross proceeds received by the Investor from any Demand Registration or
Piggy-Back Registration, and the Corporation will pay all Selling Expenses of
the Corporation, if any, in proportion to the gross proceeds received by the
Corporation from any Demand Registration or Piggy-Back Registration.

4.4
Expiry of Registration Rights

The Demand Registration rights and Piggy-Back Registration rights granted to the
Investor pursuant to this Article 4 shall terminate and be of no further force
or effect at such time as the Investor and any Affiliates collectively no longer
own Common Shares representing at least 10% of the outstanding Common Shares.
4.5
Future Registration Rights

The Corporation shall not grant registration rights to any other Person without
the prior written consent of the Investor unless such registration rights are
not more favourable, on the whole, to the grantee than the registration rights
granted to the Investor pursuant to this Agreement.
4.6
U.S. Registration Rights

In the event that the Corporation converts into, or otherwise transfers
substantially all of its assets to, an entity organized or incorporated in the
United States, and (i) immediately following such conversion or transfer the
Investor and its Affiliates collectively own at least 10% of the outstanding
shares or other equity interests of the converted or recipient U.S. entity and
(ii) the outstanding shares or other equity interests of the converted or
recipient U.S. entity are registered in the United States in accordance with the
U.S. Securities Act of 1933, as amended, the converted or recipient U.S. entity
shall grant U.S. registration rights to the Investor subject to, and in
accordance with, the same rights, terms and conditions as set forth in this
Agreement in order to register the Consideration

 

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Shares then held by the Investor and its Affiliates in the United States in
accordance with the U.S. Securities Act of 1933, as amended.
Article 5    
REPRESENTATIONS
Each Party represents and warrants to the other Party that it has all requisite
corporate power and authority to enter into this Agreement and the execution and
delivery of, and the performance of, and compliance with, the terms of this
Agreement does not and will not result in any breach of, or constitute a default
under, and do not and will not create a state of facts which, after notice or
lapse of time or both, would result in a breach of or constitute a default under
any term or provision of the articles, or resolutions of that Party, any
applicable Laws, mortgage, note, contract, agreement (written or oral),
instrument, lease or other document to which that Party is bound, or any
judgment, decree, order, statute, rule or regulation applicable to that Party.
Article 6    
MISCELLANEOUS PROVISIONS
6.1
Waiver Must be in Writing

No waiver by any Party of any breach (whether actual or anticipated) of any of
the terms, conditions, representations or warranties contained herein shall take
effect or be binding upon that Party unless the waiver is expressed in writing
under the authority of that Party. Any waiver so given shall extend only to the
particular breach so waived and shall not limit or affect any rights with
respect to any other or future breach.
6.2
No Amendment Except in Writing

This Agreement may be amended only by written instrument executed by the
Corporation and the Investor.
6.3
Service of Notice

Notwithstanding anything to the contrary contained herein, any notices,
consents, waivers or other communications required or permitted to be given
under the terms of this Agreement must be in writing and will be deemed to have
been delivered: (i) upon receipt, when delivered personally; (ii) upon delivery,
when sent by facsimile or email (provided that confirmation of transmission is
mechanically or electronically generated and kept on file by the sending party);
or (iii) one (1) Business Day after deposit with an overnight courier service
with next day delivery specified, in each case, properly addressed to the party
to receive the same.
6.4
Addresses for Notice

The address for service of notices hereunder of each of the Parties shall be as
follows:

 

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Corporation:
Invesque Inc.
14390 Clay Terrace Blvd., Suite 205
Carmel, IN 46032
Attention: Scott White
E-mail: swhite@invesque.com

with a copy (which shall not constitute notice) to:
Goodmans LLP
Bay Adelaide Centre

333 Bay Street, Suite 3400

Toronto, ON M5H 2S7

Attention: Jon Northup and Mark Spiro

Fax: (416) 979-1234

E-mail: jnorthup@goodmans.ca / mspiro@goodmans.ca

Investor:
c/o Tiptree Inc.

780 Third Avenue, 21st Floor
New York, NY 10017

Attention: Randy Maultsby

Email: RMaultsby@tiptreeinc.com

with a copy (which shall not constitute notice) to:
Morrison & Foerster LLP
250 West 55th Street
New York, New York 10019
Attention: James R. Tanenbaum
Fax:  (212) 468-7900
E-mail: JTanenbaum@mofo.com

A Party may change its address for service by notice to the other Party, and
such changed address for service thereafter shall be effective for all purposes
of this Agreement.
6.5
Further Assurances

Each Party shall provide such further documents or instruments required by any
other Party as may be reasonably necessary or desirable to effect the purpose of
this Agreement and carry out its provisions.
6.6
Governing Law

This Agreement shall be governed by and construed in accordance with the laws of
the Province of Ontario and the laws of Canada applicable therein. Each of the
Corporation and the Investor hereby submit to the non-exclusive jurisdiction of
the courts of the Province of Ontario.
6.7
Time

 

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Time shall be of the essence in this Agreement.
6.8
Entire Agreement

This Agreement and any agreement or document delivered pursuant to this
Agreement constitute the entire agreement between the Corporation and the
Investor relating to the subject matter hereof and thereof. There are no
collateral or other statements, understandings, covenants, agreements,
representations or warranties, written or oral, relating to the subject matter
hereof. This Agreement supersedes all prior agreements, understandings,
negotiations and discussions, whether oral or written, between the Parties or
their predecessors relating to the subject matter of this Agreement.
6.9
Assignment and Enurement

Neither this Agreement nor any benefits or duties accruing under this Agreement
shall be assignable by any Party other than by the Investor to an Affiliate
without the prior written consent of the Corporation not to be unreasonably
withheld. Subject to the foregoing, this Agreement shall enure to the benefit of
and be binding upon the Parties and their respective successors and permitted
assigns.
6.10
Counterpart Execution

A Party will be entitled to rely on delivery by facsimile or by e-mail in PDF
format of an executed copy of this Agreement by the other Party, including the
completed attachments hereto, and acceptance by the receiving party of such
facsimile or PDF copy will be legally effective to create a valid and binding
agreement between the Corporation and the Investor in accordance with the terms
hereof. This Agreement may be executed in counterparts, each of which shall be
deemed to be an original and all of which shall constitute one and the same
document.
[The remainder of this page is left blank intentionally]

 

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EXHIBIT 10.1

IN WITNESS WHEREOF the Parties have duly executed this Agreement as of the date
first written above.
 
 
INVESQUE INC.
Per:
/s/ Scott White
 
Name:  Scott White
 
Title: Chief Executive Officer

 
 
TIPTREE OPERATING COMPANY, LLC
Per:
/s/ Jonathan Ilany
 
Name:  Jonathan Ilany
 
Title:  Chief Executive Officer

[Signature Page to Governance and Investor Rights Agreement]

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SCHEDULE A
REGISTRATION PROCEDURES
1.1
Registration Procedures

Whenever the Corporation is under an obligation pursuant to the provisions of
this Agreement to effect the qualification of Common Shares in connection with a
Distribution of any Consideration Shares on behalf of the Investor:
(a)
the Corporation shall, as expeditiously as practicable and, in any event, not
later than 45 days after the receipt of a Demand Notice in the case of a
Distribution other than by way of a Bought Deal, prepare and file with the
appropriate Canadian Securities Regulatory Authorities all documents reasonably
necessary, including, if required, a Prospectus or short form Prospectus and any
amendment or supplement thereto, to qualify for Distribution the Consideration
Shares requested to be qualified by the Investor and, in so doing, use
commercially reasonable efforts to settle all deficiencies and obtain those
receipts and clearances and provide those customary undertakings and commitments
as may be reasonably required by any Canadian Securities Regulatory Authority,
all as may be necessary to permit the Distribution of the Consideration Shares
requested to be qualified by the Investor in compliance with all applicable
Securities Laws. Notwithstanding the foregoing, in the event the Distribution is
to be made pursuant to a Bought Deal in accordance with this Agreement, the
Corporation shall attend to such preparations and filings as soon as is
practical in the circumstances taking into account the speed and urgency under
which Bought Deals are conducted;

(b)
prior to the filing of a Prospectus and up to the date of completion of the
Distribution of the Consideration Shares requested to be qualified by the
Investor, the Corporation shall permit the Investor to review and participate in
the preparation of the Prospectus and any related offering materials or filings
and shall allow the Investor and any underwriters or agents involved to conduct
any due diligence investigations reasonably requested, provided, however, that
the Investor shall not have any right to approve the content of the Prospectus
or related offering material (other than content relating to or describing the
Investor or its Affiliates);

(c)
during the period from the date of initiation of the Distribution and up to the
date of completion of the Distribution of the Consideration Shares requested to
be qualified by the Investor, the Corporation shall promptly notify the Investor
in writing of:

(i)
any filing made by the Corporation of information relating to the Distribution
with any Canadian Securities Regulatory Authority and any correspondence with
any Canadian Securities Regulatory Authority regarding the Distribution;

(ii)
any material fact within the meaning of applicable Securities Laws which has
arisen or has been discovered and would have been required to have been

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stated in the Prospectus or any related offering materials or filings had the
fact arisen or been discovered on, or prior to, the date of such document; and
(iii)
any change in any material fact within the meaning of applicable Securities Laws
(which for the purposes of this Agreement shall be deemed to include the
disclosure of any previously undisclosed material fact) contained in the
Prospectus or any related offering materials or filings which fact or change is,
or may be, of such a nature as to render any statement in any such document
misleading or untrue in any material respect or which would result in a
misrepresentation within the meaning of applicable Securities Laws in any such
document, or which would result in any such document not complying with
applicable Securities Laws.

(d)
during the period from the date of initiation of the Distribution to the date of
completion of the Distribution of the Consideration Shares requested to be
qualified by the Investor, the Investor shall promptly notify the Corporation in
writing of:

(i)
any filing made by the Investor of information relating to the Distribution with
any Canadian Securities Regulatory Authority and any correspondence with any
Canadian Securities Regulatory Authority regarding the Distribution;

(ii)
any material fact, within the meaning of applicable Securities Laws, in respect
of the Investor which has arisen or has been discovered and would have been
required to have been stated in the Prospectus or any related offering materials
or filings had the fact arisen or been discovered on, or prior to, the date of
such document; and

(iii)
any change in any material fact, within the meaning of applicable Securities
Laws, (which for the purposes of this Agreement shall be deemed to include the
disclosure of any previously undisclosed material fact), in respect of the
Investor, contained in the Prospectus or any related offering materials or
filings which fact or change is, or may be, of such a nature as to render any
statement in any such document misleading or untrue in any material respect or
which would result in a misrepresentation within the meaning of applicable
Securities Laws in any such document, or which would result in any such document
not complying with applicable Securities Laws.

(e)
promptly, and in any event within any applicable time limitation, the
Corporation shall comply with all applicable filings and other requirements
under applicable Securities Laws as a result of a material change, the discovery
of a material fact or the change in a material fact referred to under Section
1(c) or 1(d) of this Schedule A, provided that the Corporation shall not file
any amendment to the Prospectus or other document without first complying with
its obligations in Section 1(c) of this Schedule A;

 

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(f)
the Corporation shall furnish to the Investor such number of copies of any
preliminary Prospectus, Prospectus and any supplements or amendments thereto,
any documents incorporated by reference in such Prospectus and such other
documents as the Investor may reasonably request in order to facilitate the
Distribution of the Consideration Shares requested to be qualified by the
Investor;

(g)
if an underwritten public offering is contemplated, the Corporation and the
Investor shall execute and perform the obligations under an underwriting
agreement containing customary representations, warranties, covenants and
indemnities for the benefit of the Investor, the Corporation and the
underwriter(s);

(h)
subject to applicable Securities Laws, the Corporation shall keep the Prospectus
effective until the Investor has completed the sale of Common Shares under the
Prospectus, but no longer than 60 days from the date of the final Prospectus,
provided that the Investor uses commercially reasonable efforts to complete such
sale as soon as reasonably practicable;

(i)
the Corporation shall in the event of an underwritten offering, to the extent
reasonably requested by the underwriters, use commercially reasonable efforts to
assist in the marketing of the securities being offered including to ensure the
participation of employees (including at least one senior officer) of the
Corporation in reasonable customary “road shows”.

(j)
the Corporation shall use commercially reasonable efforts to promptly furnish to
the underwriter(s) involved in the Distribution all documents as they may
reasonably request;

(k)
the Corporation shall use its commercially reasonable efforts to list the
Consideration Shares requested to be qualified by the Investor on each
securities exchange or quotation system on which the Common Shares are then-
listed or quoted, if such Common Shares are not already so listed or quoted;

(l)
the Corporation shall use commercially reasonable efforts to prevent the
issuance of any cease trading order suspending the use of any Prospectus and, if
any such order is issued, to promptly obtain the withdrawal of any such order;
and

(m)
the Corporation shall use its commercially reasonable efforts to furnish, at the
request of the Investor, on the date that such Common Shares are delivered to
the underwriters for sale in connection with the Distribution:

(i)
an opinion, dated such date, of the Corporation’s counsel for the purposes of
such Distribution, in form and substance as is customarily given to selling
shareholders in an underwritten public offering, addressed to the Investor and
the underwriters;

(ii)
a letter, dated such date, from the Corporation’s auditors, in form and
substance as is customarily given by auditors to underwriters in an

 

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underwritten public offering, addressed to the Investor and the underwriters, if
any; and
(iii)
such corporate certificates, satisfactory to the Investor and the underwriters,
as are customarily furnished in Canadian securities offerings.

1.1
Rights and Obligations of the Investor

The Investor will furnish to the Corporation such information and execute such
documents regarding the Consideration Shares requested to be qualified by the
Investor and the intended method of disposition thereof as the Corporation may
reasonably request in order to effect the requested qualification for sale or
other disposition. If an underwritten public offering is contemplated, the
Investor shall execute an underwriting agreement containing customary
representations, warranties and indemnities (and contribution covenants) for the
benefit of the underwriters and the Corporation; provided that the obligation to
indemnify set out in such underwriting agreement shall be limited in amount to
the gross proceeds received by the Investor from the sale of Consideration
Shares requested to be qualified by the Investor pursuant to such Distribution.
1.2
Indemnification

(a)
The Corporation will indemnify the Investor, each of its director, officers,
employees and agents, with respect to a registration which has been effected
pursuant to this Agreement, and each underwriter, if any, of the Corporation’s
securities covered by such registration, against all expenses, claims, losses,
damages or liabilities (or actions in respect thereof) including any of the
foregoing incurred in settlement of any litigation, commenced or threatened,
arising out of or based on any untrue statement (or alleged untrue statement) of
a material fact contained in any Prospectus or any amendment or supplement
thereto, or based on any omission (or alleged omission) to state therein a
material fact required to be stated therein, or necessary to make the statements
therein not misleading in light of the circumstances in which they were made, or
any violation or alleged violation by the Corporation of applicable Securities
Laws in connection with any such registration, and the Corporation will
reimburse the Investor and each of its directors, officers, employees and
agents, and each such underwriter, for any reasonable legal and any other
expenses incurred in connection with investigating, preparing for or defending
any such claim, loss, damage, liability or action, provided that the Corporation
will not be liable in any such case to the extent that any such claim, loss,
damage, liability or expense arises out of or is based on any untrue statement
or omission or alleged untrue statement or omission in any information that has
been provided to the Corporation in writing by the Investor or the underwriter,
respectively, contained in such Prospectus, or any amendment or supplement
thereto; and provided, further, that the Corporation will not be liable with
respect to any loss, claim, damage or liability with respect to any Person who
purchased Consideration Shares requested to be qualified by the Investor and to
whom there was not sent or who was not given a copy of any amended, supplemented
or final Prospectus, as applicable, with respect to such Consideration Shares,
if (i) such loss, claim, damage or liability results from an untrue statement or
an omission or alleged untrue statement or omission contained in any preliminary

 

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or other Prospectus that was corrected in such amended, supplemented or final
Prospectus and (ii) the Corporation had previously furnished copies of such
amended, supplemented or final Prospectus to the Investor or the underwriters
for the Investor.
(b)
The Investor will, if Consideration Shares held by the Investor are included in
the securities as to which such registration is being effected, indemnify the
Corporation, each of its directors, officers, employees and agents, and each
underwriter, if any, of the Corporation’s securities covered by such a
registration, against all expenses, claims, losses, damages and liabilities or
actions in respect thereof, including any of the foregoing incurred in
settlement of any litigation, commenced or threatened, arising out of or based
on any untrue statement (or alleged untrue statement) of a material fact
contained in any Prospectus or any amendment or supplement thereto or based on
any omission (or alleged omission) to state therein a material fact required to
be stated therein, or necessary to make the statements therein not misleading in
light of the circumstances in which they were made, or any violation or alleged
violation by the Investor of applicable Securities Laws in connection with any
such registration and the Investor will reimburse the Corporation, such
directors, officers, employees, agents and such underwriters for any reasonable
legal and any other expenses incurred in connection with investigating,
preparing for or defending any such claim, loss, damage, liability or action, in
each case to the extent that any such claim, loss, damage, liability or expense
arises out of or is based on any untrue statement or omission or alleged untrue
statement or omission in any information contained in such Prospectus, or any
amendment or supplement thereto, made in reliance upon and in conformity with
written information furnished to the Corporation by the Investor for use
therein; provided, however, that the liability of the Investor for
indemnification under this Section 4(b) will not exceed the net proceeds from
the Distribution actually received by the Investor.

(c)
Each party entitled to indemnification under this Section 1.3 (the “Indemnified
Party”) will give written notice to the party required to provide
indemnification (the “Indemnifying Party”) promptly after such Indemnified Party
has actual knowledge of any claim as to which indemnity may be sought, and will
permit the Indemnifying Party to assume the defense of any such claim or any
litigation resulting therefrom, provided that counsel for the Indemnifying
Party, who will conduct the defense of such claim or litigation, will be
approved by the Indemnified Party (whose approval will not be unreasonably
withheld), and the Indemnified Party may participate in such defense at such
party’s expense, and provided further that the failure of any Indemnified Party
to give notice as provided herein will not relieve the Indemnifying Party of its
obligations under this Section 1.3 unless the failure to give such notice is
materially prejudicial to an Indemnifying Party's ability to defend such action.
An Indemnified Party will have the right to retain its own counsel, with fees
and expenses to be paid by the Indemnifying Party, if representation of such
Indemnified Party by the counsel retained by the Indemnifying Party would be
inappropriate due to actual or potential conflicting interests between such
Indemnified Party and any other party represented by such counsel in such
proceeding. No Indemnifying Party, in the defense of any such claim or
litigation, will, except with the consent of each

 

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Indemnified Party, consent to entry of any judgment or enter into any settlement
which does not include as an unconditional term thereof the giving by the
claimant or plaintiff to such Indemnified Party of a release from all liability
in respect to such claim or litigation. No Indemnified Party shall settle any
claim or litigation resulting therefrom without the prior written consent of the
Indemnifying Party, not to be unreasonably withheld.
(d)
If the indemnification provided for in this Section 1.3 is held by a court of
competent jurisdiction to be unavailable to an Indemnified Party with respect to
any loss, liability, claim, damage, or expense referred to therein, then the
Indemnifying Party, in lieu of indemnifying such Indemnified Party hereunder,
will contribute to the amount paid or payable by such Indemnified Party as a
result of such loss, liability, claim, damage, or expense in such proportion as
is appropriate to reflect the relative fault of the Indemnifying Party on the
one hand and of the Indemnified Party on the other in connection with the
statements or omissions that resulted in such loss, liability, claim, damage, or
expense as well as any other relevant equitable considerations, provided,
however, that the liability of the Investor under this subsection (d) will not
exceed the net proceeds from the offering received by the Investor. The relative
fault of the Indemnifying Party and of the Indemnified Party will be determined
by reference to, among other things, whether the untrue or alleged untrue
statement of a material fact or the omission to state a material fact relates to
information supplied by the Indemnifying Party or by the Indemnified Party and
the parties' relative intent with respect to, knowledge regarding and
opportunity to correct, such information.

(e)
Notwithstanding the foregoing, to the extent that the provisions regarding
indemnification and contribution contained in an underwriting agreement entered
into in connection with the underwritten public offering are in conflict with
the foregoing provisions, the provisions of the underwriting agreement shall
prevail and the sections regarding indemnification and contribution contained
herein shall not apply to any offering for which the parties have entered into a
binding underwriting agreement.

6749947