Exhibit 4.1


 


 


 


VIQ Solutions Inc.


 


ANNUAL INFORMATION FORM


 


For the financial year ended December 31,
2020


 


Dated April 30, 2021


 


5915 Airport Road, Suite 700

Mississauga, Ontario

L4V 1T1


 






    


     


    




 


Table
of Contents


 


	DEFINITIONS AND GLOSSARY OF TERMS	1
	 	 
	THIS ANNUAL INFORMATION FORM	3
	 	 
	cAUTIONARY NOTES	3
	 	 
	CORPORATE STRUCTURE	5
	 	 
	GENERAL DEVELOPMENT OF THE BUSINESS	6
	 	 
	DESCRIPTION OF THE BUSINESS	7
	 	 
	RISK FACTORS	12
	 	 
	DIVIDENDS AND DISTRIBUTIONS	20
	 	 
	DESCRIPTION OF CAPITAL STRUCTURE	20
	 	 
	MARKET FOR SECURITIES	23
	 	 
	DIRECTORS, OFFICERS AND PROMOTERS	24
	 	 
	Cease Trade Orders, Bankruptcies, Penalties or Sanctions	26
	 	 
	conflicts of interest	27
	 	 
	promotErs	27
	 	 
	LEGAL PROCEEDINGS AND REGULATORY ACTIONS	28
	 	 
	INTERESTS OF MANAGEMENT AND OTHERS IN MATERIAL TRANSACTIONS	28
	 	 
	TRANSFER AGENTS AND REGISTRARS	28
	 	 
	MATERIAL CONTRACTS	28
	 	 
	INTERESTS OF EXPERTS	28
	 	 
	AUDIT COMMITTEES AND CORPORATE GOVERNANCE	29
	 	 
	ADDITIONAL INFORMATION	30




 






    


     


    




 


	DEFINITIONS AND GLOSSARY OF TERMS


 


The following is a glossary of certain general
terms used in this Annual Information Form (“AIF”), including the summary hereof. Words importing the singular,
where the context requires, include the plural and vice versa and words importing any gender include all genders.


 


“ABCA” means the Business
Corporations Act (Alberta), including the regulations promulgated thereunder, as amended;


 


“ASC” has the meaning set out
under the heading “General Development of the Business – Three Year History”;


 


“Audit Committee” has the meaning
set out under the heading “Audit Committee and Corporate Governance”;


 


“Award” means a Stock Option,
RSU, PSU or DSU granted under the Omnibus Equity Security Plan;


 


“Board” means the board of
directors of the Company;


 


“Cashless Exercise” has the
meaning set out under the heading “Stock Options and Other Compensation Securities – Omnibus Equity Incentive Plan –
Stock Options”;


 


“CJIS” has the meaning set
out under the heading “General Development of the Business – Business Outlook for 2020”;


 


“Code” means the United States
Internal Revenue Code of 1986, as amended from time to time. Any reference to a section of the Code shall be deemed to include a reference
to any regulations promulgated thereunder;


 


“Common Share” means a common
share in the capital of the Company;


 


“Company” or “VIQ”
means VIQ Solutions Inc., a corporation existing under the OBCA;


 


“Convertible Notes” has the
meaning set out under the heading “Description of Capital Structure – Convertible Notes”;


 


“Credit Facility” has the meaning
set out under the heading “General Development of the Business – Three Year History”;


 


“Crown” has the meaning set
out under the heading “General Development of the Business – Three Year History”;


 


“DSUs” has the meaning set
out under the heading “Stock Options and Other Compensation Securities – Omnibus Equity Incentive Plan”;


 


“Eligible Directors” has the
meaning set out under the heading “Description of Capital Structure – Stock Options and Other Compensation Securities –
Legacy DSU Plan”;


 


“EMEA” means Europe, the Middle
East and Africa;


 


“HomeTech” has the meaning
set out under the heading “General Development of the Business – Three Year History”;


 


“IFRS” means International
Financial Reporting Standards;


 


“In-the-Money Amount” has the
meaning set out under the heading “Stock Options and Other Compensation Securities – Omnibus Equity Incentive Plan –
Stock Options”;


 


“Legacy DSU” means a deferred
share unit issued under the Legacy DSU Plan;


 


“Legacy DSU Plan” has the meaning
set out under the heading “Description of Capital Structure – Stock Options and Other Compensation Securities – Legacy
DSU Plan”;


 


“Legacy Stock Option” means
a stock option issued under the Legacy Stock Option Plan;


 






    1


     


    




 


“Legacy Stock Option Plan”
has the meaning set out under the heading “Stock Options and Other Compensation Securities – Stock Option Plan”;





 


“Market Price” at any date
in respect of the Common Shares shall be the volume weighted average trading price of Common Shares on the TSX for the five trading days
immediately preceding the relevant date; provided, further, that with respect to an Award made to a U.S. Taxpayer, the class of Common
Shares and the number of Common Shares subject to such Award shall be identified by the Board or the Committee prior to the start of the
applicable five trading day period. In the event that such Common Shares are not listed and posted for trading on any TSX, the Market
Price shall be the fair market value of such Common Shares as determined by the Board in its sole discretion and, with respect to an Award
made to a U.S. Taxpayer, in accordance with Section 409A of the Code;


 


“Net
Transcripts” has the meaning set out under the heading “General Development of the Business – Three Year History”;


 


“NI 52-110” has the meaning
set out under the heading “Audit Committee and Corporate Governance”;


 


“NMC” has the meaning set out
under the heading “General Development of the Business – Three Year History”;


 


“OBCA” means the Business
Corporations Act (Ontario), including the regulations promulgated thereunder, as amended;


 


“Omnibus Equity Incentive Plan”
has the meaning set out under the heading “Stock Options and Other Compensation Securities – Omnibus Equity Incentive Plan”;


 


“PSUs” has the meaning set
out under the heading “Stock Options and Other Compensation Securities – Omnibus Equity Incentive Plan”;


 


“RSUs” has the meaning set
out under the heading “Stock Options and Other Compensation Securities – Omnibus Equity Incentive Plan”;


 


“Stock Options” has the meaning
set out under the heading “Stock Options and Other Compensation Securities – Omnibus Equity Incentive Plan”;


 


“Shareholders” means the holders
of Common Shares;


 


“Spark & Cannon” means
Spark & Cannon Australasia Pty Ltd;


 


“Transcription Express” has
the meaning set out under the heading “General Development of the Business – Three Year History”;


 


“TSX” means the Toronto Stock
Exchange;


 


“TSXV” means the TSX Venture
Exchange;


 


“United States” means the United
States of America;


 


“U.S. Taxpayer” shall mean
a recipient of an Award who is subject to taxation under the applicable United States tax laws;


 


“Warrants” has the meaning
set out under the heading “Description of Capital Structure – Warrants”; and


 


“WordZ” has the meaning set
out under the heading “General Development of the Business – Three Year History”.


 






    2


     


    







 


	THIS ANNUAL INFORMATION FORM


 


In this AIF, unless the context otherwise requires,
the “Company” or “VIQ” refers to VIQ Solutions Inc. All financial information in this AIF is prepared in Canadian
dollars and using IFRS as issued by the International Accounting Standards Board. VIQ’s financial statements are presented in United
States dollars.


 


This AIF applies to the business activities and
operations of the Company for the year ended December 31, 2020. Unless otherwise indicated, the information in this AIF is given
as of April 30, 2021.


 


Except as otherwise indicated in this AIF, references
to “Canadian dollars” or “$” are to the currency of Canada and references to “US$” are to United States
dollars.


 


	cAUTIONARY NOTES


 


Forward-Looking Statements


 


This AIF contains forward-looking statements or
information that relate to the Company’s current expectations, estimates, projections and views of future events. The forward-looking
statements are contained principally in the sections titled “Description of the Business” and “Risk Factors”.


 


In some cases, these forward-looking statements
can be identified by words or phrases such as “may”, “believe”, “expects”, “will”, “intends”,
 “projects”, “anticipates”, “estimates”, “continues”, “plan”, “believe”,
 “aim”, “seek” or the negative of these terms, or other similar expressions intended to identify forward-looking
statements. The Company has based these forward-looking statements on current expectations and projections about future events and financial
trends that they believe may affect the Company’s financial condition, results of operations, business strategy and financial needs,
as the case may be.


 


Forward-looking statements relating to the Company
include, among other things, statements relating to:


 


		·	the results of any historic of future acquisition completed by VIQ;






		·	VIQ’s ability to protect its intellectual property;






		·	anticipated changes to VIQ’s business model;






		·	the timing of the development and release of new products;






		·	the expansion of the scope of content solutions and value-add complimentary services VIQ intends to offer
to its clients;






		·	VIQ’s funding requirements in order to bring new services to market;






		·	the impact of newly released products on VIQ’s financial position, including the transition to a
SaaS revenue model;






		·	the availability of individuals with specialized knowledge and skill to VIQ; and






		·	VIQ’s intention to retain future earnings in order to finance its operations and expand its business,
and to not pay dividends or make distributions in the foreseeable future.



 


Forward-looking statements are based on certain
key assumptions and analyses made by the Company in light of its experience and perception of historical trends, current conditions and
expected future developments as well as other factors the Company believes are appropriate and are subject to risks and uncertainties.
Such assumptions include, amongst others, those relating to the consistency of VIQ’s operating results with projects, VIQ’s
ability to successfully register its intellectual property rights, VIQ’s ability to enforce outstanding confidentiality agreements,
the attractiveness of SaaS offerings in the markets where VIQ operates, VIQ’s ability to successfully develop, market and monetize
new products and VIQ’s ability to attract and retain qualified personnel. Although management believes that the assumptions are
reasonable, they may prove to be incorrect. Given these risks, uncertainties and assumptions, Shareholders and prospective purchasers
of the Company’s securities should not place undue reliance on these forward-looking statements. The above list of forward-looking
statements is not exhaustive and whether actual results, performance or achievements will conform to the Company’s expectations
and predictions is subject to a number of known and unknown risks, uncertainties, assumptions and other factors, including those listed
under “Risk Factors”, which are summarized below.


 






    3


     


    




 


Business risks include:








		·	the impact of COVID-19 on the Company and its business;






		·	risks related to the Company’s ability to grow its revenue;






		·	variance in the Company’s operating results period to period;






		·	risks related to the Company’s ability to integrate its products into potential clients’ existing
systems;






		·	risks related to the compatibility of the Company’s products with operating systems and computer
networks;






		·	risks related to potential stoppages to the Company’s operations and failures of the Company’s
products;






		·	risks related to cyber-threats;






		·	the Company’s ability to develop new products, penetrate new markets, and expand in existing markets;






		·	the Company’s ability to adapt to technological developments;






		·	potential downturns in general economic and market conditions;






		·	risks related to identifying and acquiring suitable acquisition targets;






		·	integration of acquired businesses into the Company’s portfolio;






		·	international operations;






		·	the Company’s ability to protect its intellectual property and the effect of potential intellectual
property claims;






		·	the potential for uninsured or uninsurable losses to arise;






		·	competition in the Company’s industry;






		·	potential product liability;






		·	the Company’s ability to manage growth;






		·	ability to retain (or acquire) skilled personnel;






		·	potential legal and regulatory proceedings against the Company; and






		·	conflicts of interest between the Company and its directors and officers.



 


Financial and accounting risks include:


		·	the availability of sufficient cash flows to the Company;






		·	the Company’s ability to access capital;






		·	potential inaccuracies in estimates or judgements related to critical accounting policies;






		·	tax related risks; and






		·	fluctuations in the value of foreign currencies.



 


Risks related to the Common Shares:


		·	volatility in the market price for the Common Shares;






		·	the Company’s intention not to pay dividends on the Common Shares;






		·	risks related to general market fluctuations; and






		·	the risk of future dilutive transactions.



 


The above risks, uncertainties, assumptions and
other factors could cause the Company’s actual results, performance, achievements and experience to differ materially from the Company’s
expectations, future results, performances or achievements expressed or implied by the forward-looking statements.


 


Further, any forward-looking statement made in
this AIF relate only to events or information as of the date when the statements are made in this AIF. Except a required by law, the Company
undertakes no obligation to update or revise publicly any forward-looking statements, whether because of new information, future events
or otherwise, after the date when the statements are made or to reflect the occurrence of unanticipated events.


 


An investor should read this AIF with the understanding
that the Company’s actual future results may differ materially from management’s current expectations. For a description of
material factors that could cause the Company’s actual results to differ materially from the forward-looking statement in this AIF,
please see “Risk Factors”.


 


Market Data


 


Unless otherwise indicated, information contained
in this AIF concerning the industry and markets in which the Company operates is based on information from independent industry organizations,
other third-party sources (including industry publications, surveys and forecasts) and management estimates.





 



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The management estimates in this AIF are derived
from publicly available information released by independent industry analysts and third party sources, as well as data from the Company’s
internal research and are based on assumptions made by the Company based on such data and its knowledge of such industry and markets,
which the Company believes to be reasonable. The Company’s internal research has not been verified by any independent source and
it has not independently verified any third-party information. While the Company is not aware of any misstatement regarding any industry
or market data included in this AIF, such information is inherently imprecise. In addition, projections, assumptions and estimates of
the Company’s future performance and the future performance of the industry in which the Company operates are necessarily subject
to a high degree of uncertainty and risk due to a variety of factors, including those described under the “Risk Factors”.


 


	CORPORATE STRUCTURE


 


Name, Address and Incorporation


 


The Company was incorporated pursuant to the ABCA
on November 10, 2004 under the name “VIQ Solutions Inc.”. The Company was continued under the OBCA on April 14,
2017.


 


The Company’s head and registered offices
are located at 5915 Airport Road, Suite 700, Mississauga, Ontario L4V 1T1.


 


The Company is a reporting issuer in Canada in
the provinces of British Columbia, Alberta and Ontario, and its Common Shares are listed on the TSX under the trading symbol “VQS”.


 


Intercorporate Relationships


 


The following chart illustrates the Company’s
corporate structure as at the date of this AIF, together with the governing law of each principal subsidiary and the percentage of voting
securities beneficially owned by the Company.





 





 



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	GENERAL DEVELOPMENT OF THE BUSINESS


 


Three Year History


 


		•	In early 2018, VIQ significantly expanded its business in Europe, the Middle East and Africa. The United
Kingdom’s Ministry of Justice, one of VIQ’s largest European clients, commenced an upgrade taking advantage of the latest
features and advanced security added to the VIQ platform, as well as preparing for progressive product enhancement. The UK Nursing and
Midwifery Council (the “NMC”) doubled the size of its VIQ SaaS installation with the start of the next phase and is
extending its subscription service with VIQ. This resulted in NMC having several VIQ installations spanning London, Edinburgh, and Glasgow,
with additional portable systems for off-site hearings. In the Middle East, VIQ partnered with Malomatia QSC to collaborate on the Qatar
Supreme Judicial Council audio/video courthouse project. In Africa, certain governmental agencies serviced by VIQ in Ghana, Mauritius,
Botswana and South Africa undertook additional installations and upgrading.



 


		•	On August 8, 2018, Spark & Cannon was awarded a new contract with the Victoria Police in
Australia for the provision of secure transcription of police recordings.



 


		•	On November 14, 2018, VIQ was awarded a patent by the United States Patent and Trademark office for
its innovative competency-based digital training portfolio solution.



 


		•	On November 28, 2018, VIQ entered into a non-revolving multi-draw term loan facility (the “Credit
Facility”) with Crown Capital Partner Funding LP (“Crown”), pursuant to which Crown agreed to provide VIQ
with up to $15,000,000 to be used by VIQ to finance strategic acquisitions. In connection with Crown entering the Credit Facility, VIQ
issued Crown 9 million Common Share purchase warrants and issued Crown 2,127,659 Common Shares.



 


		•	On November 28, 2018. VIQ acquired Net Transcripts, Inc. (“Net Transcripts”),
a provider of secure multi-speaker documentation services to law enforcement and criminal justice organizations, for approximately US$6.8
million.



 


		•	On December 11, 2018, Spark & Cannon was awarded an additional contract with the Victoria
Police in Australia to supply, install and maintain audio/visual recording equipment throughout various metropolitan and regional locations.



 


		•	On December 24, 2018, VIQ acquired Transcription Express Inc. (“Transcription Express”)
and HomeTech, Inc. (“HomeTech”). Transcription Express was acquired for aggregate consideration of US$5.55 million,
comprised of US$2.78 million in cash, a US$1.67 million promissory note and the issuance of approximately 11,000,000 Common Shares. HomeTech
was acquired for aggregate consideration of US$1.67 million, comprised of US$250,000 in cash and a US$1.2 million promissory note.



 


		•	In early 2019, VIQ entered into significant new contracts to supply, install and maintain audio/visual
recording equipment in various courts in Nairobi, Kenya and Lesotho and South Africa. Further Net Transcripts was awarded a contract extension
for transcription services and the Australian Securities and Investment Commission executed a five year extension with Spark &
Cannon for transcription services.



 


		•	From November 28, 2018 to May 22, 2019, Net Transcripts generated 83 new clients.



 


		•	In June 2019, Net Transcripts added an additional 13 clients and renewed 3 contracts with US law
enforcement agencies.



 


		•	On July 9, 2019, Spark & Cannon entered into a five year contract to provide transcription
services for the Western Australia Police Force.



 


		•	On October 1, 2019, VIQ announced the release of its cloud-based end-to-end workflow solution for
the insurance industry.



 


		•	On October 28, 2019 Spark & Cannon entered into a contract with the Queensland Department
of Justice and Attorney General to provide court evidence capture and management services. The contract is for an initial six year term
plus three one year extensions.



 


		•	On November 27, 2019, Shareholders approved the consolidation of the Common Shares on a 20 to 1 basis.



 


		•	On December 5, 2019, VIQLF in the United States becomes tradable on the OTCQX in the United States.



 



    6


     


    




		•	On January 31, 2020, VIQ acquired ASC Services LLC (“ASC”) for an aggregate purchase
price of $6.9 million, with $3.1 million paid in cash on closing and $3.8 million to be paid via an earn-out payable quarterly over 30
months following the completion the transaction.



 


		•	On February 4, 2020, the Company announced that it entered into agreements with the holders of unsecured
convertible notes (each, a “Convertible Note”) in the aggregate principal amount of approximately USD$6,792,934, granting
the holders of such Convertible Notes the option to convert the principal and the aggregate interest payable on their Convertible Notes
from the date of issuance to the maturity date, into Common Shares at a conversion price of CAD$2.18 per Common Share, as previously announced
by the Company on December 18, 2019.



 


		•	On February 26, 2020, the Company announced the acquisition of a leading US transcription provider,
wordZXpressed, Inc. (“WordZ”) of Atlanta, Georgia, VIQ’s fifth accretive acquisition in 14 months. The purchase
price paid for the WordZ acquisition was approximately $4.7 million, with approximately $1.3 million paid in cash on closing, approximately
$1.2 million paid via a promissory note payable quarterly over 36 months and approximately $2.2 million to be paid via an earnout payable
quarterly over 36 months.



 


		•	VIQ was awarded CJIS ACE after completing a rigorous audit and evaluation with Diverse Computing Inc.
The audit reviewed various systems, policies and procedures and concluded that VIQ demonstrated the required competencies in managing
all aspects of its security policy to be awarded such a designation. The CJIS ACE Compliance Seal is awarded to agencies and companies
demonstrating executive commitment and real-world working knowledge of FBI CJIS Security Policy compliance and its critical
importance to law enforcement. CJIS sets security standards for law enforcement, cloud providers, local agencies and corporate networks.
CJIS monitors criminal activities in local and international communities. Their databases are a centralized source of criminal justice
information (“CJIS”).



 


		•	On July 7, 2020, Shareholders approved the appointment of KPMG as Auditors of the Company at the
annual Shareholders meeting.



 


		•	On November 26, 2020, the Company closed a bought deal offering of 4,705,900 Common Shares, issued
a at a price of $4.25 per Common Share, for aggregate gross proceeds of $20,000,075.



 


Subsequent Events


 


		•	On January 19, 2021, the Company announced the receipt of final approval from the TSX to graduate
to the TSX from the TSXV. On January 21, 2020, the Common Shares began trading on the TSX under the symbol “VQS”. In
conjunction with the Company’s listing on the TSX, the Common Shares were voluntarily delisted from the TSXV.



 


		•	On January 28, 2021, the Company announced that it had been named to the 2021 OTCQX Best 50, a ranking
of top performing companies traded on the OTCQX Best Market.



 


		•	On March 18, 2021, the Company announced the launch of FirstDraft, powered by aiAssist, a new transcription
solution allowing users to quickly convert audio files to text providing near real-time access to interviews, testimony, recorded calls,
and dictations.



 


	DESCRIPTION OF THE BUSINESS


 


General Summary


 


VIQ delivers intelligent automation, enhanced
with human review, to drive transformation in the way evidentiary content is captured, secured, and transformed into actionable information.
This combination along with segment specific Artificial Intelligence learning makes VIQ as the leader best positioned to disrupt and gain
rapid market share.


 


VIQ’s
innovative technology platform is made of four core software products using cloud, artificial intelligence, mobility, and cybersecurity
cloud driven workflow for capture, manage, share, and create digital evidence and very specific documentation. The company is driving
the transformation of the highly secured evidentiary data and transcription industry from 0% to 80% via AI-human editors’ collaboration
using an innovative patented technology platform.


 



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VIQ operates worldwide with a network of partners
including security integrators, audio-video specialists, and hardware and data storage suppliers. The company revenue is strategically
segmented both by Geography and Industry Markets: 70% of its revenue is located in the United States, 27% in Australia and a growing 3%
in the EMEA and Canada.


 


VIQ’s solutions serve a growing customer
base across a variety of vertical and horizontal markets, the primary of which are as follows:


 


		•	21% of revenue is in criminal justice;
		•	29% in legal;
		•	23% in insurance; and
		•	27% in media, corporate finance, government and medical.



 


VIQ delivers its
products and services to clients primarily through a network of resellers and integrators, as well as through direct sales, offering
a variety of deployment methodologies and business models to meet customer demand including software, SaaS and managed services.


 


Principal Products and Services


 


VIQ combines artificial intelligence-driven voice
and video capture technology and services to securely manage digital content in the most rigid security environments including governments,
courts, insurance, law enforcement, media content, news and conferencing. VIQ’s products and services help cybersecurity focused
entities securely speed the capture, creation, and management of large volumes of information, preserve the unique value of the spoken
word and video image, and deliver meaningful data that they can utilize.


 


VIQ offers its clients a technology services stack
comprised of six core software solutions: MobileMic Pro, CaptureProTM, NetScribe, First Draft. Editing Services and aiAssist
that are integrated to create a seamless, end to end digital platform, as outlined further below.


 








 


VIQ spent the last three years integrating its
entire product portfolio into a modern, secured, cloud-based, scalable ecosystem. Through this established commercial platform, VIQ ingests
multi-media content across its markets and delivers immediate value to customers in the form of high-quality evidentiary documentation.


 



    8


     


    




The effective aggregation of customer information
in the platform, which may appear as a by-product, is in fact a valuable asset that is be monetized. Our first AI-driven use
of this information was aimed at improving the efficiency of the verbatim transcription process by delivering a progressively better first
draft. In turn, this capability enabled the delivery of First Draft, a service where a machine-generated version of a multi speakers
recording is presented to the user, all the while, feeding back into the system the quality-controlled version of the documents we
delivered, refining our linguistic and industry specific corpus models, and progressively enhancing the outcome of our services, in a
virtuous circle.


 


Looking ahead, VIQ intends on utilizing this content to extend the scope of solutions that we offer and expanding the value of the content
we collect. To that end, our ML-driven AI engine selection process drives the platform to serve emerging needs
and unlocks the additional value in the data stream. VIQ takes advantage of all available technologies to accelerate its strategy,
as the system is designed intentionally to integrate both our internal IP and external applications.


 


Our vision is to create an environment where we cultivate the relationships with our customers through a portfolio of value-added complementary
services.


 


VIQ is transitioning its technology services offerings
towards a software as a service (“SaaS”) revenue model, in which clients are charged recurring monthly fees based on
a number of variables. Given the size, nature, and visibility of our sales pipeline, VIQ anticipates this SaaS option will continue to
gain traction in the markets in which VIQ’s software is offered.


 


Specialized Skill and Knowledge


 


The Company employs individuals with a wide range
of professional and technical skills and expertise in the course of pursuing and executing its business strategy. Skills and expertise
crucial to VIQ’s success in the markets where it operates includes, but is not limited to, market knowledge, specialized editors
and specialized engineering and AI ability. Individuals with such knowledge and abilities an employed by VIQ or have been otherwise engaged
by VIQ and are readily available to meet VIQ’s needs.


 


Competitive Conditions


 


Although VIQ has many competitors in the manual
documentation automatic speech recognition/artificial intelligence segment, VIQ’s offerings are performing competitively as they
are focused on and tuned to multi speakers evidence based markets. In addition, VIQ holds patents and patent-pending status on key intellectual
property rights associated with the design and workflow of its key platforms. Please see “Description of the Business –
Intangible Property”.


 


Products in Development


 


VIQ dedicates significant effort on the refinement
of its ongoing and future technology road map and execution against it to meet its growth commitments. VIQ has many advanced products
and services under development including next versions of aiAssist, NetScribe, MobileMic and Capture Pro. VIQ develops its products through
a combination of employed and contracted engineers. VIQ expects to bring these new products and services to market commercially will require
in the range of $1-$2.6 million over the next six to twelve months.


 


Intangible Property


 


Protection of intellectual property is integral
to VIQ’s success. As such, VIQ has and will continue to pursue patent protection, register trademarks, and protect other intellectual
property through trade secrets, copyright, confidential disclosure agreements, and other mechanisms as appropriate. This includes the
use of confidential disclosure agreements with all prospective vendors and partners.


 


In order to maximize the duration of patent protection
during the commercial life a potential product and/or allow the generation of data to strengthen a potential patent, VIQ may on occasion
delay patent filing, while ensuring it does not risk the product protection during this delay.


 



    9


     


    




VIQ
has in progress applications for several trademarks associated with its newer brand names. It also holds trademarks on key products such
as NetScribe and other brand names associated with its business units. Most of these trademark applications are global being primarily
in the EU, Australia, USA and Canada. VIQ also holds two patents on technology and has one patent-pending with one patent application
work in progress. The intellectual property rights held by VIQ are summarized in the tables below:


 


	No.	Trademark	Jurisdiction	Status	Expiry
	1.        	AIASSIST	Canada	Pending	-
	 	United States	Pending	-
		Australia	Registered	January 22, 2030
	 	UK	Registered	December 6, 2029
	2.        	
    AIASSIST

    Wordmark
	
    Canada

     

    United States
	
    Pending

     

    Pending
	
    -

     

    -

	3.        	CAPTUREPRO	Canada	Pending	-
	Word mark	United States	Pending 	-
	 	Australia	Registered	October 22, 2029
	 	UK/EU	Registered	June 12, 2030
	4.        	MOBILEMIC	Canada	Pending	-
	Word mark	United States	Pending	-
	 	Australia	Declined	-
	 	UK/EU	Declined	-
	5.        	ACCESSPOINT	Canada	Pending	-
	Word mark	United States	Pending	-
	 	Australia	Declined	-
	 	UK/EU	Declined	-
	6.        	CYBERCRYPT	Canada	Abandoned	-
	Word mark	United States	Abandoned	-
	 	Australia	Registered	December 24, 2029
	 	UK/EU	Registered	September 25, 2029, 
	7.        	
    AUDIOWORX

     

    Word mark
	Canada	Declined	-
	 	United States	Declined	-
	 	Australia	Declined 	-
	 	UK/EU	Registered	September 25, 2029
	8.        	
    NETSCRIBE

     

    Work mark
	
     

     
	 	 
	 	United States 	Registered	September 7, 2024
	9.        	
    NET TRANSCRIPTS

     

    Word mark
	United States	Registered	June 24, 2024



 



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	No.	Patent	Jurisdiction	Expiry
	1.        	Evidence Based Digital Training Portfolio – A1	United States	August 18, 2037
	2.        	Evidence Based Digital Training Portfolio – B2	United States	
    August 18, 2037

     

	3.        	
    Parallel Processing Framework for Voice to Text
    Digital Media

     

    Patent application filed with United States Patent
    and Trademark Office on August 30, 2019
	United States	Pending
	4.        	
    Securing And Managing Offline Digital Evidence
    With A Smart Data Lease System

     

    Patent application filed with United States Patent
    and Trademark Office on April 8, 2021
	United States	Pending



 


Cycles


 


VIQ’s sales cycles are largely dependent
on the size and complexity of individual customers. Based on VIQ’s history and information available to date, we have identified
that fourth quarter revenues are generally lower than revenues generated during other interim periods, specifically due to decreased historic
revenues in the months of December and January related to annual holidays.


 


Economic Dependence


 


The Company is segmented by both geography and
industry markets. VIQ’s revenues are well diversified between a number of long term and short term contracts and arrangements, with
no concentration in any one particular customer. During the year ended December 31, 2020, VIQ had no customers that accounted for
more than 15% of its revenues.


 


Employees


 


As of December 31, 2020, VIQ had approximately
320 employees, 40 contractor – employees and 900 independent contractors.


 


Segmentation of Revenues


 


VIQ’s revenue is strategically segmented
both by geography and industry. Geographically, VIQ’s revenue is derived as follows:


 


		•	70% – United States;
		•	27% – Australia; and
		•	3% – Canada and EMEA (specifically the United Kingdom, Scotland, the United Arab Emirates, Qatar
and Africa).



 


The approximate proportion of the VIQ’s
revenue derived from each industry in which it clients operate is as follows:


 


		•	21% of revenue is in criminal justice;
		•	29% in legal;
		•	23% in insurance; and
		•	27% in media, corporate finance, government and medical



 



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Bankruptcy and Similar Procedures


 


VIQ is not and has not been subject to any bankruptcy,
or any receivership or similar proceedings against it or any of its subsidiaries or any voluntary bankruptcy, receivership or similar
proceedings by it or any of its subsidiaries within the three most recently completed financial years or the current financial year.


 


Reorganizations


 


VIQ and its subsidiaries have not been subject
to any material reorganization within the three most recently completed financial years or the current financial year.


 


	RISK FACTORS


 


Due to the nature of VIQ’s business, the
legal and economic climate in which it operates and its present stage of development, VIQ is subject to significant risks. The risks presented
below should not be considered to be exhaustive and may not be all of the risks that VIQ may face. Additional risks and uncertainties
not presently known to VIQ or that VIQ currently considers immaterial may also impair the business and operations. If any of the following
or other risks occur, the Company’s business, prospects, financial condition, results of operations and cash flows could be materially
adversely impacted. In that event, the trading price of the Common Shares could decline and investors could lose all or part of their
investment. There is no assurance that risk management steps taken will avoid future loss due to the occurrence of the risks described
below or other unforeseen risks. Readers should carefully consider all such risks and other information elsewhere in this AIF before making
an investment in VIQ and should not rely upon forward-looking statements as a prediction of future results. Risk factors relating to VIQ
include, but are not limited to, the factors set out below.


 


Business Risks


 


COVID-19


 


Since December 2019, the outbreak of COVID-19,
has resulted in governments worldwide enacting emergency measures to combat the spread of the virus. These measures, which include the
implementation of travel bans, mandatory quarantine periods and social distancing, have caused material disruption to business globally
resulting in an economic slowdown. Global equity markets have experienced significant volatility and weakness. Governments and central
banks have reacted with significant monetary and fiscal interventions designed to stabilize economic conditions. The duration and impact
of the COVID-19 outbreak is unknown at this time, as is the efficacy of the government and central bank interventions.


 


It remains unknown to the Company how long it
will take for the general public to be vaccinated given the unpredictable and novel nature of this virus. There is a risk of vaccine procurement
and supply chain issues, which could prolong the adverse effect the pandemic may have on the economy, the Company and its customers, and
is outside of the control of the Company. In late 2020, there had been a number of announcements by health officials alerting the public
to multiple mutations of the COVID-19 virus. It is unknown whether the vaccines being distributed or developed will be as effective on
the new strains of the virus. Based on the Company’s understanding of these announcements, there is a risk these new mutations may
prolong, or increase the adverse effect the pandemic may have on the economy, the Company and its customers, and is outside of the control
of the Company.


 


It is not possible to reliably estimate the length
and severity of these developments and the impact on the financial results and condition of the Company in future periods. The extent
of future potential business disruption due to COVID-19 cannot be known with any degree of certainty. While management anticipates that
business will be disrupted for at least part of 2021, they do not believe it will have a material adverse effect on the Company’s
overall long-term outlook.


 


The pandemic has resulted in certain customers
of the Company delaying project work, which could include the use of the Company’s services and software. These organizations chose
to focus on reorganizing their operations in response to COVID-19, which has resulted in a reduction in anticipated revenues to this point
in the current fiscal year. In addition, it is possible that COVID-19 may affect future revenues of the as a result of continuing restrictions
relating to traditional sales efforts, such as travel, face-to-face meetings and in-person tradeshows, which are not currently unavailable.


 



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In the event that the pandemic and the measures
taken in response materially and adversely affect the Company’s customers, it is possible that this could increase the Company’s
credit risk, in the event that such customers are unable to pay any amounts owed to the Company in a timely manner or at all.


 


Ability to Grow Revenue


 


To increase our revenue and achieve and maintain
profitability, we must regularly add new customers or sell additional solutions to our existing customers, which we plan to do. Numerous
factors, however, may impede our ability to add new customers and sell additional solutions to our existing customers, including our inability
to convert companies that have been referred to us by our existing network into paying customers, failure to attract and effectively train
new sales and marketing personnel, failure to retain and motivate our current sales and marketing personnel, failure to develop relationships
with partners or resellers and/or failure to ensure the effectiveness of our marketing programs. In addition, if prospective customers
do not perceive our solutions to be of sufficiently high value and quality, we will not be able to attract the number and types of new
customers that we are seeking.


 


Further, the resellers and integrators that we
work with are independent businesses that we do not control. These resellers and integrators may choose to devote their efforts to other
products in different markets or reduce or fail to devote the resources to provide effective sales and marketing support of our products,
any of which could harm our business by reducing sales to customers.


 


Fluctuations in Periodic Results


 


The Company’s operating results can vary
substantially from period to period. Planned operating expenses are normally targeted to planned revenue levels for the period and are
incurred equally throughout the period. If expenses remain relatively fixed, but the Company’s revenues are less than planned in
any quarter, the Company’s operating results would be adversely affected for that quarter. In addition, incurring unplanned expenses
could adversely affect operating results for the period in which such expenses are incurred. Failure to achieve periodic revenue, earnings
and other operating and financial results could result in an immediate and adverse effect on the market price of the Common Shares. The
Company may not discover, or be able to confirm, revenue or earnings shortfalls until the end of a quarter, which could result in a greater
immediate and adverse effect on the price of the Common Shares.


 


Ability to Integrate our Products into Clients’
Workplaces


 


A portion of our sales are made into applications
that require our products to be interfaced with other enterprise workflows, enterprise information technology environments or software
functionalities. Any significant changes to those enterprise workflows, IT environments or software programs may limit the use or
functionality of or demand for our products. As our customers advance technologically, we must continue to effectively interface our products
to remain competitive.


 


Ability to Effectively Operate our Products
with Mobile Operating Systems and Computer Networks


 


The functionality of certain of our products depends
upon the continued interoperability of these products with popular mobile operating systems. Any changes in these systems that degrade
our products’ functionality or give preferential treatment to competitive offerings could adversely affect the operability and usage
of our software products on mobile devices. Additionally, in order to deliver a high-quality user experience, it is important that our
products work well with a range of mobile technologies, systems, and networks. We may strive to keep pace with changes in mobile technologies,
operating systems, or networks or in developing products that operate effectively within existing or future technologies, systems, and
networks. Any significant changes to mobile operating systems by their respective developers may prevent our products from working properly
or at all on these systems.


 


Potential Failures of Our Products


 


Our business is dependent upon providing customers
with fast, efficient and reliable services. A reduction in the performance, reliability or availability of required network infrastructure
may harm our ability to distribute content to our customers, as well as our reputation and ability to attract and retain customers. Our
operations are susceptible to, and could be damaged or interrupted by, outages caused by fire, flood, power loss, telecommunications failure, Internet
or mobile network breakdown, earthquake and similar events. Our solutions are also subject to human error, security breaches, power losses,
computer viruses, break-ins, “denial of service” attacks, sabotage, intentional acts of vandalism and tampering designed to
disrupt our computer systems and network communications. Our failure or our customers’ failure to protect the networks against damage
from any of these events could have a material adverse effect on our business, results of operations and financial condition.


 






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Our operations also depend on web browsers, internet
service providers and mobile networks to provide our customers’ end-users with access to websites, streaming and mobile content.
Many of these providers have experienced outages in the past, and could experience outages, delays and other difficulties due to system
failures unrelated to our solutions. Any such outage, delay or difficulty could adversely affect our ability to effectively provide our
products and services, which would harm our business.


 


Risk of Cyber-Threats


 


Although
we have implemented numerous security features, malware, viruses, hacking, phishing attacks, social engineering, and other electronic
threats on businesses have become more prevalent, have occurred on our systems in the past, and may occur on our systems in the future.
While we continue to advance measures to safeguard our solutions and services from cybersecurity threats and vulnerabilities, cyber-attacks
and other security incidents continue to evolve in sophistication and frequency. The connection of our software solutions to our customers
and their information technology environments could present the opportunity for an attack on our systems to serve as a way to obtain access
into our customers’ systems, which could have a material adverse effect on our financial condition and growth prospects. Our security
measures may also be breached due to employee or other error, intentional malfeasance and other third-party acts, and system errors or
vulnerabilities, including vulnerabilities of our third-party vendors, customers, or otherwise. Businesses have experienced material sales
declines after discovering data breaches, and our business could be similarly impacted. The costs to continuously improve the security
of our solutions and reduce the likelihood of a successful attack are high and may continue to increase. Furthermore, some jurisdictions
have enacted laws requiring companies to notify consumers of data security breaches involving their personal data. These mandatory disclosures
regarding a security breach often lead to widespread negative publicity, which may cause our customers to lose confidence in the effectiveness
of the data security measures of our solutions. Any negative incidents can quickly erode trust and confidence, particularly if they result
in adverse mainstream and social media publicity, governmental investigations or litigation. Though it is difficult to determine what,
if any, harm may directly result from any specific interruption or attack, any failure to maintain performance, reliability, security
and availability of our products and technical infrastructure to the satisfaction of our customers may harm our reputation, impair our
ability to retain existing customers and attract new customers and expose us to legal claims and government action, each of which could
have a material adverse impact on our business, results of operations and financial condition.


 


Ability to Develop Products, Penetrate New
Markets or Further Penetrate Existing Markets


 


The industry in which the Company operates is
subject to rapid technological change. Our ability to attract new customers and increase revenue from existing customers will depend in
large part on our ability to enhance and improve our solutions, to introduce new features and services in a timely manner, to sell into
new markets and to further penetrate our existing markets. The success of any enhancement or new feature or service depends on several
factors, including the timely completion, introduction and market acceptance of the enhancement or new feature or service. Any new feature
or service we develop or acquire may not be introduced in a timely or cost-effective manner and may not achieve the broad market acceptance
necessary to generate significant revenue. Any new markets into which the Company attempts to sell its solutions, including new vertical
markets and new countries or regions, may not be receptive. If the Company is unable to successfully develop or acquire new features,
products or services, enhance its existing product or services to meet customer requirements, sell products and services into new markets
or sell our product and services to additional customers in our existing markets, its revenue will not grow as expected. Moreover, the
Company is frequently required to enhance and update our products and services as a result of changing standards and technological developments,
which makes it difficult to recover the cost of development and forces us to continually qualify new features with our customers.


 


Ability to Adapt to Technological Developments


 


The industry in which we operate is evolving at
a rapid pace. Our ability to attract new customers and increase revenue from customers will depend in significant part on our ability
to anticipate industry changes and to continue to enhance offer solutions or introduce or acquire new solutions on a timely basis to keep
pace with technological developments. The success of new solution depends on several factors, including the timely completion and market
acceptance of the enhancement or new solution. Any new solution we develop or acquire might not be introduced in a timely or cost-effective
manner and might not achieve the broad market acceptance necessary to generate significant revenue.


 






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Downturns in General Economic and Market
Conditions


 


Volatility in the market price of our Common Shares
due to seemingly unrelated financial developments could hurt our ability to raise capital for the financing of acquisitions or other reasons.
Any of these events, or any other events caused by turmoil in world financial markets, may have a material adverse effect on our business,
operating results, and financial conditions.


 


Ability to Identify and Acquire Suitable
Acquisition Targets


 


The Company’s strategy has historically
involved pursuing accretive acquisitions. The Company may complete additional acquisitions in the future and there are risks inherent
in any such acquisition. The Company may not be able to identify suitable new acquisition targets that are available to purchase at a
reasonable value. Even if a suitable acquisition can be identified the acquisition may not proceed if suitable terms cannot be negotiated.
When conducting due diligence on a potential acquisition it cannot be assured that all the risks and costs inherent in the business being
acquired will be identified. If an acquisition of an identified business were to proceed in which a portion or all of the consideration
consisted of cash additional funding maybe required through public or private financings if internally generated cash resources are not
sufficient.


 


Ability to Successfully Integrate Acquired
Businesses


 


The Company’s ability to integrate the acquisitions
that it made in the most recently completed financial year and future acquisitions into its business is subject to a number of risks including
the following:


 


		•	failure to integrate successfully the personnel, information systems, technology and operations of the
acquired business;






		•	failure to maximize the potential financial and strategic benefits of the acquisition;






		•	failure to realize the expected synergies of the acquired business;






		•	possible impairment of relationships with employees and clients as a result of any integration of new
businesses and management personnel;






		•	impairment of goodwill;






		•	increased demand on human resources and operating systems, procedures and controls; and






		•	reductions in future operating results as a result of the amortization of intangible assets.



 


Future acquisitions are accompanied by the risk
that obligations and liabilities of an acquired business may not be adequately reflected in the historical financial statements of that
business and the risk that historical financial statements may be based on assumptions, which are incorrect or inconsistent with the Company’s
assumptions or approach to accounting policies. The acquisition and integration of businesses may not be managed effectively and any failure
to do so could lead to disruptions in the overall activities of the Company, a loss of clients and revenue, and increased expenses. The
Company may acquire contingent liabilities in connection with the acquisitions of business, which maybe material. Best efforts are used
to identify and estimate these contingent liabilities and the likelihood that they will materialize but these estimates could differ materially
from the liabilities actually incurred.


 


International Operations


 


The Company currently operates in the United States,
Australia, United Kingdom and Canada and its products and services are sold internationally. There are certain risks inherent in international
operations including, but not limited to, remote management, unexpected changes in regulatory requirements, export restrictions, tariffs
and other trade barriers, difficulties in staffing and managing foreign operations, longer payment cycles, problems in collecting accounts
receivable, fluctuations in currency exchange rates, and potential adverse tax consequences, which could have a materially adverse effect
on the Company’s business, operating results, and financial condition.


 


Ability to Protect Intellectual Property


 


The
Company’s success is heavily dependent on its ability to protect its intellectual property. The Company relies on protecting
its proprietary intellectual property in part through confidentiality agreements with its corporate resellers, strategic partners, employees,
consultants and certain contractors. There can be no assurance that these agreements will not be breached, that the Company will have
adequate remedies for any breach, or that the Company’s trade secrets will not otherwise become known or independently discovered
by its competitors.


 






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Potential Intellectual Property Claims


 


Companies in the technology industry often own
large numbers of patents, copyrights, trademarks and trade secrets and frequently enter into litigation based on allegations of infringement
or other violations of intellectual property rights. VIQ may be subject to intellectual property rights claims in the future and its technologies
may not be able to withstand any third-party claims or rights against their use. Any intellectual property claims, with or without merit,
could be time consuming, expensive to litigate or settle and could divert management resources and attention. An adverse determination
also could prevent VIQ from offering its products and services to others and may require that it procure substitute products or services
for these members. With respect to any intellectual property rights claim, VIQ may have to pay damages or stop using technology found
to be in violation of a third party’s rights. VIQ may have to seek a license for the technology, which may not be available on reasonable
terms and may significantly increase its operating expenses. The technology also may not be available for license to VIQ at all. As a
result, VIQ may also be required to develop alternative non-infringing technology, which could require significant effort and expense.
If VIQ cannot license or develop technology for the infringing aspects of its business, it may be forced to limit its product and service
offerings and may be unable to compete effectively. Any of these results could harm VIQ’s brand and prevent VIQ from generating
sufficient revenue or achieving profitability. Litigation may be necessary to defend against claims of infringement or to protect trade
secrets. Such litigation could result in substantial costs and diversion of management efforts regardless of the results of such litigation
and an adverse result could subject VIQ to significant liabilities to third parties, require disputed rights to be licensed or require
VIQ to cease using such technology.


 


Uninsured or Uninsurable Risk


 


VIQ may become subject to liability for risks
which are uninsurable or against which VIQ may opt out of insuring due to the high cost of insurance premiums or other factors. The payment
of any such liabilities would reduce the funds available for usual business activities. Payment of liabilities for which insurance is
not carried may have a material adverse effect on VIQ’s financial position and operations.


 


Competition


 


VIQ in engaged in an industry that is highly competitive.
Because this industry is evolving and characterized by technological change, it is difficult to predict whether, when and by whom new
competing technologies may be introduced or when new competitors may enter the market. VIQ faces increased competition from companies
with strong positions in certain markets we currently serve and in new markets and regions we may enter. Many of VIQ’s current and
potential future competitors have significantly greater financial and other resources than VIQ currently possesses and may spend significant
amounts of resources to gain market share. VIQ may unable to compete effectively against current and future competitors. In addition,
increased competition or other competitive pressures may result in price reductions, reduced margins or loss of market share, any of which
could have a material adverse effect on VIQ’s business, financial condition or results of operations.


 


Competitors may be able to respond to new or emerging
technologies and changes in customer requirements more effectively than VIQ can, or may devote greater resources to the development, promotion
and sale of products than VIQ can. Current and potential competitors may establish cooperative relationships among themselves or with
third parties, including through mergers or acquisitions, to increase the ability of their products to address the needs of our current
or prospective customers. If these competitors were to acquire significantly increased market share, it could have a material adverse
effect on VIQ’s business, financial condition or results of operations. VIQ’s competitors may also establish or strengthen
co-operative relationships with systems integrators, third-party consulting firms or other parties with whom VIQ currently has relationships,
thereby limiting VIQ’s ability to promote its products and services.


 


To remain competitive, VIQ must continue to provide:


 


		•	technologically advanced products and solutions that anticipate and satisfy the demands of end-users;






		•	continuing advancements or innovations in our product offerings, including products with price-performance
advantages or value-added features in security, reliability or other key areas of customer interest;






		•	a responsive and effective sales force;



 






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		•	a dependable and efficient sales distribution network;






		•	superior customer service; and






		•	high levels of quality and reliability.



 


There is no assurance that VIQ will be able to
compete successfully against its current or future competitors. Competition may result in price reductions, lower gross profit margins,
increased discounts to customers and loss of market share, and could require increased spending by VIQ on research and development, sales
and marketing and customer support.


 


Product Liability Exposure


 


The Company faces an inherent business risk of
exposure to product liability and other claims in the event that the development or use of its technology or prospective products is alleged
to have resulted in adverse effects. While the Company has taken, and will continue to take, what it believes are appropriate precautions,
there can be no assurance that it will avoid significant liability exposure. Although the Company currently carries product liability
insurance, there can be no assurance that the Company has sufficient coverage or can obtain sufficient coverage at a reasonable cost.
An inability to obtain product liability insurance at acceptable cost or to otherwise protect against potential product liability claims
could prevent or inhibit the commercialization of products developed by the Company. A product liability claim could have a material adverse
effect on the Company’s business financial condition and results of operations.


 


Managing Growth


 


Failure to manage our growth successfully may
adversely impact our operating results. In order to manage growth and changes in strategy effectively, VIQ must: (a) maintain adequate
systems to meet customer demand; (b) expand sales and marketing, distribution capabilities, and administrative functions; (c) expand
the skills and capabilities of its current management team; and (d) attract and retain qualified employees; and e) expand our internal
operational and financial controls significantly, so that we can maintain control over operations and provide support to other functional
areas as the number of personnel and size of business increases. While it intends to focus on managing its costs and expenses over the
long term, VIQ expects to invest its earnings and capital to support its growth, but may incur additional unexpected costs. If VIQ incurs
unexpected costs it may not be able to expand quickly enough to capitalize on potential market opportunities. Our inability to achieve
any of these objectives could harm our business, financial condition and results of operations.


 


Retention and Acquisition of Skilled Personnel


 


The loss of any member of VIQ’s management
team could have a material adverse effect on its business and results of operations. In addition, the inability to hire or the increased
costs of hiring new personnel, including members of executive management, could have a material adverse effect on VIQ’s business
and operating results. The expansion of marketing and sales of its products will require VIQ to find, hire and retain additional capable
employees who can understand, explain, market and sell its products. There is intense competition for capable personnel in all of these
areas and VIQ may not be successful in attracting, training, integrating, motivating, or retaining new personnel, vendors, or subcontractors
for these required functions. New employees often require significant training and in many cases, take a significant amount of time before
they achieve full productivity. As a result, VIQ may incur significant costs to attract and retain employees, including significant expenditures
related to salaries and benefits and compensation expenses issued in connection to equity awards, and may lose new employees to its competitors
or other companies before it realizes the benefit of its investment in recruiting and training them. In addition, as VIQ moves into new
jurisdictions, it will need to attract and recruit skilled employees in those new areas.


 


Legal and Regulatory Proceedings


 


From time to time, VIQ may be a party to legal
and regulatory proceedings, including matters involving governmental agencies, entities with whom it does business and other proceedings
arising in the ordinary course of business. VIQ will evaluate its exposure to these legal and regulatory proceedings and establish reserves
for the estimated liabilities in accordance with generally accepted accounting principles. Assessing and predicting the outcome of these
matters involves substantial uncertainties. Unexpected outcomes in these legal proceedings, or changes in management’s evaluations
or predictions and accompanying changes in established reserves, could have an adverse impact on VIQ’s financial results.


 






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Conflicts of Interest


 


Certain of the directors and officers of VIQ are
or may become directors or officers of, or have significant shareholdings in, other companies and, to the extent that such other companies
may participate in ventures in which VIQ may participate, the directors and officers of VIQ may have a conflict of interest in negotiating
and concluding terms respecting the extent of such participation. Such other companies may also compete with VIQ. In the event that any
such conflict of interest arises, a director who has such a conflict will disclose the conflict to a meeting of the directors of VIQ and
will abstain from voting for or against the approval of such participation or such terms. In accordance with applicable laws, the directors
of VIQ are required to act honestly, in good faith and in the best interests of VIQ. In determining whether or not VIQ will participate
in a particular transaction, the directors will primarily consider the potential benefits to VIQ, the degree of risk to which VIQ may
be exposed and its financial position at that time. See also “Directors and Officers – Conflicts of Interest”.


 


Financial and Accounting Risks


 


Cash Flows Risk


 


VIQ’s business operations are subject to
all of the risks inherent in the establishment and maintenance of a developing business enterprise, such as competition and viable operations
management. The future earnings and cash flow from operations of VIQ are dependent, in part, on its ability to further develop and market
its products. There can be no assurances that VIQ will grow and achieve profitability. The operations of VIQ have been funded to date
by external financing and if sufficient cash flow from operations or earnings is not generated in the future, additional financing might
be required.


 


Access to Capital


 


VIQ
makes, and will continue to make, substantial investments and other expenditures related to acquisitions, research and development and
marketing initiatives. The operations of VIQ have been funded to date by external financing and if sufficient cash flow from operations
or earnings is not generated in the future, additional financing might be required. VIQ will have further capital requirements and other
expenditures as it proceeds to expand its business or take advantage of opportunities for acquisitions or other business opportunities
that may be presented to it. VIQ may incur major unanticipated liabilities or expenses. VIQ can provide no assurance that it will be able
to obtain financing to meet the growth needs of its operations.


 


Estimates or Judgments Relating to Critical
Accounting Policies


 


The preparation of consolidated financial statements
in accordance with IFRS requires management to make estimates and assumptions that affect the application of the Company’s accounting
policies and the amounts reported in the consolidated financial statements and the related notes. These estimates are based on management’s
best knowledge of current events and actions that the Company may undertake in the future. These estimates have been applied in a manner
consistent with that in prior periods and there are no known trends, commitments, events or uncertainties that the Company believes will
materially affect the assumptions utilized in these consolidated financial statements. Estimates and underlying assumptions are reviewed
on an ongoing basis and revisions to estimates are recognized prospectively. The estimates are impacted by many factors, some of which
are highly uncertain and actual results may differ from those estimates.


 


The
continuing uncertainty around the outbreak of COVID-19 pandemic required the use of judgments and estimates in the preparation
of the consolidated financial statements for the year ended December 31, 2020. The future impact of COVID-19 uncertainties could
generate, in future reporting periods, a significant impact to the reported amounts of assets, liabilities, revenue and expenses in these
and any future consolidated financial statements. Examples of accounting estimates and judgments that may be impacted by the pandemic
include, but are not limited to, impairment of goodwill and intangible assets and allowance for doubtful accounts.


 


VIQ’s operating results may be adversely
affected if the assumptions change or if actual circumstances differ from those in the assumptions, which could cause VIQ’s operating
results to fall below the expectations of investors, resulting in a decline in the share price of VIQ. Significant assumptions and estimates
used in preparing the financial statements include those related to the credit quality of accounts receivable, income taxes, income tax
credits receivable, share based payments, warrants, internally generated development costs, functional currency, impairment of non-financial
assets, purchase price allocation, contingent consideration, incremental borrowing rate used to discount leases, allocation of the transaction
price to multiple performance obligations in contracts with customers, as well as revenue and cost recognition.


 






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Tax Risks


 


VIQ operates is subject to income tax and other
forms of taxation in multiple jurisdictions. Taxation laws and rates which determine taxation expenses may vary significantly in different
jurisdictions, and legislation governing taxation laws and rates are also subject to change. Therefore, VIQ’s earnings may be impacted
by changes in the proportion of earnings taxed in different jurisdictions, changes in taxation rates, changes in estimates of liabilities
and changes in the amount of other forms of taxation. VIQ may have exposure to greater than anticipated tax liabilities or expenses. VIQ
may be subject to income taxes and non-income taxes in a variety of jurisdictions and its tax structure may be subject to review by both
domestic and foreign taxation authorities and the determination of VIQ’s provision for income taxes and other tax liabilities will
require significant judgment.


 


Foreign Currency Fluctuations


 


VIQ’s monetary assets and liabilities denominated
in currencies other than the Canadian dollar will give rise to a foreign currency gain or loss reflected in our comprehensive earnings.
To the extent the United States dollar or Australian dollar weakens against the Canadian dollar, VIQ may incur foreign exchange losses.
Such losses would be included in VIQ’s financial results and, consequently, may have an adverse effect on the price of the Common
Shares. As VIQ currently has a global client base, a significant portion of VIQ’s income is in US dollars and Great Britain pounds.
The exchange rates between the Canadian dollar, the US dollar and the Great Britain pound are subject to daily fluctuations in the currency
markets and these fluctuations in market exchange rates are expected to continue in the future. Such fluctuations affect both VIQ’s
consolidated revenues as well as our consolidated costs. Also, changes in foreign exchange rates may affect the relative costs of operations
and prices at which VIQ and its foreign competitors sell products in the same market. VIQ currently does not engage in currency hedging
through financial instruments.


 


Internal Controls Risk


 


Effective internal controls are necessary for
VIQ to provide reliable financial reports and effectively prevent fraud. Under Canadian securities law requirements, VIQ’s Chief
Executive Officer and Chief Financial Officer are required to certify that they are responsible for establishing and maintaining disclosure
controls and internal controls over financial reporting for the Company, that those disclosure controls and internal controls have been
designed and are effective in providing reasonable assurance regarding the reliability of financial reporting and the preparation of financial
statements in accordance with IFRS. VIQ maintains compliance with Canadian securities law requirements by strengthening, assessing and
testing the system of internal controls to provide the basis for the certification. However, the continuous process of strengthening VIQ’s
internal controls and complying with Canadian securities law requirements is expensive and time consuming. VIQ cannot be certain that
the measures it is taking will ensure that it maintains adequate control over financial processes and reporting. Furthermore, as VIQ grows
its business, the controls will become more complex and the Company could require more resources to ensure its internal controls remain
effective. Failure to implement required new or improved controls, or difficulties encountered in their implementation, could harm VIQ’s
results of operations or cause it to fail to meet its reporting obligations. If VIQ or its independent registered public accounting firm
discover a material weakness, the disclosure of that fact, even if quickly remedied, could reduce the market’s confidence in VIQ’s
audited consolidated financial statements and harm its share price. In addition, future non-compliance with the Canadian securities law
requirements could subject VIQ to a variety of administrative sanctions, including the suspension of trading or delisting of its common
shares, which could materially adversely affect its share price.


 


Risks Related to the Common Shares


 


Volatile Market Price for Common Shares


 


The
market price for Common Shares may be volatile and subject to wide fluctuations in response to numerous factors, many of which are beyond
the Company’s control. Fluctuations in the market price of the Common Shares could cause an investor to lose all or part
of its investment in Common Shares. Factors that could cause fluctuations in the trading price of the Common Shares include: (a) announcements
of new offerings, products, services or technologies, commercial relationships, acquisitions or other events by VIQ or its competitors;
(b) price and volume fluctuations in the overall stock market from time to time; (c) significant volatility in the market price
and trading volume of agriculture companies; (d) fluctuations in the trading volume of the Common Shares or the size of VIQ’s
public float; (e) actual or anticipated changes or fluctuations in VIQ’s results of operations; (f) whether VIQ’s
results of operations meet the expectations of securities analysts or investors; (g) actual or anticipated changes in the expectations
of investors or securities analysts; (g) litigation involving VIQ, its industry, or both; (h) regulatory developments in the
Canada and other countries; (i) general economic conditions and trends; (j) major catastrophic events; (k) escrow releases,
sales of large blocks of the Common Shares; (l) departures of key employees or members of management; or (m) an adverse impact
on VIQ from any of the other risks cited herein.


 






    19


     


    

 


No History of Payment of Cash Dividends


 


VIQ
has not declared or paid cash dividends on the Common Shares. VIQ intends to retain future earnings to finance the operation, development,
and expansion of the business. VIQ does not anticipate paying cash dividends on the Common Shares in the foreseeable future. Payment of
future cash dividends, if any, will be at the discretion of the Board and will depend on VIQ’s financial condition, results of operations,
contractual restrictions, capital requirements, business prospects and other factors that the Board considers relevant.


 


Market Risks related to Securities


 


The market price of the Common Shares may be subject
to wide fluctuations in response to many factors, including variations in the operating results of the Company, divergence in financial
results from analysts’ expectations, changes in earnings estimates by stock market analysts, changes in the business prospects for
the Company, general economic conditions, legislative changes and other events and factors outside of the Company’s control.


 


Dilution


 


VIQ may also issue Common Shares or securities
convertible into Common Shares from time to time in connection with a financing, acquisition or otherwise. Any such issuance could result
in substantial dilution to existing Shareholders and cause the trading price of VIQ’s securities to decline.


 


	DIVIDENDS AND DISTRIBUTIONS


 


While there are no restrictions in the Company’s
articles or pursuant to any agreement or understanding that prevent the Company from paying dividends or distributions, VIQ has not declared
or paid cash dividends on the Common Shares. VIQ intends to retain future earnings to finance the operation, development and expansion
of the business, and accordingly, VIQ does not anticipate paying cash dividends on Common Shares in the foreseeable future. Payment of
future cash dividends, if any, will be at the discretion of the Board and will depend on VIQ’s financial condition, results of operations,
contractual restrictions, capital requirements, business prospects and other factors that the Board considers relevant.


 


	DESCRIPTION OF CAPITAL STRUCTURE


 


Common Shares


 


VIQ is authorized to issue an unlimited number
of Common Shares, of which 24,893,638 are issued and outstanding as at the date of this AIF. Shareholders are entitled to receive notice
of, attend, and vote at any meeting of the Shareholders, and to cast one vote for each Common Share held on the applicable record date
in respect of any matter put to vote at such a meeting. Shareholders are entitled to receive dividends if, as and when declared by the
Board. Shareholders are entitled to share equally in the remaining property of the Company upon the liquidation, dissolution or winding-up
of the Company.


 


Warrants


 


As of the date of this AIF there are no warrants
to purchase Common Shares (“Warrants”) issued and outstanding.


 






    20


     


    

 


Stock Options and Other Compensation Securities


 


Legacy Option Plan


 


The Company has a “rolling” stock
option plan (the “Legacy Stock Option Plan”) pursuant to which up to a maximum of 10% of the issued and outstanding
Common Shares may be reserved for issuance pursuant to the exercise of Legacy Stock Options. As of the date of this AIF, no further grants
of Legacy Stock Options may be made under the Legacy Stock Option Plan as the Legacy Stock Option Plan is replaced with the Omnibus Equity
Incentive Plan.


 


As
of the date of this AIF, there are a total of 939,600 Legacy Stock Options issued and outstanding. Legacy Stock Options are exercisable
by the holders there of to acquire Common Shares at a future date. The terms and conditions attached to the Legacy Stock Option grants
were determined by the Board, in its sole discretion. At the time of grant the Board had the power and discretionary authority to determine
the terms and conditions of the Legacy Stock Option grants, including the individuals who would receive the Legacy Stock Option grants,
the number of Legacy Stock Options subject to each grant, the exercise price of the Legacy Stock Options, the limitations or restrictions
on vesting of Legacy Stock Options, acceleration of vesting of Legacy Stock Options, the form of consideration payable on settlement of
Legacy Stock Options and the timing of the Legacy Stock Options grants. The Board also had the power to establish procedures for payment
of withholding tax obligations with cash.


 


Legacy DSU Plan


 


On March 17, 2015, the Company adopted a
deferred share unit plan (the “Legacy DSU Plan”). The Legacy DSU Plan was approved by Shareholders on June 17,
2015.


 


At any given time, a maximum of 100,000 Common
Shares may be reserved for issuance under the Legacy DSU Plan. As of the date of this AIF, there are a total of 66,667 Legacy DSUs issued
and outstanding.


 


Only
non-employee Directors (“Eligible Directors”) are eligible to participate in the Legacy DSU Plan. A Legacy DSU
issued under the Legacy DSU Plan is a “bookkeeping” entry representing a future right to receive one Common Share or its equivalent
fair market value in cash at the time of the holder’s retirement, death or the holder otherwise ceasing to be an Eligible Director.
Under the Legacy DSU Plan, the Board may, from time to time in its sole discretion, provide for the grant of Legacy DSUs to an Eligible
Director and upon such grant, such Eligible Director shall become a participant in the Legacy DSU Plan; however, participation in the
Legacy DSU Plan is optional. Each Legacy DSU awarded by the Company is initially equal to the value of a Common Share at the time the
Legacy DSU is awarded. The value of the Legacy DSU increases or decreases as the price of the Common Shares increases or decreased.


 


Omnibus Equity Incentive Plan


 


On January 13, 2021, the Board adopted an
omnibus equity incentive plan (the “Omnibus Equity Incentive Plan”), which was approved by Shareholders at the Company’s
annual general and special meeting of Shareholders at April 29, 2021 and became effective on that date.


 


The Omnibus Equity Incentive Plan is a “rolling”
plan which provides that an aggregate maximum of 10% of the Company’s issued and outstanding Common Shares may be reserved for issuance
pursuant to the exercise of: (i) Legacy Stock Options; (ii) and Awards under the Omnibus Equity Incentive Plan. As of the date
of this AIF there are no Stock Options, RSUs, PSUs or DSUs issued and outstanding.


 


Under the Omnibus Equity Incentive Plan, employees,
directors and consultants of the are eligible to receive awards of stock options (“Stock Options”), restricted share
units (“RSUs”), performance share units (“PSUs”) and deferred share units (“DSUs”)
under the Omnibus Equity Incentive Plan.


 






    21


     


    

 


Stock Options


 


A Stock Option entitles a holder thereof to purchase
a prescribed number of treasury Common Shares at an exercise price set at the time of the grant. Such grant may be settled in Common Shares,
cash or combination thereof in the discretion of the Plan Administrator. If settled in cash, such payment will be equal to the “in
the money” amount, being an amount equal to the Market Price (as defined below) of the Common Shares issuable on the exercise of
such Stock Option as of the date such Stock Option is exercised, less the aggregate exercise price of the Option. The Board has the power
and discretionary authority to determine the terms and conditions of the Stock Option grants, including the individuals who will receive
the Stock Option grants, the number of Stock Options subject to each grant, the exercise price of the Stock Options, the limitations or
restrictions on vesting of Stock Options, acceleration of vesting of Stock Options, the form of consideration payable on settlement of
Stock Options and the timing of the Stock Options grants.


 


Subject to the policies of the TSX, a Stock Option
holder may elect to surrender a Stock Option to the Company (a “Cashless Exercise”) in consideration for an amount
from the Company equal to (i) the Market Price of the Common Shares issuable on the exercise of such Stock Option (or portion thereof)
as of the date such Stock Option (or portion thereof) is exercised, less (ii) the aggregate exercise price of the Stock Option (or
portion thereof) surrendered relating to such Common Shares (the “In-the-Money Amount”) by written notice to the Company
indicating the number of Stock Options such participant wishes to exercise using the Cashless Exercise, and such other information that
the Company may require. Subject to the provisions of the Omnibus Equity Incentive Plan and the policies of the TSX, the Company will
satisfy payment of the In-the-Money Amount by delivering to the participant: (i) such number of Common Shares having a fair market
value equal to the In-the-Money Amount; (ii) a cash payment equal to the In-the-Money Amount; or (iii) a combination of Common
Shares and cash having an aggregate value equal to the In-the-Money Amount.


 


Restricted Share Units


 


A
RSU is a unit equivalent in value to a Common Share credited by means of a bookkeeping entry in the books of the Company which entitles
the holder to receive one Common Share (or the value thereof) for each RSU after a specified vesting period. The Board has the
power and discretionary authority to determine the terms and conditions of RSU grants, including the individuals who will receive RSU
grants, the number of RSUs subject to each grant, the vesting of RSU grants, the form of consideration issuable upon vesting of RSU grants
and the timing of RSU grants.


 


Upon settlement, holders will redeem each vested
RSU for the following at the election of such holder but subject to the approval of the Board: (a) one fully paid and non-assessable
Common Share in respect of each vested RSU, (b) a cash payment or (c) a combination of Common Shares and cash. Any such cash
payments made by the Company shall be calculated by multiplying the number of RSUs to be redeemed for cash by the Market Price per Common
Share as at the settlement date.


 


Performance Share Units


 


A PSU is a unit equivalent in value to a Common
Share credited by means of a bookkeeping entry in the books of the Company which entitles the holder to receive one Common Share (or the
value thereof) for each PSU after specific performance-based vesting criteria determined by the Plan Administrator, in its sole discretion,
have been satisfied. The Board has the power and discretionary authority to determine the terms and conditions of PSU grants, including
the individuals who will receive PSU grants, the number of PSUs subject to each grant, the vesting of PSU grants, the form of consideration
issuable upon vesting of PSU grants and the timing of PSU grants.


 


Upon settlement, holders will redeem each vested
PSU for the following at the election of such holder but subject to the approval of the Board: (a) one fully paid and non-assessable
Common Share in respect of each vested PSU, (b) a cash payment, or (c) a combination of Common Shares and cash. Any such cash
payments made by the Company to a participant shall be calculated by multiplying the number of PSUs to be redeemed for cash by the Market
Price per Common Share as at the settlement date.


 


Deferred Share Units


 


A DSU is a unit equivalent in value to a Common
Share credited by means of a bookkeeping entry in the books of the Company which entitles the holder to receive one Common Share (or,
at the election of the holder and subject to the approval of the Board, the cash value thereof) for each DSU on a future date. The Board
may fix from time to time a portion of the total compensation (including annual retainer) paid by the Company to a director in a calendar
year for service on the Board that are to be payable in the form of DSUs. In addition, each director is given, subject to the provisions
of the Omnibus Equity Incentive Plan, the right to elect to receive a portion of the cash Director Fees owing to them in the form of DSUs.


 






    22


     


    

 


Except as otherwise determined by the Board or
as set forth in a particular award agreement, DSUs shall vest immediately upon grant. Upon settlement, holders will redeem each vested
DSU for: (a) one fully paid and non-assessable Common Share issued from treasury in respect of each vested DSU, or (b) at the
election of the holder and subject to the approval of the Plan Administrator, a cash payment on the date of settlement. Any cash payments
made under the Omnibus Equity Incentive Plan by the Company to a participant in respect of DSUs to be redeemed for cash shall be calculated
by multiplying the number of DSUs to be redeemed for cash by the Market Price per Common Share as at the settlement date.


 


	MARKET
FOR SECURITIES


 


Trading Price and Volume


 


The
Company’s Common Shares are listed for trading on the TSX under the symbol “VQS” and in the United States on the OTCQX
under the trading symbol “VQSLF”. During the year ended December 31, 2020, the Company’s Common Shares were
listed on the TSXV. On January 19, 2021, the Company announced its receipt of final approval from the TSX to graduate from listing
on the TSXV to listing on the TSX. On January 21, 2021, the Company’s Common Shares began trading on the TSX and, in conjunction,
were voluntarily delisted from the TSXV.


 


The following table sets out trading information
for the Common Shares on the TSXV for the Company’s most recently completed financial year:


 


	Period	 	High	 	Low	 	Volume
	December 2020	 	6.50	 	4.10	 	999,371
	November 2020	 	5.22	 	3.99	 	852,950
	October 2020	 	5.48	 	3.80	 	487,695
	September 2020	 	4.15	 	3.60	 	134,862
	August 2020	 	4.01	 	3.58	 	258,854
	July 2020	 	4.24	 	3.50	 	352,578
	June 2020	 	4.45	 	2.90	 	641,958
	May 2020	 	3.85	 	2.45	 	646,513
	April 2020	 	4.25	 	3.16	 	251,926
	March 2020	 	4.49	 	2.82	 	278,844
	February 2020	 	4.50	 	2.02	 	375,400
	January 2020	 	2.18	 	1.71	 	146,561



 


Unlisted Securities


 


During the financial year ended December 31,
2020, the Company issued the following securities not listed or quoted on any stock exchange or other marketplace:


 


	Date
of Issue
	 	Class of
 Security	 	Number
of Securities

Issued
	 	Conversion/Exercise

 price per Security
	April 24, 2020	 	Legacy Stock 
 Options	 	396,000	 	C$3.13



 






    23


     


    





 


	DIRECTORS, OFFICERS AND PROMOTERS


 


The table below lists the following information
about the Company’s directors and officers: their names, municipalities of residence, positions and offices held, and principal
occupations or employment.


 


	Name,
Municipality of 

Residence and Position 

with the Company	Principal Occupations during the Last Five Years	Period as a 

Director or 

Officer of the

 Company
	Larry Taylor (2) 

Ontario, Canada	Mr. Taylor has been CEO Group Leader of CEO Global Network since 2011 and President of Taylor Made Solutions since 2009. He currently sits as an independent board member for Continental Bank of Canada. Mr. Taylor is Board Chair for the Green Energy Cooperative of Ontario and Board Chair for Spark Power Group Inc. (TSX: SPG). Mr. Taylor is a Chartered Professional Accountant and a Certified Management Consultant. Mr. Taylor has previously held key senior executive positions with several companies including National Money Mart, Travelex Americas and Cap Gemini Ernst & Young Canada Inc. Mr. Taylor has experience working with private equity firms to identify, acquire and combine companies to create shareholder value.	June 2014 to present
	Sebastien Paré (2)

Ontario, Canada	Mr. Paré has been the Chief Executive Officer of the Company since January 2015 and has served as the President of the Company since August 2014. Prior thereto, Mr. Paré served as President of CSDC Systems Inc. since May of 2004.  Mr. Paré is a leading digital transformation expert driving VIQ to deliver intelligent automation, enhanced with human review, to drive transformation in the way evidentiary content in highly secured and regulated agencies is captured, secured, and repurposed into actionable information. He has worked in North America, the Middle East, and West Africa. Prior to his position at the Company, he was President and Chief Operating Officer of an enterprise technology platform company dedicated to public sector digital services. Mr. Paré received a Bachelor of Science from the University of Quebec at Montreal and a Master of Science from the University of British Columbia.	February 2015 to present
	Harvey Gordon (1)(2)

Ontario, Canada	Mr. Gordon is the Managing Director of Channel Solutions Inc., where he provides CEO mentoring and strategic development guidance to growth-oriented technology companies. Mr. Gordon has extensive software, professional services and technology leadership experience as the CEO of international, US and Canadian companies, both public and private. He has held key senior executive positions during high growth phases of industry leading software and service firms, including Algorithmics Inc., Changepoint Corporation, Infonet Services Corporation and Magic Lantern Group. Mr. Gordon holds a Master of Science degree in Computer Science from the University of Toronto and a Bachelor of Applied Science in Engineering Science.	June 2014 to present
	Mike Kessel (1)

Ontario, Canada	Mr. Kessel is the President and CEO of Cleveland Clinic Canada and is responsible for the growth, strategic partnerships and enterprise value creation. He implemented a unique public/private hybrid strategy that led to formal partnerships with Sick Kids, Sunnybrook and Mt. Sinai Hospitals and the Heart and Stroke Foundation. He also led partnership efforts with the Ontario Ministry of Health resulting in important firsts in country and cross border patient care. Mr. Kessel earned an MBA from Kellogg Business School at Northwestern University in Chicago and a Bachelor of Science from The Ohio State University. He is also a Chartered Professional Accountant.	September 2017 to present



 






    24


     


    

 


	Name,
Municipality of 

Residence and Position 

with the Company	Principal Occupations during the Last Five Years	Period as a

 Director or

 Officer of the

 Company
	Joseph Quarin (1)

Ontario, Canada	Mr. Quarin is a successful public company Chief Executive Officer (TSX and NYSE), corporate executive and director. He was the Chief Executive Officer and Director of Progressive Waste Solutions Ltd., a North American non-hazardous solid waste management company from January 2012 until the reverse-merger with Waste Connections Inc. in 2016. Mr. Quarin joined Progressive’s inaugural leadership team in July 2000 and played an integral role in its growth and success from US$100 million to US$2 billion in revenue. He is currently the President and Chief Executive Officer of Q5 Capital Inc., a private investment company and strategic management advisor focused on leadership, growth and operating initiatives that drive value creation. He was recognized as #10 on the Financial Post’s Top 100 CEO Scorecard 2016 and named one of Canada’s Top 40 Under 40TM in 2004.  Mr. Quarin currently serves as a Board member of Spark Power Group Inc. (TSX: SPG), Edo Revenue Royalty GP and EJ Trademark GP, Eagle River Capital, LLC and GRT Holdings Ltd. He is also a Director of the Humber River Hospital Board. Mr. Quarin holds a Master of Business Administration (with Distinction) from the Ivey Business School at Western University, a Bachelor of Commerce (Honours) from the Smith School of Business at Queen’s University, and is a Chartered Professional Accountant and Chartered Accountant.	November 2016 to present
	Bradley Wells (2)

Ontario, Canada	
    Mr. Wells has been President and CEO of Momentum
    Group Ltd. since he founded it in 2004. He served as CEO of Sym-Tech Dealer Services for the past 25 years until the company was successfully
    sold in 2019. Mr. Wells currently runs operating companies in Canada, the United States and Central America.

     
	November 2019 to present
	
    Alexie Edwards

    Ontario, Canada
	
    Mr. Edwards
    has been Chief Financial Officer since May 1, 2019. Mr. Edwards has 20+ years’ experience in finance and accounting spanning
    various industries, namely including Real Estate and Software, Proven finance leader who has built and shaped first-class finance teams,
    led the integration of numerous acquisitions in various jurisdictions, and overseen implementation of incredibly challenging accounting
    changes, Previously served as Vice President of Finance for Jonas Software (Subsidiary of Constellation Software), an international provider
    of market-leading software. Mr. Edwards holds a Post Graduate Diploma from the University of Manchester and is a Chartered
    Professional Accountant and Chartered Accountant.

     
	May 2019 to present
	
    Susan Sumner

    Florida, USA

     
	
    Ms. Sumner has been Chief Operating
    Officer since July 2018. Ms. Sumner has held 30 years executive leadership, consulting and operations management roles in
    Fortune 500 companies Deep insight and experience in building world-class operational infrastructure for IT companies, Successfully
    combined several middle-market operating companies in the medical transcription space generating a successful exit for capital
    providers, Oversaw the acquisition and integration of multiple transcription and IT businesses at Nuance Corporation.
	July 2018 to present





 


Notes:


		(1)	Member of the Audit Committee. Joseph Quarin is the Chair of the Audit Committee.






		(2)	Member of the Compensation, Nominating and Corporate Governance Committee. Larry Taylor is the Chair of
the Compensation Committee.



 






    25


     


    

 


Term of Directors


 


The term of office of the directors expires annually
at the time of each of the Company’s annual general meeting. The term of office of the executive officers expires at the discretion
of the Board.


 


Aggregate Ownership of Securities


 


As a group, the directors and officers of the
Company hold approximately 5,910,514 Common Shares, representing 23.74% of all issued and outstanding Common Shares, approximately 558,750
Legacy Stock Options representing 59.47% of the outstanding Legacy Stock Options and approximately 66,667 Legacy DSUs representing 100%
of the total outstanding Legacy DSUs.


 


Work Commitment to the Company


 


VIQ’s executive officers work on a full-time
basis for the Company. Each executive office of the Company has entered into non-competition and non-disclosure agreements with VIQ. The
directors devote their time and expertise as required by VIQ.


 


	Cease Trade Orders, Bankruptcies, Penalties or Sanctions


 


Cease Trade Orders


 


No director or executive officer of the Company
is, as at the date of this AIF, or was within ten years before the date of this AIF, a director, chief executive officer or chief financial
officer of any company (including the Company) that:


 


		(a)	was subject to a cease trade order, an order similar to a cease trade order, or an order than denied the
relevant company access to any exemption under securities legislation, that was in effect for a period of more than 30 consecutive days,
that was issued while the director or executive officer was acting in the capacity as director, chief executive officer or chief financial
officer, or



 


		(b)	was subject to a cease trade order, an order similar to a cease trade order, or an order than denied the
relevant company access to any exemption under securities legislation, that was in effect for a period of more than 30 consecutive days,
that was issued after the director or executive officer ceased to be a director, chief executive officer or chief financial officer and
which resulted from an event that occurred while that person was acting in the capacity as director, chief executive officer or chief
financial officer.



 


The foregoing information, not being within the
knowledge of VIQ, has been furnished by the respective directors and executive officers.


 


Bankruptcy & Insolvency


 


No
director or executive officer of the Company, nor a shareholder holding a sufficient number of securities of the Company to affect
materially the control of the Company:


 


		(a)	is, as at the date of this AIF, or has been within 10 years before the date of this AIF, a director or
executive officer of any company (including the Company) that, while that person was acting in that capacity, or within a year of that
person ceasing to act in that capacity, became bankrupt, made a proposal under any legislation relating to bankruptcy or insolvency or
was subject to or instituted any proceedings, arrangement or compromise with creditors or had a receiver, receiver manager or trustee
appointed to hold its assets; or



 


		(b)	has, within 10 years before the date of this AIF, become bankrupt, made a proposal under any legislation
relating to bankruptcy or insolvency, or become subject to or instituted any proceedings, arrangement or compromise with creditors, or
had a receiver, receiver manager or trustee appointed to hold the assets of the proposed director.



 






    26


     


    

 


Penalties or Sanctions


 


No director or executive officer of the Company,
or a shareholder holding a sufficient number of securities of the Company to affect materially the control of the Company, has been subject
to:


 


		(a)	any penalties or sanctions imposed by a court relating to securities legislation or by a securities regulatory
authority or has entered into a settlement agreement with a securities regulatory authority; or



 


		(b)	any other penalties or sanctions imposed by a court or regulatory body that would likely be considered
important to a reasonable investor in making an investment decision.



 


	conflicts of interest


 


The Company’s directors and officers may
serve as directors or officers, or may be associated with, other reporting companies, or have significant shareholdings in other public
companies. To the extent that such other companies may participate in business or asset acquisitions, dispositions, or ventures in which
the Company may participate, the directors and officers of the Company may have a conflict of interest in negotiating and concluding terms
respecting the transaction. If a conflict of interest arises, the Company will follow the provisions of the OBCA dealing with conflict
of interest. These provisions state that where a director has such a conflict, that director must, at a meeting of the Company’s
directors, disclose his or her interest and refrain from voting on the matter unless otherwise permitted by the OBCA. In accordance with
the laws of the Province of Ontario, the directors and officers of the Company are required to act honestly, in good faith, and the best
interest of the Company.


 


To the best of the Company’s knowledge,
there are no known existing or potential conflicts of interest among the Company or a subsidiary of the Company and the Company’s
directors and officers or the directors and officers of a subsidiary of the Company as a result of their outside business interests, except
that certain of the directors and officers serve as directors and officers of other companies, and therefore it is possible that a conflict
may arise between their duties to the Company and their duties as a director or officer of such other companies.


 


	promotErs


 


A “Promoter” is defined in the Securities
Act (Ontario) as a “(a)  a person or company who, acting alone or in conjunction with one or more other persons, companies
or a combination thereof, directly or indirectly, takes the initiative in founding, organizing or substantially reorganizing the business
of an issuer; or (b) a person or company who, in connection with the founding, organizing or substantial reorganizing of the business
of an issuer, directly or indirectly, receives in consideration of services or property, or both services and property, 10 per cent or
more of any class of securities of the issuer or 10 per cent or more of the proceeds from the sale of any class of securities of a particular
issue, but a person or company who receives such securities or proceeds either solely as underwriting commissions or solely in consideration
of property shall not be deemed a promoter within the meaning of this definition if such person or company does not otherwise take part
in founding, organizing, or substantially reorganizing the business.”


 


No person or company has been, within the two
most recently completed financial years or during the current financial year, a promoter of the Company or of a subsidiary of the Company.


 






    27


     


    

 


	LEGAL PROCEEDINGS AND REGULATORY ACTIONS


 


In the ordinary course of business, VIQ may be
subject to certain contingent liabilities with respect to existing or potential claims, lawsuits and other proceedings, including those
involving tax, social security, labour lawsuits and other matters. VIQ will accrue liabilities when it is probable that future costs will
be incurred and such costs can be reasonably estimated.


 


As of the date of this AIF, the Company’s
management is not aware of any current or contemplated legal proceedings material to the Company to which it is a party or of which any
of its property is the subject matter.


 


As of the date of this AIF, no penalties or sanctions
have been imposed against the Company by a court or regulatory body and the Company did not enter into any settlement agreements before
a court relating to securities legislation or with a securities regulatory authority.


 


	INTERESTS OF MANAGEMENT AND OTHERS IN MATERIAL TRANSACTIONS


 


There were no material interests, direct or indirect,
of directors or executive officers of VIQ, of any Shareholder who beneficially owns, directly or indirectly, or exercises control or direction
over more than 10% of the outstanding voting securities of VIQ, or any known associate or affiliate of such persons, in any transaction
within the three most recently completed financial years or during the current financial year that has materially affected or would materially
affect VIQ or any of its subsidiaries.


 


	TRANSFER AGENTS AND REGISTRARS


 


The transfer agent and registrar for the Common
Shares is TSX Trust Company located at 100 Adelaide Street W, Suite 301, Toronto, Ontario M5H 4H1.


 


	MATERIAL CONTRACTS


 


Except
for contracts entered into in the ordinary course of business and not required to be filed under Section 12.2 of NI 51-102, there
are no contracts which are regarded as material and which were entered into by the Company within the most recently completed financial
year or before the most recently completed financial year that are still in effect.


 


	INTERESTS OF EXPERTS


 


The Company’s auditor is KPMG LLP and is
located at Vaughan Metropolitan Centre, 100 New Park Place, Suite 1400, Vaughan, Ontario L4K 0J3. Such auditor is independent within
the meaning of the relevant rules and related interpretations prescribed by the relevant professional bodies in Canada and any applicable
legislation or regulations.


 


MNP LLP, the former auditor of the Company, has
confirmed that it was, with respect to the Company, throughout the period of its engagement, independent in accordance with the Code of
Professional conduct of the Chartered Professional Accountants of Ontario.


 


There is no person or company whose profession
or business gives authority to a statement made by such person or company and who is named as having prepared or certified a statement,
report or valuation described or included in a filing, or referred to in a filing, made under NI 51-102 by the Company during the most
recently completed financial year other than MNP LLP, who acted as the Company’s auditor during the most recently completed financial
year. To management’s knowledge, as of the date hereof, neither MNP LLP nor the designated professionals of MNP LLP, directly or
indirectly owned any of the outstanding Common Shares or other securities of the Company. No director, officer or employee of MNP LLP
is to be or has been elected, appointed or employed as a director, officer or employee of the Company.


 






    28


     


    

 



 


	AUDIT
    COMMITTEES AND CORPORATE GOVERNANCE



 


The following information regarding the audit
committee of the Board (the “Audit Committee”) is required to be disclosed pursuant to NI 52-110.


 


Audit Committee Mandate and Terms of Reference


 


The Audit Committee is a committee established
for the purpose of overseeing the accounting and financial reporting process of the Company and annual external audits of the consolidated
financial statements. The mandate and responsibilities of the Audit Committee is attached hereto as Schedule “A”.


 


Composition of the Audit Committee


 


The
members of the Audit Committee, being Messrs. Quarin (Chair), Gordon and Kessel, are independent in accordance with NI 52-110.
In addition, the members of the Audit Committee have education and experience relevant to the performance of their responsibilities as
Audit Committee members and are all considered “financially literate” pursuant to NI 52-110. The education and experience
of the members of the Audit Committee is as follows:


 


		·	Mr. Quarin is a successful public company Chief Executive Officer (TSX and NYSE), corporate executive
and director. He was the Chief Executive Officer and Director of Progressive Waste Solutions Ltd., a North American non-hazardous solid
waste management company from January 2012 until the reverse-merger with Waste Connections Inc. in 2016. Joe joined Progressive’s
inaugural leadership team in July 2000 and played an integral role in its growth and success from US$100 million to US$2 billion
in revenue. Joe is currently the President and Chief Executive Officer of Q5 Capital Inc., a private investment company and strategic
management advisor focused on leadership, growth and operating initiatives that drive value creation. Joe currently serves as a Board
member of Spark Power Group Inc. (TSX: SPG), Edo Revenue Royalty GP and EJ Trademark GP, and Eagle River Capital, LLC. Joe holds a Master
of Business Administration (with Distinction) from the Ivey Business School at Western University, a Bachelor of Commerce (Honours) from
the Smith School of Business at Queen’s University, and is a Chartered Professional Accountant and Chartered Accountant. Mr. Quarin
is financially literate.



 


		·	Mr. Gordon is the Managing Director of Channel Solutions Inc., where he provides CEO mentoring and
strategic development guidance to growth-oriented technology companies. Mr. Gordon has extensive software, professional services
and technology leadership experience as the CEO of international, US and Canadian companies, both public and private. He has held
key senior executive positions during high growth phases of industry leading software and service firms, including Algorithmics Inc.,
Changepoint Corporation, Infonet Services Corporation and Magic Lantern Group. Mr. Gordon holds a Master of Science degree in
Computer Science from the University of Toronto and a Bachelor of Applied Science in Engineering Science. Mr. Gordon is financially
literate.



 


		·	Mr. Kessel is the President and CEO of Cleveland Clinic Canada and is responsible for the growth,
strategic partnerships and enterprise value creation. He implemented a unique public/private hybrid strategy that led to formal partnerships
with Sick Kids, Sunnybrook and Mt. Sinai Hospitals and the Heart and Stroke Foundation. He also led partnership efforts with the Ontario
Ministry of Health resulting in important firsts in country and cross border patient care. Mr. Kessel earned an MBA from Kellogg
Business School at Northwestern University in Chicago and a Bachelor of Science from The Ohio State University. He is also a Chartered
Professional Accountant. Mr. Kessel is financially literate.



 


Audit Committee Oversight


 


At
no time since the commencement of the Company’s most recently completed financial year was a recommendation of the audit committee
to nominate or compensate an external auditor not adopted by the Board.


 






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Pre-Approval Policies and Procedures


 


The
Audit Committee reviews and pre-approves all non-audit services to be provided to the Company by its external auditors.


 


External Auditor Service Fees


 


The
Audit Committee has reviewed the nature and amount of the non-audit services provided to the Company by its external auditors ensure
auditor independence in the financial periods ended December 31, 2020 and December 31, 2019. Fees payable to its external auditors
in connection with the provisions of audit and non-audit services for the fiscal periods ending December 31, 2020 and December 31,
2019, are outlined in the following table:


 


	Type of Service Provided	 	2020	 	 	2020	 	 	2019	 
	 	 	KPMG	 	 	MNP	 	 	MNP	 
	Audit fees (1)	 	$	252,691	 	 	$	63,000	 	 	$	225,000	 
	Audit-related fees (2)	 	 	-	 	 	 	-	 	 	 	11,250	 
	Tax fees (3)	 	$	22,973	 	 	 	-	 	 	 	24,088	 
	All Other Fees (4)	 	 	-	 	 	 	-	 	 	 	68,775	 
	Total	 	$	275,664	 	 	$	63,000	 	 	$	329,113	 




 


Notes:


 


		(1)	“Audit Fees” include the aggregate fees billed by the Company’s external auditor for
professional services rendered by the external auditor for the audit of the Company’s financial statements, reviews of interim financial
statements or services that are normally provided by the external auditor in connection with statutory and regulatory filings or engagements.






		(2)	“Audit-Related Fees” include the aggregate fees billed for assurance and related services
by the Company’s external auditor that are reasonably related to the performance of the audit of the Company’s financial statements
and are not reported under “Audit Fees”.






		(3)	“Tax Fees” include the aggregate fees billed for professional services rendered by the Company’s
external auditor for tax compliance, tax advice, and tax planning and include corporate tax returns and preparation of SR&ED returns.






		(4)	“All Other Fees” include all other non-audit services.



 


	ADDITIONAL INFORMATION


 


Additional
information is contained in the Company’s audited financial statements and MD&A for the Company’s most recently completed
financial year, copies of which have been filed with the securities regulatory authorities in the provinces of British Columbia, Alberta
and Ontario and may be found on SEDAR at www.sedar.com.


 


Additional information, including directors’
and officers’ remuneration and indebtedness, principal holders of the Company’s securities and securities authorized for issuance
under the Company’s equity compensation plans, is contained in the Company’s information circular for its most recent annual
meeting of securityholders that involved the election of directors.


 




    30 


     


    

 


SCHEDULE “A”

VIQ SOLUTIONS INC.

AUDIT COMMITTEE OF THE BOARD OF DIRECTORS

CHARTER


 


		(I)	ESTABLISHMENT OF THE AUDIT COMMITTEE



 


The board of directors (the “Board”)
of VIQ Solutions Inc. (the “Corporation”) has established a committee of the Board to be called the Audit Committee
(the “Committee”).


 


		(II)	PURPOSE AND AUTHORITY



 


The primary function of the Committee
is to assist the Board in fulfilling its oversight responsibilities by:


 


		·	reviewing the financial reports and other financial information provided by the Corporation to any governmental
body or the public and other relevant documents;



 


		·	recommending the appointment and reviewing and appraising the audit efforts of the Corporation’s
independent auditor and providing an open avenue of communication among the independent auditor, financial and senior management and the
Board;



 


		·	serving as an independent and objective party to monitor the Corporation’s financial reporting process
and internal controls, the Corporation’s processes to manage business and financial risk, and its compliance with legal, ethical
and regulatory requirements; and



 


		·	encouraging continuous improvement of, and fostering adherence to, the Corporation’s policies, procedures
and practices at all levels.



 


The Committee will primarily fulfill
these responsibilities by carrying out the activities enumerated in Section IV of this Charter. The Committee has the authority to:


 


		·	engage independent counsel and other advisors as it determines necessary or advisable to carry out its
duties;



 


		·	set and pay the compensation for any advisors employed by the Committee;



 


		·	communicate directly with the external auditors; and



 


		·	delegate to individual members or subcommittees of the Committee.



 


		(III)	COMPOSITION AND MEETINGS



 


		1.	The Committee shall be comprised of three or more directors as determined by the Board. Every Committee member must be “independent”
and “financially literate” as such terms are defined in applicable securities legislation. For purposes of this Charter, a
Committee member is “independent” if the member has no direct or indirect material relationship with the Corporation, including
a relationship which could, in the view of the Board, reasonably interfere with the exercise of a member’s independent judgment.
A Committee member is “financially literate” if he or she has the ability to read and understand a set of financial statements
that present a breadth and level of complexity of accounting issues that are generally comparable to the breadth and complexity of the
issues that can reasonably be expected to be raised by the Corporation’s financial statements. Committee members may enhance their
familiarity with finance and accounting by participating in educational programs conducted by the Corporation or an outside consultant.



 


		2.	The members of the Committee shall be elected by the Board at the annual organizational meeting of the Board or until their successors
shall be duly elected and qualified. Unless a Chair is elected by the full Board, the members of the Committee may designate a Chair by
majority vote of the full Committee membership.



 






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		3.	The Committee shall meet at least four times annually, or more frequently as circumstances require. The Committee shall meet within
sixty (60) days following the end of the first three financial quarters to review, discuss and recommend for approval by the Board the
unaudited financial results for the preceding quarter and the related Management’s Discussion & Analysis (“MD&A”)
and shall meet within 120 days following the end of the fiscal year end to review, discuss and recommend for approval by the Board the
audited financial results for the year and related MD&A.



 


		4.	The Committee may ask members of management or others to attend meetings and provide pertinent information as necessary. For purposes
of performing their audit related duties, members of the Committee shall have full access to all corporate information and shall be permitted
to discuss such information and any other matters relating to the financial position of the Corporation with senior employees, officers
and independent auditors of the Corporation.



 


		5.	As part of its job to foster open communication, the Committee should meet at least annually with management and the independent auditor
in separate executive sessions to discuss any matters that the Committee or each of these groups believe should be discussed privately.
In addition, the Committee or at least its Chair may meet with the independent auditor and management quarterly to review the Corporation’s
financial statements.



 


		6.	Quorum for the transaction of business at any meeting of the Committee shall be a majority of the number of members of the Committee
or such greater number as the Committee shall by resolution determine.



 


		7.	Meetings of the Committee shall be held from time to time and at such place as the Committee or the Chair of the Committee shall determine
upon 48 hours notice to each of members. The notice period may be waived by a quorum of the Committee. Each of the Chair of the Committee,
members of the Committee, Chairman of the Board, independent auditors, Chief Executive Officer, Chief Financial Officer or Secretary shall
be entitled to request that the Chair of the Committee call a meeting which shall be held within 48 hours of receipt of such request.



 


		8.	If requested by a member of the Committee, the independent auditor shall attend meetings of the Committee as required held during
the term of office of the independent auditor.



 


		9.	The Committee shall appoint a Secretary to the Committee who need not be a director or officer of the Corporation. Minutes of meetings
of the Committee shall be recorded and maintained by the Secretary to the Committee and shall be subsequently presented to the Committee
for review and approval.



 


		10.	The Committee will regularly report to the Board on all significant matters it has considered and addressed and with respect to such
other matters that are within its responsibilities, including any matters approved by the Committee or recommended by the Committee for
approval by the Board. The Committee shall circulate to the Board copies of the minutes of each meeting held.



 


		(IV)	RESPONSIBILITIES AND DUTIES



 


To fulfill its responsibilities and
duties the Committee shall:


 


		1.	Create an agenda for the ensuing year.



 


		2.	Review and update this Charter at least annually, as conditions dictate.



 


		3.	Describe briefly in the Corporation’s annual report and more fully in the Corporation’s Management Information Circular
the Committee’s composition and responsibilities and how they were discharged.



 


		4.	Submit the minutes of all meetings of the Committee to the Board.



 


Documents/Reports Review


 


		5.	Review the Corporation’s annual and interim financial statements, annual and interim MD&A and annual and interim earnings
press releases before the Corporation publicly discloses this information.



 






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		6.	Ensure that adequate procedures are in place for the review of the Corporation’s public disclosure of financial information
extracted or derived from the Corporation’s financial statements, other than the public disclosure referred to in the preceding
section and must periodically assess the adequacy of those procedures.



 


		7.	Review any other reports or financial information submitted to any governmental body, or the public, including any certification,
report, opinion, or review rendered by the independent auditor.



 


		8.	Review policies and procedures with respect to directors’ and officers’ expense accounts and management perquisites and
benefits, including their use of corporate assets and expenditures related to executive travel and entertainment, and review the results
of the procedures performed in these areas by the independent auditor, based on terms of reference agreed upon by the independent auditor
and the Committee.



 


		9.	Review with financial management and the independent auditor any filings with regulatory bodies such as securities commissions prior
to filing or prior to the release of earnings. The Chair of the Committee may represent the entire Committee for purposes of this review.



 


Independent Auditor


 


		10.	Recommend to the Board the independent auditor to be nominated for the purpose of preparing or issuing an auditor’s report or
performing other audit, review or attest services for the Corporation, considering independence and effectiveness and recommend the fees
and other compensation to be paid to the independent auditor. Instruct the independent auditor that the Board, as the Shareholders’
representative, is the independent auditor’s client and that the independent auditor is required to report directly to the Committee.



 


		11.	Resolution of disagreements between management and the independent auditor regarding financial reporting.



 


		12.	Monitor the relationship between management and the independent auditor including reviewing any management letters or other reports
of the independent auditor and discussing any material differences of opinion between management and the independent auditor.



 


		13.	Review and discuss, on an annual basis, with the independent auditor all significant relationships they have with the Corporation
to determine their independence.



 


		14.	Review and pre-approve requests for any service engagement (in particular, non-audit services) in excess of $15,000 annually to be
performed by the independent auditor for the Corporation or its subsidiaries that is beyond the scope of the pre-approved audit engagement
letter and related fees.



 


		15.	Review the performance of the independent auditor and approve any proposed discharge of the independent auditor when circumstances
warrant. Consider with management and the independent auditor the rationale for employing accounting/auditing firms other than the principal
independent auditor.



 


		16.	Periodically consult with the independent auditor out of the presence of management about significant risks or exposures, internal
controls and other steps that management has taken to control such risks, and the fullness and accuracy of the Corporation’s financial
statements. Particular emphasis should be given to the adequacy of internal controls to expose any payments, transactions, or procedures
that might be deemed illegal or otherwise improper.



 


		17.	Arrange for the independent auditor to be available to the Committee and the full Board as needed and meet regularly in private with
the independent auditor.



 


		18.	Review the proposed audit scope, focus areas, timing and key decisions (e.g., materiality, reliance on internal audit) underlying
the audit plan and the appropriateness and reasonableness of the proposed audit fees.



 


		19.	Receive and review an annual report from the external auditor on the progress against the approved audit plan, important findings,
recommendations for improvements and the auditors’ final report.



 






    A-3


     


    

 


Financial Reporting Processes


 


		20.	In consultation with the independent auditor, review the integrity of the Corporation’s financial reporting processes, both
internal and external.



 


		21.	Consider the independent auditor’s judgments about the quality and appropriateness, not just the acceptability, of the Corporation’s
accounting principles and financial disclosure practices, as applied in its financial reporting, particularly about the degree of aggressiveness
or conservatism of its accounting principles and underlying estimates and whether those principles are common practices or are minority
practices.



 


		22.	Consider and approve, if appropriate, major changes to the Corporation’s accounting principles and practices as suggested by
management with the concurrence of the independent auditor and ensure that the accountants’ reasoning is described in determining
the appropriateness of changes in accounting principles and disclosure.



 


Process Improvement


 


		23.	Establish regular and separate systems of reporting to the Committee by each of management and the independent auditor regarding any
significant judgments made in management’s preparation of the financial statements and the view of each as to appropriateness of
such judgments.



 


		24.	Review the scope and plans of the independent auditor’s audit and reviews prior to the audit and reviews being conducted. The
Committee may authorize the independent auditor to perform supplemental reviews or audits as the Committee may deem desirable.



 


		25.	Following completion of the annual audit, review separately with each of management and the independent auditor any significant changes
to planned procedures, any difficulties encountered during the course of the audit and reviews, including any restrictions on the scope
of work or access to required information and the cooperation that the independent auditor received during the course of the audit.



 


		26.	Review any significant disagreements among management and the independent auditor in connection with the preparation of the financial
statements.



 


		27.	Where there are significant unsettled issues the Committee shall ensure that there is an agreed course of action for the resolution
of such matters.



 


		28.	Review with the independent auditor and management significant findings during the year and the extent to which changes or improvements
in financial or accounting practices, as approved by the Committee, have been implemented. This review should be conducted at an appropriate
time subsequent to implementation of changes or improvements, as decided by the Committee.



 


		29.	Review activities, organizational structure, and qualifications of the Chief Financial Officer and the staff in the financial reporting
area and see to it that matters related to succession planning within the Corporation are raised for consideration with the full Board.



 


Ethical and Legal Compliance


 


		30.	Review and update periodically a Code of Business Conduct and Ethics and ensure that management has established a system to enforce
this Code. Review through appropriate actions taken to ensure compliance with the Code and to review the results of confirmations and
violations of such Code.



 


		31.	Review management’s monitoring of the Corporation’s system in place to ensure that the Corporation’s financial statements,
reports and other financial information disseminated to governmental organizations, and the public satisfy legal requirements.



 


		32.	Review, with the Corporation’s counsel, legal and regulatory compliance matters, including corporate securities trading policies,
and matters that could have a significant impact on the Corporation’s financial statements.



 






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		33.	Review regular reports from management and others concerning the Corporation’s compliance with financial related laws and regulations,
such as:



 


		·	tax and financial reporting laws and regulations;



 


		·	legal withholdings requirements;



 


		·	other matters for which directors face liability exposure.



 


Risk Management


 


		34.	Review management’s program of risk assessment and steps taken to address significant risks or exposures, including insurance
coverage.



 


Submission Systems and Treatment
of Complaints


 


		35.	Establish procedures for: the receipt, retention and treatment of complaints received by the Corporation regarding accounting, internal
accounting controls, or auditing matters; and the confidential, anonymous submission by employees of the Corporation of concerns regarding
questionable accounting or auditing matters.



 


Hiring Policy


 


		36.	Review and approve the Corporation’s hiring policies regarding partners, employees and former partners and employees of the
present and former independent auditor of the Corporation.



 


General


 


		37.	Conduct or authorize investigations into any matters within the Committee’s scope of responsibilities. The Committee shall be
empowered to retain independent counsel, accountants and other professionals to assist it in the conduct of any investigation.



 


		38.	Perform any other activities consistent with this Charter, the Corporation’s By-laws and governing law, as the Committee or
the Board deems necessary or appropriate.



 


		39.	Notwithstanding the foregoing and subject to applicable law, the Committee shall not be responsible to plan or conduct internal or
external audits or to determine that the Corporation’s financial statements are in accordance with generally accepted accounting
principles as these are the responsibility of management and the independent auditor. Nothing contained in this Charter is intended to
require the Committee to ensure the Corporation’s compliance with applicable laws or regulation.



 






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