Fintech startup Mobikwik raises $6.7Mn in debt from Blocksoil and Karnation; updates ESOP policy.

The regulatory filings also show that MobiKwik has updated its ESOP 2014 policy, specifically regarding the time frame within which employees can execute the options in the event of termination or resignation. The new norms draw the distinction between two scenarios, listed and unlisted, citing the ‘best interest of option holders.’

In the midst of a likely-shelved IPO and an industry-wide downturn, fintech startup Mobikwik has raised INR 55 Cr ($6.7 Mn) in debt from venture capital firm BlockSoil and alternate investment fund, Karnation. In regulatory filings with the Registrar of Companies (RoC), MobiKwik said that it has raised INR 45 Cr from BlockSoil. In August, the board of the startup passed a resolution to allot 900 non-convertible debentures (NCDs) to the VC giant at an issue price of INR 5 Lakh each.

Subsequently, in September, the board also approved a proposal to allot 200 NCDs at a face value of INR 10 Lakh each, totaling around INR 10 Cr in favor of Karnation. 

Note: NCDs are debentures that cannot be converted into shares or equities and have a fixed maturity date. 

The regulatory filings also show that MobiKwik has updated its ESOP 2014 policy, specifically regarding the time frame within which employees can execute the options in the event of termination or resignation. The new norms draw the distinction between two scenarios, listed and unlisted, citing the ‘best interest of option holders.’

In the event that the startup is listed, an employee, who has voluntarily taken up retirement, will be free to exercise their ESOPs within six months. Earlier, the time frame within which employees could avail their stock options was three months. If the ESOPs are not availed within the said period, then they will purportedly lapse. The new amendment also empowers the nominations and remuneration committee to waive off the rule at its discretion, under certain criteria.

On the other hand, if the startup remains unlisted, an employee can exercise their stock options within three years from the last day of their job or within six months from the date of listing, whichever is earlier.

Writer- Ayush Singh