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Kovo+ Announces Extension of Senior Loan Agreement and Secured Promissory Grid Note
Calgary, Alberta--(Newsfile Corp. - July 3, 2025) - Kovo+ Holdings Inc. (TSXV: KOVO) (" Kovo " or...
About this update from Kovo+ Holdings Inc
[{"type":"text","content":"Kovo+ Announces Extension of Senior Loan Agreement and Secured Promissory Grid NoteCalgary, Alberta--(Newsfile Corp. - July 3, 2025) - Kovo+ Holdings Inc. (TSXV: KOVO) (\"Kovo\" or the \"Company\") is pleased to announce that it has entered into a definitive agreement with Avonlea Ventures #2 Inc. (\"AVI\"), Kovo's largest shareholder and secured creditor, whereby AVI has agreed to extend the terms of the 2nd Amended & Restated Senior Loan and Security Agreement (the \"Senior Loan Agreement\") and secured promissory grid note (the \"Secured Prom Note\") for a period of one (1) month, respectively (the \"Extension Agreement\").Extension AgreementUnder the Extension Agreement, Kovo and AVI extended the maturity date of the Senior Loan Agreement and Secured Prom Note, respectively, upon which the indebtedness owing thereunder was to be repaid for a 1-month period, now maturing on July 31, 2025 (\"Maturity Date\"). The other terms, as set out in the Senior Loan Agreement and Secured Prom Note, remain unchanged.Related Party TransactionsAVI is an Ontario corporation controlled by Mr. Michael Steele, a current director and controlling indirect shareholder of the Company. Mr. Steele is also a director, officer and the sole indirect beneficial shareholder of AVI, which is also considered a \"Non-Arm's Length Party\" pursuant to the policies of the TSX Venture Exchange.As AVI is a \"related party\" of the Company, entering into the Extension Agreement and matters relating thereto (the \"Transactions\") are considered to be \"related party transactions\" within the meaning of Multilateral Instrument 61-101 - Protection of Minority Security Holders in Special Transactions (\"MI 61-101\") requiring Kovo, in the absence of exemptions, to obtain a formal valuation and minority shareholder approval of the related party transactions.Pursuant to Sections 5.5(b), 5.5(g) and 5.7(1)(e) of MI 61-101, the Company relied on exemptions from the formal valuation and minority shareholder requirements, respectively, as, in addition to no securities of the Company being listed or quoted on certain specified exchanges: (i) Kovo was (and continues to be) in serious financial difficulty; (ii) the Transactions are each designed to improve the financial position of the Company; (iii) paragraph 5.5(f) (Bankruptcy, Insolvency, Court Order) of MI 61-101 was no...