Calgary, Alberta--(Newsfile Corp. - August 6, 2026) - Kovo+ Holdings Inc. (TSXV: KOVO) ("Kovo" or the "Company") announces that it, along with its wholly-owned subsidiaries including, without limitation, Kovo+ (USA) Inc. (formerly Medworxs, Inc.), Nexus AI Data Inc., Heal Global Holdings, Inc., AI Vector 2.0, Inc., Heal Vue, Inc., NOC5280 LLC, RPM Billing LLC, Kovo Acquisitions LLC, Kovo Human Capital LLC, and RSKM, LLC, have received a default notice and demand for repayment (the "Default Notice"), accompanied by a notice of intent to enforce security under section 244 of the Bankruptcy and Insolvency Act (Canada) (the "Enforcement Notice", and together with the Default Notice, the "Creditor Default Notices") from its senior secured creditor, Avonlea Ventures #2 Inc. ("AVI") in connection with certain defaults under the Company's 2nd Amended & Restated Senior Loan and Security Agreement dated August 29, 2024 between Kovo and AVI (the "Senior Loan") and secured promissory grid note dated May 1, 2025 (the "Secured Note"), both as extended and amended pursuant to extension agreements dated May 1, 2025, June 30, 2025, July 31, 2025, August 29, 2025, and April 20, 2026 (the "Extension Agreements" and together with the Senior Loan and Secured Note, the "Transaction Documents").

Under the Default Notice, AVI has alleged that certain events of default have occurred under the Transaction Documents, including, amongst other things, in relation to certain legal proceedings against the Company and the impact that such proceedings are likely to have on Company's ability to satisfy its obligations to the AVI.

Under the terms of the Enforcement Notice, Kovo and its subsidiaries (which are each a borrower under the Transaction Documents) (collectively, the "Borrowers") have until close of business on August 15, 2026 to repay an aggregate principal amount of US$27,088,273, or AVI may take such steps as it deems appropriate to seek repayment of such amounts, including enforcing its rights under the Transaction Documents and applicable law, without further notice to the Borrowers, or any of them, including commencing legal proceedings against the Borrowers, or any one of them, and enforcing its security.

The Company is reviewing the Creditor Default Notices and considering the Borrowers' available alternatives. The Company currently has no ability to satisfy its obligations to AVI.

Resignation of Micheal Steele

Michael Steele, a director and officer of the Corporation, and the principal of AVI, has tendered his resignation effective immediately, prior to the delivery of the Creditor Default Notices.

About Kovo+ Holdings Inc.

Kovo is a versatile technology company leading the charge in AI initiatives to drive impact and innovation across diverse industries. Kovo remains committed to its core business-model of strategic growth opportunities within mid-market Medical Billing firms, where exploitive business optimization synergies exist. Moving forward, Kovo will integrate accretive broader healthcare sector additions to its portfolio and opportunities beyond in multiple new markets. Dedicated to revolutionizing business process optimization through technological advancements and evolving AI-applied methods, Kovo embodies a commitment to ensured and enduring profitability. To learn more about Kovo and to keep up to date on Kovo news, visit www.kovoplus.com.

Cautionary Note Regarding Forward-Looking Information

Statements contained in this news release that are not historical facts are "forward-looking information" or "forward-looking statements" within the meaning of applicable Canadian securities laws. Such forward-looking statements or information are provided to inform the Company's shareholders and potential investors about management's current expectations and plans relating to the future and include, but are not limited to, (i) expectations regarding the Company's response to the Creditor Default Notices, including timing thereof; and (ii) expectations regarding the Company's future business plans and operations. Readers are cautioned that reliance on such information may not be appropriate for other purposes. Any such forward-looking information may be identified by words such as "anticipate", "proposed", "estimates", "would", "expects", "intends", "plans", "may", "will", and similar expressions. Forward-looking statements or information are based on a number of factors and assumptions that have been used to develop such statements and information, but which may prove to be incorrect. Although the Company believes that the expectations reflected in such forward-looking statements or information are reasonable, undue reliance should not be placed on forward-looking statements because the Company can give no assurance that such expectations will prove to be correct. The forward-looking information in this news release reflects the current expectations, assumptions and/or beliefs of the Company based on information currently available to the Company. Any forward-looking information speaks only as of the date on which it is made and, except as may be required by applicable securities laws, the Company disclaims any intent or obligation to update any forward-looking information, whether as a result of new information, future events or results or expressly qualified by this cautionary statement.

Contact Information

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To view the source version of this press release, please visit https://www.newsfilecorp.com/release/308417

Source: Kovo+ Holdings Inc.