Forte Group Closes Private Placement and Complementary Strategic Initiatives, Strengthening Financial Position and Balance Sheet

Executive Summary

• Forte Group closed a non‑brokered private placement of 2,500,000 units at $0.25 per unit, raising $625,000 in gross proceeds.
• The company settled $2.5 million of debt by issuing 8,771,919 “Debt Settlement Units” to related parties.
• Additional convertible loan agreements and amended secured promissory notes were executed, creating multiple conversion‑option securities and extending maturity dates into 2027–2028.

Key Details

• Private Placement – 2,500,000 units @ $0.25/unit = $625,000 gross proceeds; each unit includes one common share + one warrant to purchase an additional share at $0.30 (exercisable until 1 Oct 2027). Finder’s fee paid: $1,500. Net proceeds earmarked for working capital and payables. Hold period expires 2 Feb 2026.
• Debt Settlement – $2,500,000 debt extinguished in exchange for 8,771,919 “Debt Settlement Units” at a deemed price of $0.285/unit. Each unit = one common share + one warrant (exercise price $0.30, until 1 Oct 2027). Hold period expires 2 Feb 2026.
• Related‑Party Nature – Insider settlements involve entities owned by the CEO, CFO and directors; exempt from MI 61‑101 valuation/minority approval thresholds (<25% market cap). Company justified shortened filing window (<21 days) as necessary to improve financial position.
• Convertible Loan Agreements (Naturo Group) – Two unsecured convertible debentures total principal & fees USD 427,842.90; 15% annual interest, maturing 1 Oct 2027. Lenders may convert at $0.25 per “Convertible‑Loan Unit” (share + warrant, exercise price $0.25, until 1 Oct 2028). Hold period expires 2 Feb 2026.
• Amended Loans (Secured Promissory Notes) – Aggregate principal $357,254.68; 15% annual interest, maturing 31 Dec 2026; secured against Naturo Group assets. Conversion at $0.25 per “Amended‑Loan Unit” (share + warrant, exercise price $0.25, until 1 Oct 2028). Hold period expires 2 Feb 2026.
• Convertible Debenture Amendment (Pending) – Intended amendment of a $500,000 secured convertible debenture (plus $94,904.14 accrued interest) to new terms: 8% annual interest, maturity 31 Dec 2026, conversion at $0.25 per unit (share + warrant, exercise price $0.25, three‑year exercise window). Not yet closed; securities would have a four‑month‑plus‑one‑day hold period.
• Potential Share Consolidation – Board obtained written consent from shareholders holding ~51.76% to consolidate up to 25 pre‑consolidation shares into one post‑consolidation share. Ratio to be set by board within one year of 17 Sept 2025, subject to CSE approval. No guarantee the consolidation will occur.

Notable Quotes

• “These transactions collectively strengthen our balance sheet and provide the liquidity needed to pursue growth initiatives while preserving shareholder value.” – Marcello Leone, CEO & Director

Materiality Assessment: Material – Positive (the financing and debt‑settlement actions materially affect the company’s capital structure and financial position).