Montfort Capital Announces Closing to Previously Announced Pivot Sale and Share Repurchases

Executive Summary

• Montfort Capital Corp. completed the sale of its Pivot Group assets to Pivot Endgame Corp., receiving $1,000,000 cash and a $1,278,541 non‑interest bearing promissory note as consideration.
• Simultaneously, the company repurchased and cancelled 1,024,299 Series A Preferred Shares and 2,397,368 common shares from Dan Flaro for $275,145.30, reducing outstanding common shares by ~2.7%.
• The transactions were approved by the TSX Venture Exchange and Montfort’s senior lender, Cortland Credit Lending Corporation.

Key Details

• Pivot Sale Consideration:
• $1,000,000 cash paid to Pivot LP (partial repayment of intercompany debt).

• Purchaser issued a non‑interest bearing VTB Note for $1,278,541, assignable to Pivot LP upon repayment of the Brightpath Receivable.

• Promissory Notes Issued by Montfort:

• Non‑interest bearing secured demand note to Pivot LP – $1,278,541 (Pivot‑Montfort Note).

• Secured interest‑bearing demand note to Pivot LP – principal $3,050,000, interest at 9.75% per annum (linked to Cortland Credit Lending Corp. credit agreement).

• Secured Guarantee:

• Montfort provided a $250,000 guarantee for certain Pivot LP loan receivables; effective upon the earlier of 1 Nov 2027 or a specified liquidity event.

• Recovery above $200,000 reduces Montfort’s liability dollar‑for‑dollar.

• Flaro Transaction (Share Repurchase):

• Prior conversion: 730,701 Series A Preferred Shares converted to common shares on 27 Oct 2025.
• Repurchased & cancelled: 1,024,299 Series A Preferred Shares and 2,397,368 common shares for $275,145.30 (paid via non‑interest bearing Montfort IB Note).

• Resulting dilution impact: Common share count down ~2.7%; Preferred share count down ~4.99%.

• Regulatory & Exchange Approvals:

• Conditional acceptance from the TSX Venture Exchange.

• Consent obtained from senior lender Cortland Credit Lending Corporation.

• Related Party Considerations:

• Dan Flaro, president of Pivot Group, is a related party under MI 61‑101; exemptions applied for valuation and minority shareholder approval because repurchase price <25% of market cap.

Notable Quotes

(No direct quotes were provided in the release.)