Urban Infrastructure obtains $500,000 loan

Executive Summary

• Urban Infrastructure Group Inc. secured a $500,000 related-party loan for working capital, secured by litigation proceeds and a CEO guarantee, with a maturity date of September 9, 2026.
• The financing includes a bonus of 5 million common share purchase warrants exercisable at $0.05 per share for one year, subject to TSX Venture Exchange approval.
• The company reported increased production activity with crews operating on three sites in the Greater Toronto Area-West and a new 220-home project starting in Caledon, while providing a procedural update on five ongoing construction lien litigation actions.

Key Details

• Loan Structure: Aggregate principal of $500,000 advanced by a related party.
• Interest Rate: 12% per annum.
• Repayment Date: September 9, 2026.
• Security: First-ranking charge against all present and future litigation proceeds involving the corporation; personal guarantee of the CEO.
• Warrant Terms: 5,000,000 common share purchase warrants issued as a loan bonus.
• Warrant Exercise Price: $0.05 per share.
• Warrant Term: One year from the date of the promissory notes.
• Regulatory Status: Exempt from formal valuation and minority approval requirements under MI 61-101 as the fair market value of consideration did not exceed 25% of market capitalization.
• Finder’s Fee: $25,000 paid to an arm’s-length third party.
• Operational Activity: Skilled crews currently operating on three sites in Oakville, Kitchener, and Milton (Greater Toronto Area-West).
• New Project: Start date of April 13 for the first phase of a 220-home project in Caledon, Ontario.
• Litigation Status (Construction Lien Actions):
  • Five actions commenced in Ontario under the Construction Act regarding disputes over services/materials for residential developments.
  • Defendants have filed defenses and counterclaims alleging deficiencies and delay; Urban disputes these allegations.
  • Discoveries completed in summer 2024.
  • Trial records filed for all five actions.
  • All actions set down for trial in respective jurisdictions.
  • Pretrial conference for one action held on Dec. 11, 2025.
  • Pretrial conferences for two actions scheduled for April 14, 2026.
  • Pretrial conference for one action scheduled for July 22, 2026.
  • A motion to consolidate trials has been filed by both parties; no date set.

Notable Quotes

• "Housing shortage in Canada is a systemic issue and one that is not going to be solved overnight. While markets take time to work out imbalances, economic conditions and consumer sentiment, the need for more Canadian housing remains a constant. Urban and its dedicated crews of skilled construction professionals are proud to play a role in addressing this national issue on behalf of our customers, shareholders and Canadian homeowners," said Gary Alves, chief executive officer, Urban Infrastructure.