391-page Ontario court filing documents A.R.I.’s information and Change-of-Control rights; A.R.I. says OVO did not disclose negotiations before the sale was announced

TAMPA, Fla.--(BUSINESS WIRE)-- Two weeks before Authentic Brands Group and Vince Holding Corp. (Nasdaq: VNCE) publicly announced the purchase of the intellectual property and operating business associated with Drake’s October’s Very Own (“OVO”), a lender to OVO—A.R.I. OVO Growth Capital I, LLC (“A.R.I.”), which provided financing through the purchase of convertible promissory notes (the “Notes”)—filed a 391-page Motion Record in the Ontario Superior Court of Justice (Commercial List) in Toronto.

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The Motion Record, dated August 10 and accepted for filing on August 13, states that A.R.I. calculated C$5,037,977 in unpaid contractual obligations owing by OVO as of July 31, 2026, with additional amounts continuing to accrue.

On August 27, Authentic Brands Group, led by Canadian businessman and reported billionaire Jamie Salter, its Founder and Executive Chairman, announced that it had acquired a 51% interest in the entity holding OVO’s intellectual property. Canadian entertainer and OVO co-founder Aubrey “Drake” Graham owns 44%, and Vince owns the remaining 5%.

Authentic Brands Group is a privately held company backed by prominent institutional investors. In a previous public announcement, the company identified General Atlantic, BlackRock, CVC Capital Partners, HPS Investment Partners, Leonard Green & Partners, Simon Property Group, and Brookfield among its significant shareholders. The company also reported that General Atlantic’s latest US$500 million investment brought that firm’s total investment in Authentic Brands Group to nearly US$2 billion at the time.

Vince, led by CEO Brendan Hoffman, separately announced that it had acquired OVO’s existing operating companies, assets and liabilities, 12 retail stores and e-commerce platform.

The Asset and Equity Purchase Agreement, dated August 24 and filed with the Securities and Exchange Commission (SEC), assigned a stated purchase price of US$117,647,058.82 to OVO’s intellectual-property assets and separate aggregate consideration of US$3.00 for the purchased equity of OVO’s three operating companies in Canada, the United States and the United Kingdom.

A.R.I.’s Claim Was Already in Litigation Before OVO’s Transaction

By the time OVO’s transaction closed on August 24, A.R.I.’s claim for millions of dollars in unpaid contractual obligations had been the subject of litigation for more than two months and was documented in court records filed in both British Columbia and Ontario.

On June 11, A.R.I. commenced a lawsuit against OVO in the Supreme Court of British Columbia. A.R.I.’s claim calculated that at least C$4,609,455.72 remained unpaid, with additional amounts continuing to accrue. (British Columbia Notice of Civil Claim, paragraphs 9 and 73–75)

A.R.I.’s Ontario Motion Record (available as an accompanying supplement) was subsequently accepted for filing on August 13—two weeks before the OVO transaction was announced. The Motion Record states that A.R.I. calculated C$5,037,977 in outstanding obligations as of July 31, including amounts claimed for the Make Whole Fee, interest, default interest, legal and professional fees, and lender expenses. (Ontario Affidavit, paragraphs 142–145; Exhibit Z)

A.R.I. Says OVO Never Disclosed the Transaction with Authentic Brands Group and Vince

A.R.I. states that OVO did not inform it about the negotiations with Authentic Brands Group and Vince. According to A.R.I., it learned of the completed transaction through the August 27 public announcement—three days after it had reportedly closed.

Under the terms of their financing agreements, A.R.I. held strict information rights requiring OVO to disclose details regarding its financial condition, business, prospects and corporate affairs.

A.R.I.’s February 27 Default Notice also identified earlier alleged failures by OVO to provide required financial statements, compliance certificates and other information. (Ontario Affidavit, paragraphs 79, 81 and 102–107; Exhibits L, Q and R)

A.R.I.’s Rights in the Event of OVO’s Acquisition

The filed agreements also outline A.R.I.’s specific protections in the event that OVO was acquired before the Notes were converted or repaid.

Under the applicable Change-of-Control provision, A.R.I. could elect either to convert its investment into OVO equity at a 20% discount or receive a cash payment equal to 1.4 times its original principal—representing a 40% premium—during the relevant period. (Ontario Affidavit, paragraphs 75–81; Exhibit L)

The Make Whole Was Negotiated Before A.R.I. Invested—Not Imposed as a Default Penalty

A.R.I.’s Ontario filing (available as an accompanying supplement) explains that A.R.I. and OVO negotiated a Make Whole Fee before A.R.I. invested. A Make Whole is a contractual provision used in many financing agreements that is designed to provide an investor with a specified minimum return under defined circumstances. In this instance, it was part of the original economic bargain between A.R.I. and OVO—not added later as a fine or penalty for OVO’s defaults. (Ontario Affidavit, paragraphs 85–100)

Before A.R.I. advanced the funds to OVO, the final Term Sheet executed by OVO CEO Derek “Drex” Jancar provided:

• “Success Fee / Make Whole: If the notes do not convert into equity prior to maturity, investors will receive a make-whole payment ensuring a minimum 15% internal rate of return (IRR) over the life of the investment.” (Ontario Affidavit, paragraph 89; Exhibit L)

The definitive Convertible Note Agreements subsequently defined the Make Whole Fee as the additional amount required to produce an aggregate internal rate of return of at least 15%. (Ontario Affidavit, paragraphs 90–100)

The five-year Convertible Notes paid 10% interest and were unsecured. By comparison, A.R.I.’s separate senior secured loan paid 12.5% interest and was collateralized by OVO intellectual property, including rights relating to the October’s Very Own name and owl logo.

A.R.I.’s affidavit states that it accepted the Convertible Notes’ lower interest rate and unsecured position because the investment also included conversion rights to equity, a conversion discount of 20%, Change-of-Control payments (including a 40% premium during the applicable period), information rights and the Make Whole Fee. A.R.I. states that it would not have provided the financing without those negotiated rights. (Ontario Affidavit, paragraphs 81–84)

Public Purchase Documents Do Not Explain How A.R.I.’s Claim Was Treated

The Asset and Equity Purchase Agreement filed with the SEC in connection with the OVO transaction contains several provisions addressing OVO’s debt, convertible noteholders and payments required in connection with the transaction.

The Purchase Agreement states that:

• OVO Debt was to be repaid. The transaction contemplated the “repayment and satisfaction in full of the OVO Debt” before Vince acquired the equity of OVO’s operating companies. (Purchase Agreement, recitals; Sections 2.1–2.3)
• Covered debt included more than principal. The definition of “Funded Debt” includes principal, accrued interest, penalties, fees, expenses, premiums, breakage costs and make-whole payments associated with covered obligations. (Purchase Agreement, definitions of “Funded Debt” and “OVO Debt”)
• Covered convertible noteholders were to be paid. Persons defined as “Outstanding Convertible Noteholders” were to be paid directly from the IP purchase-price payments “in full satisfaction of all amounts owing” under their notes. The amount payable to each covered noteholder and the corresponding payment instructions appeared in Exhibit G, which was omitted from the publicly filed agreement. (Purchase Agreement, Section 2.7(b)(iii); Exhibit G)
• The public filing does not identify an excluded “Specified Person.” The Purchase Agreement defines “Outstanding Convertible Noteholders” as holders of OVO’s Convertible Notes other than a confidentially identified “Specified Person.” The identity of the “Specified Person” is not disclosed in the public filing. (Purchase Agreement, definition of “Outstanding Convertible Noteholders”)
• Payoff letters were required for applicable OVO Debt being repaid. The Purchase Agreement required executed payoff letters and, where applicable, lien-release documentation with respect to the OVO Debt being repaid as part of the transaction. The applicable financial institutions or other lenders were to confirm the amount to be paid and provide payoff instructions. (Purchase Agreement, Section 2.11(d))

The public documents do not explain how A.R.I.’s already-litigated claim was classified or treated in the transaction, whether A.R.I. was treated as the confidentially identified “Specified Person,” or how the transaction was completed without A.R.I. providing a payoff letter or releasing its claims.

In a separate SEC filing, Vince disclosed that its subsidiary amended an existing asset-based credit agreement under which Bank of America, N.A. serves as administrative and collateral agent. Vince stated that the amendment permitted completion of the OVO transaction and designated the acquired OVO operating companies as unrestricted subsidiaries under the credit facility.

A.R.I. Says Its Claim Remains Unpaid Following the OVO Transaction

The publicly filed transaction documents do not identify A.R.I. or explain how its disputed claim was classified or addressed. A.R.I. states that:

• A.R.I. issued no payoff letter related to the transaction.
• A.R.I. did not authorize the release of any of its claims or contractual rights.
• A.R.I. received none of the transaction proceeds.
• A.R.I. has not been paid the C$5,037,977 it calculated as outstanding as of July 31, 2026.

The C$5,037,977 pre-transaction calculation of OVO obligations includes amounts claimed for the Make Whole Fee, interest, default interest, lender expenses and legal expenses.

Statement from A.R.I.

A.R.I. provides growth capital to companies across the United States and Canada. The majority of the companies we finance perform as agreed and value our partnership. When a dispute does arise, however, our fiduciary responsibilities require us to protect our investors’ capital and all of the contractual rights negotiated on their behalf.

In this case, A.R.I. provided growth capital to OVO and, after defaults occurred, agreed to refrain temporarily from exercising certain enforcement rights. This forbearance period gave OVO additional time and flexibility to address its obligations outside of court. When those efforts did not produce a resolution, A.R.I. pursued the remedies available under the contractual agreements.

A.R.I.’s claim was already in litigation when the OVO transaction closed. We were not informed of the transaction negotiations, asked to provide a payoff amount or payoff letter, or asked to authorize the release of our claims. We received no portion of the transaction proceeds. Important information concerning the transaction and the treatment of our rights has still not been provided, and we will seek to obtain that information through the court process since OVO has not provided it despite multiple requests.

We believe in integrity, transparency, accountability and honoring contractual commitments. We also believe in the strength of the Canadian and United States legal systems to resolve commercial disputes based on the agreements and the facts. A.R.I. will continue pursuing its contractual rights until this matter is resolved through payment in full, a court judgment or a negotiated settlement.

Court Proceedings and Counsel

Ontario Proceeding:

• October’s Very Own ULC v. A.R.I. OVO Growth Capital I, LLC, Ontario Superior Court of Justice (Commercial List), Court File No. CL-26-00000256-0000. Motion Record is dated August 10, 2026 and was accepted for filing August 13, 2026.
• Counsel for A.R.I.: Kyle Plunkett, Brian Chung, Sara Romeih, Aird & Berlis LLP
• Counsel for October's Very Own ULC: Larry Ellis, David Ward, Armando Ranjbar, Miller Thomson LLP

British Columbia Proceeding:

• A.R.I. OVO Growth Capital I, LLC v. October’s Very Own ULC, Supreme Court of British Columbia, Vancouver Registry, Court File No. 264397. A.R.I.’s Notice of Civil Claim was filed on June 11, 2026.
• Counsel for A.R.I.: Arden Beddoes of McEwan Partners.

About A.R.I.

Applied Real Intelligence (A.R.I.) is a Florida-based investment management platform focused on private credit, structured equity, and differentiated alternative investment strategies. Founded and led by Managing General Partner Dr. Zack Ellison, A.R.I. combines institutional investment experience, disciplined underwriting, thoughtful transaction structuring and active portfolio management. The firm seeks to generate attractive risk-adjusted returns while protecting investor capital and creating opportunities for long-term upside. Its investment approach incorporates rigorous research and the proprietary A.R.I. 7S Investment Methodology™. Learn more at www.arivc.com.

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Investor and Media Relations, Applied Real Intelligence (A.R.I.), [email protected]

Source: Applied Real Intelligence (A.R.I.)