Toronto, Ontario--(Newsfile Corp. - November 23, 2022) - Lendified Holdings Inc. (TSXV: LHI) (the "Company" or "Lendified") announced today that its wholly-owned subsidiaries, Lendified Privco Holding Corporation, Lendified Inc, Castle Return Inc. and WPCFP SPV Inc. (collectively, the "Subsidiaries"), have received demand letters of repayment (the "Demand Letters") dated November 22, 2022 and notices of intention to enforce a security (the "Notices") under section 244(1) of the Bankruptcy and Insolvency Act (Canada) (the "BIA") from certain secured creditors with respect to certain secured loans made to the Subsidiaries by such secured creditors. The total amount of the outstanding loans in default is approximately $6,631,120.20 (the "Loans"). As the Subsidiaries are not in a position to repay the Loans on demand, and do not have any prospects to refinance the Loans, the Company expects the secured creditors will move to seize the Subsidiaries assets comprising the security pursuant to the loan agreements giving rise to the security and applicable legislation. Such assets largely consist of loan portfolios.
Consequently, in order to avoid any deterioration in the value of the assets subject to seizure by the secured creditors, it has consented to a waiver of the 10-day notice period provided in the BIA. It is not expected that the fair market value of the assets will be sufficient to repay the Loans and as a result, Lendified and the Subsidiaries will continue to be subject to certain obligations to the secured creditors pursuant to the Loans. It is expected that the secured creditors will attempt to sell the seized assets and the return from such sale will determine the remaining amount owed to such creditors.
As a result of the Demand Letters and the Notices, the Company will continue to administer any outstanding working capital loans it has extended to its clients but will halt writing any new business for the time being. The Board of Directors remains in place and is committed to steering the Company through these challenges; however, there can be no assurances it will be able to do so. It is not expected that the Company can continue as a going concern in its present form without an infusion of capital. There is significant doubt as to whether the Company will be able to source any such needed capital. The Company will engage in discussions with its creditors to determine if solutions can be found to enable the Company to carry on in some form in the future. There can be no assurances that such discussions will be successful, either on terms acceptable to the Company or at all. Investors are cautioned to consider carefully the Company's liquidity situation when considering trading in the Company's securities.
ABOUT LENDIFIED HOLDINGS INC.
Lendified, a company located in Ontario, Canada, is a Canadian FinTech company operating a lending platform which provides working capital loans to small businesses across Canada through a wholly-owned subsidiary.
For further information regarding Lendified, please contact:
Eoghan Bergin, Chief Executive Officer and Director
Neither the TSXV nor its Regulation Services Provider (as that term is defined in the policies of the TSXV) accepts responsibility for the adequacy or accuracy of this release.
This news release may contain forward-looking statements which reflect the Company's current expectations regarding future events. The forward-looking statements are often, but not always, identified by the use of words such as "seek", "anticipate", "plan, "estimate", "expect", "intend" and statements that an event or result "may", "will", "should", "could" or "might" occur or be achieved and other similar expressions. These forward-looking statements involve risk and uncertainties, including, but not limited to, the return (if any) the sale of the secured assets will bring to the creditors and whether the Company can successfully negotiate a solution to any additional debt owing to the secured creditors following the seizure of the assets, any of which could cause results, performance, or achievements to differ materially from the results discussed or implied in the forward-looking statements. Many risks are inherent in the industries in which the Company participates; others are more specific to the Company. The Company's ongoing quarterly filings should be consulted for additional information on risks and uncertainties relating to these forward-looking statements. Investors should not place undue reliance on any forward-looking statements. Management assumes no obligation to update or alter any forward-looking statements whether as a result of new information, further events or otherwise, other than as required by law.
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