Crown Capital Announces Closing of Go Direct Sale Transaction

CALGARY, AB, May 14, 2026 /CNW/ - As previously disclosed, on April 6, 2026, Crown Capital Partners Inc. ("Crown" or the "Corporation") (TSX: CRWN) entered into an agreement to sell the assets and business of its wholly-owned subsidiary, Go Direct Global Inc. ("Go Direct") to an employee-led group, subject to certain conditions (the "GD Transaction").

We are pleased to report that the GD Transaction closed effective today, May 14, 2026. Total consideration to be received by Crown and its subsidiaries in relation to the GD Transaction is $10.0 million, subject to customary closing adjustments, including $7.5 million of cash received at closing plus $2.5 million to be received over the subsequent 25 months.

Of the cash proceeds received at closing from the GD Transaction, $7.3 million was applied as partial repayment of Crown's senior secured credit facility, including payment of the installment due on March 31, 2026. With this repayment, Crown has complied with the terms of the forbearance agreement signed on April 6, 2026 in respect of its senior secured credit facility and is no longer in default under this facility. Following this partial loan repayment, the remaining balance outstanding on this credit facility is approximately $8.7 million.

The assets and business of Go Direct were sold to a private company controlled by Chris Johnson, President, CEO and director of Crown, and co-owned by other members of the senior management team of Go Direct. There was no change in the issued and outstanding securities of the Corporation as a result of the GD Transaction. To the knowledge of the officers and directors of Crown, there are no prior valuations in respect of Crown that relate to Go Direct or that are otherwise relevant to the GD Transaction.

The GD Transaction is a "related party transaction" under Multilateral Instrument 61-101 – Protection of Minority Security Holders in Special Transactions ("MI 61-101") as the sale was to insiders of Crown. Crown is exempt from the requirement to obtain a formal valuation for the GD Transaction and to obtain minority approval for the GD Transaction due to the fact that Crown is in "financial hardship" as contemplated by Section 5.5(g) of MI 61-101. Specifically, (i) Crown is in serious financial difficulty, (ii) the GD Transaction is designed to improve Crown's financial position, (iii) Crown has one or more independent directors in respect of the GD Transaction, and (iv) Crown's board of directors, acting in good faith, determined that the terms of the GD Transaction are reasonable given Crown's current circumstances.

Four of the five directors of Crown (i.e., directors other than Mr. Johnson) are independent of the GD Transaction. Mr. Johnson did not participate in the decision to approve the GD Transaction on behalf of the Corporation. In reviewing the proposed transaction, the independent directors considered the valuation of the purchase offer relative to comparable transactions and to the Corporation's investment in Go Direct and undertook negotiations that achieved a superior result for Crown than had originally been offered by the buying group. The independent directors unanimously concluded that the GD Transaction is in the best interests of the Corporation and that it is a timely and important step to augment its liquidity and to reduce its outstanding senior indebtedness.  

The material change report with respect to the GD Transaction is being filed concurrently with this press release. The material change report was not filed less than 21 days prior to the closing of the GD Transaction because the closing of the GD Transaction was not sufficiently certain to constitute a "material change" in the affairs of Crown until today.

Crown continues to advance the sale of other assets with anticipated closing dates in 2026. Progress towards binding agreements and details of closing will be announced as such information becomes available. There is no assurance that such transactions will be consummated in the form agreed to, or at all.

Following completion of these sales, Crown will continue to own significant assets. The board of directors of Crown has charged management with developing a restructuring plan which will reduce corporate overhead and permit value maximization of the remaining assets. The priority is to generate funds to satisfy the debt obligations of the Corporation and then to maximize value available to shareholders. Details of such plan will be made available when approved.

FORWARD-LOOKING STATEMENTS

This news release contains certain "forward looking statements" and certain "forward looking information" as defined under applicable Canadian and U.S. securities laws. Forward-looking statements can generally be identified by the use of forward-looking terminology such as "may", "will", "expect", "intend", "estimate", "anticipate", "believe", "continue", "plans" or similar terminology. Forward-looking statements in this news release include, but are not limited to, statements, management's beliefs, expectations or intentions regarding the closing of divestiture transactions, the repayment of debt, the use of proceeds from divestitures and the development of corporate restructuring plans. Forward-looking statements are based on forecasts of future results, estimates of amounts not yet determinable and assumptions that while believed by management to be reasonable, are inherently subject to significant business, economic and competitive uncertainties and contingencies. Forward-looking statements are subject to various risks and uncertainties concerning the specific factors identified in the Crown's periodic filings with Canadian securities regulators. See Crown's most recent annual information form for a detailed discussion of the risk factors affecting Crown. Crown undertakes no obligation to update forward-looking information except as required by applicable law. Such forward-looking information represents management's best judgment based on information currently available. No forward-looking statement can be guaranteed and actual future results may vary materially. Accordingly, readers are advised not to place undue reliance on forward-looking statements or information.

SOURCE Crown Capital Partners Inc.

For further information, please contact: Michael Overvelde, Chief Financial Officer, [email protected], [phone]