A.R.I. sues OVO over $4.6 million debt dispute

A.R.I. has filed suit in British Columbia against October’s Very Own, alleging the Drake co-founded company defaulted on convertible notes, signed a forbearance agreement acknowledging the debt, and still owes more than $4.6 million. The case adds legal pressure on OVO after multiple 2025 financing deals and claims of unpaid fees, interest and enforcement costs. Why it matters: - A.R.I. is trying to collect at least $4,609,455.72, plus interest, fees and costs, in a dispute that could affect OVO’s financing obligations and broader lender relationships. - The case centers on whether OVO must pay contractual amounts the company allegedly challenged, including a make-whole fee tied to early repayment or termination. What happened: - A.R.I. OVO Growth Capital I, LLC filed litigation in the Supreme Court of British Columbia in Vancouver on June 11, 2026. - The suit targets October’s Very Own ULC, the lifestyle, apparel, music and consumer products company co-founded by Aubrey “Drake” Graham, Oliver El-Khatib and Noah “40” Shebib. - The claim seeks recovery of at least $4,609,455.72, along with default interest, legal fees, lender expenses, enforcement costs, contractual fees and other amounts still accruing. - OVO issued five Convertible Promissory Notes to A.R.I. between July 14, 2025 and August 5, 2025, with aggregate principal of $5,234,121.93. The details: - The notes were five-year convertible debt instruments with conversion rights, information rights, prepayment restrictions, default remedies and a contractual Make Whole Fee. - Financial information referenced in the complaint says OVO generated about $72 million in revenue in 2024 and nearly $400 million in cumulative revenue from 2019 through 2024. - The same filing alleges OVO lost $8 million in EBITDA in 2024 and about $12 million in cumulative EBITDA from 2022 through 2024. - During 2025, A.R.I. and affiliated entities provided OVO with multiple financing transactions. - In May 2025, A.R.I. Senior Secured Growth Credit Fund, LP extended a $10 million senior secured credit facility collateralized by intellectual property assets, including rights tied to the October’s Very Own trademark and OVO owl logo. - The complaint alleges OVO defaulted on that facility, entered a separate forbearance arrangement, and repaid the facility on March 31, 2026. - A.R.I. says OVO later defaulted on the convertible notes by missing required payments and breaching other financing obligations. - A.R.I. delivered a formal notice of default on or about February 27, 2026, identifying multiple Events of Default and reserving all rights and remedies. - On or about March 20, 2026, the parties entered a Forbearance Agreement under which A.R.I. temporarily held off on enforcement actions if OVO met specified repayment obligations. - The agreement allegedly included OVO’s admission of existing Events of Default, confirmation that amounts owed were valid and due, and a promise to repay principal, the Make Whole Fee, accrued interest, default interest, forbearance fees and enforcement costs. - On or about May 25, 2026, A.R.I. delivered a repayment statement listing principal, make-whole obligations, accrued interest, default interest, legal fees, enforcement costs and other amounts. - OVO then made a partial payment while disputing its obligation to pay the Make Whole Fee and certain other charges. - A.R.I. says substantial amounts remain unpaid. - After payments already received, the complaint says OVO still owed at least $4,609,455.72 as of June 11, 2026. - Remaining unpaid obligations allegedly include the Make Whole Fee, default-rate interest, legal fees, professional expenses, enforcement costs and additional contractual amounts still accruing. Between the lines: - The lawsuit suggests a breakdown after OVO acknowledged the debt and entered forbearance, which can make the dispute over repayment terms more consequential. - The inclusion of IP-collateralized lending, conversion features and make-whole language points to a financing structure designed to protect the lender if the debt was paid off early or went into default. - OVO’s reported revenue growth did not prevent the company from posting operating losses, which may help explain why the repayment dispute reached court. What’s next: - A.R.I. says it will continue pursuing all rights and remedies available under the financing agreements and applicable law. - The case now moves through the British Columbia court process unless the parties reach a settlement or repayment agreement. - The dispute could expand to include additional accrued interest, fees and enforcement costs if the unpaid balance continues to grow. The bottom line: - A.R.I. is taking OVO to court after a string of financing deals, defaults and forbearance talks ended with more than $4.6 million still allegedly unpaid.