Velo3D Improves Financial Position with Strategic Debt Exchange

Velo3D Takes Major Steps to Strengthen Financial Position

Velo3D, Inc. (OTCQX: VLDX), a frontrunner in scalable metal 3D printing technology for production manufacturing, has declared a transformative agreement that dramatically improves its financial standing. The company is engaged in a debt-for-equity exchange where nearly $22.4 million of its senior secured notes will be annulled. In return, approximately 185 million shares of Velo3D common stock will be distributed to the holder, Arrayed Notes Acquisition Corp.

Key Aspects of the Debt Exchange Transaction

This strategic maneuver will allow Velo3D to cancel an impressive 81.7% of its principal outstanding senior secured notes while subsequently shifting arrangements around its equity. Following the transaction, Arrayed Notes Acquisition Corp. is poised to be the owner of around 95% of Velo3D's total shares. Notably, Velo3D will continue to be publicly traded with its remaining shares on OTCQX, ensuring its commitment to serve its diverse customer base.

Operational Management Changes

The shift in Velo3D's equity landscape has also resulted in significant changes within its management. Arun Jeldi, CEO of Arrayed Additive, will step into the role of CEO at Velo3D, bringing fresh perspectives to the company. Several board members are stepping down, resizing the board from ten to five members, creating a streamlined approach to decision-making and governance.

Focus on Future Growth

This considerable reduction in debt positions Velo3D to redirect its focus on operational capabilities and innovative solutions. Brad Kreger, Velo3D’s new Chief Operating Officer, expressed enthusiasm about the future, stating that the cancellation of the majority of their secured notes places the company in a robust financial position for growth. He noted the commitment to enhancing large-format metal 3D printing capabilities to meet customer needs worldwide.

Complementing Arrayed Additive’s Vision

The amalgamation of Velo3D’s advanced technology and Arrayed Additive’s lightweight manufacturing prowess creates a substantial synergy. Velo3D's emphasis on sectors such as aerospace, defense, and technology aligns seamlessly with Arrayed Additive’s capabilities in utilizing magnesium and aluminum alloys. This partnership sets the stage for significant technological advancements and market expansions that can benefit a wide array of industries.

Strategic Advisement in the Exchange Transaction

To aid in this exchange process, Sidley Austin LLP is providing legal counsel, while Berkeley Research Group, LLC handles financial advisement for Velo3D. Meanwhile, Arrayed Additive has engaged Arnold & Porter Kaye Scholer LLP for its legal advisement, ensuring that both companies are fortified with competent counsel throughout this significant financial transition.

Frequently Asked Questions

What is the impact of the debt for equity exchange on Velo3D?

The debt exchange allows Velo3D to significantly reduce its outstanding senior secured notes, enhancing its financial stability and operational focus.

Who will lead Velo3D after this transaction?

Arun Jeldi, the CEO of Arrayed Additive, will become the CEO of Velo3D following this transaction.

How will this transaction affect Velo3D’s public status?

Velo3D will continue to be a publicly traded company with its shares remaining listed on OTCQX.

What sectors does Velo3D focus on with its technology?

Velo3D primarily focuses on sectors such as aerospace, defense, energy, and semiconductor industries.

Who are the advisors involved in the transaction?

Legal advisement is provided by Sidley Austin LLP for Velo3D and Arnold & Porter Kaye Scholer LLP for Arrayed Additive, with financial advisement from Berkeley Research Group, LLC.

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