Volatus Aerospace Strengthens Balance Sheet with Debt Settlement
Volatus Aerospace Takes Bold Steps to Fortify Its Financial Standing
In a significant move towards enhancing its financial health, Volatus Aerospace Inc. (TSXV: FLT) (OTCQX: TAKOF), a recognized leader in providing innovative aerial solutions, has announced a strategic shares-for-debt settlement. This initiative is designed to strengthen the company’s balance sheet and boost shareholder value, effective from a recent agreement with convertible debenture holders.
Strategic Agreement to Convert Debt to Equity
As part of this strategy, Volatus has secured an agreement with holders of unsecured convertible debentures, which entails converting outstanding debt into equity. This exciting development, pending the approval of the TSX Venture Exchange (TSXV), brings significant implications for the company. The decision follows an extraordinary resolution by debenture holders who have opted for a shares-for-debt transaction. This transaction is set to alleviate financial pressures and pave the way for future growth initiatives.
Details of the Shares-for-Debt Settlement
The debenture holders initially consented to approximately $2,646,000 in principal amount, which was issued on May 11, 2023. This debt conversion falls under a debenture indenture with a prospective supplementary agreement aimed at reinforcing the company’s financial infrastructure. By transferring the debt into common shares at a conversion price of $0.15 per share, Volatus aims to create a more robust capital structure and increase liquidity.
Critical Aspects of the Proposal
This financial restructuring has garnered substantial backing from debenture holders and involves several key components:
- Maturity Date: The maturity date for the debentures will be established by the company but will not exceed May 11, 2025, after notifying all relevant parties.
- Principal and Interest Conversion: The outstanding principal will be settled in common shares, along with accrued interest, also converted at the same share price.
- Supplemental Shares: An additional issuance of common voting shares amounting to 10% of the principal will be granted to debenture holders.
- Warrants: Each debenture holder will receive one warrant for every common share converted, allowing for purchase at $0.20 per share within a three-year timeframe.
This comprehensive deal is set to issue upwards of 20 million common shares and nearly 18 million warrants, significantly affecting the company’s capital and shareholder structure.
Financial Flexibility for Future Growth
Abhinav Singhvi, CFO of Volatus, expressed optimism about this restructure, highlighting that "This financial restructuring is a key step toward optimizing our capital structure and setting the stage for sustainable growth." He underscored the importance of investor support in this endeavor and noted that it would afford the company greater financial flexibility moving forward.
Compliance and Expectation for Regulatory Approval
As with any financial maneuver of this magnitude, all proposed securities will be subject to a hold period in line with applicable regulations. Volatus will adhere to necessary protocols to ensure compliance and uphold investor interests while awaiting final regulatory approval.
About Volatus Aerospace Inc.
Volatus Aerospace stands at the forefront of innovative aerial solutions catering to sectors such as oil and gas, healthcare, and public safety. Equipped with over a century of combined experience in aviation, the company's mission is to leverage cutting-edge technology to enhance operational efficiency and sustainability for its clients.
Frequently Asked Questions
What is the purpose of the shares-for-debt settlement?
The settlement aims to convert outstanding debt into equity, strengthening Volatus Aerospace’s balance sheet and enhancing shareholder value.
What are the terms of the debenture conversion?
Each debenture holder will have their outstanding principal converted into common shares at a price of $0.15 each, along with accrued interest.
How many shares and warrants are expected to be issued?
Volatus expects to issue approximately 20,157,908 common shares and about 17,639,995 warrants through this debt conversion.
What are the implications for Volatus Aerospace's growth?
This restructuring is anticipated to provide increased financial flexibility, enabling the company to pursue growth strategies effectively.
Who can be contacted for more information regarding this settlement?
Investors and interested parties can contact Abhinav Singhvi, CFO of Volatus Aerospace, for more information.
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