Red Cat amends sale of consumer drone business to Unusual Machines for $20M total

Red Cat Holdings, Inc.

Cash consideration reduced to $3M plus working capital adjustment; working capital estimated at $2-4.5M.
Non-cash consideration changed to $17M in Unusual common stock at IPO price, replacing notes and preferred stock.
Minimum IPO amount for Unusual reduced from $15M to $10M; termination date extended to June 12, 2023.
Unusual to deposit $1M cash into escrow upon SEC effectiveness of its registration statement.
Unusual common stock subject to 180-day lock-up; shareholder majority approved the sale with founder abstaining.

item 1.01 item 9.01

Key facts

Extracted from this filing and checked against the source text.

Material Agreements SEC 8-K Item 1.01/1.02 confidence 0.95

Red Cat Holdings, Inc. amended Amendment with Unusual Machines, Inc. valued at $3.0 million (effective 2023-03-31).

Action: amendment
Agreement: asset purchase
Counterparty: Unusual Machines, Inc.
Value: $3.0 million
Effective: 2023-03-31

Exact text from the filing

On March 31, 2023, the SPA was amended (the “ Amendment ”). Under the Amendment, the cash consideration payable at closing was reduced to $3.0 million

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Material Agreements SEC 8-K Item 1.01/1.02 confidence 0.95

Red Cat Holdings, Inc. entered into Stock Purchase Agreement with Unusual Machines, Inc. (effective 2022-11-21).

Action: entry
Agreement: asset purchase
Counterparty: Unusual Machines, Inc.
Effective: 2022-11-21

Exact text from the filing

On November 21, 2022, Red Cat Holdings, Inc., a Nevada corporation (the “ Company ”), Unusual Machines, Inc., a Puerto Rico corporation (“ Unusual ”) and Jeffrey Thompson, the founder and Chief Executive Officer of the Company (the “ Principal Stockholder ”), entered into a Stock Purchase Agreement (the “ SPA ”) for the purchase and sale of the Company’s consumer business consisting of recreational and hobbyist drones, first-person-view goggles, and as a licensed authorized reseller.

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Material Agreements SEC 8-K Item 1.01/1.02 confidence 0.9

Red Cat Holdings, Inc. amended Amended and Restated Amendment with Unusual Machines, Inc. (effective 2023-04-13).

Action: amendment
Agreement: asset purchase
Counterparty: Unusual Machines, Inc.
Effective: 2023-04-13

Exact text from the filing

On April 13, 2023, we entered into an Amended and Restated Amendment to the SPA (the “ Amended and Restated Amendment ”). The Amended and Restated Amendment contains provisions identical to those in the Amendment signed March 31, 2023, with the additional provision that the required minimum amount of Unusual’s initial public offering has been reduced from $15 million to $10 million.

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Red Cat Holdings, Inc. filing history →

Source: SEC EDGAR

accession 0001554795-23-000123

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