TORONTO, Aug. 30,
2024 /CNW/ - Drone Delivery Canada
Corp. ("Drone Delivery Canada" or the
"Company") (TSXV: FLT) (OTCQX: TAKOF) (Frankfurt: A3DP5Y) (Frankfurt: ABBA.F) and
Volatus Aerospace Corp. ("Volatus") (TSXV: VOL)
(OTCQB: VLTTF) are pleased to announce the successful completion of
their merger of equals (the "Merger") announced on
May 21, 2024, pursuant to which Drone
Delivery Canada acquired all of the issued and outstanding common
shares of Volatus (the "Volatus Shares") by way of a plan of
arrangement under the Business Corporations Act
(Ontario) (the
"Arrangement"). The Arrangement results in Volatus becoming
a wholly-owned subsidiary of the Company. The completion of the
Merger marks a new era for the companies, combining the power of
Volatus' commercialization expertise with Drone Delivery Canada's
proven remote operations and logistics technology. The Merger
obtained requisite approval by the shareholders of both companies,
with Drone Delivery Canada holding its meeting on August 26th and Volatus on
August 23rd. The
Arrangement was approved by the Ontario Superior Court of Justice
(Commercial List) on August
27th.
In connection with the Merger, the Company will change its name
to "Volatus Aerospace Inc.", leveraging the strength of the Volatus
brand while maintaining Drone Delivery Canada's brand for cargo
operations. The shares of the Company will continue to trade under
the stock ticker symbols TSXV: FLT, OTCQX: TAKOF, Frankfurt: A3DP5Y, and Frankfurt: ABBA.F. The shares of the Company
are expected to start trading on TSX Venture Exchange (the
"TSXV") under the new name "Volatus Aerospace Inc." on or
about September 5, 2024.
Under the terms of the Arrangement, each former Volatus
shareholder is now entitled to receive 1.785 (the "Exchange
Ratio") common voting shares of the Company for each Volatus
Share held immediately prior to the effective time of the
Arrangement (the "Consideration"). The Merger was structured
as a 50/50 merger of equals with shareholders of both companies
owning approximately 50% of the Company upon completion of the
Arrangement.
In order to receive the Consideration, registered shareholders
of Volatus Shares will be required to deposit their share
certificate(s) representing Volatus Shares, together with the duly
completed letter of transmittal, with Computershare Investor
Services Inc., the depositary under the Arrangement. Shareholders
whose Volatus Shares are registered in the name of a broker,
dealer, bank, trust company or other nominee should contact their
nominee regarding the receipt of the Consideration.
Volatus Options, Warrants and Convertible Debentures
Holders of Volatus options ("Volatus Options") have
received replacement options under the Arrangement, exercisable for
common voting shares in the capital of the Company at the same
Exchange Ratio applicable to the Volatus Shares. All other terms
and conditions of the replacement options, including the term of
expiry, vesting, conditions to and manner of exercising, are the
same as the Volatus Options for which they were exchanged.
Warrants to purchase Volatus Shares ("Volatus Warrants"),
other than those that have been exercised prior to the effective
time of the Arrangement, will continue to remain outstanding as
warrants of Volatus which, upon exercise, will entitle the holder
thereof to receive, the Consideration in lieu of a Volatus Share
for each Volatus Warrant so exercised.
Convertible debentures of Volatus (the "Volatus
Debentures") will be assumed by Drone Delivery Canada and the
Volatus Debentures shall be amended so as to substitute for the
Volatus Shares subject to such Volatus Debentures such number of
common voting shares of the Company equal to (A) the number of
Volatus Shares into which such Volatus Debentures may be
convertible immediately prior to the effective time of the
Arrangement, multiplied by (B) 1.785, rounded down to two decimal
places.
As required by the warrant indentures in respect of certain
Volatus Warrants and the debenture indenture in respect of the
Volatus Debentures, Drone Delivery Canada has entered into
supplemental warrant indentures and a supplemental debenture
indenture. Copies of each of the supplemental warrant indentures
and supplemental debenture indenture will be available on Volatus'
and Drone Delivery Canada's respective SEDAR+ profiles at
www.sedarplus.ca.
Management and Board Composition
The management team of the Company is led by Glen Lynch as CEO and Steve Magirias as COO. Ian McDougall, the current chairman of Volatus,
has assumed the role of chairman of the Company's board. The other
directors of the Company are Kevin
Sherkin, Larry Taylor,
Glen Lynch and Andrew Leslie.
"Our transformative merger of Drone Delivery Canada and Volatus
marks the next major milestone for the Company," said Glen Lynch, CEO of the Company. "Back when
Volatus transitioned from a private company to a public company in
2021, we reimagined our mission to be an integrator and
consolidator of a fragmented industry—to build a streamlined and
agile ecosystem for our customers. Volatus is taking the next
evolutionary step with Drone Delivery Canada, combining its
significant technological expertise together with our commercial
experience to provide tested and proven remote operational
capabilities and logistics technology to our customers."
Delisting of Volatus Shares
Volatus Shares are expected to be delisted from the TSXV as of
the closing of the market on September 4,
2024.
Listed Volatus Warrants
Prior to the completion of the Arrangement, Volatus had
outstanding a class of Volatus Warrants listed on the TSXV under
the trading symbol "VOL.WT.A" (the "Listed Volatus
Warrants"). The Listed Volatus Warrants will continue trading
on the TSXV as Volatus Warrants, under their existing trading
symbol, and will remain listed on the TSXV until the earliest to
occur of their exercise, expiry or delisting.
Other Matters
An application has been filed with the applicable securities
regulators of Volatus for exemptive relief from certain continuous
disclosure and insider reporting requirements. In the event Volatus
is granted such relief, holders of Listed Volatus Warrants will be
directed to reference, and rely on, the public disclosure filings
of Drone Delivery Canada.
In connection with the Merger and following approval by
shareholders of Drone Delivery Canada, the Company has adopted a
new equity incentive plan (the "Equity Incentive Plan")
governing the terms and issuance of restricted share units,
performance share units and deferred share units of the
Company.
Full details of the Merger, the Arrangement, the Equity
Incentive Plan and certain other matters are set out in the joint
management information circular of Drone Delivery Canada and
Volatus and can be found under Drone Delivery Canada's and Volatus'
respective profiles on SEDAR+ at www.sedarplus.ca.
Early Warning Disclosure
Immediately before completion of the Arrangement, Drone Delivery
Canada (6-6221 Highway 7, Vaughan,
Ontario L4H 0K8) did not own or control, directly or
indirectly, any Volatus Shares or other securities of Volatus.
Immediately following completion of the Arrangement, Drone Delivery
Canada owned 125,683,761 Volatus Shares, representing 100% of the
outstanding Volatus Shares.
An aggregate of 224,344,723 common voting shares of Drone
Delivery Canada were issued to holders of Volatus Shares in
connection with the Merger. These common voting shares have a
market value of approximately $38,138,602 based on the closing price of the
common voting shares of Drone Delivery Canada on the TSXV of
$0.17 on August 29, 2024, being the last trading day prior
to the closing of the Merger.
An early warning report will be filed by Drone Delivery Canada
in accordance with applicable Canadian securities laws and will be
available under Volatus' SEDAR+ profile at www.sedarplus.ca or may
be obtained directly from the Company by mailing the Company at its
head office: 6-6221 Highway 7, Vaughan,
Ontario L4H 0K8.
Immediately before completion of the Arrangement, Mr.
Glen Lynch owned or controlled,
directly or indirectly, 38,461,667 Volatus Shares, representing
approximately 30.60% of the outstanding Volatus Shares on a
non-diluted basis, and 1,500,000 Volatus Options, representing
approximately 31.42% of the outstanding Volatus Shares on a
partially diluted basis (assuming the full exercise of such Volatus
Options). Immediately before completion of the Arrangement, Mr.
Lynch did not own or control, directly or indirectly, any common
voting shares of the Company or other securities of the
Company.
In connection with the completion of the Arrangement, Mr. Lynch
disposed of all of his Volatus Shares and Volatus Options in
exchange for, on the basis of the Exchange Ratio, 68,654,075 common
voting shares of the Company, representing approximately 15.31% of
the outstanding common voting shares and variable voting shares of
the Company, and 2,677,500 stock options of the Company,
representing approximately 15.81% of the outstanding common voting
shares and variable voting shares of the Company, on a partially
diluted basis (assuming the full exercise of such stock options of
the Company). These common voting shares of the Company have a
market value of approximately $11,671,192 based on the closing price of the
common voting shares of Drone Delivery Canada on the TSXV of
$0.17 on August 29, 2024, being the last trading day prior
to the closing of the Arrangement.
Early warning reports will be filed by Mr. Lynch in accordance
with applicable Canadian securities laws and will be available
under Volatus' and the Company's SEDAR+ profile at www.sedarplus.ca
or may be obtained directly from the Company by mailing the Company
at its head office: 6-6221 Highway 7, Vaughan, Ontario L4H 0K8.
Immediately before completion of the Arrangement, Mr.
Ian McDougall, including through his
100% owned holding companies, Delta-Mike Inc. and Aligned Two Inc.,
owned or controlled, directly or indirectly, 39,017,267 Volatus
Shares, representing approximately 31.04% of the outstanding
Volatus Shares on a non-diluted basis, 1,208,461 Volatus Options
and 555,600 Volatus Warrants, representing approximately 32.00% of
the outstanding Volatus Shares on a partially diluted basis
(assuming the full exercise of such Volatus Options and Volatus
Warrants), and 206,188 Class A preferred shares of Volatus.
Immediately before completion of the Arrangement, Mr. McDougall did
not own or control, directly or indirectly, any common voting
shares of the Company or other securities of the Company.
In connection with the completion of the Arrangement, Mr.
McDougall disposed of all of the Volatus Shares he beneficially
owned or controlled prior to completion of the Arrangement in
exchange for, on the basis of the Exchange Ratio, 69,645,821 common
voting shares of the Company, representing approximately 15.53% of
the outstanding common voting shares and variable voting shares of
the Company. Mr. McDougall further disposed of all of the Volatus
Options he beneficially owned or controlled prior to completion of
the Arrangement in exchange for, on the basis of the Exchange
Ratio, 2,157,102 stock options of the Company and his Volatus
Warrants became exercisable into 991,746 common voting shares of
the Company, representing in the aggregate approximately 16.12% of
the outstanding common voting shares and variable voting shares of
the Company, on a partially diluted basis (assuming the full
exercise of such stock options of the Company and Volatus
Warrants). These common voting shares of the Company have a market
value of approximately $11,839,789
based on the closing price of the common voting shares of Drone
Delivery Canada on the TSXV of $0.17 on August 29,
2024, being the last trading day prior to the closing of the
Arrangement. Following completion of the Arrangement, Mr. McDougall
will continue to beneficially own or control 555,600 Volatus
Warrants (exercisable into 991,746 common voting shares of the
Company as noted above) and 206,188 Class A preferred shares of
Volatus.
Early warning reports will be filed by Mr. McDougall in
accordance with applicable Canadian securities laws and will be
available under Volatus' and the Company's SEDAR+ profile at
www.sedarplus.ca or may be obtained directly from the Company by
mailing the Company at its head office: 6-6221 Highway 7,
Vaughan, Ontario L4H 0K8.
Advisors
Ventum Financial Corp. ("Ventum Capital Markets") acted
as exclusive financial advisor to Volatus and Wildeboer Dellelce
LLP acted as legal counsel to Volatus. Blink Capital Corp. acted as
a strategic advisor on the Merger.
National Bank Financial Inc. acted as exclusive financial
advisor to Drone Delivery Canada, Bennett Jones LLP acted as legal
counsel to Drone Delivery Canada.
Issuance of Shares to Ventum Capital Markets
Pursuant to an engagement letter between Ventum Capital Markets
(formerly, Echelon Wealth Partners Inc.) and Volatus dated
February 1, 2024, the Company will
issue $75,000 worth of common
voting shares to Ventum Capital Markets as a success fee in
connection with the completion of the Merger based on the 10-day
volume weighted average price per common voting share as at closing
of the Merger.
About Volatus Aerospace Inc.
Volatus Aerospace Inc., born from the merger of Volatus and
Drone Delivery Canada, is a consolidator and integrator of aerial
intelligence and logistics solutions. With deep technological and
subject matter expertise and over 100 years' worth of combined
institutional knowledge in aviation, the Company's mission has been
to build a complete aerial intelligence and logistics ecosystem
that provides agile and streamlined solutions for end users across
various industries. The Company has achieved this through strategic
partnerships and acquisitions that augment its operational,
geographical, and technological capabilities, enabling
best-in-class services, technologies, and training
globally. We are committed to enhancing operational
efficiency, safety, and sustainability through innovative,
real-world aerial solutions.
Explore our services and connect with us
at http://www.volatusaerospace.com to learn more about
how we can support your operational goals.
Cautionary Note Regarding Forward-Looking Information
Certain information contained in this news release may
constitute forward-looking information, forward-looking statements
and future-oriented financial information within the meaning of
applicable securities legislation (collectively "forward-looking
statements"). Forward-looking statements include, but are not
limited to, statements that refer to projections, forecasts or
other characterizations of future events or circumstances,
including any underlying assumptions. Forward-looking statements
may be identified by words such as "plans", "expects", "is
expected", "budget", "scheduled", "estimates", "indicates",
"forecasts", "intends", "anticipates", "believes", "may", "could",
"should", "would", "plans", "proposed", "potential", "will",
"target", "approximate", "continue", "might", "possible",
"predicts", "projects" and similar expressions, but the absence of
these words does not mean that a statement is not forward-looking.
Forward-looking statements in this news release may include but are
not limited to: (i) statements concerning the expected timing by
which the Volatus Shares will be delisted from the TSXV; (ii) the
continued listing and trading of the Listed Volatus Warrants on the
TSXV; (iii) the granting of exemptive relief by applicable
securities regulators as it relates to Volatus' continuous
disclosure obligations and insider reporting requirements; (iv) the
anticipated change of the Company's name to "Volatus Aerospace
Inc." and the timing of the shares of the Company trading on the
TSXV under the new name; (v) the anticipated benefits of the
Merger; (vi) the anticipated timing of filing of necessary early
warning reports; and (vii) the business plans, expectations, and
goals of the combined company. These forward-looking statements are
based on information available as of the date of this news release,
and the current expectations, forecasts, assumptions, views and
beliefs of management of each of Volatus and Drone Delivery Canada,
but involve known and unknown risks, uncertainties, assumptions and
other factors that may cause the actual results, performance or
achievements of Volatus, Drone Delivery Canada or the combined
company, as applicable, to differ materially from those expressed
or implied by the forward-looking statements. Some factors that
could cause actual results to differ include, among other things:
(i) the ability to recognize the anticipated benefits of the
Merger; (ii) unexpected costs related to the Merger; (iii) the
commercialization of drone flights beyond visual line of sight and
potential benefits to Volatus and Drone Delivery Canada; (iv)
geopolitical risk and changes in applicable laws or regulations;
(v) operational risks; (vi) meeting the continued listing
requirements of the TSXV; (vii) other factors set forth in the
joint management information circular of Volatus and Drone Delivery
Canada under the section "Risk Factors", available on Volatus' and
Drone Delivery Canada's respective SEDAR+ profiles at
www.sedarplus.ca and (ix) other factors set forth in Drone Deliver
Canada's annual information form under the section "Risk Factors",
available under Drone Delivery Canada's SEDAR+ profile at
www.sedarplus.ca . Although Volatus and Drone Delivery Canada have
attempted to identify important factors and that could cause actual
actions, events or results to differ materially from those
described in forward-looking statements, there may be other factors
that cause actions, events or results to differ from those
anticipated, estimated or intended. Readers are cautioned that
forward-looking statements are not based on historical facts but
instead reflect expectations, estimates or projections concerning
future results or events based on the opinions, assumptions and
estimates of management considered reasonable at the date the
statements are made. The forward-looking statements contained
herein are made as of the date of this news release. Accordingly,
forward-looking statements should not be relied upon as
representing Volatus' or Drone Delivery Canada's views as of any
subsequent date, and except as expressly required by applicable
securities laws, Volatus and Drone Delivery Canada disclaim any
obligation to update or revise any forward-looking statements,
whether as a result of new information, future events or otherwise.
There can be no assurance that forward-looking statements will
prove to be accurate, as actual results and future events could
differ materially from those anticipated in such statements.
Readers should not place undue reliance on these forward-looking
statements. Any and all forward-looking statements contained in
this news release are expressly qualified by this cautionary
statement.
None of the securities to be issued pursuant to the Arrangement
have been or will be registered under the United States Securities
Act of 1933 (the "U.S. Securities Act"), or any state
securities laws, and any securities issuable in the transaction are
anticipated to be issued in reliance upon available exemptions from
such registration requirements pursuant to Section 3(a)(10) of the
U.S. Securities Act and applicable exemptions under state
securities laws. This news release does not constitute an offer to
purchase or a solicitation of an offer to sell securities.
Neither TSXV nor its Regulation Services Provider (as that term
is defined in the policies of the TSXV) accepts responsibility for
the adequacy or accuracy of this news release.
SOURCE Drone Delivery Canada Corp.