Vertical Aerospace today announced a new agreement between the company, its majority shareholder Stephen Fitzpatrick, and its primary creditor Mudrick Capital Management. This “secures a commitment to USD50 million in new funding, strengthening Vertical’s financial position,” said a company press release. “The funding will support the company’s newly launched Flightpath 2030 Strategy to establish itself as a global leader in the eVTOL market by the end of the decade, including the ongoing development and certification of the VX4.”
The “term sheet” agreement includes:
- USD50 million funding commitment by Mudrick Capital: commitment includes USD25 million in upfront funding, and an additional USD25 million backstop that will be reduced by any amounts raised from third parties. The term sheet includes the option for Stephen Fitzpatrick to invest a further USD25 million on the same terms.
- Balance sheet strengthening: approximately USD130 million of convertible notes (50% of the outstanding amount) will be converted into equity at USD2.75 per share, “substantially reducing Vertical’s debt and significantly deleveraging the company’s balance sheet, enhancing its financial position.”
- “Greater certainty for future investors: by fixing the conversion price for the remaining outstanding convertible notes at USD3.50 per share, Vertical’s future fundraising plans will be supported.
- Remaining loan repayment date extended to December 2028: extension of term provides further security through Vertical’s certification programme.
- Renewed commitment to the UK: Vertical will continue to operate from its UK headquarters, “maintaining its brand identity and focus on innovation”.
As part of the agreement, Vertical Aerospace’s founder, Stephen Fitzpatrick, will remain on the board
Vertical’s piloted flight test programme is progressing further toward certification, recently achieving untethered, piloted thrustborne flight in Phase two of testing, continued the company. “With the VX4 prototype performing beyond expectations, the company is now working with the UK Civil Aviation Authority to secure permits to move into Phase 3 — wingborne flight tests, which is a critical step toward certification. The parties have signed a non-binding term sheet reflecting the material terms of the agreement in principle. It remains subject to implementation and execution of final transaction agreements, as well as shareholder approval of amendments to Vertical’s articles of association
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https://vertical-aerospace.com/news/