Mr. Abhinav Singhvi reports

VOLATUS AEROSPACE SECURES $15 MILLION IN FINANCING FROM MAJOR INSTITUTIONAL INVESTORS

Volatus Aerospace Inc. has closed a total of $15-million in combined funding from Investissement Quebec and Export Development Canada (EDC) (together, the new financing).

This new financing will allow Volatus to expand its operations and accelerate the development of its aerial solutions across key core industries such as oil and gas, energy utilities, public safety, and infrastructure. The total funding comprised $7.5-million from Investissement Quebec in the form of a secured convertible debenture and $7.5-million from EDC in the form of a term loan.

This new financing provides a strong foundation for Volatus to secure and advance its growth strategy. "We are honored to have the support of both Investissement Quebec and Export Development Canada," said Glen Lynch, chief executive officer of Volatus. "These financings will enable the company to achieve our near-term profitability goal and reinforce our base from which to resume our internal and external growth initiatives."

The debenture, with a term of five years, will be senior secured and convertible at the holder's option into Volatus common shares at a conversion price of 20.2 cents per common share (36 cents Volatus referenced share price prior to the DDC merger, adjusted). The debenture will bear interest at a rate of 12.5 per cent per annum until its maturity date on Oct. 21, 2029. The interest portion for the first three-year period will be initially non-cash interest, and capitalized semi-annually and convertible, at the holder's option at the then market price of the common shares as permissible by securities regulations and the rules of the TSX Venture Exchange, while the interest portion for the last two years will be payable, semi-annually, in cash until the maturity date, unless the debenture is otherwise converted at the conversion price, at any time and at the holder's option before the maturity date.

Volatus has committed to move back its head office to Quebec and further develop identified future new activities based in Quebec. These include longer-term developmental initiatives such as artificial-intelligence-based aerial solutions as well as unmanned delivery and cargo developmental projects. The company has already begun scoping such initiatives. The company felt that Quebec's unique industrial clusters, strengths and ecosystems in many areas such as aerospace, AI, air freight and cargo, as well as its R&D (research and development) support programs, further supports this move to Quebec.

"Investissement Quebec is proud to support Volatus's growth. This investment will enable the company not only to relocate its head office and most of its operations to Quebec, but also to optimize its research and development initiatives and advance its artificial intelligence projects. This financing operation clearly reflects our desire to actively contribute to the development of strategic sectors of our economy," said Bicha Ngo, president and chief executive officer of Investissement Quebec.

The term loan from Export Development Canada (EDC) will be senior secured and non-convertible with an interest rate of prime plus 8 per cent and a term of four years with a balloon payment of up to $4.5-million at the end of the fourth year on Oct. 21, 2028.

"In collaboration with Investissement Quebec, we are pleased to support Volatus with debt financing to help the company advance the development of its cutting-edge aerial solutions," said Guillermo Freire, senior vice-president, mid-market group. "Through its innovative technologies, Volatus is shaping the future of aerospace operations for the benefit of an array of sectors, and we look forward to seeing the impact of their continued growth."

The company intends to use the net proceeds from the offering toward repayment of existing debt, financing inventory, capital expenditures, working capital needs of the company directly associated with its export contract and general corporate purposes. A currently outstanding senior loan of approximately $6-million provided by a major Canadian bank will be repaid from the proceeds of the new financing. EDC and IQ will share proportionally in the senior security ranking. Certain existing aircraft-related financing debt will remain secured in priority to such loans.

Rabaska Partners acted as exclusive adviser to the company. Various legal and other advisory expenses are expected to total approximately $1.5-million.

The new financing marks a significant milestone for Volatus as it continues to expand its presence in the global aerial solutions market. The company remains focused on leveraging these funds to drive sustainable growth and advance its technology offerings.

About Volatus Aerospace Inc.

Volatus is a leader in innovative global aerial solutions for intelligence and cargo. With over 100 years of combined institutional knowledge in aviation, Volatus provides solutions for a wide array of industries, including oil and gas, energy utilities, public safety, and infrastructure. The company is committed to enhancing operational efficiency, safety and sustainability through cutting-edge aerial technologies.

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