Red Cat Holdings Reports Asset Acquisition/Disposition

TL;DR

**Red Cat Holdings just completed an asset acquisition or disposition, signaling a strategic shift!**

AI Summary

Red Cat Holdings, Inc. filed an 8-K on February 22, 2024, reporting an event that occurred on February 16, 2024, related to the completion of an acquisition or disposition of assets. The filing indicates a change in the company's structure or holdings, though specific details of the transaction, such as the acquired entity or financial terms, are not provided in the excerpt. The company's business address is 15 Ave. Munoz Rivera Ste 2200, San Juan, PR.

Why It Matters

This filing signals a strategic change for Red Cat Holdings, potentially impacting its future operations, market position, and financial performance through the acquisition or disposition of assets.

Risk Assessment

Risk Level: medium — The filing indicates a significant corporate event (acquisition/disposition) but lacks specific details, making it difficult to assess the full impact or associated risks.

Key Numbers

• 20240216 — Conformed Period of Report (Indicates the period the reported event occurred.)
• 20240222 — Filed As Of Date (The date the 8-K was filed with the SEC.)
• 0000748268 — Central Index Key (CIK) (Unique identifier for Red Cat Holdings, Inc.)
• 001-40202 — SEC File Number (SEC assigned file number for the company.)
• 833-373-3228 — Business Phone (Contact number for Red Cat Holdings, Inc.)

Key Players & Entities

• Red Cat Holdings, Inc. (company) — Registrant
• Nevada (company) — State of incorporation
• 001-40202 (dollar_amount) — Commission File Number
• 88-0490034 (dollar_amount) — I.R.S. Employer Identification No.
• February 16, 2024 (date) — Date of earliest event reported

FAQ

Key Financial Figures

• $0.001 — h registered Common stock , par value $0.001 RCAT The Nasdaq Capital Market Indi
• $20 m — Rotor Riot and Fat Shark was valued at $20 million, and consisted of the following e
• $1 million — d consisted of the following elements: $1 million in cash, which was paid from the procee
• $2 million — ds of UMAC's initial public offering; $2 million in the form of a promissory note payabl
• $17 million — hibit 10.1 hereto (the " Note "); and $17 million worth of UMAC common stock, valued at t
• $5 m — C resulting in net proceeds of at least $5 million, other than UMAC's completed IPO)

Filing Documents

• rcat0220form8k.htm (8-K) — 47KB
• rcat0220form8kexh10_1.htm (EX-10.1) — 89KB
• rcat0220form8kexh10_2.htm (EX-10.2) — 56KB
• rcat0220form8kexh10_3.htm (EX-10.3) — 25KB
• rcat0220form8kexh10_4.htm (EX-10.4) — 20KB
• rcat0220form8kexh99_1.htm (EX-99.1) — 244KB
• image_001.gif (GRAPHIC) — 0KB
• 0001554795-24-000020.txt ( ) — 721KB
• rcat-20230216.xsd (EX-101.SCH) — 3KB
• rcat-20230216_lab.xml (EX-101.LAB) — 33KB
• rcat-20230216_pre.xml (EX-101.PRE) — 22KB
• rcat0220form8k_htm.xml (XML) — 4KB

01 Completion

Item 2.01 Completion of Acquisition or Disposition of Assets Closing of Sale of Consumer Division On February 16, 2024, Red Cat Holdings, Inc., a Nevada corporation (the " Company ") closed the sale of Rotor Riot, LLC (" Rotor Riot ") and Fat Shark Holdings, Ltd. (" Fat Shark "), its wholly-owned subsidiaries, to Unusual Machines, Inc., a Puerto Rico corporation (" UMAC "). The sale was conducted pursuant to a Share Purchase Agreement dated November 21, 2022, as amended on April 13, 2023, July 10, 2023, and December 11, 2023 (the " SPA "). Rotor Riot and Fat Shark previously focused on sales to the consumer segment, including recreational and hobbyist drones, first-person-view goggles, and acting as a licensed authorized reseller of consumer drone products. The transaction closed concurrently with UMAC's initial public offering and listing on the NYSE American exchange ("IPO") under the symbol "UMAC." Following divestiture of its consumer division, the Company intends to focus its efforts exclusively on drone technology integrating robotic hardware and software for military, government, and commercial operations. On September 19, 2022, the Company formed a Special Committee of its Board of Directors consisting of Joe Freedman and Christopher Moe, independent directors, in order to negotiate and conclude the SPA on behalf of the Company. The SPA was approved by shareholders of the Company at a special meeting held March 8, 2023. In evaluating the consideration to be paid to the Company for its ownership of Rotor Riot and Fat Shark, the special committee evaluated the fair market value of both companies and obtained and reviewed an independent fair market value analysis of the companies prepared by Vantage Point Advisors, Inc. Consideration for Sale of Consumer Division Under the SPA The total consideration received by the Company for its sale of Rotor Riot and Fat Shark was valued at $20 million, and consisted of the following elements: $1 million in cash, w

Financial Statements and Exhibits

Financial Statements and Exhibits Item. 9.01. Financial Statements and Exhibits Exhibit No. Description 10.1 8% Promissory Note from Unusual Machines, Inc. 10.2 Registration Rights Agreement with Unusual Machines, Inc. 10.3 Non-Competition Agreement with Unusual Machines, Inc., Rotor Riot, LLC, and Fat Shark Holdings, Ltd. 10.4 Non-Compete agreement with Allan Evans 10.5 Share Purchase Agreement with Unusual Machines, Inc. (incorporated by reference to Current Report on Form 8-K filed November 28, 2022) 10.6 Amended and Restated Amendment No. 1 to Share Purchase Agreement with Unusual Machines, Inc. (incorporated by reference to Current Report on Form 8-K filed April 14, 2023) 10.7 Amendment No. 2 to Share Purchase Agreement with Unusual Machines, Inc. (incorporated by reference to Current Report on Form 8-K filed July 14, 2023) 10.8 Amendment No. 3 to Share Purchase Agreement with Unusual Machines, Inc. (incorporated by reference to Quarterly Report on Form 10-Q filed December 15, 2023) 10.9 Amendment No. 4 to Share Purchase Agreement with Unusual Machines, Inc. (incorporated by reference to Current Report on Form 8-K filed December 15, 2023) 99.1 Unaudited Pro Forma Financial Information

SIGNATURES

SIGNATURES Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized. RED CAT HOLDINGS, INC. Dated: February 22, 2024 By: /s/ Jeffrey Thompson Name: Jeffrey Thompson Title: Chief Executive Officer

View Full Filing

View this 8-K filing on SEC EDGAR