Vertical Aerospace Founder Backs Company with Additional $50M Investment Commitment

Founder and CEO Stephen Fitzpatrick commits to invest $50 million equity capital into Vertical Aerospace

  • An initial tranche of $25 million at $10 per share; the second tranche of $25 million at a price to be determined
  • Investment extends the projected cash runway into Q2 2025 and will support the continued development of
    the certification aircraft design
  • Vertical is engaged in discussions for further capital pending the flight test campaign of its second prototype
  • Vertical continues to target Type Certification towards the end of 2026

Vertical Aerospace (Vertical) [NYSE: EVTL], a global aerospace and technology company that is pioneering
zero-emissions aviation, announces today that it has secured $50 million in committed funding from founder, majority owner and CEO, Stephen Fitzpatrick. The investment provides the platform for further funding rounds and extends Vertical’s projected cash runway into Q2 2025, supporting the continued development of the certification aircraft design following prototype testing this year. This certification aircraft will then go into final regulatory testing before production.

This funding comes at an important period for the company as it nears the completion of its second generation, full-scale piloted VX4 prototype at GKN Aerospace’s Global Technology Centre. The aircraft will conduct a series of key public flight demonstrations in 2024, including the intention to fly at Farnborough International Airshow and to and from Heathrow Airport. These flights are expected to demonstrate the significant technical and engineering advancements made to the VX4. Following this flight test programme and planned public demonstrations, Vertical expects to be in position to refine and finalise its aircraft design.

Stephen Fitzpatrick, CEO & Founder of Vertical, said: “Since founding Vertical in 2016 I have continued to
believe in the enormous potential the company has to pioneer zero carbon aviation. The company has achieved significant technical progress both in its prototype programme and its certification plans in 2023, that I believe is not reflected in our share price. Given the success I have seen in the past 12 months, I am more confident than ever in our world-class team, and I am delighted to further support the company with additional funding.”

Mike Flewitt, Chairman of Vertical, said: “I am delighted that Stephen has committed to further funding
Vertical. His vision and funding to date have enabled Vertical to be a frontrunner in the Advanced Air
Mobility industry and I look forward to both our demonstrations and the completion of additional funding rounds to deliver on the promise the VX4 has to offer our customers and their passengers. We are on track to deliver a transformative UK developed electric aircraft to our customers across the globe.”

The funding comes off the back of several major milestones achieved by the company in 2023:

Opening the Vertical Energy Centre in January and building a complete battery powertrain with Molicel cells

Receiving Design Organisation Approval (DOA) from the UK Civil Aviation Authority (CAA) in March

Completing the thrustborne test campaign with the full-scale VX4 prototype by August

Pre-orders for 1500 VX4 aircraft worth over $5bn from more than a dozen customers worldwide by October

Completing initial Technical Familiarisations with five global aviation regulators and proceeding to a key
design review for the VX4

Starting final assembly for the second VX4 full-scale piloted prototype – which includes the technologies from the majority of the VX4’s certification aircraft partners

Strengthening the senior engineering team with hires across aircraft design, flight test, airworthiness and
powertrain Vertical has an asset-light, lower capital approach to eVTOL aircraft development, supported by its tier-one aerospace partner ecosystem and global operating partners. In 2023, Vertical’s unaudited results indicate that its net cash used in operating activities was approximately $95 million, emphasising its disciplined approach to spend management.

Transaction summary

The Company and Mr. Fitzpatrick have entered into a legally binding term sheet agreement in respect of
an equity investment by Mr. Fitzpatrick. Mr. Fitzpatrick will commit an initial tranche of $25 million, which is expected to close by March 2024, for a mixture of ordinary shares at $10 per share and warrants with a $5 exercise price, and a second tranche of $25 million by 31 July 2024 for ordinary shares at a price per share to be determined (such second tranche to be reduced by the amount of alternative equity funding secured by the Company by that date). As part of the transaction, shareholders will vote on certain changes to the Company’s articles of association with respect to Board composition and proceedings at shareholder meetings; and the Company will provide certain veto rights to Mr. Fitzpatrick, for so long as his holding of the Company’s ordinary shares remains above certain thresholds, in respect of certain changes to the company’s articles, appointments, and certain issuances of shares and other instruments. The closing of the transaction is subject to the entry into of long-form agreements and other customary closing conditions.

About Vertical Aerospace

Vertical Aerospace (NYSE: EVTL) is pioneering electric aviation. The Company was founded in 2016 by
Stephen Fitzpatrick, an established entrepreneur best known as the founder of the OVO Group, a leading
energy and technology group and Europe’s largest independent energy retailer. Vertical has focused
on building the most experienced and senior team in the eVTOL industry, who have previously certified
and supported over 30 different civil and military aircraft and propulsion systems. Vertical received its
Design Organisation Approval in 2023 underlining the UK Civil Aviation Authority’s confidence in Vertical’s
capability to design a safe and reliable aircraft and aviation-related products to the highest standards.

Vertical’s top-tier partner ecosystem, including Honeywell Aerospace, Leonardo, Hanwha, Dassault
Systèmes, Molicel, and GKN Aerospace, is expected to de-risk operational execution and its pathway
to certification allowing for a lean cost structure and enabling production at scale. Vertical has a leading
pre-order book from a diverse global customer base, creating multiple potential near term and actionable
routes to market. Customers include airlines, aircraft lessors, helicopter operators, mobility firms and
tourism groups, including American Airlines, Virgin Atlantic, Avolon, Bristow, Marubeni, Kakao Mobility,
Iberojet and FLYINGGROUP, as well as Japan Airlines (JAL), Gol, Air Greenland, Gozen Holding and AirAsia,
through Avolon’s VX4 placements.

Final assembly of Vertical’s second, more advanced full-scale VX4 prototype includes technology from
Vertical’s tier-one aerospace partners including Honeywell, GKN Aerospace, Hanwha, Leonardo, Molicel
and Solvay, each of which will contribute to the certification VX4 aircraft. It also features improvements
developed by Vertical that include its next generation propellers and proprietary battery pack technology,
which has been developed at its Vertical Energy Centre.