BT Brands, Aero Velocity to combine in all-stock transaction

BT Brands (BTBD) and Aero Velocity jointly announced that they have entered into a definitive merger agreement to combine in an all-stock transaction. The combined company will focus on the development of advanced drone technologies and providing AI-powered solutions for government and commercial applications. Under the terms of the merger agreement, a wholly-owned subsidiary of BT Brands will merge with and into Aero Velocity, with Aero Velocity continuing as a wholly-owned subsidiary of BT Brands and the surviving company of the merger. The transaction calls for an equity investment in the combined company of not less than $3M and up to $5M by Aero Velocity shareholders. Upon the closing of the proposed transactions, Aero Velocity’s stockholders are expected to own approximately 89% of the combined company, and existing BT Brands stockholders are expected to own approximately 11% of the combined company, each on a fully diluted economic basis. The foregoing percentages are subject to adjustment based on BT Brands’ net cash at the closing, among other adjustments, in each case as described in the merger agreement. Upon the closing of the proposed transactions, the combined company is expected to be renamed “Aero Velocity Inc.” and trade on the Nasdaq Capital Market. Mark Hastings will serve as CEO of the combined company. The transaction has been unanimously approved by the board of directors of both companies and is expected to close in the fourth quarter of 2025 or first quarter of 2026, subject to approvals by the stockholders of each company and other customary closing conditions.