Honda Aircraft (HON, Greensboro Piedmont Triad International) has terminated a 2023 fleet purchase agreement with Volato (TMB, Houston Hobby) covering twenty-three HA-420s, the fractional ownership and charter specialist said in an SEC filing.
"Pursuant to the terms of the FPA, Honda Aircraft will retain the deposits that have been previously paid by the company, and the company has to enter into individual purchase agreements for each aircraft for which a deposit had previously been paid," Volato said.
The deal was worth USD161.6 million. The 23 small business jets were due for delivery between the fourth quarter of 2023 and the fourth quarter of 2025. The ch-aviation fleets module shows that Volato has taken deliveries of three brand new HondaJet Elite II since late 2023. It also took five second-hand HA-420s in various variants during that timeframe. The operator's current fleet comprises twenty-six Honda Aircraft jets.
Honda Aircraft did not comment on the termination and did not respond to ch-aviation's request for comment.
Volato has been undergoing restructuring, which saw it return five leased HA-420s. It then announced a deal with FlyExclusive, wherein the latter will initially take over the flight operations of Volato and will be able to acquire the company in the second stage.
Volato posted a USD34.3 million net loss for the first half of 2024. The New York Stock Exchange recently notified the operator that its warrants, exercisable for Class A shares on a one-to-one basis, will be delisted due to their "abnormally low" price. They are currently trading at below USD0.50 per share. Volato will not challenge this decision. The delisting will only affect the warrants and not the actual shares.
The company recently submitted a compliance plan to the NYSE to ensure it can remain listed. In June 2024, it received a notice that it had insufficient equity required for loss-making companies.
"On September 5, 2024, [Volato] received notice from the NYSE American that it had accepted the company's plan and granted a plan period through December 18, 2025. During the plan period, the company will be subject to quarterly review to determine if it is making progress consistent with the plan," Volato said.
