Red Cat Holdings, Inc. (OTCPK:RCAT) entered into a letter of intent to acquire Skypersonic Inc. on January 25, 2021. As of February 11, 2021 Red Cat Holdings, Inc. signed a definitive agreement to acquire Skypersonic, Inc. from Giuseppe Santangelo, Anna Piccione and Michele De Gregorio and Wayne State University for $3 million. The consideration will be paid in shares. Red Cat will acquire 99,750 of the 102,350 shares of the issued and outstanding shares of capital stock of Skypersonic from from Giuseppe Santangelo, Anna Piccione and Michele De Gregorio and remaining 2,600 shares from Wayne State University. On February 15, 2021 Red Cat Holdings, Inc. Fat Shark Holdings, Ltd. subsidiary agreed to provide a short- term bridge loan to Skypersonic in the amount of $0.075 million under a Senior Secured Promissory Note due May 14, 2021. As of December 31, 2020, Skypersonic’s total assets were $888,864, net loss was $449,739, and revenue was $395,965. The transaction is subject to due diligence, preparation of legal documents and other normal closing conditions. The transaction is expected to close on or before May 14, 2021. Red Cat Holdings, Inc. (OTCPK:RCAT) completed the acquisition of Skypersonic Inc. for $3.8 million on May 7, 2021. On closing, Red Cat issued 857,124 common stock to the sellers. 50% of the share consideration was deposited in an escrow account for a period of 12 months as security for indemnification obligations and any purchase price adjustments due to working capital deficiencies and any other claims or expenses arising under the agreement. Prior to the closing, the Company provided $75,000 to fund operating costs of Skypersonic. This amount was capitalized as part of the purchase price. As of July 31, 2021, Red Cat Holdings has completed a preliminary determination of the working capital deficit to be $989,848 which would result in a reduction in the purchase price of $689,848, and a 171,801 reduction in the number of shares to be issued.