New Horizon Aircraft Ltd.

New Horizon Aircraft Ltd. operates in the advanced aerospace Original Equipment Manufacturer sector, specifically designing and building a next-generation hybrid-electric Vertical Takeoff and Landing aircraft for the Regional Air Mobility market. The eVTOL aircraft market is a developing sector within the transportation industry, dependent on the successful development and implementation of eVTOL aircraft and networks, none of which are currently in commercial operation. Morgan Stanley has projected that the AAM market could reach $USD 1 trillion by 2040 and $USD 9 trillion by 2050. NASA has highlighted that while the United States has over 5,000 airports, only 30 of them support 70% of all travelers, and 73% of Americans prefer road travel over flying. The large RAM market opportunity is precipitated by a transportation system insufficient to handle increasing demand; since 1990, global passenger flows have increased by more than 125% across all major modes of travel while global trade volume has increased by approximately 200%. Governments worldwide are investing a total of approximately $USD 1 trillion per annum into transport infrastructure, which is three times more as compared to twenty years ago. The Canadian government recently introduced the Initiative for Sustainable Aviation Technology where $350M will be invested into innovative companies focused on sustainable aviation solutions.

The current eVTOL landscape in North America and globally is competitive. The company believes its primary competition for market share will come from similar minded companies that realize RAM may offer a more compelling initial business case as compared to early eVTOL designs, potentially employing similar design architectures alongside hybrid-electric power systems. Competitive strengths include proprietary ducted fan-in-wing HOVR Wing technology, which provides advantages in efficiency, lower noise, the ability to fly enroute like a normal aircraft, support for CTOL, STOL, and VTOL operations, and potential certification for flight into known icing conditions. The company has accumulated 31 issued and allowed patents, the earliest expiry of which will be 2035, including US non-provisional utility patents protecting the core fan-in-wing invention and various design patents protecting the shape of the Cavorite X7.

The company's business operating model is predicated on building and selling the Cavorite X7 aircraft for both civilian and military use. The company also believes that the extensive intellectual property developed to enable the successful operation of its aircraft could be licensed to third parties to generate significant profit. The primary customer segments include civilian and military operators in the RAM market, with specific missions including medical evacuation, remote resupply, disaster relief, and military missions.

The company's core product is the Cavorite X7, a hybrid-electric 7-seat aircraft that can take off and land vertically like a helicopter but fly in a configuration much like a traditional airplane for the majority of its flight. The aircraft is expected to travel at speeds surpassing 250 miles per hour at a range over 500 miles. The Cavorite X7 architecture is based on the patented HOVR Wing technology, which uses a series of ducted electric fans located inside the wings to produce vertical lift. The aircraft is powered by a hybrid-electric main engine, with electrical power for vertical flight coming from an on-board generator driven by an internal combustion engine and an array of batteries. The specifications include the capability to transport seven people with a useful load of 1,500 lbs. The company has designed, built, and completed flight testing of a 50%-scale prototype with a 22-foot wingspan weighing approximately 600 lbs, which has been through hover testing and successfully transitioned to forward flight. The company is currently building a full-scale technical demonstrator aircraft.

The company has partnered with Cert Centre Canada for development of a certification basis that will be used to form the foundation for Type Certification with Transport Canada Civil Aviation. The company is targeting Type Certification prior to 2030. The company has benefited from project awards via government grants already exceeding $CAD 12 million. The company has accumulated 31 issued and allowed patents thus far, the earliest expiry of which will be 2035.

On January 12, 2024, the company consummated the Business Combination which resulted in the combination of Pono Capital Three, Inc. with Legacy Horizon. The company has built many sub-scale prototype aircraft, commencing with a smaller 1/7th-scale aircraft, and in 2025 successfully completed flight testing on a half-scale prototype. During flight testing, the 50%-scale prototype aircraft hovered with 20% of its fans disabled. The company has also completed a registered direct offering on May 8, 2026, and another on May 27, 2026, issuing RDO I Warrants with an exercise price of $USD 2.47 per share and RDO II Warrants with an exercise price of $USD 2.89 per share.

As a pre-revenue development-stage company, New Horizon Aircraft Ltd. has not generated any material sales revenue from aircraft deliveries, as no such revenue is expected before TCCA certification issuance. The company's financial performance narrative is characterized by significant research and development expenditures and general and administrative expenses as it progresses toward certification and commercialization.

The company is focusing its initial services on the RAM market for moving people and goods between 50 and 500 miles. Specific growth vectors include medical evacuation, where the aircraft is able to travel almost twice the speed as a traditional helicopter at significantly lower operating costs; remote resupply of critical goods to communities without runway infrastructure; disaster relief operations leveraging the hybrid-electric architecture to operate without power infrastructure; and military missions including casualty evacuation and forward operating base resupply. The company believes the technology and configuration advantages of the Cavorite X7 will represent a significant market advantage, with the aircraft anticipated to be significantly less expensive to own and operate as compared to legacy helicopters with similar payload characteristics and travel almost twice as fast.

The company expects that the technology being developed for the Cavorite X7 aircraft may be broadly useful across the industry, with the unique HOVR Wing concept potentially supporting other designs across the industry or within military applications. These technologies offer potential to significantly enhance revenue, including potential licensing sales in specific geographic regions. The company also plans to pursue a Production Certificate once a Type Certificate is obtained, which will allow volume manufacturing to meet anticipated demand.

The filing does not contain specific margin or cost outlook figures.

The company is currently building a full-scale technical demonstrator aircraft and is exploring locations for future scalable manufacturing operations. The company has 56 employees in Canada and 2 employees outside of Canada as of July 16, 2026, and considers its turnover and productivity levels to be at acceptable levels.

The company has benefited from project awards via government grants already exceeding $CAD 12 million. The company has engaged Flight Test Centre of Excellence as partners who will perform the role of Applicant's Representative for the certification effort. The company has also had initial discussions with the FAA and plans to run a parallel program to expedite certification for use in the United States.

The company faces the structural headwind that the eVTOL aircraft market is dependent on the successful development and implementation of eVTOL aircraft and networks, none of which are currently in commercial operation. The process of obtaining a valid type certificate, production certificate and airworthiness certificate for the Cavorite X7 will take several years, and any delay in the certification process could negatively impact the company by requiring additional funds and delaying the ability to sell aircraft. The company will not be permitted to deliver commercially produced aircraft to customers until TCCA type certification is obtained, so no material sales revenue from aircraft deliveries is expected before that issuance.

The company faces execution risks related to competition from alternative technologies, either known or unknown, that could bring more attractive eVTOL designs to the marketplace. The company also faces risks related to the need for additional funding to support continued development and certification, as the company is a pre-revenue development-stage company.

The company is a pre-revenue development-stage enterprise with no material sales revenue from aircraft deliveries expected before TCCA type certification issuance, which will take several years and any delay could require additional funds and delay the ability to sell aircraft. The eVTOL aircraft market is not yet in commercial operation, and the company's success depends on the successful development and implementation of eVTOL aircraft and networks. The company faces significant competition from alternative technologies and similar companies that may develop competing designs. The company has an accumulated deficit of $37,575,000 as of May 31, 2026, and will require additional capital to fund continued development and certification activities. The company's ability to obtain certification for flight into known icing conditions and other operational capabilities is uncertain and may not be achieved.

Management's message emphasizes the company's focus on building the Cavorite X7 hybrid eVTOL aircraft for the RAM market, highlighting the proprietary HOVR Wing technology as a key differentiator. The strategic priorities emphasized include targeting Type Certification prior to 2030, continuing development and flight testing of the full-scale technical demonstrator aircraft, and pursuing both civilian and military applications for the aircraft. Management also highlights the company's competitive strengths including the agile team with significant aerospace and operational experience, the safety-by-design philosophy, and the potential for the aircraft to be one of the first eVTOL aircraft certified for flight into known icing conditions.