AAI Corp Pulls Licensing Agreement Due To Delays, Funding Issues

Carter Aviation Technologies, which has been working to build a prototype of its Personal Air Vehicle (PAV) is looking for investors after its initial supporter pulled out of the licensing agreement that was funding development of the aircraft.

The PAV was on display at Oshkosh this year. Carter Aviation Technologies owner Jay Carter told the Times Record News of Wichita Falls, TX that he has traveled outside the U.S. in an attempt to secure new financing for the project.

Maryland-based AAI Corp. had licensed the technology and provided money for the venture, and the Wichita Falls Economic Development Corporation (WFEDC) joined the effort in 2009. But Carter was also seeking local investors for the project. Carter said they met seven of the eight necessary milestones set forth by the WFEDC, but a lack of additional funding from local sources caused delays in developing a prototype, and AAI said that it would not put additional resources into the project.

Carter said that the company was aiming for military contracts that never materialized because the Pentagon wants to see an operational prototype. He said that now he's shopping the PAV to foreign investors and has asked for a two-year extension to pay back the approximately $3.3 million invested by the WFEDC.

Carter and the WFEDC agreed to a repayment schedule in April, but the company so far has not been able to come up with the first $117,187.50 payment.

If the extension is agreed to by the Wichita Falls City Council, the new repayment schedule would begin in April, 2016. Carter would pay 20 percent of all licensing sales to the WFEDC in exchange for the extension. The development group loaned Carter $468,750 for each of the milestones it met under the agreement, and that would be restructured into one large loan for the purposes of repayment.

Carter did not name the foreign investors to which he has been talking. He said that the extension would strengthen his bargaining position with potential investors because their money would go towards development costs, not loan repayment.

(Carter PAV Proof of Concept aircraft pictured in file photo)

FMI: www.cartercopters.com