Ondas Inc. Announces Completion of 4M Defense Ltd. Acquisition and Material Share Issuance

Key Highlights

• Ondas Inc. (NASDAQ: ONDS) has completed a significant acquisition involving 4M Defense Ltd., Chirokka Holding Ltd., and individual shareholders.
• Share Purchase Agreement was executed on October 24, 2025, with a supplement dated March 16, 2026, indicating additional closing arrangements.
• Ondas Inc. has issued shares of common stock as part of the acquisition consideration, with a total value reaching US\$5,000,000.
• Shares issued are fully tradable and registered for resale, with no lock-up restrictions, enabling immediate liquidity for recipients.
• Earn Out Payment Conditions tied to revenue growth milestones for 2026 and 2027 can trigger further share issuances.
• Legal opinion from Snell & Wilmer L.L.P. confirms the validity of the shares issued.
• Regulation S exemption applies for the share issuances, meaning they are unregistered sales of equity securities, but compliant with SEC rules.

Investor-Relevant Details

Ondas Inc. has entered into and finalized a Material Definitive Agreement for the acquisition of 4M Defense Ltd., a move expected to strengthen Ondas’ position in the defense technology sector. As part of the acquisition, Ondas has agreed to issue shares of common stock with an aggregate value of US\$3,600,000 at the additional closing, with a further US\$1,400,000 in shares to be issued as an “Earn Out Payment” if specific revenue growth targets are met for fiscal years 2026 and 2027. The number of shares issued will be based on the volume-weighted average price (VWAP) at the time of issuance.

• Earn Out Payment Conditions: The Company must achieve at least a 30% increase in annual revenues for both 2026 (vs. 2025) and 2027 (vs. 2026), as determined by GAAP-audited financials, to trigger the additional share issuance.
• No Restrictions on Shares: Shares issued as consideration are immediately tradable and registered for resale under the Securities Act, with no contractual or regulatory restrictions. This provides recipients with immediate liquidity.
• Legal Confirmation: Snell & Wilmer L.L.P. has provided a legal opinion confirming the shares are validly issued, fully paid, and nonassessable.
• Regulation S Exemption: The share issuance is exempt from registration requirements under Regulation S, meaning they are sold to non-U.S. persons and are compliant with SEC regulations.
• Shareholder Impact: The issuance of new shares may dilute existing shareholders but could also signal confidence in the company’s growth prospects, especially if revenue targets are achieved and the earn-out shares are triggered.
• Potential Price Sensitivity: The immediate tradability of a significant number of new shares could affect the stock’s liquidity and price, especially if recipients decide to sell their holdings in the open market.

Exhibits and Additional Information

• Exhibit 2.1: Share Purchase Agreement (full details available via SEC hyperlink).
• Exhibit 2.2: Supplement to Share Purchase Agreement.
• Exhibit 5.1: Legal Opinion from Snell & Wilmer L.L.P.
• Exhibit 10.1: Registration Rights Agreement, confirming resale registration for the issued shares.
• Exhibit 23.1: Consent of Snell & Wilmer L.L.P. (included in Exhibit 5.1).
• Exhibit 104: Cover Page Interactive Data File (XBRL).

What Shareholders Need To Know

• Dilution Risk: The issuance of up to US\$5,000,000 in new shares represents a substantial increase in outstanding equity. This could dilute existing shareholder value unless offset by increased revenue and profitability from the acquired business.
• Revenue Growth Targets: The earn-out mechanism ties further share issuance to revenue growth, incentivizing performance but also creating potential future dilution.
• Immediate Tradability: The shares are not subject to lock-up, meaning recipients may sell immediately, which could impact share price in the near term.
• Legal Compliance: The transaction has been vetted and confirmed as legally sound, reducing regulatory risk.
• Acquisition Synergy: Investors should watch for integration updates and financial results from 4M Defense Ltd. to assess the acquisition’s impact on Ondas’ growth and profitability.

Conclusion

Ondas Inc.’s acquisition of 4M Defense Ltd. and the associated share issuances represent a material event that may impact both the company’s growth trajectory and its share price. The absence of restrictions on tradability, coupled with performance-based earn-out payments, makes this a potentially price-sensitive development. Shareholders should monitor both the integration progress and Ondas’ financial performance to evaluate the long-term impact of this transaction.

Disclaimer: This article is based on information from Ondas Inc.’s Form 8-K filing and related exhibits. It is not investment advice. Investors should conduct their own due diligence and consult with financial advisors before making investment decisions. The information provided may be subject to change and should be verified against official SEC filings.

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