T3 Defense CEO Converts $2.14 Million of Debt into Equity, Reducing Outstanding Debt and Strengthening Balance Sheet

T3 Defense (Nasdaq: DFNS) announced that Chairman and CEO Menachem Shalom voluntarily converted promissory notes totaling approximately $2.14 million into approximately 4.1 million restricted shares on April 28, 2026.

Rhea-AI Summary

T3 Defense (Nasdaq: DFNS) announced that Chairman and CEO Menachem Shalom voluntarily converted promissory notes totaling approximately $2.14 million into approximately 4.1 million restricted shares on April 28, 2026. The conversion removes near-term cash repayment obligations and increases the CEO's equity stake, simplifying the company's balance sheet and providing greater flexibility to support ongoing operations across its portfolio of defense technology companies.

Positive

• Eliminates approximately $2.14M of outstanding debt
• Increases CEO ownership via approximately 4.1M restricted shares, aligning interests with shareholders

Negative

• Issues approximately 4.1M restricted shares, creating potential shareholder dilution
• Conversion replaces cash obligation with equity, changing capital structure and share count

Argus Apr 28 session

+0.69% close to close Open Argus

Details

News Market Reaction – DFNS

On Apr 28, the day this news came out, DFNS closed 0.69% above the previous close.

Data tracked by StockTitan Argus for the Apr 28 session.

Key Figures

Debt converted: $2.14 million Shares issued: 4.1 million restricted shares

Debt converted

$2.14 million

Aggregate principal amount of promissory notes converted to equity

Shares issued

4.1 million restricted shares

Common stock issued to CEO in exchange for promissory notes

Historical Context

5 past events · Latest: Apr 15

5 events

1. Apr 15

   Prelim Q1 metrics

   24h Move

   +9.0%

   Preliminary Q1 revenue, backlog and reaffirmed full-year 2026 revenue guidance.

2. Mar 31

   Commercial activity update

   24h Move

   -0.4%

   Reported rising commercial activity and about $4.1M in new multi-year contracts.

3. Mar 02

   Conference participation

   24h Move

   -5.2%

   Announced participation in the Roth Annual Growth Conference and investor meetings.

4. Mar 02

   Demand commentary

   24h Move

   +9.7%

   Highlighted rising global demand for air & missile defense and counter-UAS solutions.

5. Feb 25

   Private placement

   24h Move

   -1.9%

   Announced up to $20M private placement to fund acquisitions and working capital.

24h Move is the share-price change in the day after each event; other market factors may also have contributed.

Key Terms

promissory notes, restricted shares, capital structure, missile defense, +2 more

6 terms

promissory notes financial

"has voluntarily converted promissory notes held by him in an aggregate principal"

A promissory note is a written IOU in which a borrower promises to repay a specific amount to a lender, usually with stated interest and by a set date. Investors care because these notes are a formal debt claim—like holding a scheduled payment stream—so they affect a company’s borrowing costs, cash flow and credit risk; notes can be bought, sold or used as collateral, which influences liquidity and recoveries if things go wrong.

restricted shares financial

"into approximately 4.1 million restricted shares of the Company’s common stock."

Restricted shares are company stock that cannot be sold or transferred immediately because they are subject to legal or contractual limits, such as a required holding period or performance conditions. They matter to investors because these locked-up shares can affect a company’s available stock for trading, future dilution, and insider incentives—imagine a gift that can’t be cashed until certain conditions are met, which changes when and how much supply can suddenly enter the market.

capital structure financial

"improving the Company’s overall capital structure."

Capital structure is the way a company finances its operations and growth by using different sources of money, such as borrowed funds (loans or bonds) and owner’s equity (investments from owners or shareholders). It’s like a recipe for baking a cake, where the balance of ingredients affects the final product's strength and taste; similarly, the mix of debt and equity influences a company's stability and risk. For investors, understanding a company's capital structure helps gauge how risky it might be to invest or lend money.

View in glossary

missile defense technical

"spanning critical domains including missile defense, autonomous navigation, electronic"

Missile defense is a country's systems and measures—radars, interceptors, sensors and command networks—designed to detect, track and destroy incoming missiles before they reach targets. For investors it matters because these programs drive government spending, contracts and technology development; like a national “home security” purchase that benefits suppliers, they can boost revenues for defense firms and create market sensitivity to geopolitical risk and policy shifts.

autonomous navigation technical

"including missile defense, autonomous navigation, electronic warfare, and tactical"

Autonomous navigation is the technology that allows a vehicle, robot, or vessel to sense its surroundings, make route decisions, and move without constant human control—like a self-guided driver using cameras, sensors, maps and software to find its way. For investors, it matters because it can lower operating costs, enable new business models, and create safety and regulatory challenges that affect a company’s revenue potential and capital needs.

electronic warfare technical

"including missile defense, autonomous navigation, electronic warfare, and tactical"

Electronic warfare involves using technology to disrupt, deceive, or disable an opponent’s electronic systems, such as communication networks, radar, or navigation signals. It is like jamming or scrambling a radio or GPS to prevent others from receiving clear information. For investors, it matters because advances in electronic warfare can impact military capabilities, influence global security, and affect the stability of markets and technological investments.

AI-generated analysis. How Rhea-AI works. Not financial advice.

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Conversion removes near-term cash obligations and increases CEO equity ownership

NEW YORK and NETANYA, Israel, April 28, 2026 (GLOBE NEWSWIRE) -- T3 Defense Inc. (Nasdaq: DFNS) (“T3 Defense” or the “Company”), a defense technology holding company that acquires and operates mission-critical defense companies, today announced that its Chairman and Chief Executive Officer, Menachem Shalom, has voluntarily converted promissory notes held by him in an aggregate principal amount of approximately $2.14 million into approximately 4.1 million restricted shares of the Company’s common stock.

The conversion eliminates approximately $2.14 million of outstanding debt, reducing near-term repayment obligations and improving the Company’s overall capital structure. Mr. Shalom elected to exchange the right to cash repayment for equity in the Company’s stock, amounting to 4.1 million restricted shares, further aligning his interests with those of shareholders.

“I chose to convert these notes into equity rather than take repayment because I believe our capital is better deployed strengthening the Company and supporting execution,” said Mr. Shalom, Chairman and CEO of T3 Defense. “I believe deeply in the value and potential of T3 Defense. This transaction removes debt from the balance sheet while increasing my ownership, further realigning my interest with shareholders. I expect our progress to be demonstrated through execution, and I have positioned my capital accordingly.”

The note conversion follows a period of significant operational momentum for T3 Defense, which continues to execute on its strategy of building a diversified portfolio of defense technology companies spanning critical domains including missile defense, autonomous navigation, electronic warfare, and tactical infrastructure. The transaction is intended to simplify the Company’s balance sheet and remove near-term financial obligations, providing greater flexibility to support ongoing operations and execution across its portfolio companies.

The shares issued in connection with the conversion are subject to applicable securities laws and regulations.

About T3 Defense Inc.

T3 Defense Inc. (NASDAQ: DFNS), is a holding company that acquires and operates mission-critical defense businesses involved in national security programs. It focuses on manufacturers with strong customer relationships and solid order backlogs, often capacity-and resource-constrained and specialized areas such as drones and autonomous vehicles, counter-drone systems, advanced manufacturing, tactical robotics, and AI software and system integration. Through disciplined acquisitions, centralized capital and strategy, and decentralized day-to-day operations, T3 Defense aims to strengthen essential defense capabilities and build long-term value.

Forward-Looking Statements

This press release contains forward-looking statements within the meaning of the federal securities laws. These forward-looking statements include, but are not limited to, statements regarding T3 Defense Inc.’s growth strategy; its ability to expand manufacturing throughput, industrial capacity, and production reliability; anticipated benefits of recent executive appointments; expectations regarding subsidiary coordination and operational scalability; the conversion of backlog into repeatable production output; and the Company’s ability to capitalize on structural constraints within the defense industrial base.

Forward-looking statements are based on current expectations, estimates, and projections and involve known and unknown risks and uncertainties that may cause actual results to differ materially from those expressed or implied in such statements. These risks and uncertainties include, among others, risks related to defense program funding and timing; dependence on government contracts and defense OEM relationships; supply chain constraints; manufacturing execution risks; integration of acquired businesses; availability of capital; and general economic and geopolitical conditions. Readers are encouraged to review the Company’s filings with the Securities and Exchange Commission for a discussion of additional risk factors.

T3 Defense undertakes no obligation to update or revise any forward-looking statements, whether as a result of new information, future events, or otherwise, except as required by law.

T3 Defense Inc.
575 5th Avenue
New York, NY 10017
contact@t3dfns.com
www.t3dfns.com

Investor Relations
The Equity Group Inc.
Lena Cati
lcati@theequitygroup.com
+1 (212) 836-9611

Val Ferraro
vferraro@theequitygroup.com
+1 (212) 836-9633

FAQ

AI-generated questions and answers. How Rhea-AI works. Not financial advice.

What did T3 Defense (DFNS) announce on April 28, 2026 about debt conversion?

The company announced conversion of promissory notes totaling $2.14 million into restricted equity. According to T3 Defense, the conversion created approximately 4.1 million restricted shares and removed near-term cash repayment obligations.

How many shares did CEO Menachem Shalom receive in the DFNS conversion?

Menachem Shalom received approximately 4.1 million restricted shares in the conversion. According to T3 Defense, he exchanged the notes for equity to increase ownership and align his interests with shareholders.

How does the $2.14M conversion affect T3 Defense's balance sheet and cash needs?

The conversion eliminates about $2.14 million of debt and near-term repayment obligations. According to T3 Defense, this simplifies the balance sheet and provides greater flexibility to support ongoing operations.

Does the DFNS conversion dilute existing shareholders?

The issuance of approximately 4.1 million restricted shares increases total share count, which can be dilutive to existing holders. According to T3 Defense, the shares are restricted and subject to securities laws.

Why did DFNS CEO convert debt to equity instead of taking repayment?

The CEO elected equity to retain capital in the business and boost alignment with shareholders. According to T3 Defense, he stated the conversion strengthens the company and supports execution across its portfolio.