Ondas Note Holder Purchases Additional $11.5 million of Convertible Notes: Funds to Drive Accelerated Expansion of Drone Business Including Focus on Defense Markets

Rhea-AI Summary

Ondas Holdings (NASDAQ:ONDS) announced that a note holder has purchased $11.5 million in 3% senior convertible notes due 2026. The note holder has the option to invest an additional $18.9 million. The funds will primarily support the growth of Ondas Autonomous Systems (OAS), the company's drone business, which secured $14.4 million in orders in Q3 2024.

The investment will be used to develop operational capabilities, boost inventory production for anticipated increased demand in 2025, and expand global sales, marketing, and support activities. The company sees growing opportunities in global defense and security markets for its Iron Drone and Optimus platforms. Oppenheimer & Co. Inc. will serve as placement agent for the offering.

Positive

• Secured $11.5 million in convertible notes funding with potential for additional $18.9 million
• Strong Q3 2024 performance with $14.4 million in drone orders
• Expanding market opportunities in defense and security sectors

Negative

• Additional debt through convertible notes may lead to future dilution for shareholders
• Requires significant operational scaling to meet anticipated demand

Insights

Financial Analyst

The $11.5 million convertible note financing, with potential for additional $18.9 million, represents a significant capital injection for Ondas Holdings, particularly given its current market cap of $76.6 million. The deal demonstrates strong investor confidence, as this is the fourth investment from the same note holder. The 3% interest rate is relatively favorable in the current high-rate environment. The company's $14.4 million in Q3 orders shows promising market traction, though the conversion terms and potential dilution impact will be key factors to monitor. The focus on defense markets is strategically timed amid global security concerns, potentially opening substantial revenue opportunities. The capital raise strengthens the balance sheet and provides operational runway for scaling production and sales capabilities.

Defense Industry Analyst

The strategic pivot towards defense markets is well-timed given the current global security landscape. The Iron Drone and Optimus platforms position Ondas advantageously in the critical infrastructure protection sector, where demand for autonomous security solutions is rapidly growing. The $14.4 million order book in Q3 validates market acceptance and suggests potential for larger defense contracts. The investment will enable important operational scaling, particularly in inventory and production capabilities, which is essential for credibility when pursuing defense contracts. The emphasis on US market expansion is particularly noteworthy, as it represents the world's largest defense market with substantial drone technology procurement budgets.

Investment to support the growth of Ondas Autonomous Systems (OAS) which has experienced substantial demand including $14.4 million in orders in Q3 2024

This represents the note holder's fourth investment in Ondas Holdings convertible notes, demonstrating their confidence in the Company's drone technologies and its ability to execute on substantial market opportunity

BOSTON, MASSACHUSETTS / ACCESSWIRE / December 16, 2024 / Ondas Holdings Inc. (NASDAQ:ONDS) ("Ondas Holdings" or the "Company"), a leading provider of private industrial wireless networks and commercial drone and automated data solutions, announced today that a note holder has elected to purchase $11.5 million in aggregate principal amount of 3% senior convertible notes due 2026 (the "Offering"). Also, if elected by the note holder, Ondas Holdings may complete additional closings of up to an additional $18.9 million in aggregate principal amount. The proceeds from the investment in Ondas Holdings will be used for general corporate purposes and will be primarily allocated to supporting the growth of the Company's drone business, Ondas Autonomous Systems (OAS).

"We appreciate the ongoing support from our investors as we execute our growth plan, and work to expand the global market opportunities for our OAS business," stated Eric Brock, Chairman and CEO of Ondas Holdings. "As we fulfill the $14.4 million in orders secured in Q3 2024, we recognize the need to further develop our operational capabilities, which include boosting inventory production to meet an anticipated increase in demand in 2025. Furthermore, we see a strengthening demand tailwind as global defense and security markets look to modernize capabilities, as well as an increasing interest in both our Iron Drone and Optimus platforms as critical tools to protect and secure critical locations and populations. We plan to broaden our sales, marketing, and support activities worldwide to seize this opportunity, particularly in the large US markets."

Oppenheimer & Co. Inc. will act as placement agent in connection with the Offering.

For additional information regarding the Offering, please see the Form 8-K to be filed by the Company.

About Ondas Holdings Inc.

Ondas Holdings Inc. ("Ondas") is a leading provider of private wireless data solutions via Ondas Networks Inc. ("Ondas Networks") and commercial drone solutions through Ondas Autonomous Systems Inc. via its wholly owned subsidiaries American Robotics, Inc. ("American Robotics" or "AR") and Airobotics LTD ("Airobotics"), which we operate as a separate business unit called Ondas Autonomous Systems.  

Ondas Networks is a developer of proprietary, software-based wireless broadband technology for large established and emerging commercial and government markets. Ondas Networks' standards-based (802.16s), multi-patented, software-defined radio FullMAX platform enables Mission-Critical IoT (MC-IoT) applications by overcoming the bandwidth limitations of today's legacy private licensed wireless networks. Ondas Networks' customer end markets include railroads, utilities, oil and gas, transportation, aviation (including drone operators) and government entities whose demands span a wide range of mission critical applications. 

Ondas Autonomous Systems Inc. (OAS) specializes in designing, developing, and marketing autonomous drone solutions via its two advanced drone platforms: the Optimus System, the world's first FAA-certified small UAS (sUAS) for aerial security and data capture, and the Iron Drone Raider, a counter-drone system designed to combat hostile drones. Both platforms are highly automated, AI-powered, and capable of continuous, remote operation for critical defense, infrastructure, industrial, and government applications. American Robotics and Airobotics have achieved industry-leading regulatory milestones, including the first-ever FAA Type Certification for the Optimus System and the first drone system approved by the FAA for automated beyond-visual-line-of-sight (BVLOS) operations without an on-site human operator. Ondas Networks, American Robotics and Airobotics together provide users in defense, homeland security, public safety and other critical industrial and government security and infrastructure markets with improved connectivity, situational awareness and data collection and information processing capabilities.  

Ondas Networks, American Robotics and Airobotics together provide users in defense, homeland security, public safety and other critical industrial and government security and infrastructure markets with improved connectivity, situational awareness and data collection and information processing capabilities. 

For additional information on Ondas Holdings, visit www.ondas.com or follow Ondas Holdings on X formerly known as Twitter and LinkedIn. For additional information on Ondas Networks, visit www.ondasnetworks.com or follow Ondas Networks on X and LinkedIn. For additional information on American Robotics, visit www.american-robotics.com or follow American Robotics on X and LinkedIn. For additional information on Airobotics, visit www.airoboticsdrones.com or follow Airobotics on X and LinkedIn. For additional information on Ondas Autonomous Systems, follow us on LinkedIn.  

Information on our websites and social media platforms is not incorporated by reference in this release or in any of our filings with the U.S. Securities and Exchange Commission.

Forward-Looking Statements

Statements made in this release that are not statements of historical or current facts are "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995. We caution readers that forward-looking statements are predictions based on our current expectations about future events. These forward-looking statements are not guarantees of future performance and are subject to risks, uncertainties and assumptions that are difficult to predict. Our actual results, performance, or achievements could differ materially from those expressed or implied by the forward-looking statements as a result of a number of factors, including the risks discussed under the heading "Risk Factors" discussed under the caption "Item 1A. Risk Factors" in Part I of our most recent Annual Report on Form 10-K or any updates discussed under the caption "Item 1A. Risk Factors" in Part II of our Quarterly Reports on Form 10-Q and in our other filings with the SEC. We undertake no obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future events or otherwise that occur after that date, except as required by law.

Contacts

IR Contact for Ondas Holdings Inc.
888.350.9994 
ir@ondas.com

Media Contact for Ondas
Preston Grimes 
Marketing Manager, Ondas Holdings Inc. 
preston.grimes@ondas.com

SOURCE: Ondas Holdings Inc. 

View the original press release on accesswire.com

FAQ

How much funding did Ondas Holdings (ONDS) secure in convertible notes in December 2024?

Ondas Holdings secured $11.5 million in 3% senior convertible notes due 2026, with the potential for an additional $18.9 million if elected by the note holder.

What was the value of Ondas Autonomous Systems' (OAS) orders in Q3 2024?

Ondas Autonomous Systems secured $14.4 million in orders during Q3 2024.

What are the main products Ondas (ONDS) is focusing on for defense markets?

Ondas is focusing on its Iron Drone and Optimus platforms as critical tools for protecting and securing critical locations and populations in defense markets.

What is the maturity date for ONDS's new convertible notes?

The senior convertible notes are due in 2026.

Who is the placement agent for ONDS's convertible notes offering?

Oppenheimer & Co. Inc. is acting as the placement agent for the convertible notes offering.