Filing Analysis
Dragonfly Energy Holdings Corp. received a deficiency notice from Nasdaq for failing to meet the minimum stockholders' equity requirement. The company reported a stockholders' equity deficit of $184,000, falling significantly short of the $2.5 million minimum requirement.
🚩 Red Flags
- Negative stockholders' equity (deficit of $184,000) indicates potential solvency issues.
- Failure to meet multiple alternative compliance standards (market cap and net income).
- Delisting warning is a major regulatory risk for micro-cap companies.
- Interim CFO role held by CEO suggests potential internal management instability or resource constraints.
📋 Key Facts
- Received Nasdaq deficiency letter on August 20, 2026.
- Non-compliance with Nasdaq Listing Rule 5550(b)(1) regarding minimum stockholders' equity.
- Reported stockholders' equity (deficit) of $(184,000) as of June 30, 2026.
- Failed alternative compliance standards: market value of listed securities ($35M) and net income ($500k).
- Company has until October 5, 2026, to submit a plan to regain compliance.
- Potential extension of up to 180 days (until February 16, 2027) if a plan is accepted.
Dragonfly Energy Holdings Corp. filed an 8-K to announce the release of preliminary financial results for its second quarter ended June 30, 2026. The company scheduled an earnings webcast to discuss these results on August 6, 2026.
🚩 Red Flags
- The CEO is also serving as the Interim CFO, which can indicate management instability or resource constraints in the finance department.
📋 Key Facts
- Preliminary Q2 2026 results disclosed via press release (Exhibit 99.1).
- Earnings call/webcast scheduled for August 6, 2026, at 4:30 p.m. ET.
- Report filed by Denis Phares, acting as CEO, Interim CFO, and President.
Dragonfly Energy Holdings Corp. acquired the Dakota Lithium® brand assets for $4.0 million via a combination of cash and equity, while simultaneously amending its senior secured term loan to include higher PIK interest rates and modified liquidity covenants.
🚩 Red Flags
- Significant increase in cost of debt (interest rate hike from 12% to 14%) with a shift to PIK (Pay-in-Kind), which increases total principal/debt burden over time.
- The acquisition was structured as an 'as is' purchase from a liquidation entity, indicating distressed asset acquisition.
- Modification of liquidity covenants suggests potential pressure on cash reserves and working capital.
- Multiple 8-K items (Asset Acquisition, Debt Amendment, Unregistered Equity Issuance) in a single filing.
📋 Key Facts
- Acquired substantially all operating assets of the Dakota Lithium® brand from Clean Liquidation, LLC on July 31, 2026.
- Total purchase price: $4.0 million ($1M cash + 1.5M shares issued at $2.00/share).
- Issued 1,500,000 shares of common stock subject to a 12-month lock-up period.
- Seventh Amendment to Term Loan increases interest rate from 12.0% to 14.0% per annum (payable-in-kind) through Dec 31, 2026.
- Extended testing dates for maximum senior leverage and fixed charge coverage ratios from March 31, 2027, to September 30, 2027.
- Modified minimum liquidity covenant: $4M (Aug-Jan) and $5M thereafter.
Dragonfly Energy Holdings Corp. announced a change in its Board of Directors effective June 18, 2026. Lukas Lutz has been appointed as an independent director and member of the Nominating and Corporate Governance Committee, replacing Brian Nelson.
📋 Key Facts
- Lukas Lutz appointed as Class B independent director, effective June 18, 2026.
- Mr. Lutz replaces Brian Nelson on the Board and the Nominating and Corporate Governance Committee.
- Compensation includes 10,000 Restricted Stock Units (RSUs) with a two-stage vesting schedule: 5,000 units vest immediately and 5,000 units vest after one year.
- Term of office expires at the 2027 annual meeting of stockholders.
Dragonfly Energy Holdings Corp. announced that it received a notice of allowance from the USPTO for a patent application regarding 'Powderized Solid-State Electrolyte and Electroactive Materials'. This patent relates to manufacturing processes for the company's solid-state battery development.
📋 Key Facts
- Notice of allowance received on June 18, 2026
- Patent title: 'Powderized Solid-State Electrolyte and Electroactive Materials'
- Focus: Manufacturing processes for solid-state battery development
Dragonfly Energy Holdings Corp. announced that it has received a notice of allowance from the European Patent Office for a patent application regarding its dry powder coating layers for electrochemical cells.
📋 Key Facts
- Notice of allowance received from the European Patent Office on June 15, 2026.
- The patent application is titled 'Systems and Methods for Dry Powder Coating Layers of an Electrochemical Cell'.
- The technology covers the Company's proprietary dry electrode manufacturing platform, including electrode, separator, and solid-state electrolyte layers.
Dragonfly Energy Holdings Corp. filed an 8-K to report administrative updates to its Articles of Incorporation and the withdrawal of a previous designation for Series A Convertible Preferred Stock.
📋 Key Facts
- On June 5, 2026, the company filed a Certificate of Amendment to update its registered agent and registered office in Nevada.
- The company filed a Withdrawal of Designation for 5,000 shares of Series A Convertible Preferred Stock originally designated on February 26, 2025.
- The company confirmed that no shares of Series A Preferred Stock were issued or outstanding at the time of the withdrawal.
Dragonfly Energy Holdings Corp. has filed a trade libel lawsuit against William Errol Prowse IV and Prowse Publications LLC in Nevada. The company alleges that Prowse published false and misleading technical analyses and manipulated battery testing to harm the reputation and finances of its Battle Born Batteries brand.
📋 Key Facts
- Lawsuit filed on June 1, 2026, in the Second Judicial District Court of the State of Nevada.
- Defendants are William Errol Prowse IV and Prowse Publications LLC.
- The company seeks both monetary damages and injunctive relief.
- Allegations include the removal of structural components and testing of damaged units to produce inaccurate safety and performance data.
Dragonfly Energy Holdings Corp. announced its financial results for the first quarter ended March 31, 2026, and scheduled a corresponding earnings webcast. The filing includes the press release as an exhibit and notes the CEO is currently serving as the Interim CFO.
🚩 Red Flags
- CEO Denis Phares is serving as Interim CFO, indicating a vacancy in the principal financial officer role which can suggest management instability.
📋 Key Facts
- Earnings release for Q1 ended March 31, 2026, issued on May 14, 2026.
- Earnings webcast scheduled for May 14, 2026, at 4:30 p.m. Eastern Time.
- Denis Phares is currently serving as CEO, President, and Interim Chief Financial Officer.
Dragonfly Energy Holdings Corp. announced that the Japan Patent Office has allowed its patent application for 'Powderized Solid-State Electrolyte and Electroactive Materials.' This represents the company's first patent allowance in Japan and supports its solid-state battery and dry electrode manufacturing platform.
📋 Key Facts
- Received patent allowance from Japan Patent Office on April 23, 2026
- Patent title: 'Powderized Solid-State Electrolyte and Electroactive Materials'
- First patent allowance for the company in Japan
- Technology focuses on solvent-free electrode production and improved energy density
Dragonfly Energy Holdings Corp. filed an amended 8-K (8-K/A) to correct two inadvertent errors in the unaudited condensed interim consolidated statement of operations for the three-month period ended December 31, 2025, which were previously furnished in a press release.
🚩 Red Flags
- Financial reporting errors in preliminary results can indicate weak internal controls over financial reporting (ICFR).
- The CEO is currently serving as the Interim CFO, which may suggest a vacancy or instability in the financial leadership role.
📋 Key Facts
- The filing is an Amendment No. 1 to a Current Report filed on March 16, 2026.
- The purpose of the amendment is to correct errors in the financial statements attached as Exhibit 99.1.
- The errors specifically occurred in the Unaudited Condensed Interim Consolidated Statement of Operations for the quarter ended December 31, 2025.
- The filing also references preliminary financial results for the fourth quarter and full year ended December 31, 2025.
Dragonfly Energy Holdings Corp. announced a comprehensive cost-reduction initiative aiming for $8.9 million in annualized savings, including 20% salary cuts for executive leadership and the Board of Directors. The plan involves workforce reductions, rental space consolidation, and a shift from cash to equity-based compensation to preserve liquidity.
🚩 Red Flags
- Significant 20% salary cuts for the entire executive team and Board of Directors.
- CEO Denis Phares is also serving as the Interim CFO, indicating a lack of permanent financial leadership.
- Broad workforce reductions and rental consolidation suggest urgent liquidity needs.
- The shift from cash to equity for basic compensation is a common tactic for companies facing cash flow constraints.
📋 Key Facts
- CEO Denis Phares, CCO Wade Seaburg, and CMO Tyler Bourns agreed to 20% salary reductions effective April 1, 2026.
- The Board of Directors also reduced their cash compensation by 20%, receiving RSUs in lieu of cash.
- The company implemented a 20% reduction in total payroll expense through workforce reductions and salary adjustments.
- Rental space consolidation is expected to result in a $4.0 million reduction in expenses.
- Total annualized savings from these initiatives are projected at approximately $8.9 million.
- Equity grants (options and RSUs) were issued to executives and employees in lieu of cash compensation, including 700,000 RSUs for general staff.
Dragonfly Energy Holdings Corp. entered into an Equity Distribution Agreement with Canaccord Genuity LLC to facilitate the potential sale of up to $50.0 million in common stock via an 'at-the-market' (ATM) offering.
🚩 Red Flags
- Potential for significant shareholder dilution through the ATM offering mechanism.
- Use of an ATM offering often indicates a need for immediate liquidity or working capital.
📋 Key Facts
- Entered into an Equity Distribution Agreement on January 30, 2026.
- Lead Agent: Canaccord Genuity LLC.
- Maximum aggregate gross proceeds: $50.0 million.
- Offering method: At-the-market (ATM) offering under Rule 415(a)(4).
- Commission rate: 3.0% of aggregate gross proceeds.
- The company is not obligated to sell any shares under this agreement.
Dragonfly Energy Holdings Corp. has implemented a 1-for-10 reverse stock split effective December 18, 2025. The action was previously authorized by stockholders in October 2025 and approved by the Board on December 2, 2025.
🚩 Red Flags
- Reverse stock split (often used to maintain minimum bid price requirements for Nasdaq compliance).
📋 Key Facts
- Reverse stock split ratio: 1-for-10 (every ten shares converted into one share).
- Effective Date/Time: December 18, 2025, at 6:00 a.m. ET.
- CUSIP change for Common Stock to 26145B 403.
- Ticker symbol 'DFLI' remains unchanged on the Nasdaq Capital Market.
- Fractional shares will be paid out in cash; no fractional shares issued.
Dragonfly Energy Holdings Corp. issued an 8-K to announce the release of its third quarter financial results for the period ended September 30, 2025.
🚩 Red Flags
- Interim CFO role suggests potential recent turnover or instability in financial leadership (though not explicitly stated as a departure in this specific 8-K).
📋 Key Facts
- Earnings release for Q3 2025 was disclosed on November 14, 2025.
- The company scheduled an earnings webcast for 4:30 p.m. ET on the date of filing.
- Denis Phares serves as CEO, Interim CFO, and President.
Dragonfly Energy Holdings Corp. has restructured its senior secured term loan by exchanging $25 million of outstanding principal for newly issued Series B Convertible Preferred Stock. This transaction effectively converts significant debt into equity, though the terms include high dividend rates and conversion rights that may lead to future dilution.
🚩 Red Flags
- Significant debt-for-equity swap indicates liquidity pressure or a need to reduce cash interest obligations.
- High dividend yield (10%) with PIK component increases potential dilution and long-term liability.
- Seniority of Series B Preferred Stock over common stock places Lenders ahead in liquidation preference.
- Restrictive covenants prevent the company from issuing dividends or incurring new debt without lender consent.
📋 Key Facts
- Exchanged $25 million of Term Loan principal for 25,000 shares of newly created Series B Convertible Preferred Stock on November 4, 2025.
- Series B Preferred Stock carries a 10% annual dividend rate, payable as 80% cash and 20% in-kind (PIK).
- Conversion price is set at $3.15 per share, representing an aggregate of 7,936,508 shares of Common Stock.
- Series B Preferred Stock ranks senior to all other capital stock regarding dividends and liquidation.
- The Company is required to use 50% of net proceeds from any future equity offering to redeem the Series B Preferred Stock.
Dragonfly Energy Holdings Corp. has regained compliance with Nasdaq's minimum bid price and market value requirements after a period of deficiency. However, the company is now subject to a mandatory one-year monitoring period by the Nasdaq Panel.
🚩 Red Flags
- Mandatory Panel Monitor status until October 20, 2026.
- Loss of right to provide a compliance plan for any new deficiencies arising during the monitoring period.
- Risk of automatic Delist Determination if compliance is not maintained throughout the one-year window.
📋 Key Facts
- Regained compliance with Nasdaq Listing Rule 5550(a)(2) (Minimum Bid Price Requirement) as stock closed at or above $1.00 for 10 consecutive business days.
- Regained compliance with Nasdaq Listing Rule 5550(b)(2) (MVLS Requirement) as market value of listed securities was $35 million+ for 10 consecutive business days.
- The company is subject to a Mandatory Panel Monitor through October 20, 2026.
- Under Nasdaq Rule 5815(d)(4)(B), the company cannot submit a compliance plan if a deficiency arises during this monitoring period; failure results in immediate delisting determination.
Dragonfly Energy Holdings Corp. has entered into a Sixth Amendment to its Term Loan Agreement to restructure significant debt following a public offering. The restructuring involves a $45 million prepayment, the issuance of $25 million in Series B preferred stock to lenders, and debt forgiveness, while imposing new liquidity covenants and redemption requirements.
🚩 Red Flags
- Significant dilution risk: Issuance of Series B preferred stock convertible into ~7.9 million shares at $3.15.
- Dividend burden: The 8% cash and 2% in-kind dividend on $25M represents a significant ongoing cash drain.
- Redemption pressure: Mandatory redemption right for holders if not redeemed by October 7, 2027; also requires 25% of future equity proceeds to be used for redemption.
- Restrictive covenants: New minimum liquidity covenant of $5.0 million creates a potential default trigger if cash reserves dip.
📋 Key Facts
- Prepayment of $45.0 million made on October 20, 2025, using proceeds from a public offering completed on October 17, 2025.
- Issuance of $25 million in newly created Series B preferred stock to lenders in exchange for debt.
- Series B Preferred Stock features: conversion price of $3.15 per share (approx. 7,936,508 shares), 8% annual cash dividend, and 2% annual dividend-in-kind.
- Lenders agreed to forgive $5.0 million of outstanding principal.
- Remaining $17 million in term loan carries a 12% fixed interest rate maturing October 2027.
- New minimum liquidity covenant set at $5.0 million, calculated monthly, waived through December 31, 2026.
- Company must use 25% of net proceeds from any future equity offerings to redeem the Preferred Stock.
Dragonfly Energy Holdings Corp. announced a significant $51.7 million public offering of common stock and pre-funded warrants to fund working capital and repay $45 million in debt. The filing also details a non-binding agreement in principle for a major debt restructuring with existing lenders.
🚩 Red Flags
- Significant dilution: Issuance of up to 41,000,000 new shares (common + warrants) at a price ($1.35) likely below historical or intrinsic value for a micro-cap.
- Debt restructuring complexity: The proposed conversion of $25M into preferred stock with high dividend requirements and redemption rights creates significant future equity overhang.
- Non-binding terms: The debt restructuring is an 'agreement in principle' and not yet definitive, creating execution risk.
- Liquidity covenant: New minimum liquidity covenant set at $5.0 million.
📋 Key Facts
- Public offering of 36,000,000 shares of common stock at $1.35 per share.
- Offering includes up to 5,000,000 pre-funded warrants at $1.3499 per warrant.
- Expected net proceeds: approximately $51.7 million.
- Planned use of proceeds includes repaying $45 million of outstanding Term Loan debt.
- Proposed debt restructuring involves converting $25 million of principal into new preferred stock with an 8% cash dividend and 2% in-kind dividend.
- Lenders to forgive $5 million of outstanding principal under the proposed restructuring.
Dragonfly Energy Holdings Corp. announced a major public offering of 36 million common shares and 5 million pre-funded warrants to raise approximately $51.7 million in net proceeds. The funds are primarily intended for working capital and the repayment of $45 million of outstanding debt, alongside a proposed non-binding debt restructuring agreement with lenders.
🚩 Red Flags
- Significant dilution: Issuance of up to 41.15 million new shares (including option shares) represents a massive increase in share count.
- Debt Restructuring Risk: The agreement with lenders is 'non-binding' and subject to significant closing conditions; failure to consummate could be adverse.
- High Cost of Capital: Proposed preferred stock carries an 8% cash dividend and 2% in-kind dividend, creating ongoing cash flow pressure.
- Liquidity Covenant: New minimum liquidity covenant required at $5.0 million monthly.
📋 Key Facts
- Public offering of 36,000,000 shares at $1.35 per share.
- Offering of up to 5,000,000 pre-funded warrants at $1.3499 per warrant.
- Expected net proceeds: approximately $51.7 million.
- Use of proceeds includes repayment of $45.0 million of outstanding Term Loan debt.
- Proposed debt restructuring involves converting $25 million of principal into preferred stock with an 8% cash dividend and 2% in-kind dividend.
- Lenders to forgive $5 million of outstanding principal under the proposed restructuring.
Dragonfly Energy Holdings Corp. stockholders approved a proposal authorizing the Board to implement a reverse stock split with a ratio between 1:2 and 1:50. The filing also details results from the Annual Meeting, including the election of two directors and the ratification of CBIZ CPAs P.C. as auditors.
🚩 Red Flags
- Approval of a reverse stock split (often used to maintain Nasdaq listing compliance or combat low share prices).
- Failure to pass the Increase in Authorized shares proposal, which may limit future capital raising capacity if the split is executed.
- The company's CEO also serves as Interim CFO, indicating potential management/resource constraints.
📋 Key Facts
- Stockholders approved a Reverse Stock Split Proposal with a ratio between 1-for-2 (1:2) and 1-for-50 (1:50).
- The Board has discretion to determine the exact ratio within that range.
- Stockholders approved an amendment to the 2022 Equity Incentive Plan, increasing available shares by 9,000,000.
- Two Class C directors, Denis Phares and Luisa Ingargiola, were elected to serve until the 2028 annual meeting.
- CBIZ CPAs P.C. was ratified as the independent registered public accounting firm for fiscal year ending Dec 31, 2025.
- The 'Increase in Authorized' proposal and 'Voting Standard Proposal' were not approved by stockholders.
Dragonfly Energy Holdings Corp. issued an 8-K to announce the release of preliminary financial results for the quarter ended September 30, 2025.
🚩 Red Flags
- The presence of an 'Interim' CFO suggests potential recent turnover or instability in financial leadership.
📋 Key Facts
- The company released preliminary financial results via press release on October 13, 2025.
- Reporting period covered is the quarter ending September 30, 2025.
- Denis Phares serves as CEO, Interim CFO, and President.
Dragonfly Energy Holdings Corp. entered into an underwriting agreement to conduct a public offering of 23,000,000 total shares (including the full exercise of underwriters' option) at $1.25 per share. The company expects to net approximately $26.7 million to fund working capital and debt prepayment.
🚩 Red Flags
- Significant dilution: Issuance of 23 million new shares at a low price point ($1.25) will significantly dilute existing shareholders.
- Heavy reliance on equity financing to fund working capital and repay debt, suggesting potential liquidity constraints in the prior period.
📋 Key Facts
- Underwriting agreement entered into on October 6, 2025, with Canaccord Genuity LLC.
- Offering of 20,000,000 base shares plus 3,000,000 option shares (option exercised in full).
- Public offering price set at $1.25 per share.
- Expected net proceeds: approximately $26.7 million after expenses and commissions.
- Use of proceeds includes $4.0 million for prepayment of Term Loan with ALTER DOMUS (US) LLC.
- Proceeds also intended for working capital, revenue-driving initiatives, and battery technology investments (dry electrode/solid-state).
- 90-day restriction on the issuance or sale of Common Stock following the agreement date.
Dragonfly Energy Holdings Corp. announced the issuance of U.S. Patent No. 12,403,782 for its Wakespeed® Charge Control technology. The patent pertains to power transfer from towing vehicles to trailers for battery charging.
📋 Key Facts
- Secured U.S. Patent No. 12,403,782 on September 4, 2025.
- Technology focuses on Wakespeed® Charge Control for transferring power from a towing vehicle to a trailer.
- The patent is intended to expand the company's intellectual property portfolio in advanced power systems.
Dragonfly Energy Holdings Corp. filed an 8-K to announce the release of its second quarter 2025 financial results and a subsequent earnings webcast.
🚩 Red Flags
- Interim CFO role suggests potential recent turnover or instability in financial leadership (though common in micro-caps).
📋 Key Facts
- Earnings release for the second quarter ended June 30, 2025 was issued on August 14, 2025.
- The company scheduled an earnings webcast for August 14, 2025, at 4:30 p.m. ET.
- Denis Phares serves as CEO, Interim CFO, and President.
Dragonfly Energy Holdings Corp. entered into an underwriting agreement with Canaccord Genuity LLC for a public offering of 21,980,000 shares at $0.25 per share. The offering is expected to net approximately $4.9 million in proceeds and close around July 31, 2025.
🚩 Red Flags
- Significant dilution: Issuing nearly 22 million shares at a very low price point ($0.25) suggests heavy dilution for existing shareholders.
- Low share price: The $0.25 pricing is extremely low, often characteristic of companies facing liquidity constraints or struggling to maintain minimum bid requirements.
📋 Key Facts
- Offering size: 21,980,000 shares of common stock.
- Offering price: $0.25 per share.
- Expected net proceeds: Approximately $4.9 million (after expenses and commissions).
- Underwriter: Canaccord Genuity LLC.
- Expected closing date: On or about July 31, 2025.
- The offering is being conducted via an S-3 registration statement previously filed on November 15, 2023.
Dragonfly Energy Holdings Corp. announced preliminary financial results for the quarter ended June 30, 2025, and disclosed the issuance of a new patent regarding solid-state electrochemical cell feedstock.
🚩 Red Flags
- Preliminary financial results (Item 2.02) are subject to change and have not yet been finalized in a formal quarterly report.
📋 Key Facts
- Released preliminary financial results for the quarter ending June 30, 2025 (Item 2.02).
- Announced the issuance of a new patent for powderized ionically conducting feedstock used in solid-state electrochemical cells.
- The patented technology focuses on non-flammable, lithium-conductive composite electrolytes to enhance safety and thermal stability.
- The electrolyte feedstock is designed for scalable manufacturing and high energy density across various lithium-ion chemistries.
Dragonfly Energy Holdings Corp. entered into a Settlement and Release Agreement with the holder of its Series A Convertible Preferred Stock to settle outstanding obligations. As part of the settlement, the Company will issue 2,100,000 shares of Common Stock in exchange for the surrender of all outstanding Series A Preferred Stock.
🚩 Red Flags
- Significant dilution: Issuance of 2,100,000 new common shares to settle preferred stock obligations.
- Settlement of convertible securities often indicates a restructuring of debt/equity that can lead to downward pressure on share price due to increased float.
📋 Key Facts
- Date of Agreement: July 20, 2025
- Company to issue 2,100,000 shares of Common Stock to the Investor.
- Investor will surrender all outstanding shares of Series A Preferred Stock.
- The settlement terminates obligations under previous Securities Purchase Agreements and the Certificate of Designation for Series A Preferred Stock.
- Shares are being issued without registration in reliance on Section 3(a)(9) of the Securities Act.
Dragonfly Energy Holdings Corp. received an extension from a Nasdaq Hearings Panel to regain compliance with minimum bid price ($1.00) and minimum market value of listed securities ($35M) requirements until November 10, 2025. Compliance is contingent upon meeting specific milestones involving preferred stock conversion and debt restructuring by mid-August 2025.
🚩 Red Flags
- Delisting notice/non-compliance with minimum bid price ($1.00).
- Non-compliance with Minimum Market Value of Listed Securities (MVLS) requirement ($35M).
- Failure to meet alternative listing standards regarding equity and net income.
- High dependency on rapid debt restructuring and preferred stock conversion to avoid delisting.
📋 Key Facts
- Nasdaq Hearings Panel granted an exception to regain compliance until November 10, 2025.
- Compliance requires conversion of remaining outstanding preferred stock into common stock by July 18, 2025.
- Compliance requires restructuring or converting a portion of outstanding debt into common stock by mid-August 2025.
- The company currently fails the alternative Nasdaq standards: stockholders' equity of $2.5M and net income of $500k from continuing operations.
- Securities (DFLI and DFLIW) continue to trade on Nasdaq for now, pending compliance.
Dragonfly Energy Holdings Corp. filed an 8-K to disclose the total number of common shares issued and outstanding as of June 26, 2025.
🚩 Red Flags
- Management concentration/instability: The CEO is also serving as the Interim CFO, which can indicate internal resource constraints or recent leadership turnover.
📋 Key Facts
- As of June 26, 2025, the Company had 36,488,398 shares of common stock, par value $0.0001 per share, issued and outstanding.
- The filing was signed by Denis Phares, who holds multiple roles: CEO, Interim CFO, and President.
Dragonfly Energy Holdings Corp. announced the cancellation of warrants held by the Series A Convertible Preferred Stock holder. The agreement results in the termination of warrants to purchase up to 4,000 shares at an exercise price of $10,000 per share.
🚩 Red Flags
- The cancellation involves a preferred stock holder, which often implies a related party or significant institutional investor transaction.
📋 Key Facts
- Date of event: June 23, 2025
- Agreement involves the holder of Series A Convertible Preferred Stock.
- Cancellation of warrants to purchase up to 4,000 shares of Series A Preferred Stock.
- Exercise price of cancelled warrants was $10,000 per share.
Dragonfly Energy Holdings Corp. received a second deficiency notice from Nasdaq regarding its failure to maintain the minimum Market Value of Listed Securities (MVLS) requirement. The company is also currently non-compliant with the $1.00 minimum bid price requirement and has requested a hearing to contest delisting.
🚩 Red Flags
- Delisting notice: Multiple grounds for delisting (Bid Price and MVLS).
- Failure to meet alternative listing standards (Equity < $2.5M and Net Income deficiency).
- Extreme capital/valuation distress indicated by the failure to maintain a $35M market value.
- Potential for imminent delisting from Nasdaq Capital Market.
📋 Key Facts
- Received an 'MVLS Letter' on June 11, 2025, regarding non-compliance with Nasdaq Listing Rule 5550(b)(2).
- Failed the MVLS requirement of $35 million for the 30 consecutive business days preceding the letter.
- Does not meet alternative listing standards: Stockholders' equity is below $2.5 million, and net income from continuing operations failed to meet the $500,000 threshold in recent fiscal years.
- Already received a 'Bid Price Letter' on May 14, 2025, regarding failure to maintain a $1.00 minimum bid price.
- A hearing with the Nasdaq Hearings Panel is scheduled for June 24, 2025.
- The company's securities (DFLI and DFLIW) continue to trade on Nasdaq pending the outcome of the hearing.
Dragonfly Energy Holdings Corp. announced the resignation of Rick Parod from its Board of Directors, effective May 31, 2025. The company stated the resignation was not due to any disagreement with management or the Board.
🚩 Red Flags
- None identified in this specific filing.
📋 Key Facts
- Rick Parod resigned from the Board of Directors on May 30, 2025.
- The resignation is effective as of May 31, 2025.
- The Company explicitly stated there was no disagreement with management or the Board regarding the departure.
- The Board has not yet determined how to fill the resulting vacancy.
Dragonfly Energy Holdings Corp. filed an 8-K to announce the release of its first quarter financial results for the period ended March 31, 2025. The company scheduled a webcast earnings call to discuss these results on May 15, 2025.
📋 Key Facts
- Reported date: May 15, 2025
- Reporting period: First quarter ended March 31, 2025
- Earnings call scheduled for May 15, 2025, at 4:30 p.m. ET via webcast
- The filing includes an earnings press release as Exhibit 99.1
Dragonfly Energy Holdings Corp. announced the resignation of two board members, Dr. Karina Montilla Edmonds and Mr. Jonathan Bellows, effective May 6-7, 2025. The resignations are part of a strategic effort by the Board to reduce company expenses.
🚩 Red Flags
- Board downsizing often correlates with cost-cutting measures and potential liquidity/financial distress in micro-cap companies.
- Reduction in board size can lead to reduced oversight or governance complexity during restructuring.
📋 Key Facts
- Dr. Karina Montilla Edmonds resigned from the Board on May 6, 2025.
- Mr. Jonathan Bellows resigned from the Board on May 7, 2025.
- The resignations were not due to any disagreements with the Company, management, or the Board.
- The Board size has been reduced to five directors as a result of these departures.
- The move is explicitly linked to efforts by the Company to reduce expenses.
Dragonfly Energy Holdings Corp. successfully held a special meeting of stockholders where shareholders approved significant increases in authorized share counts and waivers for Nasdaq compliance regarding the issuance of more than 20% of common stock via warrants and preferred stock. Additionally, the company completed a second closing of a private placement involving Series A Preferred Stock at a conversion price of $0.594 per share.
🚩 Red Flags
- Significant dilution risk due to the increase in authorized shares (from 250M to 400M) and the conversion of preferred stock/warrants.
- Heavy reliance on institutional financing via convertible preferred stock with low floor prices ($0.10902).
- Nasdaq compliance issues required shareholder votes to bypass the '20% rule' regarding dilutive securities.
📋 Key Facts
- Stockholders approved an increase in authorized Common Stock from 250,000,000 to 400,000,000 shares (Proposal 3).
- Shareholders approved Nasdaq compliance waivers for the issuance of >20% of common stock underlying certain warrants (Proposal 1) and Series A Preferred Stock (Proposal 2).
- Completed a second closing of a private placement on April 28, 2025, selling 450 shares of Series A Preferred Stock at $10,000 per share.
- The conversion price for the Series A Preferred Stock in the Second Closing is set at $0.594 per share.
- The Floor Price for the Series A Preferred Stock issued in the Second Closing is $0.10902.
Dragonfly Energy Holdings Corp. issued an 8-K to announce the release of preliminary financial results for the fiscal quarter ended March 31, 2025.
🚩 Red Flags
- The CEO is also serving in an interim CFO capacity, which can sometimes indicate internal transition or instability, though common in micro-caps.
📋 Key Facts
- The filing is a notice regarding the issuance of preliminary financial results for the quarter ending March 31, 2025.
- Preliminary results were released via press release on April 23, 2025.
- Denis Phares serves as CEO, Interim CFO, and President.
Dragonfly Energy Holdings Corp. announced the resignation of its independent auditor, Marcum LLP, effective upon the filing of the 2024 Form 10-K. The company has appointed CBIZ CPAs P.C. as its new independent registered public accounting firm.
🚩 Red Flags
- Auditor change (Marcum LLP resigning)
- Existing going concern language in previous audit reports
- History of material weakness in internal control over financial reporting
- Multiple 8-K items (2.02, 4.01, 7.01) indicating simultaneous earnings release and auditor change
📋 Key Facts
- Marcum LLP will resign effective immediately upon the filing of the Company’s Form 10-K for the fiscal year ended December 31, 2024.
- CBIZ CPAs P.C. has been engaged as the new independent registered public accounting firm for the fiscal year ending December 31, 2025.
- The company's previous audit report (FY 2023) included an explanatory paragraph regarding substantial doubt about the Company’s ability to continue as a going concern.
- A material weakness in internal control over financial reporting was disclosed in the FY 2023 Annual Report.
- No disagreements on accounting principles or auditing scope were reported between the company and Marcum LLP.
Dragonfly Energy Holdings Corp. has entered into a settlement agreement with LithiumHub to resolve patent litigation involving its battery management systems and lithium-ion phosphate cells. The company will pay $2.5 million over two years in exchange for non-exclusive licensing rights.
🚩 Red Flags
- Legal settlement costs totaling $2.5 million represent a significant cash outflow for a micro-cap company.
- Settlement involves patent infringement allegations regarding core product technology (BMS and LiFePO4 cells).
📋 Key Facts
- Settlement amount: $2.5 million total.
- Payment schedule: ~$0.6 million in 2025 and ~$1.9 million in 2026.
- The agreement resolves patent litigation before the U.S. International Trade Commission regarding US Patent Nos. 9,412,994 and 9,954,207.
- Company receives a non-exclusive license to LithiumHub Technologies, LLC's patents relating to the Patents-in-Suit.
- The settlement includes no admission of infringement by Dragonfly Energy.
Dragonfly Energy Holdings Corp. announced a dual-track financing consisting of a registered direct offering and a private placement of Series A Convertible Preferred Stock to a single institutional investor. The transaction is expected to net approximately $3.2 million for working capital but includes complex conversion terms and warrants.
🚩 Red Flags
- Highly dilutive structure involving convertible preferred stock with significant floor price disparities ($1.00 vs $0.424).
- The Private Placement Floor Price ($0.424) is significantly lower than the Registered Direct Offering, suggesting distressed financing terms.
- Complex warrant call rights and conversion mechanics often lead to downward pressure on stock price (death spiral-like characteristics).
- Requirement for stockholder approval to increase authorized shares by 150 million suggests significant dilution is anticipated.
📋 Key Facts
- Registered Direct Offering: 180 shares of Series A Preferred Stock at $10,000/share (Conversion price: $2.332).
- Private Placement: 170 shares of Series A Preferred Stock at $10,000/share.
- Warrants: Private placement includes warrants to purchase up to 4,000 shares of Series A Preferred Stock.
- Floor Prices: $1.00 for the Registered Direct Offering; $0.424 for the Private Placement.
- Expected Net Proceeds: Approximately $3.2 million (pre-warrant exercise).
- Stockholder Approval Required: Seeking approval to increase authorized common stock from 250M to 400M shares and approve conversions.
- Placement Agent: Chardan Capital Markets, LLC (5.0% cash fee of ~$400,000).
Dragonfly Energy Holdings Corp. announced the appointment of Dr. Vickram Singh as Chief Operating Officer, effective February 4, 2025. Dr. Singh is an internal promotion from his role as Senior Vice President of Technology.
📋 Key Facts
- Dr. Vickram Singh appointed as COO, effective Feb 4, 2025.
- Initial annual base salary: $350,000.
- Discretionary annual bonus: up to 65% of base salary.
- Long-term incentive target value: $550,000 (cash and/or equity).
- Employment term includes a three-year initial term with automatic three-year renewals.
- Severance provisions include cash equal to base salary paid over two years if terminated without cause.
Dragonfly Energy Holdings Corp. entered into a limited waiver and fourth amendment to its Term Loan Agreement on December 31, 2024, following a failure to meet Senior Leverage Ratio and Fixed Charge Coverage Ratio tests. To secure the waiver, the company issued 'penny warrants' to lenders at an exercise price of $0.01 per share.
🚩 Red Flags
- Failure to meet key financial covenants (Senior Leverage Ratio and Fixed Charge Coverage Ratio).
- Issuance of 'Penny Warrants' at $0.01 per share is highly dilutive to existing shareholders.
- Requirement for PIK (Payment-in-Kind) interest indicates potential cash flow constraints.
- The need for a Support Agreement from >20% owners suggests management is facing significant resistance or difficulty in obtaining necessary shareholder approvals.
📋 Key Facts
- Company failed compliance with Senior Leverage Ratio and Fixed Charge Coverage Ratio tests as of Dec 31, 2024.
- Lenders agreed to a waiver in exchange for the issuance of 'Penny Warrants' to purchase up to 350,000 shares at $0.01 per share.
- The company must seek shareholder approval to issue up to 1,400,000 total shares underlying various warrants (including Accrued Warrant Shares).
- A Support Agreement was signed with shareholders holding >20% of voting stock to vote in favor of the warrant issuance.
- Interest on the January 1, 2025 payment will be paid partly in cash and partly in-kind (PIK).
- Liquidity requirement under the Loan Agreement was reduced to $3.5 million as of Dec 31, 2024.
Dragonfly Energy Holdings Corp. received a notice from Nasdaq stating it is non-compliant with the minimum Market Value of Listed Securities (MVLS) requirement of $35 million. The company also fails to meet alternative listing standards regarding stockholders' equity or net income.
🚩 Red Flags
- Delisting notice from Nasdaq
- Failure to meet minimum market value requirements
- Failure to meet alternative equity and net income standards
- Risk of loss of liquidity and capital raising ability if delisted
📋 Key Facts
- Received written notice from Nasdaq on December 12, 2024, regarding non-compliance with Nasdaq Listing Rule 5550(b)(2).
- The company failed the MVLS requirement (minimum $35 million) for the 30 consecutive business days preceding the notice.
- Company does not meet alternative standards: stockholders' equity of $2.5 million or net income of $500,000 in the most recent fiscal year/two of three years.
- The company has a 180-day compliance period until June 10, 2025, to regain compliance.
- To regain compliance, MVLS must be at least $35 million for 10 consecutive business days during the compliance period.
Dragonfly Energy Holdings Corp. has successfully regained compliance with the Nasdaq Minimum Bid Price Requirement. The company was previously under a 180-day extension to address its non-compliance, which expired on December 6, 2024.
🚩 Red Flags
- Historical non-compliance with Nasdaq minimum bid price requirements indicates past extreme volatility or significant downward pressure on share price.
📋 Key Facts
- The Company received notice from Nasdaq Staff on December 9, 2024, that it has regained compliance with the Minimum Bid Price Requirement (Nasdaq Listing Rule 5450(a)(1)).
- The matter regarding the minimum bid price is now officially closed.
- Compliance was previously at risk due to a failure to maintain a $1.00 minimum bid price for 30 consecutive business days.
- A 180-day extension had been granted on June 11, 2024, which expired on December 6, 2024.
Dragonfly Energy Holdings Corp. (DFLI) has implemented a 1-for-9 reverse stock split effective November 22, 2024. The split was approved by stockholders at the Annual Meeting on November 12, 2024.
🚩 Red Flags
- Reverse stock split (typically used to combat low share prices or prevent delisting).
- The filing notes a prior authorization for splits as high as 1-for-20, suggesting potential volatility in capital structure management.
📋 Key Facts
- Reverse stock split ratio: 1-for-9 (one share of common stock for every nine shares previously held).
- Effective Date: November 22, 2024, at 6:00 a.m. ET.
- CUSIP number for Common Stock changed to 26145B 304.
- The split affects all outstanding securities, including stock options and warrants.
- Fractional shares resulting from the split were rounded up to the nearest whole number.
Dragonfly Energy Holdings Corp. filed an 8-K to announce its third quarter 2024 financial results (ended September 30, 2024) and provided updated investor presentation materials.
📋 Key Facts
- Disclosed Q3 2024 results of operations via press release on November 14, 2024.
- Hosted an earnings webcast to discuss financial performance for the period ending September 30, 2024.
- Published updated Investor Presentation materials on the company's website.
Dragonfly Energy Holdings Corp. held its Annual Meeting of Stockholders on November 12, 2024, where shareholders approved a proposal authorizing the Board to execute a reverse stock split between ratios of 1:5 and 1:20.
🚩 Red Flags
- Approval of a reverse stock split is often used to maintain Nasdaq listing compliance regarding minimum bid price requirements.
- The wide range of the potential split (up to 1:20) indicates significant uncertainty in capital structure management.
📋 Key Facts
- Stockholders approved the Reverse Stock Split Proposal with 28,233,543 votes 'FOR'.
- The authorized reverse split ratio is not less than 1:5 and not greater than 1:20.
- The Board of Directors has discretion to determine the exact ratio within one year of approval.
- Two Class B directors, Brian Nelson and Jonathan Bellows, were elected to terms ending in 2027.
- Marcum LLP was ratified as the independent registered public accounting firm for fiscal year 2024.
Dragonfly Energy Holdings Corp. entered into a limited waiver and third amendment to its Term Loan Agreement on September 30, 2024, due to failures in meeting Senior Leverage Ratio and Fixed Charge Coverage Ratio tests. As part of the waiver, the company issued penny warrants for up to 3,000,000 shares at $0.01 per share to its lenders.
🚩 Red Flags
- Breach of financial covenants (Senior Leverage Ratio and Fixed Charge Coverage Ratio).
- Issuance of highly dilutive 'Penny Warrants' at $0.01 per share to lenders.
- Shift toward PIK (Payment-in-kind) interest, indicating potential cash flow constraints.
- Significant reduction in liquidity requirements suggests the company is struggling to maintain standard cash reserves.
📋 Key Facts
- Company failed compliance with Senior Leverage Ratio and Fixed Charge Coverage Ratio tests as of September 30, 2024.
- Lenders granted a one-time waiver for the failed financial covenants via a third amendment.
- Issuance of 'Penny Warrants' to lenders: up to 3,000,000 shares at an exercise price of $0.01 per share.
- Penny Warrants are immediately exercisable and expire in ten years.
- Liquidity requirement under the Loan Agreement was reduced to $7.0 million as of September 30, 2024.
- Interest payment due October 1, 2024, is permitted to be paid partly in cash and partly in-kind (PIK).
Dragonfly Energy Holdings Corp. issued an 8-K to announce its second quarter 2024 earnings results for the period ended June 30, 2024. The filing includes a press release and updated investor presentation materials.
📋 Key Facts
- Earnings release for Q2 ended June 30, 2024, issued on August 14, 2024.
- Company hosted an earnings webcast at 5:00 p.m. ET on August 14, 2024.
- Investor presentation materials were posted to the company's website.
Dragonfly Energy Holdings Corp. entered into a significant licensing agreement with Stryten Energy LLC for its 'Battle Born Batteries' brand, involving an initial $5 million fee and potential royalties up to $25 million. The transaction involved complex restructuring of intellectual property and amendments to existing term loan agreements.
🚩 Red Flags
- Complex IP restructuring (transferring assets to a subsidiary and licensing them back) can sometimes be used to ring-fence assets or isolate liabilities.
- The agreement includes termination clauses if aggregate royalties are less than $15 million after 5 years, indicating high performance dependency.
- Lenders required a joinder/guaranty from the new subsidiary, increasing the complexity of the debt structure.
📋 Key Facts
- Dragonfly subsidiary Battle Born Battery Products, LLC granted Stryten Energy LLC an exclusive, worldwide license for 'Battle Born Batteries' trademarks in specific markets (automotive, marine, powersports, etc.).
- Initial licensing fee of $5,000,000 to be paid by Stryten.
- Royalty structure: mid-single digit royalties on net sales up to a cap of $25,000,000 in total payments.
- Trademark Transfer Agreement: Intellectual property was transferred from DFE to Battle Born LLC and licensed back for non-Stryten markets.
- Lenders waived mandatory prepayment that would have been triggered by the $5 million receipt.
- Battle Born Battery Products, LLC joined as a guarantor/credit party to the existing Term Loan Agreement.
Dragonfly Energy Holdings Corp. entered into a significant license agreement with Stryten Energy LLC, granting exclusive worldwide rights to the 'Battle Born Batteries®' trademarks for specific B2B markets in exchange for an initial $5 million fee and tiered royalties up to $25 million. The transaction involved a complex restructuring of intellectual property via a subsidiary and required lender consent/waivers regarding existing term loan obligations.
🚩 Red Flags
- Complex IP transfer/license-back structure often used in distressed restructuring or to ring-fence assets.
- Lender involvement: The transaction required formal consent and waivers from lenders, indicating tight control over cash flows by creditors.
- Termination clause: License can be terminated if royalties fall below $15 million after 5 years.
📋 Key Facts
- Initial licensing fee of $5,000,000 payable by Stryten Energy LLC to Battle Born LLC (a DFE subsidiary).
- Royalty structure: Mid-single digit royalties on net sales, capped at a total of $25,000,000 before transitioning to a nominal annual fee.
- License covers automotive, marine, powersports, lawn and garden, golf cart, and military/defense markets.
- Trademark Transfer Agreement: Intellectual property was transferred from DFE to Battle Born LLC, with rights licensed back to DFE for non-Stryten markets.
- Lenders waived the mandatory prepayment requirement that would have been triggered by the $5 million receipt of the initial licensing fee.
- Battle Born LLC has joined as a guarantor and credit party to the existing Term Loan Agreement.
Dragonfly Energy Holdings Corp. entered into a limited waiver and first amendment to its Term Loan Agreement to address potential breaches of financial covenants. As part of the deal, the company issued penny warrants to lenders to secure the waiver and amended liquidity and interest payment terms.
🚩 Red Flags
- Potential breach of financial covenants (Senior Leverage Ratio and Fixed Charge Coverage Ratio).
- Significant equity dilution via the issuance of 2.1 million penny warrants at a nominal $0.01 price.
- Shift to PIK (Payment-in-kind) interest, indicating potential cash flow constraints for debt servicing.
- Reduced liquidity requirements suggest immediate pressure on cash reserves.
📋 Key Facts
- Entered into a Limited Waiver and First Amendment to Term Loan, Guarantee and Security Agreement on June 28, 2024.
- Lenders agreed to waive Senior Leverage Ratio and Fixed Charge Coverage Ratio tests for the quarter ending June 30, 2024.
- Issued 'Penny Warrants' to lenders allowing them to purchase up to 2,100,000 shares of common stock at an exercise price of $0.01 per share.
- The Penny Warrants are immediately exercisable and expire in ten years.
- Liquidity requirement reduced to $3.5 million for the month ending June 30, 2024, increasing to $10.0 million thereafter.
- Interest due on July 1, 2024, will be payable-in-kind (PIK) rather than cash.
Dragonfly Energy Holdings Corp. has received an extension from Nasdaq to regain compliance with the minimum bid price requirement. The company is being transferred from the Nasdaq Global Market to the Nasdaq Capital Market effective June 12, 2024.
🚩 Red Flags
- Delisting risk: Failure to meet compliance by Dec 6, 2024, will result in delisting notice.
- Potential for a reverse stock split, which is often viewed negatively by the market and can lead to further dilution or volatility.
- Ongoing failure to maintain minimum bid price requirement (Nasdaq Rule 5450(a)(1)).
- Downgrade in listing tier from Nasdaq Global Market to Nasdaq Capital Market.
📋 Key Facts
- The Company was granted a second 180-day compliance period ending December 6, 2024, to meet the $1.00 minimum bid price requirement.
- Effective June 12, 2024, the company's stock will transfer from The Nasdaq Global Market to The Nasdaq Capital Market under the symbol 'DFLI'.
- To regain compliance, the company must have its stock close at or above $1.00 for 10-20 consecutive business days.
- The company explicitly mentioned considering a reverse stock split as a potential method to resolve the deficiency.
Dragonfly Energy Holdings Corp. entered into an amended and restated ChEF purchase agreement with Chardan Capital Markets LLC on May 20, 2024. The amendment updates the volume-weighted average price (VWAP) mechanics of its existing $150 million equity facility to allow for intraday VWAP purchases.
🚩 Red Flags
- Continued reliance on a large $150M equity facility suggests ongoing need for capital/liquidity.
- The inclusion of 'Intraday VWAP Purchases' in an equity facility is often associated with rapid dilution mechanisms used by micro-cap companies to raise cash quickly.
📋 Key Facts
- Entered into an Amended and Restated ChEF Purchase Agreement with Chardan Capital Markets LLC on May 20, 2024.
- The agreement pertains to an existing $150,000,000 equity facility used to sell common stock.
- The amendment specifically updates the VWAP purchase mechanics to permit 'Intraday VWAP Purchases'.
- Denis Phares serves as CEO, Interim CFO, and President.
Dragonfly Energy Holdings Corp. filed an 8-K to announce its Q1 2024 earnings release and provided updated investor presentation materials.
📋 Key Facts
- Earnings release for the first quarter ended March 31, 2024 was issued on May 14, 2024.
- The company hosted an earnings webcast to discuss financial results on May 14, 2024.
- Investor presentation materials were posted to the company's website as part of Regulation FD compliance.
Dragonfly Energy Holdings Corp. filed an 8-K to disclose the posting of new investor presentation materials on its website. This is a routine disclosure under Regulation FD.
📋 Key Facts
- The company posted updated Investor Presentation materials on May 7, 2024.
- Materials are available via the Company's Investor Relations website.
- The filing was signed by Denis Phares, CEO and Interim CFO.
Dragonfly Energy Holdings Corp. announced the termination of John Marchetti from his position as Senior Vice President, Operations, effective April 19, 2024.
🚩 Red Flags
- Departure of a high-level executive (SVP Operations) following a previous tenure as CFO suggests potential instability in leadership or operational restructuring.
- The CEO is currently acting as the Interim CFO, indicating a gap in permanent senior financial leadership.
📋 Key Facts
- John Marchetti was terminated on April 19, 2024.
- Marchetti previously served as the Company's Chief Financial Officer from September 2021 to August 2023.
- The filing was signed by Denis Phares, who is currently serving in a triple capacity: CEO, Interim CFO, and President.
Dragonfly Energy Holdings Corp. filed an 8-K to announce the release of its financial results for the fourth quarter and full year ended December 31, 2023.
🚩 Red Flags
- Management structure shows a single individual (Denis Phares) holding CEO, Interim CFO, and President roles, which may indicate resource constraints or governance concentration.
📋 Key Facts
- Earnings release issued on April 15, 2024, covering Q4 and FY 2023 results.
- The company scheduled an earnings webcast for 5:00 p.m. ET on April 15, 2024.
- Denis Phares is serving in the triple role of CEO, Interim CFO, and President.
Dragonfly Energy Holdings Corp. issued a $1,000,000 unsecured convertible promissory note to a company director, Brian Nelson, for working capital. The note was repaid in full on February 1, 2024, including a $50,000 loan fee.
🚩 Red Flags
- Related-party transaction: The borrower of the funds is a Director (Brian Nelson).
- High cost of capital: A $50,000 fee on a $1M note for a 9-day duration represents an extremely high annualized interest/fee rate.
- Short-term liquidity pressure: The company required immediate working capital and had to repay the full amount within approximately 8 days.
📋 Key Facts
- Issued an unsecured convertible promissory note of $1,000,000 to Director Brian Nelson on January 24, 2024.
- The transaction was conducted via private placement in exchange for cash.
- The note included a $50,000 loan fee payable on February 2, 2024.
- Repayment of the principal and fee occurred on February 1, 2024.
- The company had an option to settle the note using cash or common stock at a price not less than $0.47 per share.
Dragonfly Energy Holdings Corp. issued a $1.7 million unsecured convertible promissory note to a company director, Brian Nelson, which was due and paid in full within four days.
🚩 Red Flags
- Related-party transaction: The loan was issued directly to a Director (Brian Nelson).
- Extremely short duration: The note was issued on Feb 27 and due/paid by March 1, suggesting it may have been used for immediate liquidity needs.
- High cost of capital: An $85,000 fee on a $1.7M loan over ~3 days represents an extremely high effective interest rate.
📋 Key Facts
- Issued an unsecured convertible promissory note for $1,700,000 on February 27, 2024.
- The holder of the note is Brian Nelson, a Director of the Company (Related Party).
- The note became due and payable in full on March 1, 2024.
- Company paid an additional $85,000 loan fee to the Holder on March 1, 2024.
- The company had an option to repay part of the principal with common stock at a price not less than $0.55 per share.