VWAV 10-Q
VisionWave Holdings, Inc. (VWAV)
UNITED
STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM
For the quarterly period ended
For the transition period from to
| (Exact Name of Registrant as Specified in its Charter) |
| (State or other jurisdiction of incorporation) |
(Commission File Number) | (I.R.S. Employer Identification No.) |
| (Address of Principal Executive Offices) | (Zip Code) |
| Registrant’s telephone number, including area code: ( |
| N/A |
| (Former name or former address, if changed since last report) |
Securities registered pursuant to Section 12(b) of the Securities Exchange Act of 1934:
Securities registered pursuant to Section 12(b) of the Act:
| Title of each class | Trading Symbol | Name of each exchange on which registered | ||
| The Stock Market LLC | ||||
| The Stock Market LLC |
Securities registered pursuant to Section 12(g) of the Exchange Act: None
Indicate by check mark whether
the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of
1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has
been subject to such filing requirements for the past 90 days.
Indicate by check mark whether
the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation
S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to
submit such files).
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.
| Large accelerated filer | ☐ | Accelerated filer | ☐ |
| ☒ | Smaller reporting company | ||
| Emerging growth company |
If an emerging growth company,
indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial
accounting standards provided pursuant to Section 13(a) of the Exchange Act.
Indicate by check mark whether
the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☐
As of August 17, 2026, shares of common stock, par value $0.01 per share, were issued and outstanding.
1
VISIONWAVE HOLDINGS, INC.
FORM 10-Q FOR THE QUARTER ENDED JUNE 30, 2026
TABLE OF CONTENTS
2
PART I – FINANCIAL INFORMATION
Item 1 - Financial Statements
VISIONWAVE HOLDINGS, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEETS
| June 30, 2026 | September 30, 2025 | |||||||
| (Unaudited) | ||||||||
| Assets | ||||||||
| Current Assets: | ||||||||
| Cash and cash equivalents | $ | $ | ||||||
| Accounts receivable | ||||||||
| Prepaid expenses and other current assets | ||||||||
| Deposit | ||||||||
| Advances to supplier | ||||||||
| Due from related party | ||||||||
| Total Current Assets | ||||||||
| Investment in securities designated for sale | ||||||||
| Equity method investment | ||||||||
| Other investments | ||||||||
| Notes receivable, net of allowance | ||||||||
| Property, plant and equipment, net | ||||||||
| Other non-current asset | ||||||||
| Goodwill | ||||||||
| Intangible assets, net | ||||||||
| Total Assets | $ | $ | ||||||
| Liabilities and Equity (Deficit) | ||||||||
| Current liabilities: | ||||||||
| Accounts payable and accrued expenses | $ | $ | ||||||
| Customer deposit | ||||||||
| Deferred revenue | ||||||||
| Income taxes payable | ||||||||
| Excise tax payable | ||||||||
| Promissory notes | ||||||||
| Loan payable - current | ||||||||
| Due to related parties | ||||||||
| Convertible notes payable, net of unamortized debt issuance cost | ||||||||
| Stock based compensation liability | ||||||||
| Deferred tax liability | ||||||||
| Deferred underwriters’ discount | ||||||||
| Total Current Liabilities | ||||||||
| Loan payable | ||||||||
| Total Liabilities | ||||||||
| Commitments and Contingencies (Note 20) | ||||||||
| Equity (Deficit) | ||||||||
| Preferred stock, par value $, shares authorized; shares issued or outstanding | ||||||||
| Common stock, par value $, shares authorized; and shares issued and and shares outstanding at June 30, 2026 and September 30, 2025, respectively. | ||||||||
| Treasury stock, at cost, par value $ |
( |
) | ||||||
| Shares to be issued related to acquisition, par value $0.01, 6,500,000 and 0 shares at June 30, 2026 and September 30, 2025, respectively. | ||||||||
| Additional paid-in capital | ||||||||
| Accumulated deficit | ( |
) | ( |
) | ||||
| Accumulated other comprehensive income | ||||||||
| Total equity - VisionWave Holdings Inc. | ( |
) | ||||||
| Non-controlling interest | ||||||||
| Total Equity (Deficit) | ( |
) | ||||||
| Total Liabilities and Equity (Deficit) | $ | $ | ||||||
The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.
3
VISIONWAVE HOLDINGS, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE LOSS
FOR THE THREE AND NINE MONTHS ENDED JUNE 30, 2026 AND 2025
(Unaudited)
| Three Months Ended June 30, | Nine Months Ended June 30, | |||||||||||||||
| 2026 | 2025 | 2026 | 2025 | |||||||||||||
| Revenue | $ | $ | $ | $ | ||||||||||||
| Cost of Revenue | ( | ) | ( | ) | ||||||||||||
| Gross Profit | ||||||||||||||||
| Operating expenses: | ||||||||||||||||
| General and administrative | ||||||||||||||||
| Research and development | ||||||||||||||||
| Sales and marketing | ||||||||||||||||
| Depreciation and amortization | ||||||||||||||||
| Total operating expenses | ||||||||||||||||
| Loss from operations | ( | ) | ( | ) | ( | ) | ( | ) | ||||||||
| Other (expense) income: | ||||||||||||||||
| Interest income | ||||||||||||||||
| Interest expense | ( | ) | ( | ) | ||||||||||||
| Net gain/(loss) from sale of marketable securities | ( | ) | ||||||||||||||
| Loss on disposal of investments | ( | ) | ( | ) | ||||||||||||
| Change in fair value of convertible notes payable | ( | ) | ( | ) | ||||||||||||
| Change in fair value of other liabilities | ( | ) | ||||||||||||||
| Change in fair value of other investments | ( | ) | ( | ) | ||||||||||||
| Other income (expenses) | ( | ) | ||||||||||||||
| Total other (expense) income, net | ( | ) | ( | ) | ( | ) | ||||||||||
| Loss before provision for income taxes | ( | ) | ( | ) | ( | ) | ( | ) | ||||||||
| Net loss | ( | ) | ( | ) | ( | ) | ( | ) | ||||||||
| Net Loss Attributable to Non-controlling interests | ( | ) | ( | ) | ||||||||||||
| Net Loss Attributable to VisionWave Holdings Inc. Shareholders | ( | ) | ( | ) | ( | ) | ( | ) | ||||||||
| Other comprehensive loss | ||||||||||||||||
| Foreign currency translations adjustment (income) loss, net of tax | ||||||||||||||||
| Total Comprehensive loss | ( | ) | ( | ) | ( | ) | ( | ) | ||||||||
| Comprehensive Loss Attributable to Non-controlling interest | ( | ) | ( | ) | ||||||||||||
| Comprehensive Loss Attributable to VisionWave Holdings Inc. Shareholders | $ | ( | ) | $ | ( | ) | $ | ( | ) | $ | ( | ) | ||||
| Basic and diluted weighted average shares outstanding | ||||||||||||||||
| Basic and diluted net loss per share attributable to VisionWave Holdings Inc. | $ | ) | $ | ) | $ | ) | $ | ) | ||||||||
The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.
4
VISIONWAVE HOLDINGS, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY (DEFICIT)
FOR THE THREE AND NINE MONTHS ENDED JUNE 30, 2026 AND 2025
(Unaudited)
| Common stock | Treasury Stock | Additional | Shares to be issued | Accumulated | Accumulated | Non - Controlling | Total | |||||||||||||||||||||||||||||||||
| Shares | Amount | Shares | Amount | Paid-in Capital | in acquisition | Deficit | Other Comprehensive Income | Interest | Equity (Deficit) | |||||||||||||||||||||||||||||||
| Balance as of September 30, 2025 | $ | $ | $ | $ | $ | ( | ) | $ | $ | $ | ( | ) | ||||||||||||||||||||||||||||
| Issuance of shares in asset acquisition | — | |||||||||||||||||||||||||||||||||||||||
| Issuance of warrants in asset acquisition | — | — | ||||||||||||||||||||||||||||||||||||||
| Exercise of warrants | — | |||||||||||||||||||||||||||||||||||||||
| Stock based compensation | — | — | ||||||||||||||||||||||||||||||||||||||
| Net loss | — | — | ( | ) | ( | ) | ||||||||||||||||||||||||||||||||||
| Balance as of December 31, 2025 | ( | ) | ||||||||||||||||||||||||||||||||||||||
| Exercise of warrants | — | |||||||||||||||||||||||||||||||||||||||
| Issuance of shares in asset acquisition | — | |||||||||||||||||||||||||||||||||||||||
| Issuance of shares pursuant to SEPA | — | |||||||||||||||||||||||||||||||||||||||
| Shares to be issued related to acquisition | — | — | ||||||||||||||||||||||||||||||||||||||
| Issuance of shares pursuant to the SaverOne exchange agreement | — | |||||||||||||||||||||||||||||||||||||||
| Shares to be issued related to asset acquisition | — | — | ||||||||||||||||||||||||||||||||||||||
| Issuance of warrants pursuant to the Letter Agreement | — | — | ||||||||||||||||||||||||||||||||||||||
| Stock based compensation | — | |||||||||||||||||||||||||||||||||||||||
| Net loss | — | — | ( | ) | ( | ) | ||||||||||||||||||||||||||||||||||
| Balance as of March 31, 2026 | ( | ) | ||||||||||||||||||||||||||||||||||||||
| Issuance of shares in asset acquisition | — | |||||||||||||||||||||||||||||||||||||||
| Issuance of shares pursuant to SEPA | — | |||||||||||||||||||||||||||||||||||||||
| Issuance of shares pursuant to the SaverOne exchange agreement | — | |||||||||||||||||||||||||||||||||||||||
| Share swap between DFNS and VisionWave | — | |||||||||||||||||||||||||||||||||||||||
| Shares to be issued related to asset acquisition | — | — | ||||||||||||||||||||||||||||||||||||||
| Stock based compensation | — | |||||||||||||||||||||||||||||||||||||||
| Shares repurchased in connection with BOCA JV | — | ( | ) | ( | ) | |||||||||||||||||||||||||||||||||||
| Currency translation adjustment | — | — | ||||||||||||||||||||||||||||||||||||||
| Non-controlling Interest Arising on Business Combination | — | — | ||||||||||||||||||||||||||||||||||||||
| Net loss | — | — | ( | ) | ( | ) | ( | ) | ||||||||||||||||||||||||||||||||
| Balance as of June 30, 2026 | $ | ( | ) | $ | ( | ) | $ | $ | $ | ( | ) | $ | $ | $ | ||||||||||||||||||||||||||
| Common stock | Additional | Accumulated | Total | |||||||||||||||||
| Shares | Amount | Paid-in Capital | Deficit | Deficit | ||||||||||||||||
| Balance as of September 30, 2024 | $ | $ | $ | ( |
) | $ | ( |
) | ||||||||||||
| Net loss | — | ( |
) | ( |
) | |||||||||||||||
| Balance as of December 31, 2024 | ( |
) | ( |
) | ||||||||||||||||
| Net loss | — | ( |
) | ( |
) | |||||||||||||||
| Balance as of March 31, 2025 | ( |
) | ( |
) | ||||||||||||||||
| Net loss | — | ( |
) | ( |
) | |||||||||||||||
| Balance as of June 30, 2025 | $ | $ | $ | ( |
) | $ | ( |
) | ||||||||||||
The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.
5
VISIONWAVE HOLDINGS, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(Unaudited)
| Nine Months Ended June 30, | ||||||||
| 2026 | 2025 | |||||||
| Cash flows from Operating Activities: | ||||||||
| Net loss | $ | ( | ) | $ | ( | ) | ||
| Adjustments to reconcile net loss to net cash provided by operating activities: | ||||||||
| Change in fair value of other liabilities | ( | ) | ||||||
| Change in fair value of convertible notes payable | ||||||||
| Change in fair value of investments | ||||||||
| Gain on investment of marketable securities | ( | ) | ||||||
| Allowance for doubtful Notes | ||||||||
| Loss on transfer of equity method securities | ||||||||
| Amortization of debt issuance cost | ||||||||
| Stock-based compensation | ||||||||
| Depreciation and amortization | ||||||||
| Changes in current assets and current liabilities: | ||||||||
| Prepaid expenses and other current assets | ( | ) | ||||||
| Accounts receivable | ( | ) | ||||||
| Due from related party | ( | ) | ||||||
| Deposit | ( | ) | ||||||
| Advances to supplier | ( | ) | ||||||
| Accounts payable and accrued expenses | ||||||||
| Customer deposit | ||||||||
| Deferred revenue | ||||||||
| Due to related parties | ( | ) | ||||||
| Deferred taxes | ( | ) | ||||||
| Stock-based compensation liability | ||||||||
| Late payment penalty on excise taxes payable | ||||||||
| Late payment penalty on income taxes payable | ||||||||
| Net cash used in operating activities | ( | ) | ( | ) | ||||
| Cash flows from Investing Activities: | ||||||||
| Proceeds from sale of marketable securities, net | ||||||||
| Advance to C.M. Composite Materials Ltd | ( | ) | ||||||
| Purchase of property and equipment | ( | ) | ||||||
| Deposit on property, plant and equipment | ( | ) | ||||||
| Cash paid for equity method investments | ( | ) | ||||||
| Cash acquired in connection with asset acquisition | ||||||||
| Acquisition of business, net of cash acquired | ( | ) | ||||||
| Cash paid for other investments | ( | ) | ||||||
| Proceeds from sale of other investments | ||||||||
| Net cash (used in) provided by investing activities | ( | ) | ||||||
| Cash flows from Financing Activities: | ||||||||
| Proceeds from issuance of convertible note, net of costs | ||||||||
| Repayment of convertible notes | ( | ) | ||||||
| Proceeds from issuance of promissory note | ||||||||
| Proceeds from loan payable | ||||||||
| Repayment of loan payable | ( | ) | ||||||
| Repayment of promissory note | ( | ) | ||||||
| Proceeds from drawdown of SEPA | ||||||||
| Proceeds from exercise of warrants | ||||||||
| Net cash provided by financing activities | ||||||||
| Effect of exchange rate changes on cash | ||||||||
| Net change in cash | ||||||||
| Cash and cash equivalents, beginning of the period | ||||||||
| Cash and cash equivalents, end of the period | $ | $ | ||||||
| Supplemental cash flow information: | ||||||||
| Interest paid | $ | $ | ||||||
| Taxes paid | $ | $ | ||||||
| Non cash investing and financing activities: | ||||||||
| Debt discount on warrant issued for Notes | $ | $ | ||||||
| Issuance of shares pursuant to the SaverOne exchange agreement | $ | $ | ||||||
| Issuance of shares in asset acquisition | $ | $ | ||||||
| Issuance of warrants pursuant to exchange agreement | $ | $ | ||||||
| Note issued in asset acquisition | $ | $ | ||||||
| Shares to be issued related to acquisition | $ | $ | ||||||
| Share swap between DFNS and VisionWave | $ | $ | ||||||
| Non-cash repayment of Adrian Note | $ | $ | ||||||
| Goodwill acquired in Business Combination | $ | $ | ||||||
| NCI related to acquisition | $ | | $ | |||||
| Net assets acquired and liability assumed related to acquisition | $ | | $ | |||||
| VWAV shares were contributed (by members) in Boca JV LLC | $ | $ | ||||||
The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.
6
VISIONWAVE HOLDINGS, INC. AND SUBSIDIARIES
NOTES TO THE UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
Note 1—Organization and Business Operations
VisionWave Holdings, Inc. (“VW Holdings” or the “Company”) is a Delaware company incorporated in 2024. VW Holdings is the successor to Bannix Acquisition Corp., (“Bannix”) a blank check company incorporated in the state of Delaware on January 21, 2021 for the purpose of effecting mergers, capital stock exchange, asset acquisitions, stock purchases, reorganization or similar business combinations with one or more businesses (“Business Combination”).
Prior to the succession of Bannix by VW Holdings, on March 26, 2024, Bannix entered into a Business Combination Agreement (the “Original Agreement”), by and among Bannix, VisionWave Technologies, Inc., a Nevada corporation (“Target” or “VW Tech.”) and the shareholders of Target.
On September 6, 2024, Bannix entered into a Merger Agreement and Plan of Reorganization (the “Merger Agreement”), by and among Bannix, VW Holdings, a direct, wholly owned subsidiary of Bannix, BNIX Merger Sub, Inc., a Delaware corporation and a direct, wholly owned subsidiary of VisionWave (“Parent Merger Sub”), BNIX VW Merger Sub, Inc., a Nevada corporation and direct, wholly owned subsidiary of VisionWave (“Company Merger Sub”), and Target.
On July 14, 2025, the transaction contemplated by the Merger Agreement closed.
The Company has four wholly owned subsidiaries: VisionWave Technologies, Inc., Solar Drone Ltd, acquired on December 15, 2025 pursuant to the Share Purchase Agreement (See Note 10), VisionWave IL Ltd. (“VisionWave Israel”), acquired on March 18, 2026 (See Note 20) and VisionWave UK, Ltd, incorporated on May 22, 2026.
Note 2—Liquidity, Capital Resources and Going Concern
The Company’s primary sources of liquidity
have been cash from financing activities. For the nine months ended June 30, 2026, the Company’s net loss was $
On July 25, 2025, the Company entered into the Standby Equity Purchase Agreement (“SEPA”) with YA II PN, LTD, a Cayman Islands exempt limited partnership (the “Investor”) pursuant to which the Company has the right to sell to the Investor up to $50 million of its shares of common stock, subject to certain limitations and conditions set forth in the SEPA, from time to time during the term of the SEPA. The Company received proceeds of $10,540,571, from draw down during the nine months ended June 30, 2026.
The Company also received net proceed of $16,975,000 for loan issued during the nine months ended June 30, 2026 (See Note 14) and $850,000 from the issuance of convertible notes during the same periods.
The Company’s future capital requirements will depend on many factors, including the timing and extent of spending to support further sales and marketing and research and development efforts. In order to finance these opportunities, the Company will need to raise additional financing. While there can be no assurances, the Company intends to raise such capital through issuances of additional equity. If additional financing is required from outside sources, the Company may not be able to raise it on terms acceptable to the Company or at all. These factors initially raised substantial doubt about the Company’s ability to continue as a going concern within one year after the date these financial statements are issued.
7
Going Concern Assessment and Management’s Plans
In response to these conditions, on April 8, 2025, with an effective date of March 31, 2025 and as amended on July 28, 2026, the Company entered into a Funding Support Agreement with Stanley Hills, LLC (“Stanley Hills”), its principal shareholder of VisionWave Technologies, Pursuant to the agreement, Stanley Hills irrevocably and unconditionally committed to provide financial support to the Company, sufficient to fund the working capital needs through August 28, 2027. The funding may be provided by Stanley Hills in the form of direct payments to third parties, advances or intercompany loans or capital contributions, as mutually determined by the parties. Unless otherwise agreed in writing, any such advances will be non-interest bearing and repayable only at such time as determined by the Board of Directors, and only to the extent such repayment would not impair the Company’s liquidity or ability to continue as a going concern. The agreement may not be terminated by Stanley Hills prior to the twelve-month period from the date of release of the unaudited condensed consolidated financial statement.
Management has determined that the SEPA agreement, the agreement with Stanley Hills, cash receipts from customer arrangements, resource reallocation initiatives, additional insider investments and financing, along with its existing cash and committed affiliated support, alleviated the risk about the Company’s ability to continue as a going concern for a reasonable period of time, which is considered to be one year from the issuance of the unaudited condensed consolidated financial statements.
Note 3—Significant Accounting Policies
Basis of Presentation
The accompanying unaudited condensed consolidated financial statements as of June 30, 2026 and for the three and nine months ended June 30, 2026 and 2025 are unaudited. The accompanying unaudited condensed consolidated financial statements have been prepared in conformity with accounting principles generally accepted in the United States of America (“US GAAP”) for interim financial statements and Article 10 of Regulation S-X of the United States Securities and Exchange Commission (“SEC”). Accordingly, they do not include all of the information and footnotes required by generally accepted accounting principles for complete financial statements. In the opinion of management, all adjustments (consisting of normal recurring accruals) considered necessary for a fair presentation have been included. Operating results for the three and nine months ended June 30, 2026 are not necessarily indicative of the results that may be expected for the fiscal year ending September 30, 2026. The unaudited condensed consolidated financial statements should be read in conjunction with the audited consolidated financial statements as of and for the year ended September 30, 2025 and footnotes thereto filed with the Securities Exchange Commission (“SEC”) on Form 10-K on December 31, 2025.
All amounts referred to in the notes to the unaudited condensed consolidated financial statements are in United States Dollars ($) unless stated otherwise.
Principles of Consolidation
The accompanying unaudited condensed consolidated financial statements include the accounts of VisionWave Holdings Inc. and its subsidiaries (See Note 1). All intercompany balances and transactions have been eliminated in consolidation.
As of April 1, 2026, the Company consolidated VWave Boca JV, LLC, a joint venture that is a variable interest entity (“VIE”) as the Company has determined that it is the primary beneficiary. In determining this, the Company evaluated whether it has (1) the power to direct the activities that most significantly impact the VIE's economic performance, and (2) the obligation to absorb losses or the right to receive benefits from the VIE that could potentially be significant to the VIE. (See Note 6 for further details).
8
Foreign Currency Translation and Transactions
The Company’s reporting currency is the U.S. dollar. The functional currency of each entity in the group is the currency of the primary economic environment in which it operates. Transactions in foreign currencies are initially recorded in source currency and converted into the functional currency at the rates of exchange prevailing on the date of the transaction.
The Company translates the financial statements from the local (functional) currency into US Dollars using the year or reporting period end or average exchange rates in accordance with the requirements of Accounting Standards Codification subtopic 830-10, Foreign Currency Matters (“ASC 830-10”). Assets and liabilities are translated at exchange rates as of the balance sheet dates. Expenses are translated at average rates in effect for the years presented. Translation gains and losses resulting from re-measurement from functional to reporting currency are recorded in accumulated other comprehensive loss as a component of shareholders’ deficit.
Gains and losses resulting from transactions denominated in a currency other than the functional currency of the entity are included in general and administrative expenses in the consolidated statements of operations and other comprehensive loss using the average exchange rates in effect during the period.
Segment Reporting
The Company complies with ASU 2023-07, Segment Reporting (Topic 280): Improvements to Reportable Segment Disclosures (“ASU 2023-07”), which improves reportable segment disclosure requirements, primarily through enhanced disclosures about significant segment expenses among other disclosure requirements.
Emerging Growth Company Status
The Company is an “emerging growth company,” as defined in Section 2(a) of the Securities Act of 1933, as amended, (the “Securities Act”), as modified by the Jumpstart our Business Startups Act of 2012, (the “JOBS Act”), and it may take advantage of certain exemptions from various reporting requirements that are applicable to other public companies that are not emerging growth companies including, but not limited to, not being required to comply with the auditor attestation requirements of Section 404 of the Sarbanes-Oxley Act, reduced disclosure obligations regarding executive compensation in its periodic reports and proxy statements, and exemptions from the requirements of holding a nonbinding advisory vote on executive compensation and shareholder approval of any golden parachute payments not previously approved.
Further, Section 102(b)(1) of the JOBS Act exempts emerging growth companies from being required to comply with new or revised financial accounting standards until private companies (that is, those that have not had a Securities Act registration statement declared effective or do not have a class of securities registered under the Exchange Act) are required to comply with the new or revised financial accounting standards. The JOBS Act provides that a company can elect to opt out of the extended transition period and comply with the requirements that apply to non-emerging growth companies but any such election to opt out is irrevocable. The Company has elected not to opt out of such extended transition period which means that when a standard is issued or revised and it has different application dates for public or private companies, the Company, as an emerging growth company, can adopt the new or revised standard at the time private companies adopt the new or revised standard. This may make comparison of the Company’s financial statements with another public company which is neither an emerging growth company nor an emerging growth company which has opted out of using the extended transition period difficult or impossible because of the potential differences in accounting standards used.
9
Use of Estimates
The preparation of these unaudited condensed consolidated financial statements in conformity with US GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the unaudited condensed consolidated financial statements and the reported amounts of expenses during the reporting periods.
Making estimates requires management to exercise significant judgement. It is at least reasonably possible that the estimate of the effect of a condition, situation or set of circumstances that existed at the date of the unaudited condensed consolidated financial statements, which management considered in formulating its estimate, could change in the near term due to one or more future confirming events. Significant estimates include assumptions made in the valuation of stock options, valuation of convertible notes, fair value of assets acquired including intangible assets, useful life of intangibles, valuation of warrants, impairment of goodwill and intangible assets, recoverability of receivables and recoverability of deferred tax assets. Accordingly, the actual results could differ from those estimates.
Concentration of Credit Risk
Financial instruments that potentially subject the Company to concentrations
of credit risk consist of cash accounts in a financial institution, which, at times may exceed the Federal Depository Insurance Coverage
of $
Business Combinations
The Company evaluates whether acquired net assets should be accounted for as a business combination or an asset acquisition by first applying a screen test to determine whether substantially all of the fair value of the gross assets acquired is concentrated in a single identifiable asset or group of similar identifiable assets. If so, the transaction is accounted for as an asset acquisition. If not, Company applies its judgment to determine whether the acquired net assets meets the definition of a business by considering if the set includes an acquired input, process, and the ability to create outputs.
The Company accounts for business combinations using the acquisition method when it has obtained control. The Company measures goodwill as the fair value of the consideration transferred including the fair value of any non-controlling interest recognized, less the net recognized amount of the identifiable assets acquired and liabilities assumed, all measured at their fair value as of the acquisition date. Transaction costs, other than those associated with the issuance of debt or equity securities, that the Company incurs in connection with a business combination are expensed as incurred.
Any contingent consideration is measured at fair value at the acquisition date. For contingent consideration that does not meet all the criteria for equity classification, such contingent consideration is required to be recorded at its initial fair value at the acquisition date, and on each balance sheet date thereafter. Changes in the estimated fair value of liability-classified contingent consideration are recognized on the consolidated statements of operations in the period of change.
When the initial accounting for a business combination has not been finalized by the end of the reporting period in which the transaction occurs, the Company reports provisional amounts. Provisional amounts are adjusted during the measurement period, which does not exceed one year from the acquisition date. These adjustments, or recognition of additional assets or liabilities, reflect new information obtained about facts and circumstances that existed at the acquisition date that, if known, would have affected the amounts recognized at that date.
The Company accounts for certain business combinations that meet the definition of a reverse merger (also referred to as a reverse recapitalization) in accordance with ASC 805, Business Combinations, and ASC 810, Consolidation. A reverse merger occurs when the legal acquirer is determined to be the accounting acquiree, and the legal acquiree is determined to be the accounting acquirer. Accordingly:
10
| ● | No goodwill or intangible assets are recorded |
| ● | The transaction is treated as a capital transaction in substance |
| ● | The accounting acquirer’s assets and liabilities are carried forward at their historical carrying amounts |
| ● | The accounting acquiree’s net assets are recognized at fair value, if applicable |
Cash and Cash Equivalents
The Company considers all cash on hand and in banks, including accounts
in book overdraft positions, certificates of deposit and all short-term investments with an original maturity of three months or less
when purchased to be cash equivalents. Cash equivalents were $
Investments
The Company from time to time invests in equity securities. All marketable equity securities held by the Company are accounted for under “Accounting Standards Codification (“ASC”) Topic 320, “Investments - Debt and Equity Securities.” The Company accounts for available-for-sale equity investments at fair value. From time to time, if the Company determines that the available market price of an available for sale investments is not a reasonable indicator of the fair value, the Company will determine the best estimate of that fair value which is usually the cost.
Equity Method Investment
The Company accounts for investments in entities in which the Company has significant influence over the entity’s financial and operating policies, but does not control, using the equity method of accounting. The equity method investment is initially recorded at cost and subsequently increased for capital contributions and allocations of net income and decreased for capital distributions and allocations of net loss. Equity in net income (loss) from the equity method investment is allocated based on the Company’s economic interest. The equity method investment is reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount may not be recoverable. If it is determined that a loss in value of the equity method investment is other than temporary, an impairment loss is measured based on the excess of the carrying amount of an investment over its estimated fair value.
Goodwill
Goodwill is the excess of consideration paid for an acquired entity over the fair value of the amounts assigned to assets acquired, including other identifiable intangible assets, net of liabilities assumed in a business combination. To determine the amount of goodwill resulting from a business combination, the Company performs an assessment to determine the acquisition date fair value of the acquired company’s tangible and identifiable intangible assets and liabilities.
Goodwill is required to be evaluated for impairment on an annual basis or whenever events or changes in circumstances indicate the asset may be impaired. An entity has the option to first assess qualitative factors to determine whether the existence of events or circumstances leads to a determination that it is more likely than not that the fair value of a reporting unit is less than it carrying amount. These qualitative factors include: macroeconomic and industry conditions, cost factors, overall financial performance and other relevant entity-specific events. If the entity determines that this threshold is met, then the Company may apply a one-step quantitative test and record the amount of goodwill impairment as the excess of a reporting unit’s carrying amount over its fair value, not to exceed the total amount of goodwill allocated to the reporting unit. The Company determines fair value through multiple valuation techniques and weights the results accordingly.
11
The Company is required to make certain subjective and complex judgments in assessing whether goodwill may be impaired. These judgments include significant assumptions and estimates used to determine the fair value of its reporting units, such as projected revenues and related growth rates, projected operating margins and operating cash flows, discount rates, and future economic and market conditions. The Company has elected to perform its annual goodwill impairment review on July 1 of each year, initially utilizing a qualitative assessment to determine whether it is more likely than not that the fair value of each reporting unit is less than its carrying amount.
Other Intangible assets and amortization
The Company recognizes intangible assets that arise from contractual or other legal rights or are otherwise separable. Intangible assets acquired in a business combination or asset acquisition are measured at their acquisition-date fair value. For intangible assets acquired in a group constituting an asset acquisition, the total cost is allocated to the individual assets based on their relative fair values.
Upon initial recognition, an intangible asset is assigned an estimated useful life, representing the period over which the asset is expected to generate future economic benefits. Subsequently, intangible assets are amortized on a straight-line basis over their estimated useful lives. The resulting amortization expense is recognized within depreciation and amortization on the condensed consolidated statements of operations.
The estimated useful life of used to determine amortization are as follows:
| Customer relationships | |
| Intellectual property |
Capitalized intellectual property costs include those acquired in the asset acquisitions including a propriety drone system.
Property, Plant and Equipment and depreciation
The value of property and equipment that were acquired as part of the Asset Acquisition (See Note 10) are recorded at a relative fair value assessed at the time of the acquisition less depreciation. Any additional property and equipment acquired, and any expenditures that extend the life of such assets are recorded at historical cost, including direct acquisition costs, less depreciation and impairment losses. Historical cost includes expenditures that are directly attributable to the acquisition of the items.
Subsequent costs are included in the asset’s carrying amount or recognized as a separate asset, as appropriate, only when it is probable that future economic benefits associated with the item will flow to the Company and the cost of the item can be measured reliably. All other repairs and maintenance costs are charged to profit or loss during the financial period in which they are incurred.
Depreciation for equipment and other assets is computed using the straight-line method at rates calculated to depreciate the cost of the assets, less their anticipated residual values, if any, over their estimated useful lives.
The estimated useful life of used to determine depreciation are as follows:
| Computer and accessories | |
| Drones | |
| Furniture | |
An item of property and equipment is derecognized upon disposal or when no future economic benefits are expected to arise from the continued use of the asset. The gain or loss arising on the disposal or retirement of an asset is determined as the difference between the sales proceeds and the carrying amount of the asset and is recognized in profit or loss.
12
The Company evaluates the carrying value of property and equipment and finite-lived intangible assets whenever a change in circumstances indicates that the net carrying value may not be recoverable from the entity-specific undiscounted future cash flows expected to result from our use of and eventual disposition of a long-lived asset or asset group. Events or circumstances that could trigger an impairment review of a long-lived asset or asset group include, but are not limited to: (i) a significant decrease in the market price of the asset, (ii) a significant adverse change in the extent or manner that the asset is used or in its physical condition, (iii) a significant adverse change in legal factors or in the business climate that could affect the value of the asset, (iv) an accumulation of costs significantly in excess of original expectation for the acquisition or construction of the asset, (v) a current period operating or cash flow loss combined with a history of operating or cash flow losses or a forecast of continuing losses associated with the use of the asset and (vi) a more-likely-than-not expectation that the asset will be sold or disposed of significantly before the end of its previously estimated useful life. If an impairment exists, the net carrying values are reduced to fair values. The Company estimates the fair values of these long-lived assets by performing a discounted future cash flow analysis for the remaining useful life of the asset, or the remaining useful life of the primary asset in the case of an asset group. An individual asset within an asset group is not impaired below its estimated fair value. There were no impairments recorded for the three and nine months ended June 30, 2026 and 2025.
Fair Value of Financial Instruments
The fair value of the Company’s cash, current assets and current liabilities approximate the carrying amounts represented in the accompanying unaudited condensed consolidated balance sheets, due to their short-term nature.
Fair value is defined as the price which would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. A three-tier fair value hierarchy which prioritizes the inputs used in the valuation methodologies is as follows:
Level 1 Inputs - Unadjusted quoted prices in active markets for identical assets or liabilities that the reporting entity has the ability to access at the measurement date.
Level 2 Inputs - Inputs other than quoted prices included in Level 1 that are observable for the asset or liability, either directly or indirectly. These might include quoted prices for similar assets or liabilities in active markets, quoted prices for identical or similar assets or liabilities in markets that are not active, inputs other than quoted prices that are observable for the asset or liability (such as interest rates, volatilities, prepayment speeds, credit risks, etc.) or inputs that are derived principally from or corroborated by market data by correlation or other means.
Level 3 Inputs - Unobservable inputs for determining the fair values of assets or liabilities that reflect an entity’s own assumptions about the assumptions that market participants would use in pricing the assets or liabilities.
As of June 30, 2026, other than the convertible notes discussed below, the Company did not hold any financial assets or liabilities that were measured at fair value on a recurring or nonrecurring basis.
Convertible Notes Payable
For convertible debt instruments that are not considered liabilities under ASC 480 or ASC 815, the Company applies FASB ASC 470, Debt (“ASC 470”), for the accounting of such instruments, including any premiums or discounts. Debt issuance costs consist primarily of original issue discount (OID) and legal fees. These costs are netted off with the related loan and are being amortized to interest expense over the term of the related debt facilities using effective interest method.
13
The Company may elect the fair value option for certain financial instruments that meet the required criteria under ASC 825, Financial Instruments. The Company elected the fair value option for its SEPA related convertible notes, which met the required criteria under ASC 825, Financial Instruments. Issuance fees incurred on instruments for which the fair value option was elected are not deferred and are recognized as an expense when incurred in the consolidated statement of operations. The portion of the change in fair value attributable to instrument-specific credit risk, if any, is recognized in other comprehensive income, with the remainder recognized in earnings.
Offsetting Balances
In accordance with ASC Topic 210 “Balance Sheet”, the Company’s accounting policy is to offset assets and liabilities when a right of offset exists. Accordingly, the unaudited condensed consolidated balance sheets include transactions with affiliated parties on a net basis.
Research and Development Cost
The Company accounts for research and development cost (“R&D”) in accordance with ASC Topic 730, “Research and Development”. R&D represents costs are expensed as incurred.
Basic net loss per share is computed by dividing the net loss by the weighted average shares outstanding for the year. Diluted loss per share is computed by giving effect to all potential shares of common stock to the extent dilutive. For the three and nine months ended June 30, 2026 and 2025, the Company’s diluted weighted-average shares outstanding is equal to basic weighted-average shares, due to the Company’s net loss position. No common stock equivalents were included in the computation of diluted net loss per unit since such inclusion would have been anti-dilutive. At June 30, 2026 and 2025, potentially dilutive securities include the public warrants, stock options and the convertible promissory notes.
Commitments and Contingencies
In the normal course of business, the Company is subject to loss contingencies, such as legal proceedings and claims arising out of its business, which cover a wide range of matters, including, among others, government investigations, shareholder lawsuits, and no income tax matters.
An accrual for a loss contingency is recognized when it is probable that a liability has been incurred and the amount of loss can be reasonably estimated. If a potential material loss contingency is not probable but is reasonably possible, or is probable but cannot be estimated, then the nature of the contingent liability, together with an estimate of the range of possible loss if determinable and material, is disclosed.
Revenue recognition
The Company recognizes revenue in accordance with ASC Topic 606, Revenue from Contracts with Customers (“ASC 606”). The core principle of the guidance in ASC 606 is that an entity should recognize revenue to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. To achieve the core principle, the Company applied the following five-step model that requires entities to exercise judgment:
14
(1) Identify the contracts or agreements with a customer: The Company’s revenue is derived from the customer orders evidenced by invoices issued. Orders placed by customers constitute the Company’s contracts with customers.
(2) Identifying the performance obligations in the contract or agreement: The contract with the customer contains a single performance obligation: delivery of the service to the customer.
(3) Determine the transaction price: The Company requires a full prepayment from the customer at a fixed price per unit based on the terms of the invoice with the customer and before the shipment of products. The transaction price is the amount that reflects the consideration which the Company expects to receive.
(4) Allocate the transaction price to the separate performance obligations: All transaction prices are allocated to the single performance obligation.
(5) Recognize revenue as each performance obligation is satisfied: This performance obligation is satisfied when the service is performed.
The Company only applies the five-step model to contracts when it is probable that the Company will collect the consideration it is entitled to in exchange for the services it transfers to its clients.
Cost of Revenue
The Company’s cost of revenue is comprised of costs related to its commercial revenue, including direct costs and indirect costs associated with the offering of its service.
Income Taxes
The Company follows the asset and liability method of accounting for income taxes under ASC Topic 740, Income Taxes (“ASC 740”). Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in income in the period that included the enactment date. Valuation allowances are established, when necessary, to reduce deferred tax assets to the amount expected to be realized.
ASC 740 prescribes a recognition threshold and a measurement attribute
for the financial statement recognition and measurement of tax positions taken or expected to be taken in a tax return. For those benefits
to be recognized, a tax position must be more likely than not to be sustained upon examination by taxing authorities. The Company recognizes
accrued interest and penalties related to unrecognized tax benefits as income tax expense. There were no unrecognized tax benefits as
of June 30, 2026 and September 30, 2025. Interest and penalties related to Bannix Acquisition for the three and nine months ended June
30, 2026 were $
Accounts Receivable and Allowance for Credit Losses
Accounts receivable represent unconditional rights to consideration arising from the Company’s provision of goods or services to customers. Accounts receivable are recorded at the invoiced amount and generally do not bear interest. The Company presents accounts receivable net of an allowance for credit losses.
The Company estimates expected credit losses in accordance with ASC 326, Financial Instruments—Credit Losses. The allowance for credit losses represents the Company’s estimate of credit losses expected over the contractual life of its accounts receivable. The estimate is based on relevant information available at each reporting date, including historical credit loss experience, the aging and composition of outstanding receivables, customer-specific credit information, current economic conditions, and reasonable and supportable forecasts of future economic conditions.
Noncontrolling Interests
Noncontrolling interests represent the portion of the equity of consolidated subsidiaries and VIEs that is not attributable, directly or indirectly, to the Company. Noncontrolling interests are reported separately within stockholders’ equity in the consolidated balance sheets, except for redeemable noncontrolling interests that are required to be presented outside of permanent equity.
The carrying amount of noncontrolling interests is adjusted for the noncontrolling interest holders’ share of net income or loss, other comprehensive income or loss, capital contributions, distributions, and other changes in the equity of the consolidated entity. Net income or loss and each component of other comprehensive income or loss are attributed to the Company and the noncontrolling interests based on their respective economic interests, including applicable ownership percentages and any substantive contractual profit-and-loss allocation provisions. Losses are attributed to noncontrolling interests even when such attribution results in a deficit noncontrolling interest balance.
Changes in the Company’s ownership interest in a consolidated subsidiary or VIE that do not result in a loss of control are accounted for as equity transactions. No gain or loss is recognized in consolidated net income. The difference between the consideration paid or received and the adjustment to the carrying amount of the noncontrolling interest is recognized directly in equity attributable to the Company.
If the Company ceases to be the primary beneficiary of a VIE or otherwise loses its controlling financial interest, the Company deconsolidates the entity. Upon deconsolidation, the Company derecognizes the former subsidiary’s assets, liabilities, and noncontrolling interests, recognizes any retained investment at fair value, and recognizes the resulting gain or loss in earnings.
Recent Accounting Pronouncements
On November 4, 2024, the FASB issued ASU 2024-03, Disaggregation of Income Statement Expenses (DISE), requiring additional disclosure of the nature of expenses included in the statements of operations. The new standard requires disclosures about specific types of expenses included in the expense captions presented on the face of the statements of operations as well as disclosures about selling expenses. The standard is effective for annual reporting periods beginning after December 15, 2026 and interim reporting periods within annual reporting periods beginning after December 15, 2027. The Company is currently assessing the impact this standard will have on its unaudited condensed consolidated financial statements and related disclosures.
15
The Company’s management does not believe that any other recently issued, but not yet effective, accounting pronouncements, if currently adopted, would have a material effect on the Company’s unaudited condensed consolidated financial statements.
Note 4 — Recapitalization
As outlined in Note 1, the Company consummated the Reverse Acquisition with VisionWave Technologies on July 14, 2025.
Pursuant to and in accordance with the terms set forth in the Merger Agreement, (a) Parent Merger Sub merged with and into Bannix, with Bannix continuing as the surviving entity (the “Parent Merger”), as a result of which, (i) Bannix became a wholly owned subsidiary of VW Holdings, and (ii) each issued and outstanding share of Bannix immediately prior to the effective time of the Parent Merger (the “Parent Merger Effective Time”) (other than shares of Bannix Common Stock that have been redeemed or are owned by Bannix or any of its direct or indirect subsidiaries as treasury shares and any Dissenting Parent Shares) was automatically cancelled in exchange for one share of common stock, par value $ of VW Holdings, each Bannix Warrant automatically converted into one warrant to purchase shares of VW Holdings Common Stock on substantially the same terms and conditions and each Bannix’s Right automatically converted into the number of shares of VW Holdings Common Stock that would have been received by the holder of such Bannix Right if it had been converted upon the consummation of a Business Combination in accordance with Bannix’s organizational document and, (b) immediately following the consummation of the Parent Merger but on the same day, Company Merger Sub merged with and into Target, with Target continuing as the surviving entity (the “Company Merger”, and, together with the Parent Merger, the “Mergers”), as a result of which, (i) Target became a wholly owned subsidiary of VW Holdings, and (ii) each issued and outstanding security of Target immediately prior to the effective time of the Company Merger (the “Company Merger Effective Time”) (other than any cancelled Shares or dissenting shares) were no longer be outstanding and were automatically cancelled in exchange for the issuance to the holder thereof of a substantially equivalent security of VW Holdings. The Mergers and the other transactions contemplated by the Merger Agreement are hereinafter referred to as the “Reverse Acquisition.”
The Merger Agreement contained representations, warranties and covenants of each of the parties thereto that are customary for transactions of this type, including, among others, covenants providing for (i) certain limitations on the operation of the parties’ respective businesses prior to consummation of the Business Combination, (ii) the parties’ efforts to satisfy conditions to consummation of the Business Combination, including by obtaining any necessary approvals from governmental agencies, (iii) prohibitions on the parties soliciting alternative transactions, (iv) VW Holdings preparing and filing a registration statement on Form S-4 with the Securities and Exchange Commission (the “SEC”) and taking certain other actions to obtain the requisite approval of Bannix’s stockholders to vote in favor of certain matters, including the adoption of the Merger Agreement and approval of the Business Combination, at a special meeting to be called for the approval of such matters, and (v) the protection of, and access to, confidential information of the parties. On May 5, 2025, the SEC declared the Company’s registration statement on Form S-4 to be effective.
As described in the Merger Agreement, VW Holdings has agreed to adopt an equity incentive plan
The Business Combination was accounted for as a reverse recapitalization in accordance with GAAP. Under this method of accounting, Bannix, who is the legal acquirer, was treated as the “acquired” company for financial reporting purposes and VisionWave Technologies Inc. was treated as the accounting acquirer. VisionWave Technologies Inc. has been determined to be the accounting acquirer based on evaluation of the following facts and circumstances under the redemption scenarios:
16
| ● | VisionWave Technologies Inc.’s existing stockholders had more than 69% of the voting interest of VW Holdings under both the no redemption and maximum redemption scenarios; |
| ● | VisionWave Technologies Inc.’s senior management comprises the senior management of VW Holdings Inc.; the directors nominated by VisionWave Technologies represent the majority of the board of directors of VW Holdings Inc.; |
| ● | VisionWave Technologies Inc.’s operations comprise the ongoing operations of VW Holdings Inc. |
Accordingly, for accounting purposes, the Reverse Acquisition was treated as the equivalent of a capital transaction in which VisionWave technologies Inc. is issuing stock for the net assets of Bannix. The net assets of Bannix were stated at historical cost, with no goodwill or other intangible assets recorded. Operations prior to the Reverse Acquisition were those of VisionWave Technologies, Inc.
Transaction Proceeds
Upon closing of the Reverse Acquisition, the Company acquired cash of $
| Cash-trust and cash, net of redemptions | $ | |||
| Less: transaction costs paid | ( |
) | ||
| Net payout in Reverse Acquisition | ||||
| Less: Liabilities assumed | ( |
) | ||
| Less: Promissory note combined | ( |
) | ||
| Add: assets acquired | ||||
| Reverse acquisition, net | $ | ( |
) |
The number of shares of Common Stock issued immediately following the consummation of the Reverse Acquisition were:
| Bannix Class A common stock, outstanding prior to the Reverse Acquisition | ||||
| Less: Redemption of Bannix Class A common stock | ( |
) | ||
| Bannix Class B common stock, outstanding prior to the Reverse Acquisition | ||||
| Business Combination shares | ||||
| Bannix public Rights converted to shares at closing | ||||
| Bannix private Rights converted to shares at closing | ||||
| VisionWave Technologies Inc. Shares | ||||
| Common Stock immediately after the Reverse Acquisition |
17
The number of VisionWave Holdings’ shares was determined as follows:
| VisionWave Technologies Inc. Shares | VisionWave Holdings Inc. Shares after conversion ratio | |||||||
| Class A Common | ||||||||
| Class B Common | ||||||||
| Total | ||||||||
In exchange, each share of VisionWave Technologies was converted into shares of the Company’s common stock.
Public and private placement warrants
The
Note 5 — Prepaid Expenses and Other Current Assets
Prepaid expenses and other current assets consisted of the following as of June 30, 2026 and September 30, 2025:
| June 30, 2026 | September 30, 2025 | |||||||
| Insurance premium | $ | $ | ||||||
| Interest receivable | ||||||||
| Deposit on asset | ||||||||
| Prepaid consulting fees | ||||||||
| Other prepaid expenses | ||||||||
| Legal retainer | ||||||||
| VAT receivable | ||||||||
| Other deposits | ||||||||
| Due from underwriters | ||||||||
| Total | $ | $ | ||||||
Note 6 — Investments
Equity Method Investments
SaverOne
On January 26, 2026, the Company entered into a definitive Exchange Agreement (the “Exchange Agreement”) with SaverOne 2014 Ltd., an Israeli company whose American Depositary Shares are listed on The Nasdaq Stock Market (“SaverOne”). The Exchange Agreement replaced and superseded the previously disclosed non-binding Letter of Intent dated December 31, 2025.
18
The Exchange Agreement provides for a three-stage equity exchange and strategic
collaboration providing for the Company to acquire up to approximately 51% of SaverOne’s issued and outstanding ordinary shares
on a fully diluted basis, subject to milestone achievement and applicable regulatory approvals. In exchange, the Exchange Agreement provides
SaverOne with the ability to acquire VisionWave common stock with an aggregate economic value of up to $
The transaction establishes SaverOne as the core operating platform for VisionWave’s radio-frequency (RF) defense and security technologies, supported by a non-exclusive, worldwide license to certain VisionWave RF intellectual property for defense and security applications.
Staged Exchange Structure
Stage 1:
SaverOne issues VisionWave ordinary shares representing 19.99% of SaverOne’s
outstanding share capital (fully diluted), in exchange for VisionWave common stock valued at approximately $
Stage 2:
Upon achievement of the first operational integration milestone, SaverOne
issues VisionWave ordinary shares representing 19.99% of SaverOne’s outstanding share capital (fully diluted), in exchange for VisionWave
common stock valued at approximately $
Stage 3:
Upon achievement of a commercial or defense pilot milestone, SaverOne issues
VisionWave ordinary shares representing 11.02% of SaverOne’s outstanding share capital (fully diluted) resulting in VisionWave owning
approximately 51% of SaverOne in exchange for VisionWave common stock valued at approximately $
The number of VisionWave shares of common stock issued in each stage is determined based on a five-day VWAP immediately preceding the applicable closing.
Additional Provisions
The Exchange Agreement also includes, among other things:
| ● | Board representation rights for VisionWave at SaverOne |
| ● | Registration rights for resale of VisionWave shares of common stock |
| ● | Use-of-proceeds covenants tied to RF platform development |
| ● | Value-protection mechanisms subject to Nasdaq compliance |
| ● | Mutual non-competition provisions within the defined field of use |
The transaction remains subject to milestone certifications, regulatory approvals, and customary closing conditions.
At the close of stage 1 of the agreement, the Company issued shares
valued at $
19
During the nine months ended June 30, 2026, the Company purchased an additional shares of SaverOne costing $644,528. At June 30, 2026, the Company has an ownership interest of approximately 41.5% in SaverOne which represents 714,089 SaverOne shares.
At June 30, 2026, the Company determined that approximately
additional shares of the Company with fair value of $
SaverOne is accounted for as an equity method investment at June 30, 2026, pursuant
to ASC 323 Investments—Equity Method and Joint Ventures. The investment in SaverOne of $
In addition, the Company issued the corresponding shares to management at the Stage 1-3 Closing pursuant to Schedule 1.7 of the January 26, 2026 Agreement, including the applicable portion of the $3 million pool (39.1877%). At June 30, 2026, the Company determined that approximately additional shares of the Company with fair value of $ are issuable to management under the value protection mechanism. The shares were not issued at June 30, 2026. The total fair value of the shares of $2,892,159, $360,448 shares payable under the value protection mechanism at issuance date and $ in shares payable awaiting finalizing of administrative processes were included in stock-based compensation on the accompanying unaudited condensed consolidated statements of operations.
Joint Venture
On January 9, 2026, the Company entered into a Strategic Joint Venture Agreement (the “JV Agreement”) with BOCA JOM, LLC (“BOCA”), GBT Tokenize Corp. (“TOKENIZE”), and GBT Technologies, Inc. (“GBT”). The parties agreed to form a Nevada limited liability company (the “JV LLC”) to develop, commercialize, and manage designated electronic design automation (EDA), defense, and high-security technology projects.
Capital Contributions and Valuation To fund and resource the JV LLC, the parties agreed to specific capital and asset contributions. TOKENIZE will contribute its intellectual property portfolio along with 897,102 shares of the Company’s common stock for 22.04% ownership of the JV, and GBT will contribute 2,020,500 shares of the Company’s common stock for 2.264% ownership of the JV. BOCA will contribute the designated projects and provide non-exclusive licenses granting the JV LLC rights to use certain background intellectual property solely for the designated projects for 37.848% ownership of the JV. The Company will provide non-exclusive licenses granting the JV LLC rights to use certain background intellectual property solely for the designated projects for 37.848% ownership of the JV.
All contributions of the Company’s securities are subject to compliance with applicable securities laws and Nasdaq Listing Rules, including any requisite shareholder approval. To facilitate the negotiation of equity ownership percentages, the parties utilized an internal reference value of $1.0 billion. The Company explicitly notes that this internal value is not a statement of the JV LLC’s actual fair market value, was reached without an independent third-party valuation, and should not be relied upon as an indication of value for the JV LLC, its assets, or the Company’s interest therein.
Governance: The JV LLC will be governed by a three-member board, with specific governance and deadlock resolution mechanisms to be established in a separate operating agreement. TOKENIZE and GBT will not participate in the management or governance of the JV LLC. Additionally, the JV Agreement permits the Company to appoint a director to BOCA’s board; any reciprocal appointment of a BOCA designee to the Company’s board remains subject to approval by the Company’s independent directors, compliance with Nasdaq rules, and, if applicable, shareholder approval. The Company has appointed its CEO as the Managing Member of the JV.
20
Intellectual Property, Term, and Termination: Any intellectual property developed by the JV LLC (“Foreground IP”) will be wholly owned by the JV LLC, while each party retains ownership of its independently developed background IP. The JV Agreement has an initial term of seven years and contains customary termination rights, including if required regulatory approvals (e.g., CFIUS or export controls) are denied. Furthermore, if no designated project generates revenue within twelve months following the formation of the JV LLC, the JV Agreement may be terminated, and contributed consideration may be returned, subject to board-level fiduciary determinations.
The transaction was closed on April 1, 2026.
As of June 30, 2026, the JV LLC, a variable interest entity consolidated by the Company, held 2,917,602 shares of the Company's common stock. These shares were contributed to the JV LLC by GBT Tokenize Corp. and GBT Technologies, Inc. in connection with the JV LLC's formation and are presented as treasury stock within the Company's consolidated statement of stockholders' equity. These shares are excluded from the weighted-average shares used in the Company's computation of basic and diluted earnings per share.
No gain or loss is recognized in the Company's consolidated statements of operations from changes in the fair value of these shares, consistent with the Company's policy of not recognizing gains or losses on transactions or remeasurements involving its own equity securities.
These shares remain subject to transfer restrictions under the Strategic Joint Venture Agreement dated January 9, 2026 (the “JV Agreement”), pursuant to which they may not be sold, assigned, transferred, pledged, hypothecated, encumbered, or otherwise disposed of without the prior written consent of the other party to the JV Agreement, subject to limited permitted-transfer exceptions. The JV Agreement does not specify a fixed expiration date for this restriction.
VWave Boca JV, LLC is a VIE for which the Company has determined that it is the primary beneficiary as it has the power to direct significant activities and obligations to absorb losses or right to receive benefits and therefore consolidates the JV and records non-controlling interest.
The Company contributed access by license in its intellectual property
with a carrying value of zero in exchange for its investment in VWave Boca JV, LLC. The Company’s shares of common stock contributed
by the other members have been accounted for as treasury stock. The Company’s share of the income (loss) reported by the JV are
consolidated in the accompanying condensed consolidated statements of operations. On April 1, 2026, the acquisition date, total treasury
stock at cost was $
21
Investment in VWAV BOCA JV LLC — Restricted Shares and Contingent Termination
As of June 30, 2026, VWAV BOCA JV LLC (the “JV LLC”) held shares of the Company's common stock, contributed by GBT Tokenize Corp. and GBT Technologies, Inc. (“Tokenize” and “GBT”) in connection with the JV LLC's formation. These shares may not be sold, assigned, transferred, pledged, hypothecated, encumbered, or otherwise disposed of by the JV LLC without the prior written consent of the other party to the Strategic Joint Venture Agreement dated January 9, 2026 (the “JV Agreement”), subject to limited permitted-transfer exceptions. The JV Agreement does not specify a fixed expiration date for this restriction.
The JV Agreement further provides that if no Designated Project generates revenue prior to April 1, 2027, the JV Agreement may be terminated, in which case the consideration contributed by each party, including the shares described above, would be returned to its original contributor (Tokenize and GBT, in the case of these shares) without compensation. This termination right is exercisable only upon mutual written agreement of BOCA and the Company, or by the Company if its board of directors determines in good faith that continuation would violate its fiduciary duties to shareholders; it is not automatic. As of June 30, 2026, no designated project had generated revenue. If this termination right were exercised, the Company would derecognize its interest in the JV LLC and account for the effects of the JV's dissolution in the period of termination.
No gain or loss has been recognized by the Company related to changes in the fair value of the shares described above, as such shares represent the Company's own equity securities.
Other Investments
T3 Defense Inc. (“DFNS”) share swap
Note 7 — Note Receivable
Advance to C.M. Composite Materials Ltd
On December 26, 2025, the Company advanced principal in the amount of $
In connection with the advance, CM delivered a Promissory Note to the Company
(the “CM Note”). The CM Note has a 24-month maturity, with the outstanding principal due and payable on December 31, 2027,
unless repaid earlier. The CM Note does not bear interest unless an event of default occurs, in which case interest accrues at a rate
of
On January 22, 2026, the Company entered into an additional Promissory
Note with CM for an amount of $
On February 4, 2026, the Company entered into an additional Promissory
Note with CM for an amount of $
In February 2026, CM entered into a settlement agreement with a vendor who alleged failure to meet contractual obligation in the sum of approximately 12 million Israeli Shekels following a failed motion to appoint a receiver by that said vendor. Pursuant to the agreement, CM is expected to make monthly payments to liquidate the obligation and regular court appearances. The Company evaluated the current financial position of CM and determined that there is not an increased credit risk nor is the collectability of the CM Note uncertain, due to past profitability of CM.
22
The CM Notes described herein remain fully enforceable regardless of whether any contemplated transaction is completed.
At June 30, 2026, total advances to C.M. Composite Materials Ltd. of $
Side Letter Agreement
On March 11, 2026, the Company entered into a Side Letter with C.M., Giza Zinger Even Mezzanine, Limited Partnership (“Giza”), and Matania (Mati) Moskovitch. This Side Letter supplements and addresses obligations under the Company’s previously disclosed Investment and Share Purchase Agreement (SPA) and Loan Agreement, both dated February 20, 2026. Under the Side Letter, the Company acknowledges an existing settlement agreement between Giza, Mati, and CM, and agrees that CM’s performance and payments under that settlement do not constitute a breach or event of default under the SPA or Loan Agreement.
Pursuant to the Side Letter, the Company has irrevocably committed to providing
aggregate funding of at least $
Until CM’s obligations to Giza are fully satisfied, the Company has agreed not to exercise its conversion rights under the Loan Agreement (the Note) to convert amounts into equity of CM without Giza’s prior written consent. Furthermore, the parties agreed not to take actions that would result in the dilution of CM’s shareholders, including the issuance of new equity, options, warrants, or convertible securities.
The Side Letter also stipulates that any shares of the Company to be issued to the shareholder (Mati) in connection with the SPA will be deposited with an approved Israeli trustee. These shares will be held in a dedicated securities account in Israel for the purpose of securing CM’s obligations to Giza.
The advances were made pursuant to a promissory note with a 24-month maturity, bearing no interest unless an event of default occurs (then at 5% per annum or the lower legal maximum), prepayable without penalty, and not contingent on any acquisition or strategic transaction.
Any loan pursuant to the Loan Agreement will bear simple interest at 12% per annum (or such lower rate as mutually agreed in writing, but not exceeding prevailing market rates for similar loans as determined in good faith by the Company), calculated on a 360-day year basis for actual days elapsed. The loan will mature three (3) years after the Effective Date. The obligations under the Loan Agreement are secured by a first-priority security interest in substantially all assets of the Target Company (including accounts, inventory, equipment, general intangibles, intellectual property, and proceeds thereof).
23
During the nine months ended June 30, 2026, the Company advanced to the
Target a total of $
VisionWave Israel advances
On June 30, 2026, the VisionWave Israel advanced VIP Lux Travel Ltd. NIS 500,000 (approximately $169,036) to finance working capital and general corporate purposes. The advance is due on demand.
On July 9, 2026, VisionWave Israel Ltd. entered into a loan agreement with VIP Lux Travel Ltd. pursuant to which the Company advanced an additional loan of NIS 1.0 million to a previous NIS 0.1 million advanced early July, which, together with an existing advance was consolidated into a single loan with an aggregate principal balance of NIS 1.1 million. The proceeds of the additional borrowing are intended to finance working capital and general corporate purposes.
The consolidated loan bears interest at a fixed annual rate of 6.0% and is payable in accordance with an agreed amortization schedule consisting of periodic principal and interest payments through the contractual maturity date of February 1, 2027. Total contractual interest payable over the remaining term of the loan is approximately NIS 19,250. The loan may be prepaid in accordance with the terms of the agreement.
The loan is secured by a first-priority mortgage on a residential property owned by a third-party guarantor, together with related security interests and customary remedies upon an event of default. Events of default include, among other things, payment defaults, insolvency events, certain judgments or liens, breaches of the loan or security agreements, and other customary default provisions, any of which may permit the lender to accelerate all amounts outstanding.
In July 2026, VIP Lux filed for bankruptcy. The Company assessed the receivable from VIP Lux and determined a 100% credit loss on the outstanding balance at June 30, 2026. For the three and nine months ended June 30, 2026 and 2025, the allowance for doubtful notes was included in general and administrative expenses on the unaudited condensed consolidated statements of operations.
The following table summarizes the Company’s notes receivable as of June 30, 2026:
| C.M. Composite Materials Ltd | $ | |||
| Side Letter Agreement – C.M, Giza and Mati | ||||
| Notes Receivable | $ |
24
Note 8 — Property, Plant and Equipment, Net
Property and equipment, net consisted of the following at June 30, 2026 and September 30, 2025:
| June 30, 2026 | September 30, 2025 | |||||||
| Computer and accessories | $ | $ | ||||||
| Furniture | |
|||||||
| Drones | ||||||||
| Total cost | ||||||||
| Accumulated depreciation | ( |
) | ||||||
| Net book value | $ | $ | ||||||
Depreciation expense was $
At June 30, 2026 and September 30, 2025, $
Note 9 — Acquisition of Junko Solar Ltd
On March 11, 2026, SolarDrone entered into a Consulting and Share Purchase
Agreement (the “Junko Agreement”) with Mr. Amos Cohen, the controlling shareholder of Junko Solar Ltd., an Israeli company
engaged in solar panel maintenance and cleaning services. Pursuant to the Junko Agreement, SolarDrone agreed to acquire 51% of the issued
and outstanding shares of Junko Solar Ltd. (the “Junko Transaction”). The parties agreed on a pre-money valuation of Junko
Solar of $
●$68,000 upon execution of the Agreement
●$68,000 within 35 days
●$68,000 within 35 days thereafter
Upon payment of the first installment, the shares representing 51% ownership of Junko Solar Ltd. will be transferred to SolarDrone or its designated affiliate.
Pursuant to the Agreement, Mr. Amos Cohen was appointed Chief Executive Officer and a director of SolarDrone Ltd. Mr. Cohen will provide management and strategic services to SolarDrone pursuant to a consulting arrangement and will receive a consulting fee of 50,000 N.I.S per month plus VAT.
As part of the Transaction, Junko Solar Ltd. will transfer operational activities related to solar panel cleaning and maintenance services, including customer relationships, business opportunities, and related operational assets to SolarDrone. SolarDrone will manage and operate the business going forward. The transaction was closed on April 1, 2026 and was accounted for as a business combination under ASC 805.
25
Purchase Price Allocation
The preliminary allocation of the purchase price to the identifiable assets acquired and liabilities assumed, based on their estimated fair values at the acquisition date, is as follows:
| Consideration paid | $ | |||
| % of Junk acquired | % | |||
| Total fair value of Junko’s net assets | $ | |||
| Assets Acquired: | ||||
| Accounts receivable | $ | |||
| Other receivables | ||||
| Property & equipment | ||||
| Customer relationships | ||||
| Total Assets Acquired | ||||
| Liabilities Assumed: | ||||
| Bank loan | ||||
| Accounts and other payables | ||||
| Related party payable | ||||
| Deferred tax liability | ||||
| Total liability assumed | ||||
| Goodwill | ||||
| Net asset acquired | $ |
The purchase price allocation remains preliminary and subject to adjustment during the measurement period, which extends through one year after the acquisition date. During the measurement period, the Company may record adjustments to the provisional amounts recognized for assets acquired and liabilities assumed based on additional information obtained about facts and circumstances that existed as of the acquisition date.
The excess of the fair value of the consideration transferred over the
fair value of the identifiable net assets acquired was recorded as goodwill of $
All intangible assets acquired are subject to amortization and their associated estimated acquisition date fair values are as follows:
| Intangible assets | Estimated useful life | Acquisition date fair value | ||||
| Customer relationships | $ | |||||
26
The consolidated financial statements of the Company include the results
of operations of Junko from April 1, 2026 through June 30, 2026 and do not include results of operations for periods prior to April 1,
2026. The results of operations of Junko from April 1, 2026 to June 30, 2026 included total expenses and a net loss of $
Note 10 — Asset Acquisitions
Solar Drone
On December 3, 2025, the Company entered into a Share Purchase Agreement
(the “Solar Drone Agreement”) with BladeRanger Ltd., a company organized under the laws of Israel and listed on the Tel Aviv
Stock Exchange under the ticker “BLRN” (“BladeRanger”), and, solely for purposes of acknowledgment and certain
covenants therein, Solar Drone Ltd., an Israeli corporation engaged in the development of solar-powered drone technology (the “Solar
Drone”).
In July 2026, the Company determined that an additional Pre-Funded Warrant is payable BladeRanger following effectiveness of the registration statement registering the resale of the Company Shares.
The Company evaluated this acquisition under ASC 805, Business Combinations. ASC 805 requires that an acquirer determine whether it has acquired a business. If the criteria of ASC 805 are met, a transaction would be accounted for as a business combination and the purchase price is allocated to the respective net assets and liabilities assumed based on their fair values and a determination is made whether any goodwill results from the transaction. The Company concluded that the acquired set of assets did not meet the US GAAP definition of a business as substantially all of the fair value of the gross assets acquired are concentrated in a single identifiable asset or group of similar identifiable assets and consequently accounted for the purchase as an asset acquisition. The Company allocated the total consideration transferred on the date of the acquisition to the assets and liabilities acquired on a relative fair value basis.
The following table summarizes the acquisition date fair value of the assets acquired and the liabilities assumed:
| Amounts Recognized as of Acquisition Date | ||||
| Total Consideration | $ | |||
| Cash | $ | |||
| Other Receivables | ||||
| Fixed Assets (a) | ||||
| Intangible assets (b) | ||||
| Other Payables | ( |
) | ||
| Due to related party (c) | ( |
) | ||
| Net assets acquired | $ | |||
27
(a) Fixed asset consists primarily of drones and computer equipment acquired by the Company. The fair value of fixed assets was estimated to equal the replacement cost.
(b) Intangible assets consist of intellectual property related drone technology and are recorded at estimated fair values based on the allocation of the total consideration transferred on the date of the acquisition to the assets and liabilities acquired on a relative fair value basis. (See Note 10).
(c) Intercompany balance with VisionWave Holdings Inc. eliminated in consolidation.
QuantumSpeed
On January 5, 2026, the Company entered into an Asset Purchase Agreement with Adrian Holdings S.R.L. to acquire all right, title, and interest in specific intellectual property assets related to QuantumSpeed technology.
The aggregate consideration for the intellectual property consists of a
$
The issuance of the remaining shares with a fair value of $
If shareholder approval is not obtained within the nine-month period, the Company is required to transfer 60% of its equity interest in QuantumSpeed Inc. back to the seller, free and clear of all encumbrances. In such an event, the seller’s security interest in the equity would be released, and the seller would retain full ownership of the initial closing shares and the $10 million promissory note. No alternative consideration will be provided in lieu of the unissued contingent share.
The Company evaluated this acquisition under ASC 805, Business Combinations. ASC 805 requires that an acquirer determine whether it has acquired a business. If the criteria of ASC 805 are met, a transaction would be accounted for as a business combination and the purchase price is allocated to the respective net assets and liabilities assumed based on their fair values and a determination is made whether any goodwill results from the transaction. The Company concluded that the acquired asset did not meet the US GAAP definition of a business as substantially all of the fair value of the gross assets acquired are concentrated in a single identifiable asset and consequently accounted for the purchase as an asset acquisition. The Company allocated the total consideration transferred on the date of the acquisition to the single intellectual property acquired on a relative fair value basis.
The following table summarizes the acquisition date fair value of the asset acquired:
| Amounts Recognized as of Acquisition Date | ||||
| Total Consideration | $ | |||
| Intellectual Property (QuantumSpeed) | $ | |||
| Asset acquired | $ | |||
28
xClibre
On April 10, 2026, the Company entered into an Asset Purchase Agreement with Dream America Marketing Services, Ltda. to acquire all right, title, and interest in certain intellectual property assets related to xClibre technology. The acquired assets consist solely of intellectual property.
In consideration for the assigned intellectual property, the Company agreed
to provide aggregate consideration consisting of up to shares of the Company’s common stock and a $6,000,000 promissory
note. At the closing of the transaction, the Company issued shares of common stock and executed the $
The issuance of the remaining 3,500,000 contingent shares is subject to obtaining satisfactory proof-of-concept results and Nasdaq Shareholder Approval. The Company has agreed to use commercially reasonable efforts to obtain this proof-of-concept approval no later than nine months following the closing date. The proof-of-concept was obtained in April 2026.
On April 10, 2026, the transactions contemplated by the Agreement were completed. The Assigned IP consists of intellectual property rights owned by the Seller relating to the xClibre technology, including patents, patent applications, trademarks, copyrights, trade secrets, know-how, software and other proprietary rights. On April 10, 2026, the Company issued 3,500,000 shares of its common stock to the Seller as partial consideration for the Assigned IP.
The Company evaluated this acquisition under ASC 805, Business Combinations. ASC 805 requires that an acquirer determine whether it has acquired a business. If the criteria of ASC 805 are met, a transaction would be accounted for as a business combination and the purchase price is allocated to the respective net assets and liabilities assumed based on their fair values and a determination is made whether any goodwill results from the transaction. The Company concluded that the acquired asset did not meet the US GAAP definition of a business as substantially all of the fair value of the gross assets acquired are concentrated in a single identifiable asset and consequently accounted for the purchase as an asset acquisition. The Company allocated the total consideration transferred on the date of the acquisition to the single intellectual property acquired on a relative fair value basis.
The following table summarizes the acquisition date fair value of the asset acquired:
| Amounts Recognized as of Acquisition Date | ||||
| Total Consideration | $ | |||
| Cost related to acquisition | ||||
| Fair value of the asset acquired | $ | |||
| Intellectual Property (xClibre) | $ | |||
| Asset acquired | $ | |||
29
Note 11 — Goodwill and Other Intangible Assets
Goodwill
As of June 30, 2026, the carrying amount of goodwill was $
Other Intangible Assets
As noted in Notes 10, on December 15, 2025 and January 5, 2026, the Company acquired intellectual property from the acquisition of Solar Drone and QuantumSpeed, respectively. Solar Drone is a drone-based industrial technology platform providing automated cleaning and inspection solutions for utility-scale solar installations and high-voltage electrical infrastructure. The core asset is a proprietary, field-proven drone system that replaces manual, ground-based, and helicopter-based maintenance with autonomous drone operations, improving energy output, safety, and operational reliability while reducing costs and downtime.
QuantumSpeed is currently in a proof-of-concept and system architecture phase, where core mathematical, algorithmic, and architectural principles have been defined and validated at a prototype level.
The Company also acquired intellectual property xClibre from Dream America (See Note 10).
At acquisition dates, the fair value of intellectual property are as follows:
| Intellectual Property | Acquisition date fair value | |||
| SolarDrone | $ | |||
| QuantumSpeed | ||||
| xClibre | ||||
| $ | ||||
The following table summarized intangible assets of the Company:
| Estimated Useful Life (years) | June 30, 2026 | September 30, 2025 | ||||||||||
| Intellectual property | $ | $ | ||||||||||
| Customer relationship | ||||||||||||
| Accumulated amortization | ( | ) | ||||||||||
| Net book value | $ | $ | ||||||||||
Amortization of the intangible asset during the three and nine months ended
June 30, 2026 was $
30
The future amortization of the intangible asset is as follows:
| Fiscal Year | Amount | ||||
| Remainder of 2026 | $ | ||||
| 2027 | |||||
| 2028 | |||||
| 2029 | |||||
| 2030 | |||||
| Thereafter | |||||
| Total unamortized intangible assets | $ | ||||
Note 12 — Accounts Payable and Accrued Expenses
Accounts payable and accrued liabilities consist of the following as of June 30, 2026 and September 30, 2025:
| June 30, 2026 | September 30, 2025 | |||||||
| Underwriter’s marketing fee (See Note 17) | $ | $ | ||||||
| Vendors payable | ||||||||
| Accrued compensation expense | ||||||||
| Franchise tax payable | ||||||||
| Insurance premium financing | ||||||||
| Accrued interest expense | ||||||||
| Other payables and accrued expenses | ||||||||
| Total | $ | $ | ||||||
Note 13 — Excise Tax Payable
On August 16, 2022, the Inflation Reduction Act of 2022 (the “IR Act”) was signed into federal law. The IR Act provides for, among other things, a 1% federal excise tax on certain repurchases of stock by publicly traded U.S. domestic corporations and certain U.S. domestic subsidiaries of publicly traded foreign corporations occurring on or after January 1, 2023. The excise tax is imposed on the repurchasing corporation itself, not its shareholders from which shares are repurchased. The amount of the excise tax is generally 1% of the fair market value of the shares repurchased at the time of the repurchase. However, for purposes of calculating the excise tax, repurchasing corporations are permitted to net the fair market value of certain new stock issuances against the fair market value of stock repurchases during the same taxable year. In addition, certain exceptions apply to the excise tax. The U.S. Department of the Treasury (the “Treasury”) has been given authority to provide regulations and other guidance to carry out and prevent the abuse or avoidance of the excise tax.
On December 27, 2022, the Treasury published Notice 2023-2, which provided clarification on some aspects of the application of the excise tax. The notice generally provides that if a publicly traded U.S. corporation completely liquidates and dissolves, distributions to such complete liquidation and other distributions by such corporation in the same taxable year in which the final distribution in complete liquidation and dissolution is made are not subject to the excise tax. Although such notice clarifies certain aspects of the excise tax, the interpretation and operation of aspects of the excise tax (including its application and operation with respect to SPACs) remain unclear and such interim operating rules are subject to change.
31
Because the application of this excise tax is not entirely clear, any redemption or other repurchase effected by the Company, in connection with a Business Combination, extension vote or otherwise, may be subject to this excise tax. Consequently, any redemption or other repurchase that occurs after December 31, 2022, in connection with a Business Combination, extension vote or otherwise, may be subject to the excise tax. Whether and to what extent the Company would be subject to the excise tax in connection with a Business Combination, extension vote or otherwise would depend on a number of factors, including (i) the fair market value of the redemptions and repurchases in connection with the Business Combination, extension or otherwise, (ii) the structure of a Business Combination, (iii) the nature and amount of any PIPE or other equity issuances in connection with a Business Combination (or otherwise issued not in connection with a Business Combination, but issued within the same taxable year of a Business Combination) and (iv) the content of regulations and other guidance from the Treasury. In addition, because the excise tax would be payable by the Company and not by the redeeming holder, the mechanics of any required payment of the excise tax have not been determined. The foregoing could cause a reduction in the cash available on hand to complete a Business Combination and in the Company’s ability to complete a Business Combination.
During the second quarter of 2024, the Internal Revenue Service issued final regulations with respect to the timing and payment of the excise tax. These regulations provided that the filing and payment deadline for any liability incurred during the period from January 1, 2023 to December 31, 2023 would be October 31, 2024. Any amount of such excise tax not paid in full, will be subject to additional interest and penalties which are currently estimated at 8% interest per annum, a 0.5% underpayment penalty per month or portion of a month up to 25% of the total liability for any amount that is unpaid from November 1, 2024 until paid in full, and a failure to file penalty of 5% per month.
Prior to the consummation of the Reverse Acquisition, Bannix’s common
stockholders exercised their right to redeem their shares for a pro rata portion of the funds in Bannix’s Trust Account. As a result
of these redemptions, Bannix estimated the excise tax liability and applicable interest and penalties pursuant to the IR Act. At the consummation
of the Reverse Acquisition, $
Management believes that the federal stock repurchase excise tax does not apply to the Company’s business combination based on the specific facts and circumstances of the transaction. However, because the application of the excise tax to de-SPAC transactions remains subject to interpretation and uncertainty, the Company has continued to recognize the related liability, including estimated interest and penalties, in its financial statements pending final resolution of its accounting assessment.
Note 14 — Promissory Notes
The following table presents promissory Note balances at June 30, 2026 and September 30, 2025.
| June 30, 2026 | September 30, 2025 | |||||||
| Evie Autonomous Extension Notes | $ | $ | ||||||
| YA II PN Letter Agreement | ||||||||
| Adrian Note | ||||||||
| Dream Note | ||||||||
| $ | $ | |||||||
32
Evie Autonomous LTD
Prior to the consummation of the Reverse Acquisition, Bannix issued unsecured
promissory notes to Evie Autonomous LTD (“Evie”) with a principal amount of $
YA II PN
The YA II PN Note matures 12 months from issuance and requires monthly
amortization payments of $
The Company has the right to optionally redeem all or any portion of the outstanding principal at any time at 105% of the principal amount redeemed plus accrued and unpaid interest. Upon an uncured Event of Default, the Investor may convert all or any portion of the outstanding principal, accrued interest, and other amounts due into Common Stock at a conversion price equal to 90% of the lowest daily VWAP during the 10 consecutive Trading Days immediately prior to the conversion date, subject to a 4.99% beneficial ownership blocker, and a floor price.
Concurrently with the issuance of the YA II PN Note, the Company issued to the Investor a warrant (the “Warrant”) to purchase shares of Common Stock at an exercise price of $ per share, exercisable for a term of five years from issuance.
The obligations under the Note are guaranteed by each subsidiary of the Company pursuant to a Global Guaranty Agreement.
The Letter Agreement contains customary representations, warranties, covenants (including restrictions on variable rate transactions, additional indebtedness without consent, and use of proceeds), and events of default. The Company is not required to register the shares issuable upon conversion of the Note but has agreed to register the shares issuable upon exercise of the Warrant. The Investor has demand registration rights covering all shares of common stock underlying the Note. Upon written demand, the Company must file a resale registration statement within 45 calendar days, use commercially reasonable efforts to cause it to become effective promptly, and address any Rule 415 limitations through pro-rata reductions and successive filings as necessary. In addition, the Company shall, at its sole cost and expense, file with the SEC on or before the date that is 90 calendar days after the closing date file a registration statement on Form S-1 registering the resale of all of the shares of common stock issuable upon exercise of the Warrant (the “Warrant Registration Statement”). The Company shall use its commercially reasonable efforts to cause the Warrant Registration Statement to be declared effective as soon as practicable after the filing thereof. The registration statement was filed on April 16, 2026.
33
Total debt issuance cost of $
Adrian Note
As stated in Note 10, on January 5, 2026, the Company issued a $10 million
promissory note pursuant to the Adrian Asset Purchase Agreement (the “Adrian Note”). The loan accrues interest at a rate of
12% per annum with a 1% reduction in the interest rate for every $
For the three and nine months ended June 30, 2026 and 2025, interest expense
of $
Dream Note
As stated in Note 10, on April 10, 2026, the Company issued a $6 million
promissory note pursuant to the Asset Purchase Agreement with Dream America Marketing Services, Ltda (the “Dream Note”). The
loan accrues interest at a rate of 12% per annum with a 1% reduction in the interest rate for every $1,000,000 of payment. The loan matures
on April 10, 2027. For the three and nine months ended June 30, 2026 and 2025, interest expense of $
Note 15 — Loan Payable
34
35
The following table summarizes loan balances at June 30, 2026 and September 30, 2025.
| Loan | June 30, 2026 | September 30, 2026 | ||||||
| May 2023 | $ | $ | ||||||
| November 2023 | ||||||||
| January 2025 | ||||||||
| May 2026 | ||||||||
| March 2026 | ||||||||
| February 2026 | ||||||||
| Short term portion | ||||||||
| Long term portion | ||||||||
| $ | $ | |||||||
Note 16 — Warrants
As stated in Note 14, concurrently with the issuance of the YA II PN Note, the Company issued to the Investor the Warrant to purchase shares of Common Stock at an exercise price of $9.00 per share, exercisable for a term of five years from issuance. The Company accounted for the Warrant in accordance with the guidance contained in ASC 815 whereby under that provision these warrants met the criteria for equity treatment. As such, these warrants are recorded at fair value at issuance date.
The Company utilized a Monte Carlo Simulation model to estimate the fair values of the February 26, 2026 of the Warrants, which incorporated significant inputs that were not observable in the market, and thus represents a Level 3 measurement as defined in ASC 820. The unobservable inputs utilized for measuring the fair value of the contingent consideration reflect management’s own assumptions about the assumptions that market participants would use in valuing the contingent consideration. The Company determined the fair value by using the below key inputs to the Monte Carlo Simulation Model.
| February 26, 2026 | ||||
| Stock Price | $ | |||
| Exercise Price | $ | |||
| Volatility | % | |||
| Risk free rate of return | % | |||
| Term to maturity (years) | ||||
| Term to financing (years) | ||||
The fair value of the Warrants on February 26, 2026 of $
Note 17 — Related Party Transactions
Due to Related Parties
Prior to the consummation of the Reverse Acquisition, Bannix entered into
various transactions with related parties to fund working capital needs. A total of $
36
| June 30, 2026 | September 30, 2025 | |||||||
| Suresh Yezhuvath | $ | $ | ||||||
| Instant Fame and affiliated parties (1) | ||||||||
| Stanley Hills (3)(4) | ||||||||
| Accrued executive compensation (2) | ||||||||
| Anat Attia | ||||||||
| IGOR (5) | ||||||||
| $ | $ | |||||||
(1) Instant Fame and affiliated parties
Represents unsecured promissory note issued by Bannix on December 13, 2022
in favor of Instant Fame, in the principal amount of $
(2) Accrued executive compensation
(3) Transfer of balances
(4) VisionWave Technologies related party transactions
Stanley Hills, LLC, a corporation wholly owned by Anat Attia, paid the entire company expenses for VisionWave Technologies Inc., as well as funded the Company’s bank and brokerage accounts, on behalf of the Company. On April 8, 2025, with an effective date of March 31, 2025 and as amended on July 28, 2026, the Company entered into a Funding Support Agreement with Stanley Hills, LLC (“Stanley Hills”), the principal shareholder of VisionWave Technologies. Pursuant to the agreement, Stanley Hills irrevocably and unconditionally committed to provide financial support to the Company, sufficient to fund the working capital needs through August 28, 2027. The funding may be provided by Stanley Hills in the form of direct payments to third parties, advances or intercompany loans, or capital contributions, as mutually determined by the parties. Unless otherwise agreed in writing, any such advances will be non-interest bearing and repayable only at such time as determined by the Board of Directors, and only to the extent such repayment would not impair the Company’s liquidity or ability to continue as a going concern. The agreement may not be terminated by Stanley Hills prior to the twelve-month period from the date of release of the financial statement.
On January 19, 2026, the Company and Yorkville Advisors amended the SEPA
to provide that the prepaid advance would no longer constitute an advance under the SEPA but instead be evidenced by stand-alone promissory
notes. During the three and nine months ended June 30, 2026, Stanley Hills provided funding of $
37
During the nine months ended June 30, 2026, a total of $
(5) IGOR
During the three and nine months ended June 30, 2026,
an affiliate of Stanley Hills, paid $
Due from related party
During the year ended September 30, 2025, the Company advanced against
compensation $
Note 18 — Convertible Notes Payable
Securities Purchase Agreements
On July 15, 2025, the Company entered into Securities Purchase Agreements
(the “July 2025 SPAs”) with two unaffiliated accredited investors (“July 2025 Lenders”), pursuant to which the
Company issued promissory notes (the “July 2025 Notes”) to the July 2025 Lenders in the aggregate principal amount of $
During the three and nine months ended June 30, 2026, the Company repaid
$
38
On October 6, 2025, the Company entered into a Securities Purchase Agreement
(the “October 2025 SPA”) with an unaffiliated accredited investor, pursuant to which the Company issued a promissory note
(the “October 2025 Note”) to the investor in the aggregate principal amount of $
During the three and nine months ended June 30, 2026, the Company repaid
$
On November 12, 2025, the Company entered into a Securities Purchase Agreement
(the “November 2025 SPA”) with an unaffiliated accredited investor, pursuant to which the Company issued a promissory note
(the “November 2025 Note”) to the November 2025 investor in the aggregate principal amount of $
During the three and nine months ended June 30, 2026, the Company repaid
$247,940 on the November 2025 Notes. For the three months ended June 30, 2026 and 2025, total amortized debt issuance cost of $
39
Standby Equity Purchase Agreement - Pre-Paid Advance
In connection with the SEPA (See Note 20), and subject to the condition
set forth therein, the Investor advanced to the Company in the form of convertible promissory notes (the “Convertible Notes”)
an aggregate principal amount of $5.0 million (the “Pre-Paid Advance”). The first Pre-Paid Advance was disbursed on July 25,
2025 with respect to $
The Convertible Notes is a legal debt obligation with a variable-share
conversion feature and the Company elected to account for the Convertible Notes at fair value under ASC 825. The Note remains a liability
after issuance and the instrument is remeasured after initial recognition, with changes in fair value recorded in earnings each reporting
period until settlement, modification, or extinguishment and consistent with the liability-classified model. As of June 30, 2026 and September
30, 2025, the par value of the notes was $
40
January 2026 Notes
On January 9, 2026, the Company issued promissory notes (the “January
2026 Notes”) to two investors in the aggregate principal amount of $
The Company evaluated the embedded conversion features and other terms of the January 2026 Notes under applicable accounting guidance, including ASC 815, Derivatives and Hedging. The conversion feature is exercisable solely upon an event of default and accordingly, the Company concluded that bifurcation of the embedded conversion feature was not required as of issuance. The January 2026 Notes were therefore initially recorded at their principal amount, net of unamortized original issue discount and debt issuance costs. As the notes were not elected under the fair value option of ASC 825, the Company accounts for the January 2026 Notes at amortized cost and no recurring fair value measurement is required.
For the nine months ended June 30, 2026 and 2025, total amortized debt
issuance cost of $
The following table presents changes of the convertible notes with significant unobservable inputs (Level 3) for the three and nine months ended June 30, 2026.
| Convertible Notes | ||||
| Convertible Notes balance at September 30, 2025 | $ | |||
| Change in fair value | ||||
| Convertible Notes balance at December 31, 2025 | ||||
| Change in fair value | ( |
) | ||
| Convertible Notes balance at March 31, 2026 | ||||
| Change in fair value | ||||
| Convertible Notes balance at June 30, 2026 | $ | |||
The Convertible notes were valued using unobservable inputs that are not corroborated by market data (Level 3). The valuation is based on Monte Carlo Simulation to simulate weekly stock prices through maturity. The enterprise value is then allocated to each class of outstanding shares and convertible notes based on an option pricing model where the value for each class is driven by the current value and expected volatility of the underlying equity value.
41
The key assumptions used to value the convertible notes as of June 30, 2026 and September 30, 2025:
| June 30, 2026 | September 30, 2025 | |||||||
| Stock Price | $ | $ | ||||||
| Equity Volatility | % | % | ||||||
| Discount Rate | % | % | ||||||
| Risk free rate of return | - % | % | ||||||
| Term to maturity (years) | - | |||||||
The following table presents balance of the convertible notes with significant unobservable inputs (Level 3) as of June 30, 2026 and September 30, 2025:
| June 30, 2026 | September 30, 2025 | |||||||
| Convertible notes (at fair value) | $ | $ | ||||||
| July Notes (at amortized cost) | ||||||||
| October Note (at amortized cost) | ||||||||
| November Note (at amortized cost) | ||||||||
| January 2026 Note (at amortized cost)) | ||||||||
| Balance, Convertible notes payable | $ | $ | ||||||
Note 19 — Underwriter’s Agreement
Upon completion of the initial public offering of Bannix IPO, the underwriters
are entitled to a deferred underwriting discount of $
On June 9, 2025, Bannix entered into an amendment to the underwriting agreement. Pursuant to the amendment, payments of the Business Combination marketing fee will be modified as follows:
| ● | $ |
| ● | $ |
At the close of the Reverse Acquisition, the Company assumed $
42
In addition, Bannix issued the underwriter (and/or its designees) (the
“Representative”) shares of Common Stock for $0.01 per share (the “Representative Shares”) upon the consummation
of the Bannix IPO. A balance of $
Note 20 — Commitment and Contingencies
Standby Equity Purchase Agreement
On July 25, 2025, the Company entered into the Standby Equity Purchase Agreement (“SEPA”) with YA II PN, LTD, a Cayman Islands exempt limited partnership (the “Investor”) pursuant to which the Company has the right to sell to the Investor up to $50 million of its shares of common stock, subject to certain limitations and conditions set forth in the SEPA, from time to time during the term of the SEPA.
In connection with the SEPA, and subject to the condition set forth therein, Investor advanced to the Company in the form of convertible promissory notes (the “Convertible Notes”) an aggregate principal amount of $5 million (the “Pre-Paid Advance”) (See Note 18).
The Investor, in its sole discretion and providing that there is a balance remaining outstanding under the Convertible Notes, may deliver a notice under the SEPA requiring the issuance and sale of shares of common stock to the Investor at the Conversion Price in consideration of an offset of the Convertible Notes (“Investor Advance”). The Investor, in its sole discretion, may select the amount of any Pre-Paid Advance, provided, that the number of shares issued does not cause the Investor to exceed the 4.99% ownership limitations does not exceed the Exchange Cap or the number of shares of common stock that are registered. As a result of a Pre-Paid Advance, the amounts payable under the Convertible Notes will be offset by such amount subject to each Investor Advance. The Company will control the timing and amount of any sales of shares of common stock to the Investor, except with respect to the Pre-Paid Advances.
The SEPA will automatically terminate on the earliest to occur of (i) the
24-month anniversary of the date of the SEPA or (ii) the date on which the Investor shall have made payment of Advances pursuant to the
SEPA for shares of common stock equal to $
As consideration for the Investor’s
commitment to purchase the shares of common stock pursuant the SEPA, the Company paid the Investor, (i) a structuring fee in the
amount of $
43
The SEPA fails the fixed-for-fixed equity classification test due to the Exchange Cap requiring shareholder approval, which constitutes a variable settlement contingency outside the issuer’s control. Therefore, equity classification under ASC 815-40 is precluded, and the SEPA must be accounted for as a liability (or derivative liability, as applicable). While the SEPA has an underlying (the issuer’s stock price) and a notional amount (the $50 million commitment), it does not meet the third characteristic of a derivative because it requires more than a nominal initial net investment (e.g., the $5 million Pre-Paid Advance in two tranches and related fees). Therefore, the SEPA does not meet the definition of a derivative under ASC 815-10-15-83. Accordingly, the SEPA should be recorded as nonderivative liability requiring ongoing fair value remeasurement. As of June 30, 2026 and September 30, 2025, based on management assumptions the SEPA liability was zero.
Amendment to SEPA
On January 19, 2026, the Company entered into an amendment to the Standby Equity Purchase Agreement, dated as of July 25, 2025 (the “SEPA Amendment No. 1”), by and between the Company and YA II PN, Ltd. (the “Investor”).
The Amendment amends the SEPA to, among other things:
(i) remove the Investor’s ability to deliver Investor Notices, which previously allowed the Investor to require the Company to issue and sell shares of Common Stock to the Investor in offset of amounts outstanding under the Promissory Notes;
(ii) modify the conditions under which an amortization event may occur, providing that no amortization event shall be deemed to have occurred due to a Registration Event ( prior to July 15, 2026 (the “Rule 144 Date”), and after the Rule 144 date, no such amortization event shall occur so long as the Company remains current on its filings with the Securities and Exchange Commission (the “SEC”) and the Investor is able to rely on Rule 144 under the Securities Act of 1933, as amended, to resell shares of Common Stock issuable under the Promissory Notes;
(iii) cancel the Investor’s obligation to fund an additional $
During the three and nine months ended June 30, 2026, the Company issued
shares under the SEPA for total proceeds of $
Contingent Commission Payable
On May 22, 2025, VisionWave Technologies executed an Addendum to an existing
agreement, pursuant to which Raptor LLC was appointed as exclusive sales agent for TFLM shares (See Note 22) and Raptor LLC will
be entitled to a fixed fee of $
44
Litigation
From time to time, the Company may be subject to routine litigation, claims or disputes in the ordinary course of business. The Company defends itself vigorously in all such matters but cannot predict the outcome or effect of any potential litigation, claims or disputes.
Maxim Group LLC
On April 17, 2026, Maxim Group LLC filed a complaint against VisionWave Holdings, Inc. in the Supreme Court of the State of New York, County of New York, alleging breach of contract and seeking damages related to certain financing transactions completed by the Company in July 2025 and February 2026 pursuant to an engagement agreement dated April 9, 2025. Maxim alleges entitlement to placement fees and declaratory relief in connection with financings involving YA II PN, Ltd., a fund managed by Yorkville Advisors Global, LP. The action includes claims for alleged unpaid fees of approximately $1.33 million, declaratory relief concerning alleged tail rights and rights of first refusal, attorneys’ fees, interest, and other relief. The action was filed under an unassigned New York County index number as of the filing date. The Company believes the asserted claims are without merit and intends to defend the matter vigorously.
Also on April 17, 2026, the Company filed a separate action against Maxim
Group LLC in the Supreme Court of the State of New York, County of New York, asserting claims for breach of contract, declaratory judgment,
and unjust enrichment. The Company alleges, among other things, that Maxim did not identify or place relevant financing transactions,
was not entitled to compensation under the parties’ agreement, and wrongfully invoiced the Company for fees related to the July
2025 and February 2026 financings. The Company seeks, among other relief, repayment of approximately $
Pre-litigation disputes with former employees
The Company is involved in certain pre-litigation disputes with former employees, former executives, and other individuals associated with the Company arising primarily from organizational changes implemented following the departure of the Company’s former Chief Executive Officer in late December 2025. Such matters include allegations relating to severance, unpaid compensation, notice-period pay, equity awards, and related contractual and employment matters. Certain individuals have asserted claims through counsel, and the parties have engaged in correspondence and preliminary settlement discussions.
The Company disputes the allegations and claims asserted in these matters and intends to vigorously defend its positions. As of the date of this Quarterly Report, no formal lawsuits, arbitrations, or other legal proceedings have been filed with respect to these matters. Due to the early stage of these disputes, the absence of formal proceedings, and the inherent uncertainty surrounding such matters, the Company is unable to reasonably estimate the possible loss or range of loss, if any, that may result from these matters. Accordingly, no liability has been accrued in the accompanying condensed consolidated financial statements.
Except as described above, the Company is not a party to any other pending legal proceedings that management believes, individually or in the aggregate, would have a material adverse effect on the Company’s business, financial condition, or results of operations.
45
AI Infrastructure Agreement
On October 5, 2025, the Company entered into an Order Form (the “PVML Agreement”) with PVML Ltd., a Tel Aviv–based provider of secure data-AI infrastructure. The Agreement establishes a strategic collaboration to integrate PVML’s secure, real-time data-AI infrastructure with the Company’s radar and AI-driven computer-vision technologies to enable secure, autonomous mission-data systems for defense and homeland-security applications.
The terms of the PVML Agreement include:
| ● | The initial term is twelve (12) months, automatically renewable for successive one-year periods unless either party gives 60-days’ prior notice of non-renewal. |
| ● | The Company will pay total consideration of $ |
| ● | The PVML Agreement provides for a yearly platform fee covering 2.4 million PVML Units (“PUs”) of data-processing capacity, with usage fees for consumption beyond that level. |
| ● | Each party retains ownership of its respective intellectual property, and the Company will own all outputs and derivatives generated through its use of the PVML platform. |
The Company paid $
Letter of Engagement with the National Oil Company of Liberia
On March 18, 2026, the Company entered into a Letter of Engagement (the “LOE”) with the National Oil Company of Liberia (“NOCAL”). The LOE relates to offshore petroleum Blocks LB-4 and LB-5 located in the Liberia Basin and establishes a framework for the Company to advance toward the execution of a Production Sharing Contract (“PSC”) with the Government of Liberia. The execution of a PSC is subject to pre-qualification by the Liberia Petroleum Regulatory Authority, regulatory approvals, and legislative ratification.
Under the LOE, the Company has been granted exclusive, non-transferable rights to pursue the Blocks for an eight-month period from the date of execution, during which NOCAL is prohibited from negotiating or granting rights in the Blocks to third parties. While the LOE does not constitute a final award of petroleum rights, it contains binding provisions including confidentiality, exclusivity, and specified financial obligations.
In connection with the LOE, the Company is subject to the following near-term and contingent financial obligations:
| ● | Initial Signing Bonus: The Company is required to pay a binding initial signing bonus of $300,000 per block (totaling $600,000) within 60 days of the execution of the LOE. This amount is fully refundable without interest if the Blocks are not awarded to the Company for reasons not attributable to its own actions |
| ● | Data Licensing (Contingent): Following the execution of a PSC, the Company would be required to license seismic data for a minimum of $1,000,000 per block within 120 days |
| ● | PSC Signature Bonus (Contingent): Upon execution and legislative ratification of a PSC, the Company would be obligated to pay a signature bonus of $1,000,000 per block within 90 days |
The contemplated PSC would include a multi-phase exploration program spanning approximately seven years. It also contemplates certain carried and participating interests, including a 10% carried interest to NOCAL, a 10% carried interest to the Government of Liberia, a 5% carried interest to citizens, and up to 5% participation by a local Liberian company.
46
During the nine months ended June 30, 2026, the Company paid the initial
sign on bonus of $
Bitcoin mining acceleration and orchestration platform
On February 17, 2026, the Company entered into a Statement of Work (the
“SOW”) with a third-party vendor for the development, validation, and deployment of a custom qSpeed-Mine™ Bitcoin mining
acceleration and orchestration platform. The SOW has a total contract value of $
Scope and Structure
The SOW provides for the design, validation, and deployment of a production-grade software acceleration layer, fleet orchestration/control plane, observability tools, security hardening, and deployment engineering optimized for Bitcoin (SHA-256d) mining across up to approximately 1,000 nodes/machines. The engagement is structured with objective technical milestones and acceptance criteria, and payments are contingent upon successful delivery and acceptance of each milestone. The expected program duration is approximately 32 weeks.
Payment Milestones
The SOW provides for the following milestone-based payment structure:
●$350,000 was paid upon execution of the SOW;
●Approximately $1 million is payable through completion and acceptance of the proof-of-concept (“POC”) milestone;
●Approximately $6 million is payable upon completion and acceptance of successive intermediate milestones, including scaled deployment and operational validation; and
●Approximately $3 million is payable upon final delivery and full program acceptance.
If milestone execution proceeds as planned, the SOW is structured to generate not less than the full $10 million in revenue during calendar year 2026, subject to milestone completion and acceptance of which there is no guarantee. Revenue is expected to be recognized in accordance with applicable accounting standards based on milestone achievement and acceptance.
Additional Terms
All deliverables under the SOW are owned by the Company, reinforcing the Company’s proprietary rights in the QuantumSpeed™ platform. The SOW does not obligate the counterparty to continue beyond accepted milestones and does not include minimum purchase or volume commitments beyond the defined milestone structure.
The Company does not intend to pursue this transaction and no formal cancellation has been made to date.
47
C.M. Composite Materials Ltd Investment and Share Purchase Agreement
On February 20, 2026 (the “Effective Date”), the Company entered into two related definitive agreements in connection with a strategic investment and acquisition transaction involving C.M. Composite Materials Ltd., an Israeli corporation with registration number 513931289 (the “Target Company”): (i) an Investment and Share Purchase Agreement (the “Share Purchase Agreement”), dated as of February 20, 2026, by and among the Company (as Buyer), Matania (Mati) Moskovich (as Seller), and the Target Company (solely for purposes of acknowledgment and certain covenants); and (ii) a Loan Agreement (the “Loan Agreement”), dated as of February 20, 2026, by and between the Company (as Lender) and the Target Company (as Borrower).
Pursuant to the Share Purchase Agreement, the Company agreed to acquire from the Seller 10.2 ordinary shares of the Target Company (the “Purchased Shares”), representing 51% of the issued and outstanding ordinary shares of the Target Company (which has 20 outstanding ordinary shares out of authorized ordinary shares, par value 0.1 NIS per share). In consideration therefore, the Company agreed to issue to the Seller 250,000 shares of the Company’s common stock, $0.01 par value per share (the “Buyer Shares”), valued at $ based on the parties’ agreement.
The transaction is structured as a private placement exempt from registration
under Section 4(a)(2) of the Securities Act of 1933, as amended (the “Securities Act”), and/or Rule 506 of Regulation D promulgated
thereunder. The Seller was granted certain registration rights with respect to the Buyer Shares. The Company has also agreed to provide
loans to the Target Company as additional consideration under the Share Purchase Agreement. The Loan Agreement provides for a secured
loan facility in an aggregate principal amount of up to $
The advances were made pursuant to a promissory note with a 24-month maturity, bearing no interest unless an event of default occurs (then at 5% per annum or the lower legal maximum), prepayable without penalty, and not contingent on any acquisition or strategic transaction.
Any loan pursuant to the Loan Agreement will bear simple interest at 12% per annum (or such lower rate as mutually agreed in writing, but not exceeding prevailing market rates for similar loans as determined in good faith by the Company), calculated on a 360-day year basis for actual days elapsed. The loan will mature three (3) years after the Effective Date. The obligations under the Loan Agreement are secured by a first-priority security interest in substantially all assets of the Target Company (including accounts, inventory, equipment, general intangibles, intellectual property, and proceeds thereof). The Loan Agreement is evidenced by a promissory note.
On February 26, 2026, the Company entered into the First Amendment (the “Amendment”) to the Investment and Share Purchase Agreement, dated as of February 20, 2026 (the “SPA”), by and among the Company (“Buyer”), Matania (Mati) Moskovich (the “Seller”), and, solely for purposes of acknowledgment and certain covenants therein, C.M. Composite Materials Ltd., an Israeli limited liability company (the “CM Company”). Capitalized terms used but not defined herein shall have the meanings ascribed to them in the SPA. The Amendment adds a new recital to the SPA emphasizing that the sole purpose of the Company entering into the SPA is to facilitate and enable the establishment of a joint venture in India between the CM Company (and/or FBM) and Belrise Industries Limited (or its affiliate) as contemplated by that certain Memorandum of Understanding dated February 16, 2026 (the “Belrise MOU”), and that the execution and performance of definitive agreements with Belrise Industries Limited (the “Belrise JV Agreements”) is a critical and indispensable component of the overall transaction.
48
The Amendment provides that the Company’s obligation to consummate the purchase of the Purchased Shares and the other transactions contemplated by the SPA is expressly conditioned upon the satisfaction (or waiver by the Company in its sole and absolute discretion) of the following condition precedent (the “Belrise Condition”): (a) the CM Company and FBM Composite Materials Ltd. shall have duly executed and delivered the Belrise JV Agreements substantially in the form and on the terms contemplated by the Belrise MOU; and (b) the Belrise JV Agreements shall be in full force and effect and shall not have been terminated, amended, or modified in any respect materially adverse to the CM Company or the Company without the prior written consent of the Company.
The Seller acknowledges that the Belrise Condition is material, and failure to satisfy it entitles the Company to terminate the SPA without liability. The Amendment amends and restates Section 2.3 of the SPA to provide that the Closing shall take place remotely no later than June 30, 2026 (or such later date as mutually agreed), provided that in no event shall the Closing occur unless and until the Belrise Condition has been satisfied (or waived by the Company). The Amendment also permits termination by the Company if the Belrise Condition has not been satisfied (or waived by the Company) on or before March 31, 2026 (the “Belrise Long-Stop Date”), provided that the Company may not terminate if it is then in material breach of its obligations under the SPA. Except as expressly amended by the Amendment, the SPA remains in full force and effect.
At June 30, 2026, the transaction had not been consummated.
Acquisition of VisionWave IL, Ltd.
On March 18, 2026, the Company acquired 100% of the issued and outstanding shares of VisionWave IL Ltd., an Israeli private shell limited company (“VisionWave Israel”), for nominal consideration.
Further, on March 18, 2026, VisionWave Israel appointed Khdoura Sabbagh
as Chief Executive Officer and its sole director and entered into an Employment Agreement with Mr. Sabbagh, pursuant to which Mr. Sabbagh
was appointed Chief Executive Officer of VisionWave Israel. Under the Employment Agreement, Mr. Sabbagh will receive an annual base salary
of $
On March 18, 2026, VisionWave Israel also entered into a Consulting Agreement with CO-Finance Financial and Accounting Consulting Ltd., a company controlled by Oren Attiya, pursuant to which Mr. Attiya will provide financial and accounting services to VisionWave Israel. Under the Consulting Agreement, the consultant will receive monthly compensation of NIS 12,000 plus VAT. The agreement is structured as an independent contractor arrangement and includes customary terms and conditions.
At June 30, 2026, the options were not granted under the employment agreement.
Advance to supplier and customer deposit
In January 2025, the Company entered into a product purchase agreement and paid $98,250 advance payment to the vendor. The product was delivered and tested by the vendor on March 13, 2025 was shipped to the client. The client, pursuant to the December 2024 product purchase agreement requested a 50% deposit totaling $108,006 in 2025. The client received the product and live fire tests were performed on September 15, 2025.
49
During the nine months ended June 30, 2026, the client and the Company mutually agreed to terminate the contract. The Company will repay the deposit to the client and the company is expected to receive a refund from the vendor. The deposit was refunded in July 2026. At June 30, 2026 and September 30, 2025, the advance to the vendor is recorded as advances to suppliers on the accompanying unaudited condensed consolidated balance sheets. At June 30, 2026 and September 30, 2025, the deposit of $108,006 is recorded as customer deposit on the accompanying unaudited condensed consolidated balance sheets.
Ian Share Purchase Agreement
On May 12, 2026, VisionWave Israel Ltd. (“VW Israel”), a wholly owned subsidiary of the Company, entered into a definitive Share Purchase and Shareholders Agreement (the “Agreement”) with Mr. Ian Paklida (the “Seller”), pursuant to which VW Israel agreed to acquire 60% of the issued and outstanding equity interests of VIP Lux Travel Ltd. and PKLST Tourism and Leisure Ltd., both Israeli corporations (collectively, the “Target Companies”).
The Agreement is definitive; however, the transaction has not yet closed.
Under the terms of the Agreement, the consideration for the acquisition of the Target Companies will be the issuance of shares of common stock of the Company, subject to the satisfaction of various conditions precedent and regulatory approvals.
The Agreement contemplates an aggregate transaction value of up to approximately 15 million NIS, payable in the Company shares valued at approximately USD $3 million. The number of shares to be issued will be shares of common stock of the Company representing $6.02 cost per share.
The Agreement includes customary representations, warranties, covenants, indemnification provisions, confidentiality obligations, lock-up restrictions, and closing conditions. Closing remains subject to, among other things:
| ● | completion of legal, financial, and operational due diligence; |
| ● | receipt of all required corporate and regulatory approvals; |
| ● | applicable tax rulings and/or approvals in Israel; |
| ● | execution and delivery of final ancillary closing documents; and |
| ● | satisfaction or waiver of other customary closing conditions. |
Until the closing occurs, there can be no assurance that the acquisition will be consummated on the terms currently contemplated, or at all.
The Company intends to evaluate strategic opportunities relating to the Target Companies’ operations and potential integration into VisionWave’s broader international business activities.
During the three months ended June 30, 2026, the Company advanced million NIS (approximately $167,000) to the Target Companies. On July 31, 2026 VIP Lux Travel Ltd filed for bankruptcy. VisionWave Israel filed its objection to the procedure on August 6, 2026 and claimed fraud by VIP Lux Travel Ltd and its manager including using a forged document.
Latin American Government Purchase Order
On April 2, 2026, the Company announced the receipt of a signed purchase order from a Latin American governmental public safety organization. The order provides for the supply of drone-based operational systems and integrated payload technologies, including long-range observation quadrotor platforms, day/night EO/IR imaging payloads, and network-based connectivity modules. The systems are intended to support defense, public safety, and law enforcement missions.
50
The purchase order contemplates a multi-phase deployment structure, with initial deliveries expected to commence in 2026. The completion of the order and subsequent deployment phases are subject to standard commercial terms and customary conditions, including delivery milestones, quantity confirmations, performance, and acceptance. The Company has noted that there can be no assurance that the full scope of the purchase order will be completed or that all anticipated revenues from the order will be realized.
At June 30, 2026, no delivery was made under this purchase order, waiting on end user letter from the client.
Lucky Whale Production Limited
On June 12, 2026, the Company entered into a term sheet (the “Term Sheet”) with Lucky Whale Production Limited, a Hong Kong-incorporated project sponsor (the “Sponsor”), setting out the principal proposed terms for the establishment of a joint venture to develop, hold and operate a proposed Tier IV data center project located in Beth Shemesh, Israel (the “Project”).
Under the proposed structure described in the Term Sheet, the Company and the Sponsor would form a jointly held company (the “Joint Company”), which would be owned 68% by the Company and 32% by the Sponsor. The Joint Company would in turn hold 75% of a special purpose project company that would hold the land, building permit and related rights for the Project, with the remaining 25% retained by the current land owner. As a result of this ownership chain, the Company’s effective indirect interest in the Project would be approximately 51%. The precise structure, including the manner of transfer of rights and applicable tax matters, would be determined in the definitive agreements.
As consideration for the acquisition of the Project rights, the Term Sheet contemplates that the Company would issue shares of its common stock with an aggregate value of approximately US$40 million to the land owner, on an all-share basis with no cash component. The number of shares would be determined by reference to a volume-weighted average price of the Company’s common stock over an agreed period near closing. Any such issuance would be subject to all required approvals, including, to the extent required under the rules of The Nasdaq Stock Market, approval by the Company’s stockholders, and the shares would be subject to lock-up and orderly resale arrangements and customary registration rights. The issuance of the consideration shares, together with the Company’s other recent and pending equity issuances, would be dilutive to existing stockholders.
The Term Sheet further contemplates that the Company would commit, in the definitive agreements, to arrange the financing required to construct and establish the Project. The Project would require substantial additional capital, which the Company expects would be sourced through capital-markets activities and/or project-finance facilities. There can be no assurance that such financing would be available to the Company on acceptable terms, or at all.
The Term Sheet also addresses other proposed terms customary for a transaction of this type, including management and governance arrangements (under which the Sponsor would manage the Project and appoint its chief executive officer, subject to reserved matters requiring the Company’s consent and a deadlock-resolution mechanism), a put option in favor of the land owner exercisable for a limited period following completion of construction, mutual exclusivity, and confidentiality. The completion of the proposed transaction would be subject to conditions precedent, including the completion of due diligence, the execution of definitive agreements, the receipt of required corporate, stockholder, SEC and Nasdaq approvals, the receipt of a fairness opinion if required, and the receipt of applicable regulatory, licensing and third-party consents.
On July 24, 2026, the Company determined that continuing to pursue the proposed transaction would not be in the best interests of the Company or its shareholders. Accordingly, the Company has notified Lucky Whale Production Limited that it has elected not to proceed with the transaction contemplated by the previously announced term sheet and does not intend to negotiate or execute definitive agreements relating to the proposed project.
51
Meteor Aerospace Ltd
On June 29, 2026, the Company entered into a binding Acquisition Agreement (the “Meteor Agreement”) with Meteor Aerospace Ltd. (“Meteor”), an Israeli aerospace and defense company pursuant to which the Company agreed to acquire fifty-one percent (51%) of the issued and outstanding share capital of Meteor, subject to the satisfaction of specified closing conditions.
Meteor is engaged in the development, manufacturing and commercialization of aerospace and defense technologies, including unmanned aerial systems, unmanned ground systems, unmanned surface vessels, loitering munition systems, electronic warfare technologies, command, control, communications, cyber and battlefield management systems, and related intellectual property.
The Agreement values Meteor at a pre-money equity valuation of $40 million.
Subject to the satisfaction of all closing conditions, VisionWave will
acquire 51% of the issued and outstanding equity interests of Meteor for aggregate consideration having a value of approximately $
● approximately $ million of unrestricted shares of VisionWave common stock; and
● approximately $ million of restricted shares of VisionWave common stock, subject to a contractual lock-up period of six months following closing.
The number of shares to be issued will be determined based upon the volume weighted average price (“VWAP”) of VisionWave common stock during the five trading days immediately preceding the closing date.
The closing of the transaction is expressly conditioned upon, among other things:
● successful completion of a live flight validation of Meteor’s Impact-700 unmanned aerial system;
● VisionWave’s satisfactory completion of legal, financial, operational, technical, aerospace, cybersecurity, export control, intellectual property and commercial due diligence;
● satisfaction or waiver of other customary closing conditions.
The Agreement provides that the flight validation is intended to verify the operational integrity, engineering functionality and basic flight capability of the Meteor Impact-700 platform and is not intended to demonstrate maximum performance specifications, commercial readiness or full operational capabilities.
Upon closing, VisionWave will obtain a controlling interest in Meteor and will have the right to appoint three of the five directors serving on Meteor’s Board of Directors, designate the Chairman of the Board and approve major corporate actions. All directors are required to be Israeli citizens.
The Agreement further provides for:
● a thirty-day exclusivity period during which Meteor and its shareholders may not solicit or negotiate alternative acquisition or financing transactions, subject to limited exceptions;
● customary confidentiality obligations;
52
● representations and warranties regarding ownership, intellectual property, regulatory compliance and accuracy of information;
● binding arbitration in Israel for dispute resolution; and
● the continued involvement of Meteor founder Itzhak Nissan, former President and Chief Executive Officer of Israel Aerospace Industries Ltd., who is expected to enter into an executive employment and/or consulting agreement at closing and serve as Chief Technology Director of Meteor for a minimum period of three years following closing.
The Agreement contemplates that the acquisition will include Meteor’s existing and future products, technologies, software, intellectual property, research and development activities, engineering developments, manufacturing capabilities and related business assets, including, among others:
● Impact-700 tactical unmanned aerial vehicle;
● Impact-1400 strategic MALE unmanned aerial vehicle;
● Rambow unmanned ground vehicle;
● Orca unmanned surface vessel;
● MERLOW loitering munition system;
● electronic warfare and SIGINT technologies;
● command, control, communications, cyber and battlefield management systems; and
● related aerospace and defense technologies.
The Company expects to utilize the acquired technologies to expand its autonomous systems, defense technologies and integrated security solutions portfolio.
At June 30, 2026, the transaction was not closed. In July 2026, the company announced that it will no longer pursue this transaction.
Foresight Autonomous Holdings Ltd
On June 2, 2026, the Company entered into a Securities Exchange Agreement (the “Foresight Agreement”) with Foresight Autonomous Holdings Ltd. (“Foresight”), pursuant to which the Company will acquire, in two stages, newly issued ordinary shares of Foresight representing 52% of Foresight’s issued and outstanding share capital as of the Stage 1 Closing (the “Stage 1 Closing Date”). With this proposed transaction, it is the goal of the Company to establish Foresight as the core operating platform for the Company’s RF-focused perception systems and related defense, homeland security and autonomous technology initiatives.
Summary of Key Terms
●Stage 1 Closing (expected within 45–60 days of the Effective Date): Foresight will issue to the Company newly issued ordinary shares, no par value per share (“Ordinary Shares”), representing 46% of Foresight’s issued and outstanding share capital as of the Stage 1 Closing Date (post-issuance, including 1% finder’s fee allocation). In exchange, the Company will issue to Foresight shares of the Company’s common stock, $0.01 par value per share (the “Common Stock”) with an aggregate value of $ (88.4615% of $17.5 million total), calculated based on the volume-weighted average price of the Company’s Common Stock over the five consecutive trading days immediately preceding the Stage 1 Closing Date (the “VWAV Average Price”).
53
●Stage 2 Closing (conditional upon achievement of a defined
milestone): Foresight will issue an additional 6% of its share capital, and the Company will issue additional shares of its Common Stock
valued at approximately $
●Total Consideration: $
●Board Representation: The Company will have the right to designate two directors to the Foresight Board of Directors upon Stage 1 Closing and one additional director upon Stage 2 Closing.
The Foresight Agreement contains a value protection mechanism designed
to preserve 65% of the economic value of the shares of Common Stock issued to Foresight. For a two-year period following each Closing
(the “Protection Period”), if Foresight sells all of the shares of Common Stock (and any previously issued make-whole shares)
and realizes aggregate gross proceeds below the applicable protected amount of $
The Foresight Agreement includes customary registration rights, a 24-month management preservation covenant for Foresight’s executive team, a covenant requiring Foresight to allocate no less than 50% of proceeds from sales of the Company’s Common Stock to the Perception Platform, a 36-month leak-out agreement limiting Foresight’s daily sales of the Company’s Common Stock to 5% of actual daily trading volume, and audit rights allowing the Company to inspect Foresight’s trading records to verify compliance. The Foresight Agreement also contains mutual representations, warranties, covenants, indemnification, and termination provisions customary for a transaction of this nature.
At June 30, 2026, the transaction was not closed.
Note 21 — Stockholder’s Equity (Deficit)
Preferred Stock— The Company is authorized to issue shares of preferred stock, par value $ per share, with such designations, voting and other rights and preferences as may be determined from time to time by the Company’s board of directors. As of June 30, 2026 and September 30, 2025, there were shares of preferred stock issued or outstanding.
54
Common Stock— The Company is authorized to issue shares of common stock with par value of $ each. As of June 30, 2026 and September 30, 2025, there were 27,332,069 and 14,521,094 shares of Common Stock issued and outstanding, respectively.
Warrants
As part of the Bannix IPO, Bannix issued
Bannix accounted for the
The warrants became exercisable on the later of 12 months from the closing of this offering or upon completion of its initial Business Combination and will expire five years after the completion of Reverse Acquisition, at 5:00 p.m., Eastern Time, or earlier upon redemption or liquidation.
Once the warrants become exercisable, the Company may redeem the warrants:
| ● | in whole and not in part; |
| ● | at a price of $ |
| ● | upon not less than 30 days’ prior written notice of redemption, to each warrant holder; and |
| ● | if, and only if, the reported last sale price of the Public Shares equals or exceeds $ per share (as adjusted for share subdivisions, share consolidations, share capitalizations, rights issuances, reorganizations, recapitalizations and the like) for any 20 trading days within a 30-trading day period ending on the third trading day prior to the date the Company sends the notice of redemption to the warrant holders. |
| ● | if, and only if, there is a current registration statement in effect with respect to the issuance of the shares underlying such warrants at the time of redemption and for the entire 30-day trading period referred to above and continuing each day until the date of redemption. |
At the time of the Reverse Acquisition, The Private Placement Warrants
became identical to the Public Warrants underlying the Units sold in the Bannix IPO. The Private Placement Warrants were classified as
Equity upon close of the Reverse Acquisition. During the three and nine months ended June 30, 2026, and warrants were exercised
for $0 and $6,235,945, respectively. At June 30, 2026 and September 30, 2025, there were
Conversion of public and private rights
On July 14, 2025, at the close of the Reverse Acquisition, public rights and private rights under Bannix were converted for Common shares on a ten-to-one basis.
55
The following is an analysis of the warrants grant activity:
| Number | Weighted Average Exercise Price | Weighted Average Remaining Life | |||||||||||
| Outstanding at September 30, 2025 | $ | ||||||||||||
| Granted | |||||||||||||
| Expired | — | ||||||||||||
| Exercised | ( | ) | ( | ) | ( | ) | |||||||
| Outstanding at December 31, 2025 | |||||||||||||
| Granted | |||||||||||||
| Expired | — | ||||||||||||
| Forfeited | ( | ) | ( | ) | ( | ) | |||||||
| Outstanding at March 31, 2026 | |||||||||||||
| Granted | — | ||||||||||||
| Expired | — | ||||||||||||
| Forfeited | — | ||||||||||||
| Outstanding at June 30, 2026 | $ | ||||||||||||
At June 30, 2026 and September 30, 2025, the intrinsic value of the warrants
was $
The assumptions used in Monte Carlo Simulation model related to the February
26, 2026
| February 26, 2026 | ||||
| Stock Price | $ | |||
| Exercise Price | $ | |||
| Volatility | % | |||
| Risk free rate of return | % | |||
| Term to maturity (years) | ||||
| Term to financing (years) | ||||
Stock based compensation
Omnibus Equity Incentive Plan
On August 5, 2025, the Board of Directors (the “Board”) of Bannix adopted Bannix’s 2025 Omnibus Equity Incentive Plan (the “Plan”), which authorizes the issuance of up to shares of Bannix’s common stock, par value $0.01 per share (the “Common Stock”). The Plan is subject to approval by Bannix’s shareholders within twelve (12) months of the Board’s adoption date. If shareholder approval is obtained, the Plan will become effective as of August 5, 2025. The Plan provides for the grant of various equity-based awards, including non-qualified stock options, incentive stock options, restricted stock awards, restricted stock unit awards, stock appreciation rights, performance stock awards, performance unit awards, unrestricted stock awards, distribution equivalent rights, or any combination thereof. The Plan is intended to assist Bannix in attracting, retaining, and incentivizing key management employees, directors, and consultants, and to align their interests with those of Bannix’s shareholders.
Stock Options
On August 6, 2025 and September 2, 2025, the Company entered into several
employment agreements, pursuant to which the Company granted options to employees with vesting periods of years and exercise
price of $
During the three and nine months ended June 30, 2026, 0 and 3,600,000 unvested options were forfeited which resulted in stock-based compensation reversal of $0 and $1,733,920.
56
On July 16, 2025, the Company entered into a consultant non statutory stock
option agreement with a vendor, pursuant to which the vendor was granted stock options that vested immediately at an exercise
price of $
The assumptions used in the Black-Scholes model are set forth in the table immediately below:
| January 2, 2026 - March 12, 2026 | August 6, 2025 - September 2, 2025 | |||||||
| Exercise price | $ - | $ - | ||||||
| Risk-free interest rate | - % | -% | ||||||
| Volatility | - % | - % | ||||||
| Expected life (years) | - | - | ||||||
| Dividend yield | % | % | ||||||
The following is an analysis of the stock option grant activity:
| Number | Weighted Average Exercise Price | Weighted Average Remaining Life | |||||||||||
| Outstanding at September 30, 2025 | $ | — | |||||||||||
| Granted | |||||||||||||
| Expired | — | ||||||||||||
| Exercised | — | ||||||||||||
| Outstanding at December 31, 2025 | |||||||||||||
| Granted | |||||||||||||
| Expired | — | ||||||||||||
| Forfeited | ( | ) | ( | ) | ( | ) | |||||||
| Outstanding at March 31, 2026 | |||||||||||||
| Granted | — | ||||||||||||
| Expired | — | ||||||||||||
| Forfeited | — | ||||||||||||
| Outstanding at June 30, 2026 | $ | ||||||||||||
At June 30, 2026 and September 30, 2025, the intrinsic value of outstanding options is $ and $, respectively. At June 30, 2026 and September 30, 2025, options were vested and exercisable, respectively.
The Company will recognize the remaining total stock-based compensation of $15,233,519 in future periods as follows:
| Year | Amount | ||||
| 2026 | $ | ||||
| 2027 | |||||
| 2028 | |||||
| 2029 | |||||
| 2030 | |||||
| Total | $ | ||||
57
Restricted stock units (“RSUs”)
On August 1, 2025, the Company entered into agreements with three independent
directors, pursuant to which each independent directors will be granted $ of restricted stock units annually. On January 30, 2026,
the Company issued an additional 14,961 RSUs to independent directors. The restricted stock units will vest after 1 year of service. For
the three and nine months ended June 30, 2026 and 2025, the Company recorded stock-based compensation expense related to the RSUs of $
and $, respectively, and $ and $ in the nine months ended June 30, 2026 and 2025, respectively. At June 30, 2026 and September
30, 2025, unearned compensation is $
The following table summarizes RSU issuance and related stock-based expense,
| Quarter ended | RSU issued | Value of RSUs issued | Stock based compensation | ||||||||||
| September 30, 2025 | $ | $ | |||||||||||
| December 31, 2025 | |||||||||||||
| March 31, 2026 | |||||||||||||
| June 30, 2026 | |||||||||||||
| $ | $ | ||||||||||||
Issuance of shares to former directors
2026 and 2025.
Other share issuances
As outlined in Note 14, the Company issued shares of Common stock
at a fair value of $
At the close of the Reverse Acquisition, Bannix owed a vendor shares pursuant to an agreement for the provision of services. On July 25, 2025, the Company issued the Common Shares to the vendor to satisfy the outstanding obligation.
As stated in Note 10, on December 15, 2025, the Company issued Common Shares pursuant to the asset acquisition.
On January 28, 2026, the Company issued shares to the vendor in satisfaction of the terms under the $75,000 RSUs issuable under the consulting arrangement.
58
Stock-based compensation liability
In November 2025, the Company entered into an advisory services agreement with an independent member of the board of directors. As compensation for the services of the board member, a compensation of $ monthly payable in cash and $5,000 monthly payable in shares. At June 30, 2026 and September 30, 2025, the $ and $ payable in shares was not issued to the director and is included in stock-based compensation liability on the accompanying unaudited condensed consolidated balance sheets.
On October 9, 2025, the Company entered into a consulting arrangement with a vendor, pursuant to which $ of RSUs will be issued within 5 days of the execution date and the contract then 6 months later. The Company issued 8,352 shares to the vendor during the three months ended March 31, 2026. There were no shares payable and unissued at June 30, 2026 and September 30, 2025.
As stated in Note 20, pursuant to the PVML Agreement, the payment contains
an equity component valued at $
At June 30,2026, $
Note 22 — Gain on Sale of Marketable Securities
On June 4, 2024, VW Tech invested in 10 million shares Avant Technologies,
Inc. (“AVAI”). On February 28, 2025 and March 5, 2025, VW Tech sold of AVAI shares for net proceeds of $
As a result of this non-cash exchange, the Company recognized a loss on
sale of the shares of AVAI of approximately $
Note 23 — Income Tax
The Company files income tax returns in the U.S. federal jurisdiction and
in various state and local jurisdictions and is subject to examination by the various taxing authorities, since inception. At the close
of the Reverse Acquisition, the Company assumed $
Note 24 — Segment Information
ASC Topic 280 establishes standards for companies to report financial statement information about operating segments, products, services, geographic areas, and major customers. Operating segments are defined as components of an enterprise for which separate financial information is available that is regularly evaluated by the Company’s chief operating decision maker (“CODM”), or group, in deciding how to allocate resources and assess performance.
59
The CODM has been identified as the Chief Executive Officer, who reviews the operating results for the Company as a whole to make decisions about allocating resources and assessing financial performance. Accordingly, management has determined that the Company only has one operating segment.
The CODM assesses performance for the single segment and decides how to allocate resources based on operating loss that also is reported on the consolidated statements of operations. The measure of segment assets is reported on the unaudited condensed consolidated balance sheets as total assets. When evaluating the Company’s performance and making key decisions regarding resource allocation the CODM reviews several key metrics, which include the following:
| Three Months Ended June 30, | Nine Months Ended June 30, | |||||||||||||||
| 2026 | 2025 | 2026 | 2025 | |||||||||||||
| Revenue | $ | $ | $ | $ | ||||||||||||
| Cost of goods sold | ( | ) | ( | ) | ||||||||||||
| Gross Profits | ||||||||||||||||
| Operating Expenses: | ||||||||||||||||
| General and administrative | ||||||||||||||||
| Research and development | ||||||||||||||||
| Sales and marketing | ||||||||||||||||
| Depreciation and amortization | ||||||||||||||||
| Operating loss | $ | ( | ) | $ | ( | ) | $ | ( | ) | $ | ( | ) | ||||
The key metrics included in segment profit or loss reviewed by the CODM are operating costs. The CODM reviews operating costs to manage and forecast cash to ensure enough capital is available to meet operational needs and find research and development efforts. The CODM also reviews operating costs to manage, maintain and enforce all contractual agreements to ensure costs are aligned with all agreements and budget.
Note 25 — Subsequent Events
The Company evaluated subsequent events and transactions that occurred after the balance sheet date up to the date of the filing of this report. The Company did not identify any subsequent events, other than disclosed in the Notes and discussed below, that would have required adjustment or disclosure in these unaudited condensed consolidated financial statements.
Distributor Agreement
On July 1, 2026, the Company entered into a Distributor Agreement (the “Distributor Agreement”) with Stratonex Defence Technologies Ltd., a private company organized under the laws of England and Wales (“Stratonex”).
Pursuant to the Agreement, the Company appointed Stratonex as its strategic commercialization, integration and sovereign delivery partner for the United Kingdom, Europe and other mutually agreed markets. The Agreement establishes a framework pursuant to which Stratonex will identify, develop and manage commercial opportunities for the Company’s technologies, including engagement with government, defense and institutional customers, while supporting systems integration, sovereign deployment and commercialization of the Company’s products within the applicable territories.
The Agreement includes an opportunity registration process pursuant to which Stratonex may register prospective commercial opportunities with the Company. Upon written acceptance by the Company, registered opportunities receive exclusive protection during the applicable registration period, subject to the terms and conditions of the Agreement. The Agreement does not grant Stratonex exclusive distribution rights throughout the applicable territories and expressly reserves the Company’s right to appoint additional distributors and market its products through other channels, except with respect to accepted registered opportunities.
60
The initial term of the Agreement is two (2) years and automatically renews for successive one-year periods unless earlier terminated in accordance with its terms. Either party may terminate the Agreement upon sixty (60) days’ prior written notice or earlier upon specified events of default. The Agreement also contains customary provisions relating to confidentiality, intellectual property ownership, export compliance, warranties, indemnification and limitations of liability.
The Agreement does not obligate Stratonex to purchase any minimum quantity of products, does not establish minimum revenue commitments and does not obligate the Company to accept any purchase order submitted by Stratonex. Product pricing will be established pursuant to quotations issued by the Company from time to time.
Ben Everitt, the founder and a 50% shareholder of Stratonex, also serves as a member of the Company’s Advisory Board pursuant to an Advisory Board Agreement entered into in October 2025. Mr. Everitt serves solely as an independent advisor to the Company’s Board of Directors and is not a director, executive officer or employee of the Company. Mr. Everitt is a former Member of the Parliament of the United Kingdom and has more than twenty years of experience in government, national security, defense policy and strategic advisory roles, including service on the United Kingdom Parliament’s National Security Bill Committee and participation in the Armed Forces Parliamentary Scheme.
The Company’s Board of Directors reviewed and approved the Agreement after considering the existing advisory relationship between the Company and Mr. Everitt. Mr. Everitt is not a member of the Company’s Board of Directors and did not participate in the Company’s review, negotiation or approval of the Agreement.
Securities Purchase Agreement and Convertible Debentures
On July 20, 2026, the Company entered into a Securities Purchase Agreement (the “Securities Purchase Agreement”) with YA II PN, Ltd. (the “Investor”), an investment fund managed by Yorkville Advisors Global, LP, pursuant to which the Company agreed to issue and sell to the Investor convertible debentures in the aggregate principal amount of up to $15,000,000 (the “Convertible Debentures”), at a purchase price equal to 85% of the principal amount thereof, in two tranches. The first tranche, in the principal amount of $10,000,000, closed on July 20, 2026 (the “First Closing”). The second tranche, in the principal amount of $5,000,000, will close upon the effectiveness of the initial registration statement described below under “Registration Rights Agreement.” The Company also paid the Investor a non-refundable due diligence fee of $50,000, which was netted from the proceeds of the First Closing. The Company intends to use the net proceeds of the offering for working capital and general corporate purposes.
The Convertible Debentures bear interest at a rate of 5.00% per annum (which increases to 18.00% per annum during the continuance of an event of default), calculated on the basis of a 365-day year, and mature on July 20, 2027. Beginning on December 30, 2026, and on the same day of each calendar month thereafter, the Company is required to repay the Convertible Debentures in monthly installments of $1,750,000 of principal, plus a payment premium equal to 2% of the principal amount being paid and accrued and unpaid interest. Installment amounts are payable, at the Company’s option, in cash or by offset against the proceeds of one or more advances under the Company’s Standby Equity Purchase Agreement with the Investor, dated July 25, 2025, as amended (the “SEPA”). While the Convertible Debentures are outstanding, any advances under the SEPA must use the three-day pricing option provided for therein, and payments in excess of the installment amount then due are not subject to the payment premium. The Company may redeem amounts outstanding under the Convertible Debentures prior to maturity at any time upon advance notice by paying the principal amount being redeemed, a redemption premium equal to 5% of such principal amount, and accrued and unpaid interest.
The Convertible Debentures are convertible at the option of the Investor into shares of the Company’s common stock, par value $0.01 per share (the “Common Stock”), at a fixed conversion price of $5.00 per share. Upon the occurrence and during the continuance of an event of default, the Investor may convert at the lower of such fixed price or a variable price equal to 90% of the lowest daily volume-weighted average price of the Common Stock during the ten trading days immediately preceding the conversion date, subject to a floor price of $0.702 per share. The Investor may not convert the Convertible Debentures (or exercise the Warrants described below) to the extent that, after giving effect thereto, the Investor and its affiliates would beneficially own more than 4.99% of the outstanding Common Stock. The Convertible Debentures also may not be converted, and the Warrants may not be exercised, to the extent the shares issuable would exceed the aggregate number of shares of Common Stock that the Company may issue under the applicable rules of The Nasdaq Stock Market LLC (the “Exchange Cap”), unless the Company’s stockholders approve issuances in excess of the Exchange Cap.
61
The Securities Purchase Agreement contains customary representations, warranties and covenants of the Company, including, among other things, covenants that, while the Convertible Debentures are outstanding and subject to specified exceptions, restrict the Company’s ability to enter into variable rate transactions (other than pursuant to the SEPA), incur additional indebtedness or grant liens, effect discounted offerings, and make payments on certain related-party indebtedness. Closing of the transaction was conditioned upon, among other things, the delivery of consent and deferral agreements by the holders of certain outstanding promissory notes issued by the Company.
Warrants
In connection with the Securities Purchase Agreement, the Company issued to the Investor warrants (the “Warrants”) to purchase up to 1,800,000 shares of Common Stock at an exercise price of $5.00 per share. The Warrants are exercisable upon issuance and expire 36 months after the date of issuance. The Warrants are exercisable for cash, provided that if, after the six-month anniversary of the date of the Securities Purchase Agreement, a registration statement covering the resale of the shares underlying the Warrants is not available, the Warrants may be exercised on a cashless basis.
Registration Rights Agreement
In connection with the Securities Purchase Agreement, the Company entered into a Registration Rights Agreement with the Investor (the “Registration Rights Agreement”), pursuant to which the Company agreed to file with the Securities and Exchange Commission (the “SEC”) an initial registration statement covering the resale of the shares of Common Stock issuable upon conversion of the Convertible Debentures and exercise of the Warrants, together with certain additional shares issuable under the SEPA, within 60 days, and to use commercially reasonable efforts to cause such registration statement to be declared effective within the deadlines specified therein and to maintain its effectiveness until the registrable securities have been sold or may be sold without restriction under Rule 144.
Global Guaranty Agreement
In connection with the Securities Purchase Agreement, certain subsidiaries of the Company receiving proceeds of the Convertible Debentures, consisting of VisionWave Technologies, Inc., VisionWave Holdings UK Ltd and Solar Drone Ltd., entered into a Global Guaranty Agreement in favor of the Investor (the “Guaranty”), pursuant to which such subsidiaries, jointly and severally, guaranteed the payment obligations of the Company under the Convertible Debentures and the related transaction documents.
Consent and Deferral Letter Agreements
On July 20, 2026, as a condition to the First Closing, the Company entered into side letter agreements (the “Consent and Deferral Letters”) with each of Dream America Marketing Services, Ltda. (“Dream America”), the holder of a promissory note issued by the Company on April 10, 2026 in the original principal amount of $6,000,000, and Adrian Holdings S.R.L. (“Adrian”), the holder of a promissory note issued by the Company on January 5, 2026 in the original principal amount of $10,000,000. Pursuant to the Consent and Deferral Letters, each of Dream America and Adrian has agreed, until the obligations under the Convertible Debentures have been indefeasibly paid in full, (i) not to demand, request, accept, receive or apply any cash payments from the Company in respect of its promissory note (including payments of principal, interest, fees, default interest, premiums, costs or expenses), with any such payments received to be returned to the Company or held in suspense unless otherwise consented to in writing by the Investor, and (ii) to forbear from exercising its rights and remedies upon the occurrence of any default under its promissory note. Each of Dream America and Adrian has also consented to the Company’s incurrence of the indebtedness under the Convertible Debentures and to the payments required to be made thereunder, whether made in cash or through the issuance and sale of shares of Common Stock and the use of the proceeds of such issuances and sales to repay the Convertible Debentures. Except as set forth in the Consent and Deferral Letters, the terms of such promissory notes remain in full force and effect.
62
Extension of Maturity of SEPA Promissory Notes
On July 20, 2026, the Investor, as holder of the promissory notes issued by the Company in connection with prepaid advances under the SEPA on July 25, 2025 (in the original principal amount of $3,000,000) and September 11, 2025 (in the original principal amount of $2,000,000) (collectively, the “SEPA Notes”), delivered to the Company written notice of its election, pursuant to the terms of the SEPA Notes, to extend the maturity date of the SEPA Notes to January 25, 2027 (the “Maturity Extension”), which extension the Company acknowledged and agreed.
Termination of Term Sheet with Lucky
On July 24, 2026, the Company determined that continuing to pursue the proposed transaction with Lucky Whale would not be in the best interests of the Company or its shareholders. Accordingly, the Company has notified Lucky Whale Production Limited that it has elected not to proceed with the transaction contemplated by the previously announced term sheet and does not intend to negotiate or execute definitive agreements relating to the proposed project.
C.M Composite Side Letter
On July 28, 2026, the Company entered into a side letter (the “Side Letter”) with the Seller and C.M. Composite, pursuant to which the parties agreed to extend (i) the Belrise Long-Stop Date from March 31, 2026 to December 31, 2026, effective retroactively as of March 31, 2026, and (ii) the Outside Closing Date from June 30, 2026 to December 31, 2026, effective retroactively as of June 30, 2026. Accordingly, the Company is entitled to terminate the Share Purchase Agreement, without liability, if the Belrise Condition has not been satisfied (or waived by the Company in its sole and absolute discretion) on or before December 31, 2026, provided that the Company may not so terminate if it is then in material breach of its obligations under the Share Purchase Agreement, and the Closing shall take place no later than December 31, 2026 (or such later date as may be mutually agreed in writing by the parties); provided, that in no event shall the Closing occur unless and until the Belrise Condition has been satisfied (or waived by the Company in its sole and absolute discretion).
Under the Side Letter, each party acknowledged that no party has exercised, or shall be deemed to have exercised, any right of termination under the Share Purchase Agreement arising from the failure of the Belrise Condition to be satisfied on or before March 31, 2026 or the failure of the Closing to occur on or before June 30, 2026, and each party irrevocably waived any right to terminate the Share Purchase Agreement, and any claim, right or remedy, in each case solely to the extent arising from the passage of the original Belrise Long-Stop Date or the original Outside Closing Date prior to the date of the Side Letter. The Side Letter does not waive the Belrise Condition itself, which remains a condition precedent to the Company’s obligation to consummate the Closing. Except as expressly set forth in the Side Letter, the Share Purchase Agreement and each other agreement, instrument and document executed in connection therewith remain unmodified and in full force and effect.
D-Fence Term Sheet
On August 2, 2026, VisionWave Holdings, Inc. (the “Company” or “VisionWave”) entered into a term sheet (the “Term Sheet”) with D-Fence Electronic Fencing Systems Ltd. (“D-Fence”), an Israeli developer of artificial intelligence-powered perimeter security and electronic fencing systems, providing the framework for VisionWave’s proposed acquisition of a controlling equity interest in D-Fence. The Term Sheet is binding upon the parties only with respect to its provisions relating to exclusivity, confidentiality, expenses, governing law and termination; the remaining provisions of the Term Sheet, including those describing the structure and terms of the proposed transaction, are non-binding and are subject in all respects to the negotiation and execution of a definitive share purchase agreement (the “Definitive Agreement”).
63
Pursuant to the Term Sheet, VisionWave intends to acquire at least fifty-one percent (51%) of the outstanding equity interests of D-Fence in exchange for shares of VisionWave common stock. VisionWave will also receive an option, exercisable for a period of two years following the initial closing, to acquire the remaining forty-nine percent (49%) of D-Fence. The Term Sheet contemplates an implied valuation of approximately $5 million for the initial acquisition, with the remaining equity subject to an implied valuation of approximately $20 million.
The Term Sheet provides that no cash consideration will be paid to the D-Fence shareholders. VisionWave may, however, provide up to $1,000,000 per year to D-Fence in the form of a loan to fund contract execution and approved operating expenses, which D-Fence will be obligated to repay from available funds in accordance with the terms of such loan. Any shares of VisionWave common stock issued in connection with the proposed transaction are expected to be issued in a private placement exempt from the registration requirements of the Securities Act of 1933, as amended (the “Securities Act”), in reliance on Section 4(a)(2) thereof and/or Regulation D thereunder, and the closing of the proposed transaction will be subject to approval by the Company’s stockholders in accordance with applicable Nasdaq listing rules.
The Term Sheet also provides for a price protection mechanism pursuant to which, if within six months following the closing the price or implied valuation of the Company’s common stock is lower than the implied per-share valuation at the closing, the exchange ratio will be retroactively adjusted and the Company will issue, for no additional consideration, additional shares of common stock to the former D-Fence shareholders in an amount sufficient to preserve the total transaction value agreed upon at the closing. Any such additional issuance would result in dilution to the Company’s existing stockholders.
In addition, the Term Sheet contemplates that the Definitive Agreement will provide the D-Fence shareholders with customary registration rights, including the obligation of the Company to file a resale registration statement on Form S-1 (or Form S-3, if eligible) within 90 calendar days following the closing and to use its best efforts to cause such registration statement to be declared effective within 180 calendar days following the closing, together with one demand registration right, customary piggy-back registration rights, a lock-up of 180 days from effectiveness and customary indemnification provisions. The Term Sheet further contemplates that Uriel Bin and Max Nudelman will remain in their positions with D-Fence for a period of four years following the closing.
The Term Sheet grants the Company exclusivity through September 30, 2026 and contemplates that the Definitive Agreement will be executed no later than September 30, 2026, with the closing to occur no later than October 15, 2026, subject to extension by mutual written consent to a date no later than October 31, 2026. The Term Sheet may be terminated by either party upon written notice if the Definitive Agreement is not executed by September 30, 2026 or if any condition precedent becomes incapable of satisfaction.
Hen Basketball Haifa Club Sponsorship Agreement
On August 5, 2026, the Company entered into a Sponsorship Agreement (the “Sponsorship Agreement”) with Hen Basketball Haifa Club, a registered association organized under the laws of the State of Israel (the “Club”), a professional basketball club competing in the Israeli basketball leagues. Pursuant to the Sponsorship Agreement, the Company will serve as the main sponsor of the Club for the 2026-2027 basketball season, and will receive sponsorship and promotional rights that include, among other things, display of the Company’s logo on the Club’s official playing jerseys, use of the Company’s logo on the Club’s official marketing materials, website and social media channels, and acknowledgment of the Company as the Club’s main sponsor in official publications and sponsor listings. The Sponsorship Agreement remains in effect until the conclusion of the 2026-2027 basketball season, unless earlier terminated in accordance with its terms.
As consideration for the sponsorship rights granted to the Company, the Company agreed to issue to the Club 2,000,000 newly issued shares of the Company’s common stock, par value $0.01 per share (the “Shares”).
The Shares will constitute “restricted securities” within the meaning of Rule 144 under the Securities Act of 1933, as amended (the “Securities Act”), will bear a customary restrictive legend, and will be subject to a six-month holding period under Rule 144. Following expiration of the applicable holding period, the Club may not sell, on any single trading day, a number of Shares exceeding ten percent (10%) of the average daily trading volume of the Company’s common stock for the ten (10) trading days preceding the date of such sale. The Club has no registration rights with respect to the Shares, and has agreed not to engage in any short sales of, or hedging or derivative transactions with respect to, the Company’s common stock while it holds any Shares.
The Sponsorship Agreement contains customary representations, warranties and covenants of the parties. Either party may terminate the Sponsorship Agreement upon an uncured material breach by the other party, and the Company may terminate the Sponsorship Agreement with immediate effect in the event of conduct by the Club that brings, or is reasonably likely to bring, the Company into public disrepute. If the Sponsorship Agreement is terminated by the Company prior to the conclusion of the 2026-2027 season as a result of the Club’s material breach or such conduct, the Club is required to return to the Company a pro-rata portion of the Shares corresponding to the unexpired portion of the term (or to pay the Company the value thereof).
64
Termination of Agreement with Meteor
On August 13, 2026, the Company delivered to Meteor a written notice terminating the Agreement, entered in on June 29, 2026, effective immediately (the “Termination Notice”). The Company terminated the Agreement following its due diligence review
Conversion of Convertible Promissory Note
On August 17, 2026, YA II PN, Ltd. (“YA”) delivered a conversion notice to the Company pursuant to Convertible Promissory Note No. VWAV-2, dated September 11, 2025. Pursuant to the conversion notice, YA elected to convert $1,250,000 of outstanding principal and $112,109.59 of accrued interest, representing an aggregate conversion amount of $1,362,109.59.
In accordance with the terms of the Note, the applicable conversion price was $1.00 per share, resulting in the issuance of 1,362,109 shares of the Company’s common stock to YA. Following the conversion, $750,000 of principal remained outstanding under the Note.
Additional Share Issuances
Subsequent to June 30, 2026 and to the date of this Report on Form 10Q, the Company issued an additional 1,510,000 shares under the SEPA.
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations
The following “Management’s Discussion and Analysis of Financial Condition and Results of Operations (“MD&A”)” should be read in conjunction with our unaudited condensed consolidated financial statements for the three and nine months ended June 30, 2026 and 2025, and our audited financial statements as of the year ended September 30, 2025, included in Form 10-K filed with the Securities and Exchange Commission (“SEC”) on December 31, 2025.
This discussion includes forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended (the “Exchange Act”). We have based these forward-looking statements on our current expectations and projections about future events. These forward-looking statements are subject to known and unknown risks, uncertainties and assumptions about us that may cause our actual results, levels of activity, performance or achievements to be materially different from any future results, levels of activity, performance or achievements expressed or implied by such forward-looking statements. In some cases, you can identify forward-looking statements by terminology such as “may,” “should,” “could,” “would,” “expect,” “plan,” “anticipate,” “believe,” “estimate,” “continue,” or the negative of such terms or other similar expressions. Such statements include, but are not limited to, possible business combinations and the financing thereof, and related matters, as well as all other statements other than statements of historical fact included herein. Factors that might cause or contribute to such a discrepancy include, but are not limited to, those described in our other SEC filings.
65
Unless the context otherwise requires, references in this “Management’s Discussion and Analysis of Financial Condition and Results of Operations” to “VW Holdings,” “we”, “us”, “our”, and the “Company” are intended to refer to (i) following the Reverse Acquisition (as defined below), the business and operations of VisionWave Holdings, Inc and its consolidated subsidiaries, and (ii) prior to the Reverse Acquisition, VisionWave Technologies, Inc.
Overview
VisionWave through its wholly owned subsidiaries VisionWave Technologies Inc., a Nevada corporation (“VisionWave Technologies”), and Solar Drone, Ltd., an Israeli corporation (“Solar Drone”), is at the forefront of developing advanced capabilities for defense and commercial applications by integrating artificial intelligence (AI), computational acceleration, and autonomous solutions across unmanned vehicles for air, ground, and sea domains. Our core technologies—including high-resolution radars, advanced vision systems, proprietary VisionRF™ radio frequency (RF) sensing platforms, qSpeed™ computational acceleration, and the Stratum™ AI platform for autonomy and mission control—will enhance operational efficiency, precision, and real-time decision-making for military, homeland security, and dual-use commercial applications worldwide.
From tactical ground vehicles and unmanned systems to precision weapon control and multi-domain sensing solutions, we intend to develop reliable, high-performance technologies that will operate effectively in contested and challenging environments. Headquartered in the United States with research and development activities supporting our platform, we intend to position ourselves to serve global defense and infrastructure markets.
Since the formation of VisionWave Technologies in March 2024 and our subsequent public listing via business combination, we have pursued aggressive commercialization of our proprietary and acquired technologies, with a primary focus on defense, surveillance, homeland security, and scalable commercial applications (including solar infrastructure automation). We maintain a growing portfolio of patented and patent-pending solutions.
To accelerate this strategy, we have executed multiple strategic acquisitions, asset purchases, joint ventures, and equity exchanges since late 2025, including the QuantumSpeed intellectual property assets (computational acceleration technology); a staged strategic equity exchange with SaverOne 2014 Ltd., establishing SaverOne as the core operating platform for our RF-based defense and security technologies; the acquisition of an IP asset from Blade Ranger, vested under a Company name Solar Drone Ltd (drone technologies); a 51% controlling stake (not closed yet) in C.M. Composite Materials Ltd., an Israeli aerospace-certified composite manufacturer supplying structural components for advanced defense systems (subject to the JV Condition in India and other closing conditions, with targeted closing by September 30, 2026); the Solar Drone subsidiary’s acquisition of a 51% interest in Junko Solar Ltd. (solar panel maintenance and cleaning services); the xClibre intellectual property a video intelligence IP assets, and entry into a Letter of Engagement with the National Oil Company of Liberia for offshore petroleum blocks (subject to regulatory and legislative approvals).
These transactions will expand our technology portfolio, manufacturing capabilities, and market reach while integrating complementary RF sensing, composite materials, autonomous platforms, and infrastructure solutions. Integration of these acquired assets is ongoing and subject to the risks and challenges described elsewhere in this report.
Our business model emphasizes innovation, strategic partnerships, manufacturing excellence, and licensing. We intend to license proprietary technologies (including VisionRF™, qSpeed™,) to defense contractors, government agencies, and industry partners for seamless integration into their systems. We will also sell finished products—such as unmanned aerial/ground vehicles, advanced radar and RF platforms, tactical mobility systems, and solar drone solutions—directly to defense, homeland security, and industrial customers. Strategic alliances and joint ventures will support co-development of customized solutions and expansion into global markets.
66
We have developed product lines that have reached the prototype or advanced development stage across autonomous platforms, sensing systems, and tactical solutions. Several of these have achieved technology readiness levels validated through simulated testing, demonstrations, and trials with targeted clients and defense contractors. “Ready for deployment” means we possess the technological capability to manufacture and deliver customized solutions upon receipt of customer orders; it does not imply existing inventory. Client-specific adaptations (e.g., payload configurations, platform integrations) will be addressed through Non-Refundable Engineering (NRE) efforts following orders. No development costs have been accrued in advance of pilot orders or production commencement.
We intend to transition these products into full-scale manufacturing once customer requirements are fully addressed, final validations are completed, and operational readiness is confirmed. Transition to manufacturing will remain subject to successful final validations, customer requirements, operational readiness confirmation, and—critically—securing sufficient financing and large-scale purchase orders, of which there can be no assurance.
To support our growth initiatives, commercialization efforts, and integration of recent acquisitions, we have entered into updated financing arrangements with YA II PN, Ltd. (“YA II”). These include a Standby Equity Purchase Agreement (SEPA) providing up to $50 million in equity financing (amended January 19, 2026, including modifications to amortization and registration-related events) and a $20 million senior secured loan closed and funded in late February 2026 (12-month maturity, 15% original issue discount, 0% interest absent default, monthly amortization commencing 60 days after issuance, optional redemption rights, and accompanying warrants). These facilities, together with prior convertible note advances, provide critical near-term liquidity while we pursue customer contracts, milestone achievements under our strategic transactions, and additional capital as needed.
This multi-faceted approach—combining internal development, strategic M&A, partnerships, and targeted financing—reflects our commitment to balancing near-term commercialization opportunities with sustained innovation. We intend to deliver mission-critical solutions that will address evolving defense and infrastructure demands while prudently managing the execution risks inherent in our rapid growth strategy.
Recent Developments
Amended and Restated Bylaws
On December 8, 2025, the Board unanimously approved and adopted Amended and Restated By-Laws of the Company (the “Amended and Restated By-Laws”), effective immediately. The only substantive change effected by the Amended and Restated By-Laws is to reduce the quorum required for the transaction of business at stockholder meetings from a majority to 33.3% of the shares entitled to vote at such meetings, as permitted under the Delaware General Corporation Law.
Business Development Committee
On December 8, 2025, the Board established a Business Development Committee of the Board and adopted a written charter for the committee. The Business Development Committee is tasked with assisting the Board in identifying, evaluating, and developing strategic business development opportunities, including mergers, acquisitions, joint ventures, strategic partnerships, licensing arrangements, and other growth initiatives. The Board appointed Judit Nagypal and Ms. Dzikowski, each independent directors of the Company, as the initial members and Ms. Dzikowski shall serve as the Chairperson of the Business Development Committee. VisionWave has business development personnel located in the U.S., the UK, France and Israel.
QuantumSpeed IP Asset Acquisition
On January 5, 2026, the Company entered into an Asset Purchase Agreement (the “Adrian Asset Purchase Agreement”) with Adrian Holdings S.R.L., a Costa Rican company (“Adrian”). Pursuant to the Adrian Asset Purchase Agreement, the Company agreed to acquire from Adrian, and Adrian agreed to sell, transfer, convey and assign to the Company, all right, title and interest in and to certain intellectual property assets related to the technology known as QuantumSpeed (the “Assigned IP”), as more fully described in the Adrian Asset Purchase Agreement.
67
In consideration for the Assigned IP, the Company agreed to pay Adrian aggregate consideration consisting of (i) 10,000,000 shares of the Company’s Common Stock (the “Purchase Shares”), and (ii) a promissory note in the principal amount of $10,000,000 (the “Adrian Note”). At closing (which occurred on January 5, 2026, the Company issued and delivered to Adrian 3,000,000 Purchase Shares (the “Closing Shares”) and executed and delivered the Adrian Note.
The issuance of the remaining 7,000,000 shares of the Company’s Common Stock (the “Contingent Shares”) is subject to approval by the Company’s shareholders as required under applicable Nasdaq listing rules. The Company has agreed to use its commercially reasonable efforts to obtain such shareholder approval (the “Shareholder Approval”) as soon as practicable following the Closing, including by including a proposal for such approval in its next annual or special meeting of shareholders (four excluding any specific meeting to be held on or about February 2026), and in no event later than nine (9) months after the Closing Date. If Shareholder Approval is not obtained within nine (9) months after the Closing Date, then (i) the Company shall promptly cause sixty percent (60%) of the equity interests in a new entity QuantumSpeed Inc., a planned wholly-owned subsidiary of the Company to which the acquired intellectual property assets will have been assigned, to be transferred to Adrian (or its designee) free and clear of all encumbrances (other than restrictions under applicable securities laws), (ii) Adrian’s security interest in such equity interests shall be automatically released, and (iii) Adrian shall retain full ownership of the 3,000,000 shares of common stock previously issued at Closing and the Adrian Note, without any obligation to return, cancel, or forfeit the same. For the avoidance of doubt, in such event, no alternative consideration will be provided in lieu of the Contingent Shares.
Employment Agreement – Erik Klinger, Chief Financial Officer
On January 2, 2026, the Company entered into an Employment Agreement (the “Klinger Agreement”) with Erik Klinger, pursuant to which Mr. Klinger will continue to serve as the Company’s Chief Financial Officer, effective as of January 2, 2026.
The Klinger Agreement provides for an initial three-year term, automatically renewing for successive one-year periods unless either party provides timely notice of non-renewal. Mr. Klinger’s annual base salary is $120,000, payable in accordance with the Company’s standard payroll practices. Mr. Klinger is eligible to participate in the Company’s employee benefit plans available to similarly situated executives, including medical, dental, and vision insurance, and is entitled to four weeks of paid vacation per year (pro-rated for partial years).
On January 2, 2026, in connection with the Klinger Agreement, the Company granted Mr. Klinger a nonstatutory stock option (the “Klinger Option”) to purchase 500,000 shares of the Company’s common stock at an exercise price equal to the closing price of the Company’s common stock on December 31, 2025, pursuant to the Company’s proposed 2025 Omnibus Equity Incentive Plan (the “Plan”). The Klinger Option is subject to twelve equal quarterly vesting installments over four years, commencing on the date of shareholder approval of the Plan (the “Approval Date”), and is otherwise subject to the terms and conditions of the Plan and the Employee Nonstatutory Stock Option Agreement entered into between the Company and Mr. Klinger. The grant of the Klinger Option is expressly contingent upon shareholder approval of the Plan; if the Plan is not approved by shareholders, the Klinger Option will be null and void.
The Klinger Agreement also includes provisions regarding termination of employment (including by death, disability, for Cause, without Cause, for Good Reason, or without Good Reason), severance payments in certain circumstances (including a one-time payment equal to $120,000 upon certain terminations, subject to execution of a general release), and acceleration of equity awards upon a Change in Control (as defined in the Klinger Agreement).
There are no arrangements or understandings between Mr. Klinger and any other person pursuant to which he was selected to continue as Chief Financial Officer. There are no family relationships between Mr. Klinger and any director or executive officer of the Company, and there are no transactions between Mr. Klinger and the Company that are reportable pursuant to Item 404(a) of Regulation S-K.
68
Strategic Joint Venture Agreement
On January 9, 2026, the Company entered into a Strategic Joint Venture Agreement (the “JV Agreement”) with BOCA JOM, LLC (“BOCA”), GBT Tokenize Corp. (“TOKENIZE”), and GBT Technologies, Inc. (“GBT”). The parties agreed to form a Nevada limited liability company (the “JV LLC”) to develop, commercialize, and manage designated electronic design automation (EDA), defense, and high-security technology projects.
Capital Contributions and Valuation To fund and resource the JV LLC, the parties agreed to specific capital and asset contributions. TOKENIZE will contribute its intellectual property portfolio along with 897,102 shares of the Company’s common stock for 22.04% ownership of the JV, and GBT will contribute 2,020,500 shares of the Company’s common stock for 2.264% ownership of the JV. BOCA will contribute the designated projects and provide non-exclusive licenses granting the JV LLC rights to use certain background intellectual property solely for the designated projects for 37.848% ownership of the JV. The Company will provide non-exclusive licenses granting the JV LLC rights to use certain background intellectual property solely for the designated projects for 37.848% ownership of the JV.
All contributions of the Company’s securities are subject to compliance with applicable securities laws and Nasdaq Listing Rules, including any requisite shareholder approval. To facilitate the negotiation of equity ownership percentages, the parties utilized an internal reference value of $1.0 billion. The Company explicitly notes that this internal value is not a statement of the JV LLC’s actual fair market value, was reached without an independent third-party valuation, and should not be relied upon as an indication of value for the JV LLC, its assets, or the Company’s interest therein.
Governance: The JV LLC will be governed by a three-member board, with specific governance and deadlock resolution mechanisms to be established in a separate operating agreement. TOKENIZE and GBT will not participate in the management or governance of the JV LLC. Additionally, the JV Agreement permits the Company to appoint a director to BOCA’s board; any reciprocal appointment of a BOCA designee to the Company’s board remains subject to approval by the Company’s independent directors, compliance with Nasdaq rules, and, if applicable, shareholder approval. The Company has appointed its CEO as the Managing Member of the JV.
Intellectual Property, Term, and Termination: Any intellectual property developed by the JV LLC (“Foreground IP”) will be wholly owned by the JV LLC, while each party retains ownership of its independently developed background IP. The JV Agreement has an initial term of seven years and contains customary termination rights, including if required regulatory approvals (e.g., CFIUS or export controls) are denied. Furthermore, if no designated project generates revenue within twelve months following the formation of the JV LLC, the JV Agreement may be terminated, and contributed consideration may be returned, subject to board-level fiduciary determinations.
The transaction was closed on April 1, 2026.
As of June 30, 2026 the JV LLC a variable interest entity consolidated by the Company, held 2,917,602 shares of the Company's common stock. These shares were contributed to the JV LLC by GBT Tokenize Corp. and GBT Technologies, Inc. in connection with the JV LLC's formation and are presented as treasury stock within the Company's consolidated statement of stockholders' equity. These shares are excluded from the weighted-average shares used in the Company's computation of basic and diluted earnings per share.
No gain or loss is recognized in the Company's consolidated statements of operations from changes in the fair value of these shares, consistent with the Company's policy of not recognizing gains or losses on transactions or remeasurements involving its own equity securities.
These shares remain subject to transfer restrictions under the Strategic Joint Venture Agreement dated January 9, 2026 (the “JV Agreement”), pursuant to which they may not be sold, assigned, transferred, pledged, hypothecated, encumbered, or otherwise disposed of without the prior written consent of the other party to the JV Agreement, subject to limited permitted-transfer exceptions. The JV Agreement does not specify a fixed expiration date for this restriction.
VWave Boca JV, LLC is a VIE for which the Company has determined that it is the primary beneficiary as it has the power to direct significant activities and obligations to absorb losses or right to receive benefits and therefore consolidates the JV and records non-controlling interest.
The Company contributed access by license in its intellectual property with a carrying value of zero in exchange for its investment in VWave Boca JV, LLC. The Company’s shares of common stock contributed by the other members have been accounted for as treasury stock. The Company’s share of the income (loss) reported by the JV are consolidated in the accompanying unaudited condensed consolidated statements of operations.
SaverOne Transaction
On January 26, 2026, VisionWave entered the Exchange Agreement with SaverOne. The Exchange Agreement provides for a three-stage equity exchange and strategic collaboration providing for VisionWave to acquire up to approximately 51% of SaverOne’s issued and outstanding ordinary shares on a fully diluted basis, subject to milestone achievement and applicable regulatory approvals. In exchange, the Exchange Agreement provides SaverOne with the ability to acquire VisionWave common stock with an aggregate economic value of up to $7.0 million, subject to staged issuance, price-based adjustments, and compliance with Nasdaq listing rules. The number of VisionWave shares of common stock issued in each stage is determined based on a five-day VWAP immediately preceding the applicable closing. The transaction establishes SaverOne as the core operating platform for VisionWave’s radio-frequency (RF) defense and security technologies, supported by a non-exclusive, worldwide license to certain VisionWave RF intellectual property for defense and security applications. Below is a summary of the three-stage equity exchange:
69
| ● | Stage 1 - SaverOne issues VisionWave ordinary shares representing 19.99% of SaverOne’s outstanding share capital (fully diluted), in exchange for VisionWave common stock valued at approximately $2.74 million. On March 5, 2026, VisionWave completed the Stage 1 Closing pursuant to the Exchange Agreement. At the Stage 1 Closing, VisionWave issued the Stage 1 VisionWave Shares to SaverOne, having an aggregate value of approximately $2.7 million, calculated based on the VWAV Average Price (as defined in the Exchange Agreement) of $7.5031 per share. In exchange, SaverOne issued the Company 148,584 restricted ADSs (representing 6,418,828,800 restricted ordinary shares) representing 19.99% of SaverOne’s issued and outstanding share capital as of the effective date of the Exchange Agreement (calculated on a fully diluted basis, excluding any dilutive effects from future issuances unrelated to the Exchange Agreement). In addition, the Company will issue the corresponding shares issuable to management at the Stage 1 Closing pursuant to Schedule 1.7 of the Exchange Agreement, including the applicable portion of the $3 million pool (39.1877%). |
| ● | Stage 2 - Upon achievement of the first operational integration milestone, SaverOne issues VisionWave ordinary shares representing 19.99% of SaverOne’s outstanding share capital (fully diluted), in exchange for VisionWave Common Stock valued at approximately $2.74 million. |
| ● | Stage 3 - Upon achievement of a commercial or defense pilot milestone, SaverOne issues VisionWave ordinary shares representing 11.02% of SaverOne’s outstanding share capital (fully diluted) resulting in VisionWave owning approximately 51% of SaverOne in exchange for VisionWave Common Stock valued at approximately $1.51 million. |
At the close of stage 3 of the transaction, VisionWave shareholdings of SaverOne was 41.5%.
Blade Ranger Transaction
On December 3, 2025, VisionWave entered into the Blade Ranger Agreement with Seller, and, solely for purposes of acknowledgment and certain covenants therein, the Target Company, which was amended on December 15, 2025. Pursuant to the Blade Ranger Agreement VisionWave acquired all of the issued and outstanding shares of the Target Company (the “Acquisition”) from the Seller in consideration for the issuance by VisionWave to the Seller (or its designee(s)) of the Buyer Shares and the Initial PFWs. Further, if the VWAP of VisionWave’s Common Stock for the five Trading Day period immediately preceding the date of effectiveness of the registration statement registering the resale of the Buyer Shares and Warrant Shares is less than $12.00 per share then VisionWave shall issue Blade Ranger such number of Additional PFWs equal the difference between (x) $21,600,000 divided by such average daily VWAP and (y) 1,800,000, to be issued within two Business Days following the effectiveness of such registration statement.
The Pre-Funded Warrants are exercisable immediately upon issuance at a nominal exercise price of $0.01 per share (with the aggregate exercise price, except for such nominal amount, pre-funded to VisionWave) and will remain exercisable until exercised in full, subject to customary adjustments, beneficial ownership limitations (9.99%), and an exchange cap of 19.99% of VisionWave’s outstanding common stock prior to the initial exercise date unless shareholder approval is obtained pursuant to Nasdaq Listing Rule 5635. The Warrant Shares issuable upon exercise of the Pre-Funded Warrants are subject to the registration rights set forth in the Agreement.
Bitcoin mining acceleration and orchestration platform
On February 17, 2026, the Company entered into a Statement of Work (the “SOW”) with a third-party vendor for the development, validation, and deployment of a custom qSpeed-Mine™ Bitcoin mining acceleration and orchestration platform. The SOW has a total contract value of $10.0 million and represents a commitment for custom software and systems development to enhance the Company’s Bitcoin mining operations. The SOW provides for the design, validation, and deployment of a production-grade software acceleration layer, fleet orchestration/control plane, observability tools, security hardening, and deployment engineering optimized for Bitcoin (SHA-256d) mining across up to approximately 1,000 nodes/machines. The engagement is structured with objective technical milestones and acceptance criteria, and payments are contingent upon successful delivery and acceptance of each milestone. The expected program duration is approximately 32 weeks.
70
The SOW provides for the following milestone-based payment structure:
| ● | $350,000 was paid upon execution of the SOW; |
| ● | Approximately $1.0 million is payable through completion and acceptance of the proof-of-concept (“POC”) milestone; |
| ● | Approximately $6.0 million is payable upon completion and acceptance of successive intermediate milestones, including scaled deployment and operational validation; and |
| ● | Approximately $3.0 million is payable upon final delivery and full program acceptance. |
If milestone execution proceeds as planned, the SOW is structured to generate not less than the full $10.0 million in revenue during calendar year 2026, subject to milestone completion and acceptance of which there is no guarantee. Revenue is expected to be recognized in accordance with applicable accounting standards based on milestone achievement and acceptance. All deliverables under the SOW are owned by the Company, reinforcing the Company’s proprietary rights in the QuantumSpeed™ platform. The SOW does not obligate the counterparty to continue beyond accepted milestones and does not include minimum purchase or volume commitments beyond the defined milestone structure
C.M. Composite Materials Ltd. Transaction
On February 20, 2026 (the “Effective Date”), the Company, entered into two related definitive agreements in connection with a strategic investment and acquisition transaction involving C.M. Composite Materials Ltd., an Israeli corporation with registration number 513931139 (the “C.M. Composite”): (i) an Investment and Share Purchase Agreement (the “Share Purchase Agreement”), dated as of February 20, 2026, by and among the Company (as Buyer), Matania (Mati) Moskovich (as Seller)(“Moskovich”), and the C.M. Composite (solely for purposes of acknowledgment and certain covenants); and (ii) a Loan Agreement (the “Loan Agreement”), dated as of February 20, 2026, by and between the Company (as Lender) and the C.M. Composite (as Borrower).
Pursuant to the Share Purchase Agreement, the Company agreed to acquire from the Seller 10.2 ordinary shares of the C.M. Composite (the “Purchased Shares”), representing 51% of the issued and outstanding ordinary shares of the C.M. Composite (which has 20 outstanding ordinary shares out of 30,000 authorized ordinary shares, par value 0.1 NIS per share). In consideration therefor, the Company agreed to issue to Moskovich 250,000 shares of the Company’s Common stock (the “Buyer Shares”), valued at $2,500,000 based on the parties’ agreement.
The Loan Agreement provides for a secured loan facility in an aggregate principal amount of up to $5,000,000 (the “Commitment”). The Company is obligated to make an initial advance of up to $1,300,000 within thirty (30) Business Days following the Effective Date (subject to satisfaction of conditions precedent), to be used for general working capital purposes consistent with the C.M. Composite’s ordinary course of business. Subsequent advances of the remaining up to $3,500,000 may be made in one or more tranches upon mutual written agreement of the parties, solely for working capital of the establishment and operation of a new facility outside Israel, with each tranche subject to the Company’s reasonable approval and minimum amounts (generally not less than $250,000 unless otherwise agreed). Proceeds of subsequent advances are to be used exclusively to operate, develop, certify, market, and commercialize the C.M. Composite’s technologies and products in global markets, including the United States. The Company advanced $500,000 to C.M. Composite on February 5, 2026, the Company advanced $200,000 to C.M. Composite on January 22, 2026 and the Company advanced $398,345 to C.M. Composite on December 26, 2025. The advances were made pursuant to a promissory note with a 24-month maturity, bearing no interest unless an event of default occurs (then at 5% per annum or the lower legal maximum), prepayable without penalty, and not contingent on any acquisition or strategic transaction.
Any loan pursuant to the Loan Agreement will bear simple interest at 12% per annum (or such lower rate as mutually agreed in writing, but not exceeding prevailing market rates for similar loans as determined in good faith by the Company), calculated on a 360-day year basis for actual days elapsed. The loan will mature three (3) years after the Effective Date. The obligations under the Loan Agreement are secured by a first-priority security interest in substantially all assets of the C.M. Composite (including accounts, inventory, equipment, general intangibles, intellectual property, and proceeds thereof).
71
On March 11, 2026, the Company entered into a Side Letter (the “Side Letter”) with C.M. Composite, Giza Zinger Even Mezzanine, Limited Partnership (“Giza”), and Moskovich. The Side Letter supplements and addresses certain obligations under the Share Purchase Agreement and the Loan Agreement with C.M. Composite and Moskovich, as well as the settlement agreement dated February 5, 2026, between Giza, Mati, and C.M. Composite (the “Giza Settlement Agreement”).
Pursuant to the Side Letter, among other things:
| ● | the Company acknowledges the terms of the Giza Settlement Agreement and agrees that C.M. Composite’s performance thereunder (including payments, reporting, and security perfection) does not constitute a breach or default under the Share Purchase Agreement, Loan Agreement, Note, or related agreements. |
On February 26, 2026, the Company entered into the First Amendment (the “Amendment”) to that certain Share Purchase Agreement by and among the Company, Moskovich, and, solely for purposes of acknowledgment and certain covenants therein, C.M. Composite.
The Amendment adds a new recital to the Share Purchase Agreement emphasizing that the sole purpose of the Company entering into the SPA is to facilitate and enable the establishment of a joint venture in India between C.M. Composite (and/or FBM) and Belrise Industries Limited (or its affiliate) as contemplated by that certain Memorandum of Understanding dated February 16, 2026 (the “Belrise MOU”), and that the execution and performance of definitive agreements with Belrise Industries Limited (the “Belrise JV Agreements”) is a critical and indispensable component of the overall transaction.
The Amendment provides that the Company’s obligation to consummate the purchase of the Purchased Shares and the other transactions contemplated by the SPA is expressly conditioned upon the satisfaction (or waiver by the Company in its sole and absolute discretion) of the following condition precedent (the “Belrise Condition”): (a) C.M. Composite and FBM Composite Materials Ltd. shall have duly executed and delivered the Belrise JV Agreements substantially in the form and on the terms contemplated by the Belrise MOU; and (b) the Belrise JV Agreements shall be in full force and effect and shall not have been terminated, amended, or modified in any respect materially adverse to C.M. Composite or the Company without the prior written consent of the Company. The Seller acknowledges that the Belrise Condition is material, and failure to satisfy it entitles the Company to terminate the SPA without liability.
The Amendment amends and restates Section 2.3 of the Share Purchase Agreement to provide that the Closing shall take place remotely no later than June 30, 2026 (or such later date as mutually agreed), provided that in no event shall the Closing occur unless and until the Belrise Condition has been satisfied (or waived by the Company).
The Amendment also permits termination by the Company if the Belrise Condition has not been satisfied (or waived by the Company) on or before March 31, 2026 (the “Belrise Long-Stop Date”), provided that the Company may not terminate if it is then in material breach of its obligations under the Share Purchase Agreement.
Under the Amendment, to the extent the Belrise Condition is not satisfied by the Seller and the Company has not otherwise waived such condition, the Company may elect to close the SPA in accordance with certain terms and conditions at a reduced purchase price. The Company has agreed to use its reasonable best efforts to work with the Seller to satisfy the Belrise Condition and has acknowledged the Belrise Condition is critical to the value of the transaction and to its financial investment.
The Agreement contains a customary termination provision if the Company’s Board is materially adversely affected with respect to certain aspects of the transaction following the Initial Closing. This includes terminations under applicable securities laws, and if the Seller’s security interest shall be automatically released, and (iii) the Seller shall retain full ownership of the 3,500,000 shares of common stock previously issued at Closing and the Note, without any obligation to return, cancel, or forfeit the same.
72
xClibre IP Assets Acquisition
On April 10, 2026, the Company entered into an Asset Purchase Agreement (the “Agreement”) with Dream America Marketing Services, Ltda., a Costa Rican company (the “Seller”). Pursuant to the Agreement, the Company agreed to acquire from the Seller, and the Seller agreed to sell, transfer, convey and assign to the Company, all right, title and interest in and to certain intellectual property assets related to the technology known as xClibre (the “Assigned IP”), as more fully described in the Agreement.
In consideration for the Assigned IP, the Company agreed to pay the Seller aggregate consideration consisting of (i) 7,000,000 shares of the Company’s common stock, par value $0.01 per share (the “Purchase Shares”), and (ii) a promissory note in the principal amount of $6,000,000 (the “Note”).
At closing, the Company has issued and delivered to the Seller 3,500,000 Purchase Shares (the “Closing Shares”) and executed and delivered the Note.
The issuance of the remaining 3,500,000 shares of the Company’s common stock (the “Contingent Shares”) is subject to (i) satisfactory proof-of-concept results and (ii) Nasdaq Shareholder Approval under Nasdaq Listing Rule 5635. The Company has agreed to use its commercially reasonable efforts to obtain such proof-of-concept approval (the “POC Approval”) as soon as practicable following the Closing, and in no event later than nine (9) months after the Closing Date. The Company has also agreed to use reasonable best efforts to obtain Nasdaq Shareholder Approval. If proof-of-concept approval is not obtained within nine (9) months after the Closing Date, then (i) the Company shall promptly cause sixty percent (60%) of the equity interests in a new entity xClibre Inc., a planned wholly-owned subsidiary of the Company to which the acquired intellectual property assets will have been assigned, to be transferred to the Seller (or its designee) free and clear of all encumbrances (other than restrictions under applicable securities laws), (ii) the Seller’s security interest in such equity interests shall be automatically released, and (iii) the Seller shall retain full ownership of the 3,500,000 shares of common stock previously issued at Closing and the Note, without any obligation to return, cancel, or forfeit the same. For the avoidance of doubt, in such event, no alternative consideration will be provided in lieu of the Contingent Shares.
The Agreement contains customary representations, warranties, covenants and indemnification provisions for a transaction of this nature.
The Assigned IP consists of intellectual property rights owned by the Seller relating to the xClibre technology, including patents, patent applications, trademarks, copyrights, trade secrets, know-how, software and other proprietary rights, as set forth in Exhibit A to the Agreement.
YA II Transactions
On July 25, 2025, we entered into the Standby Equity Purchase Agreement (“SEPA”) with YA II PN, LTD., a Cayman Islands exempt limited company (“YA II” or “Investor”). Under the SEPA, the Company has the right to sell to YA II up to $50 million of its shares of common stock, subject to certain limitations and conditions set forth in the SEPA, from time to time during the term of the SEPA.
Upon the satisfaction of the conditions to YA II’s purchase obligation set forth in the SEPA, including having a registration statement registering the resale of the shares of common stock issuable under the SEPA declared effective by the SEC, the Company will have the right, but not the obligation, from time to time at its discretion until the SEPA is terminated to direct Investor to purchase a specified number of shares of common stock (“Advance”) by delivering written notice to YA II (“Advance Notice”). While there is no mandatory minimum amount for any Advance, it may not exceed an amount equal to 100% of the average of the daily traded amount during the five consecutive trading days immediately preceding an Advance Notice.
73
The shares of common stock purchased pursuant to an Advance delivered by the Company will be purchased at a price equal to 97% of the lowest daily VWAP of the shares of common stock during the three consecutive trading days commencing on the date of the delivery of the Advance Notice, other than the daily VWAP on a day in which the daily VWAP is less than a minimum acceptable price as stated by the Company in the Advance Notice or there is no VWAP on the subject trading day. The Company may establish a minimum acceptable price in each Advance Notice below which the Company will not be obligated to make any sales to YA II. “VWAP” is defined as the daily volume weighted average price of the shares of common stock for such trading day on the Nasdaq Stock Market during regular trading hours as reported by Bloomberg L.P.
The January Amendment amended the SEPA to, among other things:
(i) remove the Investor’s ability to deliver investor notices, which previously allowed the Investor to require the Company to issue and sell shares of Common Stock to the Investor in offset of amounts outstanding under the Convertible Notes;
(ii) modify the conditions under which an Amortization Event (as defined in the Convertible Notes) may occur, providing that no Amortization Event shall be deemed to have occurred due to a Registration Event (as defined in the Convertible Notes) prior to the Rule 144 Date, and after the Rule 144 Date, no such Amortization Event shall occur so long as the Company remains current on its filings with the SEC and the Investor is able to rely on Rule 144 under the Securities Act of 1933, as amended, to resell shares of Common Stock issuable under the Promissory Notes;
(iii) cancel the Investor’s obligation to fund an additional $2,000,000 in principal amount to the Company as set forth in a letter agreement dated September 11, 2025, between the Company and the Investor (provided that subsequent fundings on the same or different terms may be mutually agreed by the parties in the future and documented in writing); and
(iv) require the Company to use its best efforts to promptly respond to comments from the staff of the SEC regarding the Company’s initial Registration Statement on Form S-1 (File No. 333-289952) and seek effectiveness of such Registration Statement as soon as reasonably practicable.
In connection with the SEPA, and subject to the condition set forth therein, YA II has agreed to advance to the Company the Pre-Paid Advance. The first Pre-Paid Advance was disbursed on July 25, 2025 with respect to $3.0 million and the balance of $2.0 million was disbursed on September 11, 2025. The purchase price for the Pre-Paid Advance is 94% of the principal amount of the Pre-Paid Advance. Interest shall accrue on the outstanding balance of any Pre-Paid Advance at an annual rate equal to 6.0%, subject to an increase to 18% upon an event of default as described in the Convertible Notes. The maturity date will be 12-months after the closing of each tranche of the Pre-Paid Advance. Investor may convert the Convertible Notes into shares of the Company’s common stock at a conversion price equal to the lower of $10.00 or 93% of the lowest daily VWAP during the five consecutive trading days immediately preceding the conversion (the “Conversion Price”); provided, that in no event may the Conversion Price be lower than $1.00 (the “Floor Price”). In addition, upon the occurrence and during the continuation of an event of default, the Convertible Notes may be declared immediately due and payable, in which case the Company shall pay to YA II the principal and interest due thereunder. In no event shall Investor be allowed to effect a conversion if such conversion, along with all other shares of common stock then beneficially owned by YA II and its affiliates, would exceed 4.99% of the outstanding shares of the then common stock of the Company. If at anytime on or after the issuance of the Convertible Notes (i) the Floor Price Event, (ii) the Exchange Cap Event or (iii) a Registration Event occurs, provided, however, that no Registration Event shall be deemed to have occurred prior to the Rule 144 Date, and after the Rule 144 Date, no Registration Event shall be deemed to have occurred so long as the Company remains current on its filings with the SEC and the Investor is able to rely on Rule 144 under the Securities Act of 1933, as amended, to resell shares of common stock issuable under the Convertible Notes, then the Company shall make monthly payments to Investor beginning on the seventh trading day after the Amortization Event and continuing monthly in the amount of $750,000 plus a 5.0% premium and all accrued and unpaid interest. The Exchange Cap Event will not apply in the event the Company has obtained the approval from its stockholders in accordance with the rules of Nasdaq Stock Market for the issuance of shares of common stock pursuant to the transactions contemplated in the Convertible Note and the SEPA in excess of the Exchange Cap.
The Company will control the timing and amount of any sales of shares of common stock to YA II. Actual sales of shares of common stock to Investor as an Advance under the SEPA will depend on a variety of factors to be determined by the Company from time to time, which may include, among other things, market conditions, the trading price of the Company’s common stock and determinations by the Company as to the appropriate sources of funding for our business and operations.
74
The SEPA will automatically terminate on the earliest to occur of (i) the 24-month anniversary of the date of the SEPA or (ii) the date on which Investor shall have made payment of Advances pursuant to the SEPA for shares of common stock equal to $50,000,000. We have the right to terminate the SEPA at no cost or penalty upon five (5) trading days’ prior written notice to Investor, provided that there are no outstanding Advance Notices for which shares of common stock need to be issued and the Company has paid all amounts owed to Investor pursuant to the Convertible Notes and the SEPA. The Company and YA II may also agree to terminate the SEPA by mutual written consent. Neither the Company nor YA II may assign or transfer our respective rights and obligations under the SEPA, and no provision of the SEPA may be modified or waived by us or Investor other than by an instrument in writing signed by both parties.
As consideration for YA II’s commitment to purchase the shares of common stock pursuant the SEPA, the Company paid YA II, (i) a structuring fee in the amount of $35,000 and (ii) 200,000 shares of common stock as an equity fee. Further, the Company is required to pay YA II a commitment fee of $500,000 of which $250,000 shall be due and payable on the earlier of the effective date of the initial registration statement, or 60 days following the date of the SEPA, and the remaining $250,000 shall be due and payable on the date that is 90 days following the due date of the initial $250,000 installment, in each case to be paid by the issuance of such number of common shares that is equal to the applicable portion of the commitment fee divided by the average of the daily VWAPs of the common shares during the three trading days immediately prior to the applicable due date.
On February 26, 2026, the Company entered into a Letter Agreement (the “Letter Agreement”) with YA II PN, Ltd. (the “Investor”), pursuant to which the Investor agreed to provide the Company with a $20,000,000 senior loan (the “Loan”) on the terms and conditions set forth therein.
The Loan is evidenced by a Promissory Note (the “Note”) in the original principal amount of $20,000,000, bearing 0% interest per annum (increasing to 18% upon an Event of Default as defined therein). The Note was issued at an original issue discount of 15%, resulting in gross proceeds to the Company of $17,000,000 (prior to deduction of a $25,000 structuring and due diligence fee), or $16,975,000 net cash received.
The Note matures 12 months from issuance and requires monthly amortization payments of $2,500,000 of principal (plus a 2% Payment Premium on such principal amount) beginning on the 60th day following issuance and continuing on the same day of each successive month thereafter until maturity (each an “Installment Date”). The Company may satisfy any Installment Amount in cash or, at its election, by delivering an Advance Notice under the Company’s existing Standby Equity Purchase Agreement dated July 25, 2025, as amended (the “SEPA”), subject to a 30-day repayment waterfall in favor of the Investor.
The Company has the right to optionally redeem all or any portion of the outstanding principal at any time at 105% of the principal amount redeemed plus accrued and unpaid interest. Upon an uncured Event of Default, the Investor may convert all or any portion of the outstanding principal, accrued interest, and other amounts due into Common Stock at a conversion price equal to 90% of the lowest daily VWAP during the 10 consecutive Trading Days immediately prior to the conversion date, subject to a 4.99% beneficial ownership blocker, and a floor price.
Concurrently with the issuance of the Note, the Company issued to the Investor a warrant (the “Warrant”) to purchase 1,333,333 shares of Common Stock at an exercise price of $9.00 per share, exercisable for a term of five years from issuance.
The obligations under the Note are guaranteed by each subsidiary of the Company pursuant to a Global Guaranty Agreement.
The Letter Agreement contains customary representations, warranties, covenants (including restrictions on variable rate transactions, additional indebtedness without consent, and use of proceeds), and events of default. The Company is not required to register the shares issued upon conversion of the Note but has agreed to register the shares issuable upon exercise of the Warrant. The Investor has demand registration rights covering all shares of common stock underlying the Note. Upon written demand, the Company must file a resale registration statement within 45 calendar days, use commercially reasonable efforts to cause it to become effective promptly, and address any Rule 415 limitations through pro-rata reductions and successive filings as necessary. In addition, the Company shall, at its sole cost and expense, file with the SEC on or before the date that is 90 calendar days after the closing date file a registration statement on Form S-1 registering the resale of all of the shares of common stock issuable upon exercise of the Warrant (the “Warrant Registration Statement”). The Company shall use its commercially reasonable efforts to cause the Warrant Registration Statement to be declared effective as soon as practicable after the filing thereof.
75
Solar Drone
On March 11, 2026, SolarDrone Ltd. (“SolarDrone”), an Israeli subsidiary of VisionWave entered into a Consulting and Share Purchase Agreement (the “Junko Agreement”) with Mr. Amos Cohen, a controlling shareholder of Junko Solar Ltd., an Israeli company engaged in solar panel maintenance and cleaning services. Pursuant to the Junko Agreement, SolarDrone agreed to acquire 51% of the issued and outstanding shares of Junko Solar Ltd. (the “Junko Transaction”). The parties agreed on a pre-money valuation of Junko Solar of $400,000, and SolarDrone agreed to purchase the 51% controlling interest for an aggregate purchase price of $204,000. The purchase price will be paid in three equal installments:
| ● | $68,000 upon execution of the Agreement |
| ● | $68,000 within 35 days |
| ● | $68,000 within 35 days thereafter |
Upon payment of the first installment, the shares representing 51% ownership of Junko Solar Ltd. will be transferred to SolarDrone or its designated affiliate.
Pursuant to the Agreement, Mr. Amos Cohen was appointed Chief Executive Officer and a director of SolarDrone Ltd. Mr. Cohen will provide management and strategic services to SolarDrone pursuant to a consulting arrangement and will receive a consulting fee of 50,000 N.I.S per month plus VAT.
As part of the Transaction, Junko Solar Ltd. will transfer operational activities related to solar panel cleaning and maintenance services, including customer relationships, business relationships, and related operational assets to SolarDrone. SolarDrone will manage and operate the business going forward. The transaction was closed on April 1, 2026.
Chief Operating Officer
On March 13, 2026, the Company appointed Eric T. Shuss as Chief Operating Officer, effective March 13, 2026. In connection therewith, the Company entered into an Employment Agreement dated March 13, 2026 with Mr. Shuss (the “Shuss Agreement”). Material terms of the Shuss Agreement include:
| ● | An initial term of three years, with automatic one-year renewals absent 30 days’ prior written notice by either party. |
| ● | Annual base salary of $120,000, increasing to $240,000 upon the Company achieving $3,000,000 in revenue during any 90-day period. |
| ● | Eligibility for an annual performance bonus targeted at 0.5% of net income as reported in the Company’s SEC filings. |
| ● | Participation in the Company’s standard employee benefit plans. |
| ● | Severance upon a qualifying termination without cause or for good reason: a lump-sum payment equal to the greater of $500,000 or two times the then-current base salary, subject to execution of a general release of claims. |
| ● | Customary restrictive covenants, including confidentiality, invention assignment, non-solicitation, and non-competition obligations. |
Concurrently, Mr. Shuss was granted a nonstatutory stock option to purchase 500,000 shares of the Company’s common stock under the Company’s 2025 Omnibus Equity Incentive Plan, with an exercise price equal to the closing price of the common stock on March 12, 2026, vesting in twelve equal quarterly installments commencing June 30, 2026, and expiring five years from the date of grant (subject to earlier termination upon cessation of service).
Mr. Shuss also entered into a Proprietary & Confidential Information, Inventions Assignment, Non-Solicitation and Non-Competition Agreement and a Mutual Agreement to Arbitrate, each dated in connection with his employment.
76
Change in Role of Douglas Davis
On December 29, 2025, Noam Kenig resigned as Chief Executive Officer and as a member of the Board effective immediately for personal reasons. Mr. Kenig’s resignation was not the result of any disagreement with the Company on any matter relating to the Company’s operations, policies or practices. On December 29, 2025, the Board appointed Douglas Davis, the Company’s current Executive Chairman, to serve as Interim Chief Executive Officer, effective immediately. On March 13, 2026, the Board appointed Douglas Davis, previously serving as Interim Chief Executive Officer and Executive Chairman, as Chief Executive Officer of the Company, effective March 13, 2026, removing the “Interim” designation from his title. In connection therewith, on March 13, 2026, the Company entered into an amendment (the “Davis Amendment”) to Mr. Davis’s Employment Agreement dated August 6, 2025, which formalizes his Chief Executive Officer title (in addition to his continuing role as Executive Chairman) and provides for an additional milestone-based equity bonus. Material terms of the Davis Amendment include:
| ● | No changes to Mr. Davis’s base salary, annual bonus, or other compensation terms from the original Employment Agreement. |
| ● | A one-time non-qualified stock option (the “Milestone Option”) to purchase shares of the Company’s common stock equal to $100,000,000 in value (determined based on the Nasdaq closing price per share on the trading day immediately preceding the achievement date (the “Reference Price”)), granted under the Plan on the first business day following the date on which the Company first achieves both (i) $100,000,000 in trailing twelve-month revenue (as reported in the Company’s most recent Form 10-Q or Form 10-K) and (ii) a fully diluted market capitalization of at least $1,000,000,000 (calculated using the Reference Price), subject to Mr. Davis’s continued employment through the grant date. |
| ● | The exercise price per share of the Milestone Option equal to the Reference Price. |
| ● | Full vesting on the grant date, with a 10-year term (subject to earlier termination as provided in the Plan and applicable award agreement), cashless exercise provisions (to the extent permitted under the Plan), and subject to the Company’s clawback policy (as may be adopted or amended to comply with Dodd-Frank Act requirements or Nasdaq rules) |
| ● | The grant is subject to Board or Compensation Committee approval, Plan share availability, and compliance with applicable securities laws, including Nasdaq listing rules. |
Changes to Board Committee Memberships and Independent Lead Director Position
On March 13, 2026:
| ● | The Board accepted the resignation of Eric T. Shuss from his position as Lead Independent Director and from all Board committee memberships, effective March 13, 2026. Mr. Shuss will continue to serve as a member of the Board. |
| ● | The Board appointed Atara Dzikowski as a member of the Audit Committee, the Compensation Committee, and the Nominating and Corporate Governance Committee, effective March 13, 2026, and as Chair of the Nominating and Corporate Governance Committee. |
| ● | The Board appointed Chuck Hansen as Independent Lead Director of the Board, effective March 13, 2026. |
National Oil Company of Liberia
On March 18, 2026, the Company entered into a Letter of Engagement (“LOE”) with the National Oil Company of Liberia (“NOCAL”), relating to offshore petroleum Blocks LB-4 and LB-5 located in the Liberia Basin. The LOE establishes a structured framework for the Company to advance toward the execution of a Production Sharing Contract (“PSC”) with the Government of Liberia, subject to prequalification by the Liberia Petroleum Regulatory Authority (“LPRA”), regulatory approvals, and legislative ratification by the Liberian Legislature.
77
The Company has been granted exclusive, non-transferable rights to pursue the Blocks for a period of eight (8) months from execution of the LOE (“Effective Date”), subject to extension if delays in the PSC process are not attributable to the Company. During this period, NOCAL is prohibited from negotiating or granting rights in the Blocks to third parties (except limited reconnaissance licenses that do not interfere). Assignment requires NOCAL’s prior written approval, not unreasonably withheld.
The Company has agreed to pay an initial signing bonus of $300,000 per block (total $600,000) within sixty (60) days following execution of the LOE by both parties. In the event the Blocks are not awarded to the Company for reasons not attributable to the Company, such payment is refundable in full without interest. This obligation is binding and material to the Company’s near-term liquidity.
Following execution of a PSC, the Company would be required to license seismic data for not less than $1,000,000 per block within 120 days of PSC execution. Upon execution and ratification of a PSC, the Company would be required to pay a signature bonus of $1,000,000 per block, payable within ninety (90) days of legislative ratification. The LOE contemplates a 10% carried interest to NOCAL; 10% carried interest to the Government of Liberia; 5% carried interest to citizens; and up to 5% participation by a local Liberian company. The contemplated PSC includes a multi-phase exploration program over approximately seven (7) years.
The LOE contains binding provisions, including exclusivity, confidentiality, compliance with anti-corruption laws (including FCPA) and specified financial obligations. However, the LOE does not constitute a final award of petroleum rights or grant any exploration or production rights at this stage. The execution of a PSC remains subject to prequalification, regulatory approvals, and legislative ratification in Liberia. There can be no assurance that a PSC will be executed or that the Company will ultimately be awarded the Blocks, that the Company’s proprietary RF sensing technologies will prove feasible or effective in this new application domain (outside the Company’s core defense and security markets), or that the Company will derive any revenue or benefit from this initiative. The Company may require additional capital, strategic partners, or farm-out arrangements to fulfill obligations, and the transaction involves significant geopolitical, regulatory, and operational risks in an emerging market jurisdiction.
Acquisition of VisionWave IL, Ltd.
On March 18, 2026, the Company acquired 100% of the issued and outstanding shares of VisionWave IL Ltd., an Israeli private shell limited company (“VisionWave Israel”), for nominal consideration.
Further, on March 18, 2026, VisionWave Israel appointed Khdoura Sabbagh as Chief Executive Officer and its sole director and entered into an Employment Agreement with Mr. Sabbagh, pursuant to which Mr. Sabbagh was appointed Chief Executive Officer of VisionWave Israel. Under the Employment Agreement, Mr. Sabbagh will receive an annual base salary of $150,000 and is eligible to receive options to purchase 2,000,000 shares of the Company’s common stock, subject to vesting and the terms of the Company’s equity incentive plan. The agreement contains customary terms regarding duties, confidentiality, intellectual property, and termination. At June 30, 2026, the options were not yet granted.
On March 18, 2026, VisionWave Israel also entered into a Consulting Agreement with CO-Finance Financial and Accounting Consulting Ltd., a company controlled by Oren Attiya, pursuant to which Mr. Attiya will provide financial and accounting services to VisionWave Israel. Under the Consulting Agreement, the consultant will receive monthly compensation of NIS 12,000 plus VAT. The agreement is structured as an independent contractor arrangement and includes customary terms and conditions.
At June 30, 2026, the options were not granted under the employment agreement.
78
Ian Share Purchase Agreement
On May 12, 2026, VisionWave Israel Ltd. (“VW Israel”), a wholly owned subsidiary of the Company, entered into a definitive Share Purchase and Shareholders Agreement (the “Agreement”) with Mr. Ian Paklida (the “Seller”), pursuant to which VW Israel agreed to acquire 60% of the issued and outstanding equity interests of VIP Lux Travel Ltd. and PKLST Tourism and Leisure Ltd., both Israeli corporations (collectively, the “Target Companies”).
The Agreement is definitive; however, the transaction has not yet closed.
Under the terms of the Agreement, the consideration for the acquisition of the Target Companies will be the issuance of shares of common stock of the Company, subject to the satisfaction of various conditions precedent and regulatory approvals.
The Agreement contemplates an aggregate transaction value of up to approximately 15 million NIS, payable in the Company shares valued at approximately USD $3 million. The number of shares to be issued will be 513,752 shares of common stock of the Company representing $6.02 cost per share.
The Agreement includes customary representations, warranties, covenants, indemnification provisions, confidentiality obligations, lock-up restrictions, and closing conditions. Closing remains subject to, among other things:
| ● | completion of legal, financial, and operational due diligence; |
| ● | receipt of all required corporate and regulatory approvals; |
| ● | applicable tax rulings and/or approvals in Israel; |
·execution and delivery of final ancillary closing documents; and
·satisfaction or waiver of other customary closing conditions.
Listing In Germany
During May 2026, the Company commenced the process of seeking registration of its common stock for trading on the Frankfurt Stock Exchange in Germany and, in connection therewith, obtained a Legal Entity Identifier (“LEI”) from WM Datenservice for international securities settlement and regulatory purposes. The process was completed in June 2026.
In connection with the Frankfurt listing and expansion of investor awareness activities in Europe, particularly within Germany, Switzerland, and Austria, the Company entered into (i) an Investor Awareness Advisory Agreement and (ii) an Investor Awareness Services Agreement with CapitaLink Ltd, an Israeli-based investor awareness and communications advisory firm.
Under the advisory agreement, the Company agreed issued 55,000 restricted shares of common stock pursuant to the Company’s 2024 Omnibus Equity Incentive Plan as consideration for advisory on investor awareness services related to the European market and Frankfurt listing process. The shares are subject to a 180-day lock-up and Rule 144 resale restrictions.
Under the services agreement, CapitaLink agreed to assist the Company with investor awareness outreach, European media distribution, informational campaign management, and administrative support relating to the Frankfurt Stock Exchange listing process, including support associated with exchange-related requirements and fees.
79
The Company’s Board of Directors approved the engagements and determined that the agreements were intended solely for investor awareness, educational outreach, and public communications purposes and did not constitute broker-dealer, placement agent, or investment advisory activities.
Key Financial Definitions/Components of Results
Operating Expenses
We classify our operating expenses into the following categories:
| ● | General and administrative expenses. General and administrative expenses consist primarily of personnel-related expenses for our executives, consultants and advisors. These expenses also include non-personnel costs, such as office supplies, legal, audit and accounting services and other professional fees. |
| ● | Research and development expenses. Research and development expenses include internal personnel and third-party consulting costs related to preliminary research and development of the Company’s products. |
| ● | Sales and marketing expenses. Sales and marketing expenses consist primarily of business development professional fees, advertising and marketing costs. |
| ● | Depreciation and amortization. Depreciation and amortization expenses consist primarily of depreciation related to property and equipment and amortization related to intangible assets. |
Critical Accounting Estimates
Management’s discussion and analysis of our financial condition and results of operations is based on our consolidated financial statements, which are prepared in conformity with accounting principles generally accepted in the United States of America. The preparation of these financial statements requires us to make certain estimates, judgments, and assumptions that we believe are reasonable based upon the information available. These estimates and assumptions can be subjective and complex and may affect the reported amounts of assets and liabilities, revenues, and expenses reported in those financial statements. As a result, actual results could differ from such estimates and assumptions. Such changes to estimates could potentially result in impacts that would be material to the consolidated financial statements.
While our significant accounting policies are described in more detail in Note 3 to our condensed consolidated financial statements on this Quarterly Report on Form 10-Q, we believe that the following accounting policies were most critical to the judgments and estimates used in the preparation of our consolidated financial statements.
Use of Estimates
The preparation of these consolidated financial statements in conformity with US GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the consolidated financial statements and the reported amounts of expenses during the reporting period.
Making estimates requires management to exercise significant judgement. It is at least reasonably possible that the estimate of the effect of a condition, situation or set of circumstances that existed at the date of the consolidated financial statements, which management considered in formulating its estimate, could change in the near term due to one or more future confirming events. Significant estimates include assumptions made in the valuation of the stock options, valuation of convertible notes, fair value of assets acquired including intangible assets, useful life of intangible assets, valuation of warrants, impairment of goodwill and intangible assets, recoverability of receivables, and recoverability of deferred tax assets. Accordingly, the actual results could differ from those estimates.
80
Business Combinations
The Company evaluates whether acquired net assets should be accounted for as a business combination or an asset acquisition by first applying a screen test to determine whether substantially all of the fair value of the gross assets acquired is concentrated in a single identifiable asset or group of similar identifiable assets. If so, the transaction is accounted for as an asset acquisition. If not, the Company applies its judgement to determine whether the acquired net assets meets the definition of a business by considering if the set includes an acquired input, process, and the ability to create outputs.
The Company accounts for business combinations using the acquisition method when it has obtained control. The Company measures goodwill as the fair value of the consideration transferred including the fair value of any non-controlling interest recognized, less the net recognized amount of the identifiable assets acquired and liabilities assumed, all measured at their fair value as of the acquisition date. Transaction costs, other than those associated with the issuance of debt or equity securities, that the Company incurs in connection with a business combination are expensed as incurred.
Any contingent consideration is measured at fair value at the acquisition date. For contingent consideration that does not meet all the criteria for equity classification, such contingent consideration is required to be recorded at its initial fair value at the acquisition date, and on each balance sheet date thereafter. Changes in the estimated fair value of liability-classified contingent consideration are recognized on the consolidated statements of operations in the period of change.
When the initial accounting for a business combination has not been finalized by the end of the reporting period in which the transaction occurs, the Company reports provisional amounts. Provisional amounts are adjusted during the measurement period, which does not exceed one year from the acquisition date. These adjustments, or recognition of additional assets or liabilities, reflect new information obtained about facts and circumstances that existed at the acquisition date that, if known, would have affected the amounts recognized at that date.
Net Loss Per Share
Basic net income (loss) per share is computed by dividing the net loss by the weighted average shares outstanding for the year. Diluted loss per share is computed by giving effect to all potential shares of common stock to the extent dilutive. For the three and nine months ended June 30, 2026 and 2025, the Company’s diluted weighted-average shares outstanding is equal to basic weighted-average shares, due to the Company’s net loss position. No common stock equivalents were included in the computation of diluted net loss per unit since such inclusion would have been antidilutive. As of June 30, 2026 and 2025, potentially dilutive securities include the public warrants, stock options and the convertible promissory notes.
Results of Operations
The following tables set forth the results of our operations for the periods presented, as well as the changes between periods. The period-to-period comparison of financial results is not necessarily indicative of future results.
81
The three months ended June 30, 2026 and 2025.
The following table sets forth the Company’s unaudited condensed consolidated statements of operations data for the three months ended June 30, 2026 and 2025:
| Three Months Ended June 30, | ||||||||||||
| 2026 | 2025 | Change | ||||||||||
| Revenue | $ | 286,339 | $ | — | $ | 286,339 | ||||||
| Cost of revenue | (171,759 | ) | — | (171,759 | ) | |||||||
| Gross Profit | 114,580 | — | 114,580 | |||||||||
| Operating costs: | ||||||||||||
| General and administrative | 5,989,701 | 132,933 | 5,856,768 | |||||||||
| Research and development | 747,803 | 8,548 | 739,255 | |||||||||
| Sales and marketing | 3,167,400 | 4,585 | 3,162,815 | |||||||||
| Depreciation and amortization | 8,354,343 | — | 8,354,343 | |||||||||
| Loss from operations | (18,144,667 | ) | (146,066 | ) | (17,998,601 | ) | ||||||
| Other (expense) income: | ||||||||||||
| Interest income | 185,789 | — | 185,789 | |||||||||
| Interest expense | (5,230,404 | ) | — | (5,230,404 | ) | |||||||
| Net loss from sale of Marketable Securities | — | (9,455 | ) | 9,455 | ||||||||
| Loss on disposal of investments | (523,011 | ) | — | (523,011 | ) | |||||||
| Change in fair value of convertible notes payable | (568,706 | ) | — | (568,706 | ) | |||||||
| Change in fair value of other liabilities | (15,610 | ) | — | (15,610 | ) | |||||||
| Change in fair value of other investments | (1,632,548 | ) | — | (1,632,548 | ) | |||||||
| Other expenses | (1,450 | ) | — | (1,450 | ) | |||||||
| Total other (expense) income, net | (7,785,940 | ) | (9,455 | ) | (7,776,485 | ) | ||||||
| Net loss | $ | (25,930,607 | ) | $ | (155,521 | ) | $ | (25,775,086 | ) | |||
Gross Profit
Gross profit for the three months ended June 30, 2026 was $114,580 as compared to $0 for the same period in 2025. The Company generates revenue from the Solar Drone mainly through its subsidiary Junko, which was acquired during the nine months ended June 30, 2026.
General and Administrative
General and administrative expenses for the three months ended June 30, 2026 was $5,989,701 as compared to $132,933 for the same period in 2025. The $5,856,768 increase in general and administrative for the three months ended June 30, 2026 reflects increases in professional services such as legal, stock-based compensation, consulting and accounting.
Research and Development
Research and Development expenses for the three months ended June 30, 2026 was $747,803, as compared to $8,548 for the same period in 2025. The $739,255 increase in research and development reflects increases in personnel and supplies related costs as the Company continues to develop its products. The Company expects that its research and development expense will increase in future periods as it seeks to develop and commercialize its products.
82
Sales and Marketing
Sales and marketing for the three months ended June 30, 2026 was $3,167,400 as compared to $4,585 for the same period in 2025. The $3,162,815 increase in sales and marketing reflects increases in marketing such as investor awareness costs as the Company continues to develop its products.
Depreciation and amortization
Depreciation and amortization for the three months ended June 30, 2026 was $8,354,343 as compared to $0 for the same period in 2025. The $8,354,343 increase is related to depreciation on fixed assets purchased and acquired in the asset acquisitions and amortization on intellectual property acquired in the asset acquisitions.
Interest income
During the three months ended June 30, 2026, the Company earned $185,789 in interest income on balances held in bank accounts as well as notes receivable balances.
Interest expense
Interest expense of $5,230,404 for the three months ended June 30, 2026, is mainly a result of the accrual of interest on the convertible notes payable and amortization of debt issuance cost on convertible notes payable.
Net loss from sale of Marketable Securities
Net loss from sale of Marketable Securities for the three months ended June 30, 2025 was a loss of 9,455 as a result of sale of AVAI shares.
Loss of disposal on investments
Loss on disposal of investment was $523,011 for the three months ended June 30, 2026 as a result of SaverOne shares transferred to Adrian for loan payment partially offset by sale of other investments held at fair value.
83
Change in fair value of convertible notes payable
During the three months ended June 30, 2026, the Company recorded a loss of $568,706 from the change in fair value of the convertible promissory note agreements issued under the Standby Equity Purchase Agreement entered into on July 25, 2025.
Change in fair value of other liabilities
During the three months ended June 30, 2026, the Company recorded a loss of $15,610 from the change in fair value of the stock-based compensation in connection with shares due to a vendor.
Change in fair value of other investments
During the three months ended June 30, 2026, the Company recorded a loss of $1,632,548 from the change in fair value of the investments in T3.
Other expenses
During the three months ended June 30, 2026, other expense of $1,450 was related to miscellaneous charges.
The nine months ended June 30, 2026 and 2025.
| Nine Months Ended June 30, | ||||||||||||
| 2026 | 2025 | Change | ||||||||||
| Revenue | $ | 286,339 | $ | — | $ | 286,339 | ||||||
| Cost of revenue | (171,759 | ) | — | (171,759 | ) | |||||||
| Gross Profit | 114,580 | — | 114,580 | |||||||||
| Operating costs: | ||||||||||||
| General and administrative | 13,592,558 | 408,164 | 13,184,394 | |||||||||
| Research and development | 1,334,412 | 79,993 | 1,254,419 | |||||||||
| Sales and marketing | 6,780,011 | 4,585 | 6,775,426 | |||||||||
| Depreciation and amortization | 14,175,488 | — | 14,175,488 | |||||||||
| Loss from operations | (35,767,889 | ) | (492,742 | ) | (35,275,147 | ) | ||||||
| Other (expense) income: | ||||||||||||
| Interest income | 205,191 | — | 205,191 | |||||||||
| Interest expense | (7,565,321 | ) | — | (7,565,321 | ) | |||||||
| Net gain from sale of Marketable Securities | — | 104,656 | (104,656 | ) | ||||||||
| Loss on disposal of investments | (523,011 | ) | — | (523,011 | ) | |||||||
| Change in fair value of convertible notes payable | (847,752 | ) | — | (847,752 | ) | |||||||
| Change in fair value of other liabilities | 247,190 | — | 247,190 | |||||||||
| Change in fair value of other investments | (1,632,548 | ) | — | (1,632,548 | ) | |||||||
| Other income | 107,525 | — | 107,525 | |||||||||
| Total other (expense) income, net | (10,008,726 | ) | 104,656 | (10,113,382 | ) | |||||||
| Net loss | $ | (45,776,615 | ) | $ | (388,087 | ) | $ | (45,388,528 | ) | |||
84
Gross Profit
Gross profit for the nine months ended June 30, 2026 was $114,580 as compared to $0 for the same period in 2025. The Company generates revenue from the Solar Drone mainly through its subsidiary Junko, which was acquired during the nine months ended June 30, 2026.
General and Administrative
General and Administrative expenses for the nine months ended June 30, 2026 was $13,592,558 as compared to $408,164 for the same period in 2025. The $13,184,394 increase in research and development reflects increases in personnel and supplies related to such as the Company continues to develop its.
Research and Development
Research and Development for the nine months ended June 30, 2026 was $1,334,412 as compared to $79,993 for the same period in 2025. The $1,254,419 increase in sales and marketing reflects increases in marketing such as investor awareness costs as the Company continues to develop its products.
Sales and Marketing
Sales and marketing for the nine months ended June 30, 2026 was $6,780,011 as compared to $4,585 for the same period in 2025. The $6,775,426 increase in sales and marketing reflects increases in marketing such as investor awareness costs as the Company continues to develop its products.
Depreciation and amortization
Depreciation and amortization for the nine months ended June 30, 2026 was $14,175,488 as compared to $0 for the same period in 2025. The $14,175,488 increase is in related to depreciation on fixed assets purchased and acquired in the asset acquisitions and amortization on intellectual property acquired in the asset acquisitions.
Interest income
During the nine months ended June 30, 2026, the Company earned $205,191 in interest income on balances held in bank accounts as well as notes receivable balances.
Interest expense
Interest expense of $7,565,321 for the nine months ended June 30, 2026, is mainly a result of the accrual of interest on the convertible notes payable and amortization of debt issuance cost on convertible notes payable.
Net gain from sale of Marketable Securities
Net gain from sale of Marketable Securities for the nine months ended June 30, 2025 was a gain of 104,656 as a result of sale of AVAI shares.
85
Loss of disposal on investments
Loss on disposal of investment was $523,011 for the nine months ended June 30, 2026 as a result of SaverOne shares transferred to Adrian for loan payment partially offset by the gain on disposal of other investments held at fair value.
Change in fair value of convertible notes payable
During the nine months ended June 30, 2026, the Company recorded a loss of $847,752 from the change in fair value of the convertible promissory note agreements issued under the Standby Equity Purchase Agreement entered into on July 25, 2025.
Change in fair value of other investments
During the nine months ended June 30, 2026, the Company recorded a loss of $1,632,548 from the change in fair value of the investments in T3.
Change in fair value of other liabilities
During the nine months ended June 30, 2026, the Company recorded a gain of $247,190 from the change in fair value of the stock-based compensation liability.
Other income
Other income of $107,525 for the nine months ended June 30, 2026, is mainly as a result for the completion of a pilot.
Liquidity, Capital Resources and Going Concern
The Company’s primary sources of liquidity have been cash from financing activities. For the nine months ended June 30, 2026, the Company’s net loss was $45,776,615. During the nine months ended June 30, 2026, the Company used cash of $14,821,280 for operating activities. As of June 30, 2026, the Company had an accumulated deficit of $60,788,463 as of June 30, 2026. As of June 30, 2026, working capital deficit was $33,262,307 and cash was $4,881,610.
On July 25, 2025, the Company entered into the Standby Equity Purchase Agreement (“SEPA”) with YA II PN, LTD, a Cayman Islands exempt limited partnership (the “Investor”) pursuant to which the Company has the right to sell to the Investor up to $50 million of its shares of common stock, subject to certain limitations and conditions set forth in the SEPA, from time to time during the term of the SEPA. The Company received proceeds of $10,540,571 from draw down during the nine months ended June 30, 2026.
The Company also received net proceed of $16,975,000 for loan issued during the three and nine months ended June 30, 2026 (See Note 14) and $850,000 from the issuance of convertible notes for the same periods.
86
Going Concern Assessment and Management’s Plans
In response to these conditions, on April 8, 2025, with an effective date of March 31, 2025 and as amended on July 28, 2026, the Company entered into a Funding Support Agreement with Stanley Hills, LLC (“Stanley Hills”), its principal shareholder of VisionWave Technologies, Pursuant to the agreement, Stanley Hills irrevocably and unconditionally committed to provide financial support to the Company, sufficient to fund the working capital needs through August 28, 2027. The funding may be provided by Stanley Hills in the form of direct payments to third parties, advances or intercompany loans or capital contributions, as mutually determined by the parties. Unless otherwise agreed in writing, any such advances will be non-interest bearing and repayable only at such time as determined by the Board of Directors, and only to the extent such repayment would not impair the Company’s liquidity or ability to continue as a going concern. The agreement may not be terminated by Stanley Hills prior to the twelve-month period from the date of release of the unaudited condensed consolidated financial statement.
Management has determined that the SEPA agreement, the agreement with Stanley Hills, cash receipts from customer arrangements, resource reallocation initiatives, additional insider investments and financing, along with its existing cash and committed affiliated support, alleviated the risk about the Company’s ability to continue as a going concern for a reasonable period of time, which is considered to be one year from the issuance of the unaudited condensed consolidated financial statements.
Cash flows for the nine months ended June 30, 2026 and 2025
The following table summarizes the Company’s cash flows from operating, investing and financing activities for the nine months ended June 30, 2026 and 2025:
| Nine Months Ended June 30, | ||||||||
| 2026 | 2025 | |||||||
| Net cash used in operating activities | $ | (14,281,280 | ) | $ | (113,840 | ) | ||
| Net cash (used) provided by in investing activities | (6,788,836 | ) | 114,375 | |||||
| Net cash provided by financing activities | $ | 24,188,450 | $ | — | ||||
Net Cash Used in Operating Activities
Net cash used in operating activities was $14,281,280 during the nine months ended June 30, 2026, compared to net cash used in operating activities of $113,840 during the nine months ended June 30, 2025. The period-to-period change was a result of VW Holding’s net loss for the periods and decrease in due from related party and increase in prepaid expenses partially offset by the increase in accounts payable and accrued expenses, increase in deferred revenue and increase in stock-based compensation liability.
Net Cash Used in Investing Activities
Net cash used in investing activities was $6,788,836 during the nine months ended June 30, 2026, compared to net cash provided by investing activities of $114,375 during the nine months ended June 30, 2025. The period-to-period change was a result of use of proceeds to fund Note Receivable and purchase fixed assets, acquire equity method investments and other investments, acquire subsidiary, net of cash acquired in asset acquisition.
Net Cash provided by Financing Activities
For the nine months ended June 30, 2026, net cash provided by financing activities was $24,188,450, compared to net cash flow from financing activities of $0 during the nine months ended June 30, 2025, respectively. The period-to-period change was primarily due to proceeds from issuance of convertible notes payable net of repayment, proceeds from issuance of promissory notes net of repayment, proceeds from drawdown of SEPA and the exercise of warrants.
87
Off-Balance Sheet Financing Arrangements
We have no obligations, assets or liabilities, which would be considered off-balance sheet arrangements as of June 30, 2026. We do not participate in transactions that create relationships with entities or financial partnerships, often referred to as variable interest entities, which would have been established for the purpose of facilitating off-balance sheet arrangements. We have not entered into any off-balance sheet financing arrangements, established any special purpose entities, guaranteed any debt or commitments of other entities, or purchased any non-financial assets.
Item 3. Quantitative and Qualitative Disclosures About Market Risk.
As a smaller reporting company (as defined in Rule 12b-2 of the Exchange Act), we are not required to provide disclosure under this Item 3.
Item 4. Controls and Procedures
Evaluation of Disclosure Controls and Procedures
Disclosure controls and procedures are designed to ensure that information required to be disclosed by us in our Exchange Act reports is recorded, processed, summarized, and reported within the time periods specified in the SEC’s rules and forms, and that such information is accumulated and communicated to our management, including our principal executive officer and principal financial officer or persons performing similar functions, as appropriate to allow timely decisions regarding required disclosure.
As required by Rules 13a-15 and 15d-15 under the Exchange Act, our Chief Executive Officer and Chief Financial Officer carried out an evaluation of the effectiveness of the design and operation of our disclosure controls and procedures as of June 30, 2026. Based upon their evaluation, our Chief Executive Officer and Chief Financial Officer concluded that our disclosure controls and procedures (as defined in Rules 13a-15(e) and 15d-15(e) under the Exchange Act) were not effective.
Limitations on the Effectiveness of Controls
Management of the Company, including its Chief Executive Officer and its Chief Financial Officer, does not expect that the Company’s disclosure controls and procedures or its internal control over financial reporting will prevent or detect all error and all fraud. A control system, no matter how well designed and operated, can provide only reasonable, not absolute, assurance that the control system’s objectives will be met. The design of a control system must reflect the fact that there are resource constraints, and the benefits of controls must be considered relative to their costs. Furthermore, because of the inherent limitations in all control systems, no evaluation of controls can provide absolute assurance that misstatements due to error or fraud will not occur or that all control issues and instances of fraud, if any, have been detected. These inherent limitations include the realities that judgments in decision-making can be faulty and that breakdowns can occur because of simple error or mistake. Controls can also be circumvented by the individual acts of some persons or by the collusion of two or more persons. The design of any system of controls is based in part on certain assumptions about the likelihood of future events, and there can be no assurance that any design will succeed in achieving its stated goals under all potential future conditions. Projections of any evaluation of the effectiveness of controls to future periods are subject to risks. Over time, controls may become inadequate because of changes in conditions or deterioration in the degree of compliance with policies or procedures.
Changes in Internal Control over Financial Reporting
During the fiscal quarter ended June 30, 2026, there has been no change in our internal control over financial reporting that has materially affected, or is reasonably likely to materially affect, our internal control over financial reporting. Our process for evaluating controls and procedures is continuous and encompasses constant improvement of the design and effectiveness of established controls and procedures.
88
PART II - OTHER INFORMATION
Item 1. Legal Proceedings
Maxim Group LLC
On April 17, 2026, Maxim Group LLC filed a complaint against VisionWave Holdings, Inc. in the Supreme Court of the State of New York, County of New York, alleging breach of contract and seeking damages related to certain financing transactions completed by the Company in July 2025 and February 2026 pursuant to an engagement agreement dated April 9, 2025. Maxim alleges entitlement to placement fees and declaratory relief in connection with financings involving YA II PN, Ltd., a fund managed by Yorkville Advisors Global, LP. The action includes claims for alleged unpaid fees of approximately $1.33 million, declaratory relief concerning alleged tail rights and rights of first refusal, attorneys’ fees, interest, and other relief. The action was filed under an unassigned New York County index number as of the filing date. The Company believes the asserted claims are without merit and intends to defend the matter vigorously.
Also on April 17, 2026, the Company filed a separate action against Maxim Group LLC in the Supreme Court of the State of New York, County of New York, asserting claims for breach of contract, declaratory judgment, and unjust enrichment. The Company alleges, among other things, that Maxim did not identify or place the relevant financing transactions, was not entitled to compensation under the parties’ agreement, and wrongfully invoiced the Company for fees related to the July 2025 and February 2026 financings. The Company seeks, among other relief, repayment of approximately $210,000 previously paid to Maxim, rescission of an additional
invoice of approximately $1.4 million, declaratory relief regarding the parties’ rights under the agreement, damages, restitution, interest, and costs. The Company believes Maxim’s claims are without merit and intends to vigorously defend against them while aggressively pursuing its own claims. This action was also filed under an unassigned New York County index number as of the filing date. At this early stage of the proceedings, the Company is unable to reasonably estimate the ultimate outcome or potential loss, if any, associated with these matters.
Except as described above, the Company is not a party to any other pending legal proceedings that management believes, individually or in the aggregate, would have a material adverse effect on the Company’s business, financial condition, or results of operations.
Pre-litigation disputes with former employees
The Company is involved in certain pre-litigation disputes with former employees, former executives, and other individuals associated with the Company arising primarily from organizational changes implemented following the departure of the Company’s former Chief Executive Officer in late December 2025. Such matters include allegations relating to severance, unpaid compensation, notice-period pay, equity awards, and related contractual and employment matters. Certain individuals have asserted claims through counsel, and the parties have engaged in correspondence and preliminary settlement discussions.
The Company disputes the allegations and claims asserted in these matters and intends to vigorously defend its positions. As of the date of this Quarterly Report, no formal lawsuits, arbitrations, or other legal proceedings have been filed with respect to these matters. Due to the early stage of these disputes, the absence of formal proceedings, and the inherent uncertainty surrounding such matters, the Company is unable to reasonably estimate the possible loss or range of loss, if any, that may result from these matters. Accordingly, no liability has been accrued in the accompanying condensed consolidated financial statements.
89
Item 1A. Risk Factors
As of June 30, 2026, there have been no material changes to the risk factors previously disclosed in our Annual Report on Form 10-K for the fiscal year ended September 30, 2025, filed with the Securities and Exchange Commission (the “SEC”) on December 31, 2025, and in our Registration Statement on Form S-1 filed with the SEC on April 16, 2026 (the “S-1”), which is incorporated by reference herein. The following risk factors supplement and highlight certain risks from the S-1 that remain particularly material to the Company in light of events occurring during the quarter ended June 30, 2026. These risks, together with those in the S-1 and our other SEC filings, could materially and adversely affect our business, financial condition, results of operations, cash flows, and the trading price of our Common Stock. Investors should carefully consider these risks before making any investment decision.
We have a history of operating losses, limited operating history, and substantial doubt about our ability to continue as a going concern.
We are an early-stage company with limited operating history. We have incurred significant net losses since inception, and we expect to continue to incur substantial operating losses as we advance our technology development, integration initiatives (including Solar Drone and the SaverOne platform), and commercialization efforts. As of June 30, 2026, our liquidity position and cash runway remain limited. Absent the mitigating plans and the committed financial support described in Note 2 to the accompanying unaudited condensed consolidated financial statements, these conditions would raise substantial doubt about our ability to continue as a going concern within one year after the date these financial statements are issued. Although management has concluded that such doubt has been alleviated, there can be no assurance that the committed support will be sufficient or available when needed. Our ability to continue operations depends on our ability to obtain additional financing, generate revenue from customer orders, and achieve positive cash flow, none of which is assured.
Our current business plans require a significant amount of capital. If we are unable to obtain sufficient funding or do not have access to capital on acceptable terms, we may not be able to execute our business plans, and our prospects, financial condition, and results of operations could be materially adversely affected.
The extent to which we rely on YA II PN, LTD. (“YA II”) as a source of funding depends on multiple factors, including the prevailing market price of our common stock, our ability to satisfy the conditions necessary to deliver Advance Notices under the Standby Equity Purchase Agreement dated July 25, 2025 (as amended, the “SEPA”), the impact of the Exchange Cap and Ownership Limitation under the SEPA, and our success in securing funding from other sources.
In addition to the SEPA facility (under which we may sell up to $50 million of common stock, subject to limitations), we have received substantial capital from YA II. We received a $5.0 million Pre-Paid Advance under the SEPA, evidenced by convertible notes issued at 94% of principal, bearing 6% interest (increasing to 18% upon default), with a 12-month maturity per tranche (the “Convertible Notes”). On February 26, 2026, we entered into a Letter Agreement with YA II pursuant to which YA II provided a $20 million senior loan (the “Loan”) evidenced by a Promissory Note (the “Note”) issued at a 15% original issue discount, resulting in net cash proceeds of approximately $16.975 million after fees. The Note bears 0% interest (increasing to 18% upon an Event of Default), matures in 12 months, and requires monthly amortization payments of $2.5 million of principal plus a 2% premium (commencing on the 60th day after issuance). Amortization may be satisfied in cash or, subject to a 30-day repayment waterfall in favor of YA II, by delivering an Advance under the SEPA. Concurrently, we issued YA II a five-year warrant to purchase 1,333,333 shares of common stock at an exercise price of $9.00 per share. The obligations under the Note are guaranteed by each of our subsidiaries.
We have experienced operating losses and expect to continue to incur operating losses as we implement our business plans in the defense technology, advanced sensing, AI, and related sectors. We expect our capital expenditures to remain significant as we expand operations, including through our network of subsidiaries and strategic initiatives. Our limited operating history in certain areas means our capital requirements are uncertain and may differ materially from current expectations. New growth opportunities may also require additional capital.
90
As of June 30, 2026, our principal source of liquidity is our cash balance in the amount of approximately $14 million. While the SEPA provides us with the right, but not the obligation, to sell shares to YA II, our ability to utilize the facility is subject to conditions that may not be satisfied, including registration effectiveness, market conditions, and the Exchange Cap (unless stockholder approval is obtained in accordance with Nasdaq rules). In addition, certain events under the Convertible Notes (including a Floor Price Event or Exchange Cap Event, subject to post-Rule 144 Date provisions) may trigger monthly amortization payments of $750,000 plus a 5.0% premium and accrued interest. An uncured Event of Default under the Note could result in acceleration of the full amount, 18% default interest, and conversion rights at a discount to market (subject to a 4.99% beneficial ownership blocker and floor price).
Any additional debt incurred from YA II or third parties could increase our vulnerability to downturns in operating results or economic conditions. If our cash flow from operations is insufficient to meet debt service obligations—including monthly amortizations under the Note or potential accelerated payments under the Convertible Notes—we may be required to refinance, dispose of assets, or seek additional financing on unfavorable terms.
As an early-stage growth company, our ability to access capital is critical. We expect to continue seeking additional capital through the SEPA (when conditions permit), other equity or equity-linked offerings, credit facilities, or debt securities to finance future expenditures. Sales of additional equity or equity-linked securities (including under the SEPA, upon conversion of the Note or Convertible Notes, or exercise of the Warrant) will dilute our existing stockholders. Incurrence of additional indebtedness would increase debt service obligations and could impose restrictive operating and financial covenants.
Our ability to raise sufficient funds on favorable terms is subject to general market conditions, investor acceptance of our business model, and our compliance with the terms of existing arrangements with YA II. If we are unable to obtain adequate financing, we may need to significantly reduce spending, delay or cancel planned activities, or substantially alter our corporate or operational structure. We might not obtain any such funding, or we might not have sufficient resources to conduct our business as projected. Either outcome could force us to curtail or discontinue operations, materially adversely affecting our prospects, financial condition, and consolidated results of operations, in which case investors could lose some or all of their investment.
Our recent strategic transactions, including the SaverOne Exchange Agreement and BladeRanger/Solar Drone acquisition, involve significant integration, milestone, and execution risks.
The SaverOne transaction is structured in three stages, with Stage 1 – 3 completed by June 30, 2026. Failure integrate acquired technologies and operations (including Solar Drone), or satisfy regulatory or shareholder approval requirements could result in loss of strategic benefits, unexpected costs, dilution, or termination of the arrangements, any of which would materially and adversely affect our business and financial condition.
The senior secured loan from YA II PN Ltd. and associated Warrant expose us to repayment obligations, restrictive covenants, and dilution risks.
In February 2026, we entered into a $20 million senior loan (with 15% OID) evidenced by a Promissory Note and issued a Warrant to purchase 1,333,333 shares of Common Stock. The Note carries default interest at 18% and is secured by a global guaranty. Events of default or failure to satisfy payment obligations could accelerate repayment and materially impair our liquidity. Exercise of the Warrant and any future equity issuances will cause dilution to existing stockholders.
We face significant dilution risk from outstanding and potential future issuances of Common Stock, Pre-Funded Warrants, and other securities.
As of June 30, 2026, we have outstanding Pre-Funded Warrants (initial and potential Additional PFWs under the BladeRanger Agreement), the YA II Warrant, and shares issuable under the SaverOne Exchange Agreement and management pools. The S-1 registers resale of approximately 6,148,943 shares (including Warrant Shares). Additional issuances pursuant to these instruments, the 2024 and 2025 Incentive Plans, or future financings will dilute existing stockholders and may depress our stock price.
91
Commercialization of our technologies is subject to technical, regulatory, and market acceptance risks.
Our products are in various stages of development, prototype testing, and early commercialization (including Solar Drone solar-panel cleaning and defense applications). There can be no assurance that we will successfully complete development, obtain necessary certifications, secure large-scale purchase orders, or achieve market acceptance. Delays or failure in any of these areas would materially and adversely affect our revenue, results of operations, and financial condition.
Our intellectual property may not provide adequate protection, and we may infringe third-party rights.
We rely on patents, trade secrets, and other intellectual property to protect our technologies, including the recently acquired xClibre™ AI video intelligence portfolio and provisional patent filings. There can be no assurance that our patents will issue, be enforceable, or provide meaningful commercial protection. We may face claims of infringement or challenges to our IP rights, any of which could result in costly litigation, licensing obligations, or loss of competitive advantage.
We are subject to stringent regulatory, export-control, and Nasdaq continued-listing requirements.
Our defense and homeland-security technologies are subject to U.S. and Israeli export controls, ITAR/EAR requirements, and other governmental approvals. Failure to obtain or maintain necessary clearances could delay or prevent commercialization. In addition, issuances of Common Stock under our agreements require Nasdaq shareholder approval under Listing Rule 5635 in certain circumstances. Any failure to comply with listing standards could result in delisting, which would materially and adversely affect the liquidity and market price of our Common Stock.
Our international operations, particularly in Israel, expose us to geopolitical, currency, and regulatory risks.
A significant portion of our technology development, manufacturing, and strategic partnerships (SaverOne, BladeRanger, Solar Drone) is located in Israel. Geopolitical instability, armed conflict, currency fluctuations (NIS/USD), and changes in Israeli or U.S. regulatory policy could disrupt operations, increase costs, or impair our ability to integrate acquired assets or fulfill contractual obligations.
We face significant challenges in integrating our recent and contemplated acquisitions, asset purchases, joint ventures and strategic transactions, and there can be no assurance that we will successfully close pending stages or future deals or realize the anticipated benefits of our business plan. Any failure could materially and adversely affect our business, financial condition, results of operations, liquidity and the market price of our common stock.
Since late 2025, the Company has entered into multiple material transactions, including:
● the January 5, 2026 QuantumSpeed asset purchase from Adrian Holdings S.R.L. (with 7 million contingent shares subject to Nasdaq stockholder approval and potential subsidiary equity transfer if approval is not obtained);
●the January 9, 2026 joint venture with BOCA JOM, LLC, GBT Tokenize Corp. and GBT Technologies, Inc. (subject to Nasdaq Rule 5635 approvals, CFIUS/export controls and other regulatory clearances);
● the three-stage SaverOne equity exchange dated January 26, 2026 (all three stages have closed);
● the December 2025 Blade Ranger acquisition (with additional pre-funded warrants potentially issuable based on VWAP);
●the February 2026 51% acquisition (not closed) of C.M. Composite Materials Ltd. and related $5 million loan facility (expressly conditioned on JV Condition in India and subject to Giza Side Letter restrictions, with closing required by June 30, 2026);
● the March 2026 SolarDrone/Junko solar business acquisition;
92
●the March 2026 Letter of Engagement with the National Oil Company of Liberia for Blocks LB-4 and LB-5 (requiring a $600,000 signing bonus and future payments - $4,000,000 if Production agreement will be achieved, subject to regulatory and legislative approvals);
● the April 10, 2026 xClibre asset purchase from Dream America Marketing Services, Ltda. (with 3.5 million contingent shares subject to Nasdaq stockholder approval;
● Proposed Data Center Joint Venture. On June 12, 2026, the Company entered into a term sheet with Lucky Whale Production Limited to form a joint venture to develop a Tier IV data center in Beth Shemesh, Israel, in which the Company would hold an effective indirect interest of approximately 51%, with consideration of approximately $40 million in Common Stock issuable to the land owner;
●T3 Defense Share Exchange. On May 17, 2026, the Company issued 475,492 shares of Common Stock (valued at approximately $2.658 million) to T3 Defense Inc. (Nasdaq: DFNS) in exchange for 6,000,000 shares of DFNS common stock; and
● Adrian Holdings Assignment Agreement. On June 22, 2026, the Company assigned to Adrian Holdings S.R.L. its right to receive a portion of the SaverOne shares issuable at the Stage 2 and Stage 3 closings, reducing the outstanding principal of the Adrian Note by approximately $1.43 million.
These and any future transactions expose us to substantial risks, including:
●Integration difficulties. Combining acquired technologies (QuantumSpeed IP, SaverOne RF platforms, C.M. Composite materials, Junko operations, Blade Ranger assets, xClibre assets etc.), personnel, operations and systems across multiple jurisdictions may divert significant management attention, result in higher-than-expected costs, loss of key personnel, operational disruptions, control weaknesses and failure to achieve expected synergies or revenue growth.
●Failure to close or unwind risks. Many transactions remain subject to conditions outside our control, such as Nasdaq stockholder approvals under Rule 5635, regulatory clearances (CFIUS, export controls, Israeli/Indian/Liberian approvals), milestone achievements and the JV Condition. Failure to satisfy these conditions could result in loss of benefits already partially paid for (including cash advances and issued shares), mandatory equity transfers, or forfeiture of consideration without refund.
●Dilution and valuation uncertainty. These deals have caused and will continue to cause substantial dilution through issuance of millions of shares, pre-funded warrants and potential additional securities. The $1.0 billion internal reference value used in the JV was not supported by an independent valuation or fairness opinion.
●International and regulatory risks. Operations in or targeting Israel, India, Costa Rica and Liberia expose us to political, economic, currency, anti-corruption (FCPA), sanctions and national-security risks. Failure to obtain or maintain required approvals could render acquired assets unusable.
Our growth strategy depends heavily on the successful execution and integration of these and future transactions. Failure to manage these risks effectively could have a material adverse effect on our business, financial condition, results of operations and stock price.
93
We depend on key personnel, and failure to retain or attract qualified management and technical talent could impair our business.
Our success depends heavily on our executive officers (including Douglas Davis, our Executive Chairman and CEO) and key technical personnel. The loss of any of these individuals, or our inability to attract and retain other qualified personnel, could delay technology development, integration efforts, and commercialization, materially and adversely affecting our business, financial condition, and results of operations.
These risk factors are not exhaustive. Additional risks and uncertainties not presently known to us or that we currently deem immaterial may also impair our business operations and the value of our securities. Investors are urged to review the full discussion of risk factors in our S-1 and subsequent SEC filings. All forward-looking statements in this Quarterly Report are qualified in their entirety by reference to these risk factors.
Bannix’ failure to redeem all remaining public offering shares may expose the Company to legal, regulatory, and reputational risks
Bannix was required to redeem all remaining public offering shares no later than June 27, 2025. Bannix Acquisition Corp. did not redeem the remaining public offering shares as required, and the Business Combination was subsequently consummated on July 14, 2025. The failure to redeem was inconsistent with disclosures in the Bannix IPO prospectus and the Business Combination proxy statement. This failure may expose the Company to legal, regulatory, and reputational risks.
Any of the above mentioned factors, or any other negative impact on the global economy, capital markets or other geopolitical conditions resulting from the Russian invasion of Ukraine, the Israel-Hamas conflict, the Iran conflict and subsequent sanctions or related actions, could adversely affect the Company’s operations in the future or with future capital raising activities. The Company has not been affected so far by these conflicts or US tariffs.
Substantial Sales or Issuances of Common Stock Under Our Financing Arrangements with YA II May Cause Our Stock Price to Decline and Result in Dilution to Our Stockholders.
On July 25, 2025, we entered into the Standby Equity Purchase Agreement (as amended, the “SEPA”) with YA II PN, LTD. (“YA II”), pursuant to which we may sell up to $50 million of our common stock from time to time. In connection with the SEPA, YA II provided a $5 million Pre-Paid Advance (evidenced by Convertible Notes issued at 94% of principal, bearing 6% interest, with conversion rights at the lower of $10.00 or 93% of the lowest daily VWAP during the five preceding trading days, subject to a $1.00 floor price). Following effectiveness of the registration statement registering shares issuable under the SEPA, on February 26, 2026, we entered into a Letter Agreement with YA II pursuant to which YA II provided a $20 million senior secured loan (the “Loan”) evidenced by a Promissory Note (the “Note”) issued at a 15% original issue discount, resulting in net proceeds of approximately $16.975 million after fees. The Note bears 0% interest (increasing to 18% upon default), requires monthly amortization payments of $2.5 million of principal plus a 2% premium (commencing on the 60th day after issuance and continuing monthly until maturity in 12 months), and may be satisfied in cash or, subject to a 30-day repayment waterfall in favor of YA II, by delivering an Advance under the SEPA. Concurrently, we issued YA II a five-year Warrant to purchase 1,333,333 shares of common stock at $9.00 per share. The obligations under the Note are guaranteed by each of our subsidiaries.
Any sales of shares under the SEPA, issuances upon conversion of the Convertible Notes or the Note (upon an uncured Event of Default at 90% of the lowest daily VWAP during the 10 preceding trading days, subject to a 4.99% beneficial ownership blocker and floor price), or exercises of the Warrant, or the perception that such sales or issuances may occur, could cause the market price of our common stock to decline significantly. These issuances will dilute the ownership interests of our existing stockholders and may dilute earnings per share and book value per share. We have agreed to register the shares issuable upon exercise of the Warrant and have granted YA II demand registration rights covering shares issuable upon conversion of the Note.
94
The Number of Shares Issuable and the Proceeds We May Receive Under the SEPA Are Uncertain and May Be Materially Less Than the Maximum Commitment.
We control the timing and amount of any Advances under the SEPA, subject to limitations including the Ownership Limitation, the Exchange Cap (unless stockholder approval is obtained in accordance with Nasdaq rules), and other conditions in the SEPA. The purchase price for shares sold under an Advance is 97% of the lowest daily VWAP during the applicable three-trading-day period. Depending on market conditions and the trading price of our common stock, we may not raise the full $50 million commitment amount even if all currently registered shares are sold, and additional registration statements would be required to sell shares beyond those registered. These factors, together with our obligations under the Note, could limit our access to capital and require us to seek alternative financing on less favorable terms.
Our Obligations Under the Convertible Notes and the Promissory Note May Require Significant Cash Payments That Could Adversely Affect Our Liquidity, Financial Condition, and Operations.
Certain events under the Convertible Notes (including a Floor Price Event, Exchange Cap Event, or Registration Event, subject to post-Rule 144 Date provisions) trigger monthly amortization payments of $750,000 plus a 5% premium and accrued interest. The Note requires substantial monthly amortization payments and contains customary covenants, including restrictions on variable rate transactions, additional indebtedness without YA II’s consent, and use of proceeds. An uncured Event of Default under the Note could result in acceleration, 18% default interest, and immediate conversion rights at a discount to market. These payment obligations, whether satisfied in cash or through SEPA Advances, could materially strain our liquidity and financial resources, particularly if market conditions limit our ability to utilize the SEPA or if we experience Events of Default.
Investors Who Purchase Shares at Different Times May Pay Different Prices and Experience Different Levels of Dilution.
Pursuant to the SEPA, we have discretion over the timing, prices, and number of shares sold to YA II. YA II may resell such shares, the shares issuable upon conversion of the Note (upon default), or the shares issuable upon exercise of the Warrant at different times and prices. As a result, investors purchasing shares in this offering or in the secondary market may experience different levels of dilution and different investment outcomes. The resale of these shares, or the perception that such resales could occur, could also harm the prevailing market price of our common stock.
These risk factors have been prepared on behalf of VisionWave Holdings Inc. (Nasdaq: VWAV) in connection with its SEC reporting obligations and reflect all material facts regarding the SEPA (including the Pre-Paid Advance and Convertible Notes) and the February 26, 2026 Loan transaction with YA II. The disclosures are condensed for clarity while preserving the substance required for investor protection under the Securities Act of 1933, as amended. No additional risks have been identified in the Bylaws or Certificate of Incorporation that require disclosure in this context.
Item 2. Unregistered sale of equity securities, use of proceeds, and issuer purchases of equity securities
During the three months ended June 30, 2026, the Company issued the following securities that were not registered under the Securities Act of 1933, as amended (the “Securities Act”):
● On April 10, 2026, the Company issued 3,500,000 shares of common stock to Dream America Marketing Services, Ltda. as partial consideration for the xClibre intellectual property assets acquired pursuant to the Asset Purchase Agreement dated April 10, 2026 (See Note 10).
● At the Stage 2 and Stage 3 closings under the Exchange Agreement with SaverOne 2014 Ltd., the Company issued 945,251 shares of common stock to SaverOne, and issued 386,386 shares of common stock to members of management pursuant to Schedule 1.7 of the Exchange Agreement (See Note 6).
● In May 2026, the Company issued 475,590 shares of common stock to T3 Defense Inc. (“DFNS”) pursuant to the Share Exchange and Swap Agreement dated May 17, 2026 (See Note 6).
95
● On May 7, 2026, the Company issued 55,000 shares of common stock to a vendor pursuant to a consulting agreement for services to be rendered from May 2026 to October 2026 (See Note 21).
Each of the foregoing issuances was made in reliance upon the exemption from registration provided by Section 4(a)(2) of the Securities Act as a transaction by an issuer not involving any public offering. Each recipient acquired the securities for investment and not with a view to, or for resale in connection with, any distribution thereof, and appropriate restrictive legends were affixed to the securities. No underwriters were involved in, and no general solicitation or general advertising was used in connection with, any of the foregoing issuances, and no commissions were paid in connection therewith.
Securities Purchase Agreements
On July 15, 2025, the Company entered into Securities Purchase Agreements (the “July 2025 SPAs”) with two unaffiliated accredited investors (“July 2025 Lenders”), pursuant to which the Company issued promissory notes (the “July 2025 Notes”) to the July 2025 Lenders in the aggregate principal amount of $354,200, which includes an aggregate original issue discount of $46,200, for a purchase price of $308,000. The Company incurred an additional $8,000 in fees related to this transaction which is capitalized as part of the debt issuance cost and amortized over the term of the July 2025 Notes. The July 2025 Notes bear interest at a one-time charge of 12% applied on the issuance date, mature on May 15, 2026, and is repayable in five monthly payments commencing January 15, 2026. The July 2025 Notes are convertible into shares of the Company’s common stock, par value $0.01 per share (the “Common Stock”), solely upon an event of default, at a conversion price equal to 75% of the lowest trading price during the ten trading days prior to conversion. The Company also entered into an irrevocable transfer agent instructions letter with its transfer agent in connection with the July 2025 Notes. The proceeds from the issuances of the July 2025 Notes were used for general working capital purposes. The July 2025 Lenders have piggyback registration rights and have agreed not to engage in short sales of the Company’s common stock during the term of the July 2025 Notes. The July 2025 Notes include customary representations, warranties, covenants, and default provisions. The Company may prepay the July 2025 Notes within the first 180 days. The loan pursuant to the July 2025 Notes closed and funded on July 17, 2025.
The Company repaid $396,704 on the July 2025 Notes (inclusive of $42,504 of interest). For the three months ended June 30, 2026 and 2025 total amortized debt issuance cost of $12,877 and $0 was included in interest expense on the accompanying consolidated statements of operations, respectively, and $45,463 and $0 for the nine months ended June 30, 2026 and 2025, respectively. For the three months ended June 30, 2026 and 2025, total interest expense $6,376 and $0 was included in interest expense on the accompanying consolidated statements of operations, respectively, and $31,878 and $0 for the nine months ended June 30, 2026 and 2025, respectively. At June 30, 2026 and September 30, 2025, the balance of the July Notes of $0 and 308,737, recorded in convertible notes payable on the accompanying balance sheets, includes $0 and $45,463, respectively, of unamortized debt issuance cost.
On October 6, 2025, the Company entered into a Securities Purchase Agreement (the “October 2025 SPA”) with an unaffiliated accredited investor, pursuant to which the Company issued a promissory note (the “October 2025 Note”) to the investor in the aggregate principal amount of $296,700, which includes an aggregate original issue discount of $38,700, for a purchase price of $258,000. The Company incurred an additional $8,000 in fees related to this transaction which is capitalized as part of the debt issuance cost and amortized over the term of the October 2025 Note. The October 2025 Note bear interest at a one-time charge of 12% applied on the issuance date, mature on July 30, 2026, and is repayable in five monthly payments commencing March 30, 2026. The October 2025 Note is convertible into shares of the Company’s common stock, par value $0.01 per share, solely upon an event of default, at a conversion price equal to 75% of the lowest trading price during the ten trading days prior to conversion. The Company also entered into an irrevocable transfer agent instructions letter with its transfer agent in connection with the October 2025 Note. The proceeds from the issuances of the October 2025 Note were used for general working capital purposes. The October 2025 investor have piggyback registration rights and have agreed not to engage in short sales of the Company’s common stock during the term of the October 2025 Note. The October 2025 Note include customary representations, warranties, covenants, and default provisions. The Company may prepay the October 2025 Notes within the first 180 days.
96
For the three and nine months ended June 30, 2026 and 2025, total amortized debt issuance cost of $14,012 and $0, and $42,035 and$0 was included in interest expense on the accompanying consolidated statements of operations, respectively. For the three and nine months ended June 30, 2026 and 2025, total interest expense $10,681 and $0, and $35,374 and $0 was included in interest expense on the accompanying consolidated statements of operations, respectively. At June 30, 2026 and September 30, 2025, the balance of the October Notes of $1,269 and $0, respectively, recorded in convertible notes payable on the accompanying balance sheets, includes $4,665 and $0, respectively, of unamortized debt issuance cost.
On November 12, 2025, the Company entered into a Securities Purchase Agreement (the “November 2025 SPA”) with an unaffiliated accredited investor, pursuant to which the Company issued a promissory note (the “November 2025 Note”) to the November 2025 investor in the aggregate principal amount of $354,200, which includes an aggregate original issue discount of $46,200, for a purchase price of $308,000. The Company incurred an additional $8,000 in fees related to this transaction which is capitalized as part of the debt issuance cost and amortized over the term of the November 2025 Note. The November 2025 Note bear interest at a one-time charge of 12% applied on the issuance date, mature on September 15, 2026, and is repayable in five monthly payments commencing May 15, 2026. The November 2025 Note is convertible into shares of the Company’s common stock, par value $0.01 per share (the “Common Stock”), solely upon an event of default, at a conversion price equal to 75% of the lowest trading price during the ten trading days prior to conversion. The Company also entered into an irrevocable transfer agent instructions letter with its transfer agent in connection with the November 2025 Notes. The proceeds from the issuances of the November 2025 Notes were used for general working capital purposes. The investor has piggyback registration rights and have agreed not to engage in short sales of the Company’s common stock during the term of the November 2025 Note. The November 2025 Note include customary representations, warranties, covenants, and default provisions. The Company may prepay the November 2025 Note within the first 180 days.
For the three and nine months ended June 30, 2026 and 2025, total amortized debt issuance cost of $17,533 and $0, and $41,707 and $0 was included in interest expense on the accompanying consolidated statements of operations, respectively. For the three and nine months ended June 30, 2026 and 2025, total interest expense $12,751 and $0, and $31,878 and $0 was included in interest expense on the accompanying consolidated statements of operations, respectively. At June 30, 2026 and September 30, 2025, the balance of the November Notes of $93,767 and $0, respectively, recorded in convertible notes payable on the accompanying balance sheets, includes $12,493 and $0, respectively of unamortized debt issuance cost.
On January 9, 2026, the Company issued promissory notes (the “January 2026 Notes”) to two investors in the aggregate principal amount of $354,200, which includes an aggregate original issue discount of $46,200, for a purchase price of $293,000. The Company incurred an additional $8,000 in fees related to this transaction which is capitalized as part of the debt issuance cost and amortized over the term of the January 2026 Notes. The January 2026 Notes bear interest at a one-time charge of 12% applied on the issuance date, mature on November 15, 2026, and is repayable in five monthly payments commencing July 15, 2026. The January 2026 Notes are convertible into shares of the Company’s common stock, par value $0.01 per share, solely upon an event of default, at a conversion price equal to 75% of the lowest trading price during the ten trading days prior to conversion. The Company also entered into an irrevocable transfer agent instructions letter with its transfer agent in connection with the January 2026 Notes. The proceeds from the issuances of the January 2026 Notes were used for general working capital purposes. The investors have piggyback registration rights and have agreed not to engage in short sales of the Company’s common stock during the term of the January 2026 Notes. The January 2026 Notes include customary representations, warranties, covenants, and default provisions. The Company may prepay the January 2026 Notes within the first 180 days.
The Company evaluated the embedded conversion features and other terms of the January 2026 Notes under applicable accounting guidance, including ASC 815, Derivatives and Hedging. The conversion feature is exercisable solely upon an event of default and accordingly, the Company concluded that bifurcation of the embedded conversion feature was not required as of issuance. The January 2026 Notes were therefore initially recorded at their principal amount, net of unamortized original issue discount and debt issuance costs. As the notes were not elected under the fair value option of ASC 825, the Company accounts for the January 2026 Notes at amortized cost and no recurring fair value measurement is required.
97
For the nine months ended June 30, 2026 and 2025, total amortized debt issuance cost of $31,151 and $0, respectively, was included in interest expense on the accompanying unaudited condensed consolidated statements of operations. For the three and nine months ended June 30, 2026 and 2025, total interest expense $12,751 and $0, respectively, and $23,377 and $0, respectively, was included in interest expense on the accompanying unaudited condensed consolidated statements of operations. At June 30, 2026 and September 30, 2025, the balance of the January Notes of $331,150 and $0, respectively, recorded in convertible notes payable on the accompanying balance sheets, includes $23,050 and $0, respectively of unamortized debt issuance cost.
Standby Equity Purchase Agreement - Pre-Paid Advance
On July 25, 2025, we entered into the SEPA with the Investor. Under the SEPA, the Company has the right to sell to the Investor up to $50 million of its shares of common stock, subject to certain limitations and conditions set forth in the SEPA, from time to time during the term of the SEPA. On January 19, 2026, we entered into Amendment No. 1 to the SEPA.
Upon the satisfaction of the conditions to the Investor’s purchase obligation set forth in the SEPA, including having a registration statement covering the resale of the shares of common stock issuable under the SEPA declared effective by the SEC, the Company will have the right, but not the obligation, from time to time at its discretion until the SEPA is terminated to direct Investor to purchase a specified number of shares of common stock (“Advance”) by delivering written notice to the Investor (“Advance Notice”). While there is no mandatory minimum amount for any Advance, it may not exceed an amount equal to 100% of the average of the daily traded amount during the five consecutive trading days immediately preceding an Advance Notice.
The shares of common stock purchased pursuant to an Advance delivered by the Company will be purchased at a price equal to 97% of the lowest daily VWAP of the shares of common stock during the three consecutive trading days commencing on the date of the delivery of the Advance Notice, other than the daily VWAP on a day in which the daily VWAP is less than a minimum acceptable price as stated by the Company in the Advance Notice or there is no VWAP on the subject trading day. The Company may establish a minimum acceptable price in each Advance Notice below which the Company will not be obligated to make any sales to THE INVESTOR. “VWAP” is defined as the daily volume weighted average price of the shares of common stock for such trading day on the Nasdaq Stock Market during regular trading hours as reported by Bloomberg L.P.
Additionally, pursuant to the Employment Agreements and under the Plan (subject to shareholder approval thereof), the Company granted nonstatutory stock options (each, an “Option”) to the Executives as follows:
● Mr. Davis was granted Options to purchase 2,000,000 shares of Common Stock.
● Mr. Rittman was granted an Option to purchase 500,000 shares of Common Stock.
Each Option has an exercise price of $7.20 per share (to be determined as the fair market value on the grant date) and vests in twelve (12) equal quarterly instalments over four (4) years, commencing on the date of shareholder approval of the Plan (the “Approval Date”). The Options are exercisable for five (5) years from the grant date and allow for cashless exercise. The grants are contingent upon shareholder approval of the Plan; if not approved, the Options will be null and void.
On January 2, 2026, the Company entered into an employment agreement (the “Klinger Agreement”) with Erik Klinger, pursuant to which Mr. Klinger will continue to serve as the Company’s Chief Financial Officer, effective as of January 2, 2026.
The Klinger Agreement provides for an initial three-year term, automatically renewing for successive one-year periods unless either party provides timely notice of non-renewal. Mr. Klinger’s annual base salary is $120,000, payable in accordance with the Company’s standard payroll practices. Mr. Klinger is eligible to participate in the Company’s employee benefit plans available to similarly situated executives, including medical, dental, and vision insurance, and is entitled to four weeks of paid vacation per year (pro-rated for partial years).
98
On January 2, 2026, in connection with the Klinger Agreement, the Company granted Mr. Klinger a nonstatutory stock option (the “Option”) to purchase 500,000 shares of the Company’s common stock at an exercise price equal to the closing price of the Company’s common stock on December 31, 2025, pursuant to the Company’s proposed 2025 Omnibus Equity Incentive Plan (the “Plan”). The Option is subject to twelve equal quarterly vesting instalments over four years, commencing on the date of shareholder approval of the Plan (the “Approval Date”), and is otherwise subject to the terms and conditions of the Plan and the Employee Nonstatutory Stock Option Agreement entered into between the Company and Mr. Klinger. The grant of the Option is expressly contingent upon shareholder approval of the Plan; if the Plan is not approved by shareholders, the Option will be null and void.
QuantumSpeed IP Asset Acquisition
On January 5, 2026, the Company entered into an Asset Purchase Agreement (the “Adrian Asset Purchase Agreement”) with Adrian Holdings S.R.L., a Costa Rican company (“Adrian”). Pursuant to the Adrian Asset Purchase Agreement, the Company agreed to acquire from Adrian, and Adrian agreed to sell, transfer, convey and assign to the Company, all right, title and interest in and to certain intellectual property assets related to the technology known as QuantumSpeed (the “Assigned IP”), as more fully described in the Adrian Asset Purchase Agreement.
In consideration for the Assigned IP, the Company agreed to pay Adrian aggregate consideration consisting of (i) 10,000,000 shares of the Company’s Common Stock (the “Purchase Shares”), and (ii) a promissory note in the principal amount of $10,000,000 (the “Adrian Note”). At closing which occurred on January 5, 2026, the Company issued and delivered to Adrian 3,000,000 Purchase Shares (the “Closing Shares”) and executed and delivered the Adrian Note.
The issuance of the remaining 7,000,000 shares of the Company’s Common Stock (the “Contingent Shares”) is subject to approval by the Company’s shareholders as required under applicable Nasdaq listing rules. The Company has agreed to use its commercially reasonable efforts to obtain such shareholder approval (the “Shareholder Approval”) as soon as practicable following the Closing, including by including a proposal for such approval in its next annual or special meeting of shareholders (but excluding any special meeting to be held on or about February 2026), and in no event later than nine (9) months after the Closing Date. If Shareholder
Approval is not obtained within nine (9) months after the Closing Date, then (i) the Company shall promptly cause sixty percent (60%) of the equity interests in QuantumSpeed Inc., a wholly-owned subsidiary of the Company to which the acquired intellectual property assets will have been assigned, to be transferred to Adrian (or its designee) free and clear of all encumbrances (other than restrictions under applicable securities laws), (ii) Adrian’s security interest in such equity interests shall be automatically released, and (iii) Adrian shall retain full ownership of the 3,000,000 shares of common stock previously issued at Closing and the Adrian Note, without any obligation to return, cancel, or forfeit the same. For the avoidance of doubt, in such event, no alternative consideration will be provided in lieu of the Contingent Shares.
All such issuances were exempt from the registration requirements of the Securities Act of 1933, as amended (the “Securities Act”). The securities were offered and sold in reliance on the exemption provided by Section 4(a)(2) of the Securities Act and/or Regulation D promulgated thereunder. Each purchaser represented that it was an “accredited investor” (as defined in Rule 501(a) of Regulation D) or otherwise qualified under applicable exemptions, and the Company did not engage in any general solicitation or advertising in connection with the offers or sales. No underwriters were involved in the transactions.
Item 3. Defaults Upon Senior Securities
None.
Item 4. Mine Safety Disclosures
None.
99
Item 5. Other Information
During the three and nine months ended June 30, 2026, no director or officer of the Company adopted or terminated a “Rule 10b5-1 trading arrangement” or “non-Rule 10b5-1 trading arrangement,” as each term is defined in Item 408(a) of Regulation S-K.
On May 1, 2026, the Board approved the appointment of Atara Dzikowski as Vice President of Mergers and Acquisitions. In connection therewith, the Company entered into an Employment Agreement dated May 1, 2026 with Ms. Dzikowski (the “Employment Agreement”). In addition, the Company and Ms. Dzikowski, a current member of the Board, entered into a Proprietary & Confidential Information, Inventions Assignment, Non-Solicitation and Non-Competition Agreement (the “Restrictive Covenant Agreement”) and the Mutual Agreement to Arbitrate (the “Arbitration Agreement”).
Material terms of the Employment Agreement include an initial term of three years commencing on April 1, 2026, with automatic one-year renewals absent thirty days’ prior written notice of non-renewal by either party and an annual base salary of $240,000. On the effective date, subject to prior approval by the Board or the Compensation Committee and the terms of the Company’s 2025 Omnibus Equity Incentive Plan (or any successor plan), an award of 500,000 shares of common stock or restricted stock units, of which 150,000 shares vest immediately upon the grant date. The remaining 350,000 shares shall vest upon the earlier of: (i) time-based vesting of 100,000 shares on each of the first three (3) anniversaries of the effective date and the final 50,000 shares on the three and one-half (3.5) year anniversary of the effective Date, or (ii) performance-based vesting tied to consolidated revenue milestones of the Company and its subsidiaries (as determined in accordance with U.S. generally accepted accounting principles (“GAAP”) and reported in the Company’s periodic reports filed with the Securities and Exchange Commission): 100,000 shares upon achievement of $5,000,000 in cumulative Revenue; an additional 100,000 shares upon achievement of $10,000,000 cumulative Revenue; an additional 100,000 shares upon achievement of $15,000,000 cumulative Revenue; and the final 50,000 shares upon achievement of $17,500,000 cumulative Revenue. “Revenue” means the Company’s consolidated total revenue. Achievement of milestones shall be certified by the Board of Directors or Compensation Committee in its reasonable discretion.
Further, Ms. Dzikowski will be eligible to participate in the Company’s standard employee benefit plans made available to similarly situated executives, including medical, dental and vision insurance, short- and long-term disability benefits, life insurance and retirement plan participation, subject to the terms of such plans as they may be amended from time to time. Upon termination for death, disability, for cause, resignation without good reason, or expiration of the term, Ms. Dzikowski will be entitled to only accrued but unpaid base salary and, to the extent required by law, accrued unused paid time off. Upon termination without cause or for good reason, the accrued benefits plus a severance payment equal to the then-current base salary, payable within six months of termination, conditioned upon execution of a general release of claims in a form provided by the Company and continued compliance with post-termination obligations. Customary provisions requiring full-time devotion of efforts, exclusive employment, and compliance with Company rules and policies.
Changes to Board Committee Memberships
On April 22, 2026, the Board accepted the resignation of Atara Dzikowski from the Audit Committee, the Compensation Committee, and the Nominating and Governance Committee, effective upon the commencement of her employment as Vice President of Mergers and Acquisitions. Ms. Dzikowski will continue to serve as a non-independent member of the Board of Directors.
Concurrently, the Board appointed Judit Nagypal as a member of the Audit Committee, Mansour Khatib as a member of the Compensation Committee, and Judit Nagypal as a member and Chair of the Nominating and Governance Committee, with such appointments effective immediately upon Ms. Dzikowski’s resignation from the respective committees. The Board confirmed that the committees, as reconstituted, continue to satisfy all applicable Nasdaq independence and composition requirements.
On May 8, 2026, the Company entered into Amendment No. 1 to the Employment Agreement dated September 2, 2025 with Jez Willman. The Amendment updates Mr. Willman’s title to Managing Director, UK and European Operations, increases his annual base salary to $200,000 effective May 1, 2026, and provides for additional performance-based stock option grants (50,000 options upon the second UGV commercial invoice and 100,000 options upon cumulative $1 million in commercial invoices). The Amendment was approved by the Board of Directors on May 6, 2026.
100
Appointment of Shayna Quinn
On April 16, 2026, the Board appointed Shayna Quinn as a member of the Board, effective immediately, to serve until the next annual meeting of stockholders and until her successor is duly elected and qualified, or until her earlier resignation or removal in accordance with the Company’s Bylaws and applicable law.
Ms. Quinn, age 33, brings more than nine years of executive leadership experience in high-growth technology and transportation sectors, with expertise in mergers and acquisitions, integration planning, strategic partnerships, business development, market expansion, and operational scaling. Since February 2025, she has served as an M&A Integration Consultant at Windels Marx (Transportation Sector), leading post-deal integration efforts, stakeholder coordination, and regulatory compliance workstreams. Previously, she was Director, Business Development & Head of Market Expansion & Integrations at Kaplan (2020–2023), where she oversaw new market launches, acquisition due diligence, merger integration planning, and multi-regional team leadership. From 2016 to 2019, she served as Director of Operations & Special Projects at Juno, directing global operations supporting over 48,000 independent contractors and managing regulatory partnerships with authorities such as the NYC Taxi & Limousine Commission. Ms. Quinn holds a B.A. in Nursing Science from Stevenson University (2014) and an M.S. in Public Health from Cornell University (2017).
The Board has determined that Ms. Quinn qualifies as an independent director under Nasdaq Listing Rule 5605(a)(2) and applicable SEC rules.
In connection with her appointment, the Company and Ms. Quinn entered into an Independent Director Engagement Agreement dated April 16, 2026 (the “Director Agreement”). Under the Director Agreement, Ms. Quinn will receive: (i) an annual cash retainer of $36,000, payable quarterly in arrears; and (ii) an annual grant of $60,000 in shares of restricted stock under the Company’s 2024 Omnibus Equity Incentive Plan, granted on or about August 1 of each year and vesting in full after twelve (12) months of continuous service (subject to accelerated vesting upon a Change in Control or the director’s death or disability). The Director Agreement also provides for expense reimbursement in accordance with Company policy. The Director Agreement is consistent with the Company’s Director Compensation Policy.
xClibre Asset Acquisition
On April 10, 2026, the Company entered into an Asset Purchase Agreement (the “Agreement”) with Dream America Marketing Services, Ltda., a Costa Rican company (the “Seller”).
Pursuant to the Agreement, the Company agreed to acquire from the Seller, and the Seller agreed to sell, transfer, convey and assign to the Company, all right, title and interest in and to certain intellectual property assets related to the technology known as xClibre (the “Assigned IP”), as more fully described in the Agreement.
In consideration for the Assigned IP, the Company agreed to pay the Seller aggregate consideration consisting of (i) 7,000,000 shares of the Company’s common stock, par value $0.01 per share (the “Purchase Shares”), and (ii) a promissory note in the principal amount of $6,000,000 (the “Note”).
At closing, the Company has issued and delivered to the Seller 3,500,000 Purchase Shares (the “Closing Shares”) and executed and delivered the Note.
The issuance of the remaining 3,500,000 shares of the Company’s common stock (the “Contingent Shares”) is subject to (i) satisfactory proof-of-concept results and (ii) Nasdaq Shareholder Approval under Nasdaq Marketplace Rule 5635. The Company has agreed to use its commercially reasonable efforts to obtain such proof-of-concept approval (the “POC Approval”) as soon as practicable following the Closing, and in no event later than nine (9) months after the Closing Date. The Company has also agreed to use reasonable best efforts to obtain Nasdaq Shareholder Approval. If proof-of-concept approval is not obtained within nine (9) months after the Closing Date, then (i) the Company shall promptly cause sixty percent (60%) of the equity interests in xClibre Inc., a wholly-owned subsidiary of the Company to which the acquired intellectual property assets will have been assigned, to be transferred to the Seller (or its designee) free and clear of all encumbrances (other than restrictions under applicable securities laws), (ii) the Seller’s security interest in such equity interests shall be automatically released, and (iii) the Seller shall retain full ownership of the 3,500,000 shares of common stock previously issued at Closing and the Note, without any obligation to return, cancel, or forfeit the same. For the avoidance of doubt, in such event, no alternative consideration will be provided in lieu of the Contingent Shares.
The Agreement contains customary representations, warranties, covenants and indemnification provisions for a transaction of this nature.
101
Item 6. Exhibits
The following exhibits are filed as part of, or incorporated by reference into, this Quarterly Report on Form 10-Q.
102
103
| 10.45 # | Promissory Note, dated April 10, 2026, in the principal amount of $6,000,000 issued to Dream America Marketing Services, Ltda. | 8-K | 001-42741 | 10.1 | 13-Apr-26 |
| 10.46 †# | Independent Director Engagement Agreement, dated April 16, 2026, between the Company and Shayna Quinn | 8-K | 001-42741 | 10.1 | 12-Sep-25 |
| 10.47 †# | Employment Agreement, dated May 1, 2026, between the Company and Atara Dzikowski | 8-K | 001-42741 | 10.1 | 4-May-26 |
| 10.48 †# | Amendment No. 1, dated May 8, 2026, to Employment Agreement dated September 2, 2025 with Jez Willman | 8-K | 001-42741 | 10.1 | 11-May-26 |
| 10.49 * | Share Purchase and Shareholders Agreement, dated May 12, 2026, by and between VisionWave Israel Ltd. and Mr. Ian Paklida (VIP Lux Travel Ltd. and PKLST Tourism and Leisure Ltd.) | ||||
| 10.50 * | Share Exchange and Swap Agreement, dated May 17, 2026, by and between VisionWave Holdings, Inc. and T3 Defense Inc. | ||||
| 10.51 † | Employment Agreement, dated June 1, 2026, between VisionWave IL Ltd. and Einav Eliraz | 8-K | 001-42741 | 10.1 | 2-Jun-26 |
| 10.52 | Securities Exchange Agreement, dated June 2, 2026, by and between VisionWave Holdings, Inc. and Foresight Autonomous Holdings Ltd. | 8-K | 001-42741 | 10.1 | 4-Jun-26 |
| 10.53 † | Amendment No. 1, dated June 11, 2026, to Employment Agreement dated August 6, 2025 with Danny Rittman | 8-K | 001-42741 | 10.1 | 12-Jun-26 |
| 10.54 *# | Assignment of Exchange Rights, Joinder and Partial Satisfaction of Note Agreement, dated June 22, 2026, by and between VisionWave Holdings, Inc. and Adrian Holdings S.R.L. | ||||
104
105
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
| VISIONWAVE HOLDINGS, INC. | ||
| Date: August 19,2026 | By: | /s/ Douglas Davis |
| Name: | Douglas Davis | |
| Title: | Chief Executive Officer & Executive Chairman | |
| (Principal Executive Officer) | ||
| VISIONWAVE HOLDINGS, INC. | ||
| Date: August 19, 2026 | By: | /s/ Erik Klinger |
| Name: | Erik Klinger | |
| Title: | Chief Financial Officer | |
| (Principal Financial and Accounting Officer) | ||
106