Dragonfly Energy Announces Acquisition of Dakota Lithium Assets

What Happened
On July 31, 2026, Dragonfly Energy Holdings Corp. and its wholly owned subsidiary, Dragonfly Energy Corp., entered an asset purchase agreement to acquire substantially all operating assets associated with the Dakota Lithium® brand from Clean Liquidation, LLC (successor to Clean Republic SODO, LLC). The purchase price was $4.0 million, consisting of $1.0 million in cash and 1,500,000 shares of Dragonfly common stock issued at $2.00 per share (aggregate $3.0 million). The subsidiary bought the assets on an “as is, where is” basis and assumed certain liabilities. The stock was issued under a Securities Receipt Agreement in exchange for a release of secured claims and is subject to a 12‑month lock‑up and transfer restrictions. Dragonfly also filed a press release describing the transaction and the related loan amendment.

Key Details

• Purchase price: $4.0 million total — $1.0M cash + 1,500,000 shares at $2.00/share (valued $3.0M).
• Shares issued pursuant to a Securities Receipt Agreement; subject to a 12‑month lock‑up and restrictive legend.
• Seventh Amendment to Term Loan (effective July 31, 2026): lenders consented to the acquisition; interest modified to 14.0% per annum payable‑in‑kind during the PIK Period (effective date through Dec 31, 2026).
• Covenant changes: testing of senior leverage and fixed charge coverage ratios delayed from Mar 31, 2027 to Sept 30, 2027; minimum liquidity requirement set at $4.0M (Aug 31, 2026–Jan 31, 2027) and $5.0M thereafter.

Why It Matters
The transaction brings Dakota Lithium operating assets and related liabilities onto Dragonfly’s balance sheet and was funded partly with equity, resulting in issuance of 1.5 million shares (subject to restrictions). The accompanying amendment to the company’s term loan raises near‑term financing cost (14% PIK through year‑end) and tightens/sets minimum liquidity requirements while delaying covenant testing. Investors should note the equity issuance (dilution potential), the lock‑up on those shares, and the changed debt terms that affect cash‑flow and covenant timing; review the full agreements (filed as exhibits) for detailed terms.