Draganfly is raising US$10 million from U.S. drone component maker Unusual Machines and an unnamed U.S. investment fund, with each putting in US$5 million.

Why it matters: The deal ties Draganfly more closely to an American component supplier as it scales production. It comes weeks after the company landed its first Canadian Armed Forces contract under the Defence Drone Initiative.

Driving the news: Draganfly will sell 1,869,159 common shares at US$5.35 each, matching its Sept. 25 closing price. The registered direct offering is open to U.S. buyers only. The deal is expected to close on or about Sept. 29, pending Canadian Securities Exchange approval and notice to Nasdaq.

Jett Capital Advisors and Northland Capital Markets are joint-lead placement agents. Draganfly says it will put the net proceeds toward new capability development and working capital to meet U.S. and international demand.

What they're saying: "This strategic investment from Unusual Machines and a leading U.S. Investment Fund is about positioning, not size," said Cameron Chell, CEO and chairman of Draganfly.

"This investment into Draganfly allows us to support their production growth and deepen our supplier relationships," said Dr. Allan Evans, CEO of Unusual Machines.

By the numbers: The raise is modest next to the $131.9 million in cash Draganfly reported as of June 30.

The bigger picture: On Sept. 11, Ottawa awarded Draganfly a five-year contract for 100 low-cost tactical ISR drone systems for the CAF. Canada holds options on up to 4,900 more, valued at about $24.25 million if exercised in full.

That award followed Draganfly's qualification in all five capability streams of the DDI Marketplace.

What's next: Closing is expected Tuesday. Prospectus documents will be posted to SEDAR+ and EDGAR.