ATCH.AMEXAtlasclear Holdings, INC
S-1/A: AtlasClear Holdings Files Amendment for Resale of Up to 34.5 Million Shares
Sentiment:
S-1/A Filing
AtlasClear Holdings has filed an amendment to its registration statement to allow selling stockholders to offer and sell up to 34,532,737 shares of common stock.
Delay expectedThe company incurred $1,500,000 in fees through June 30, 2024, which was added to the principal of the Funicular Note, as a result of the delay in filing the First Registration Statement.The interest rate of the Amended Chardan Note will increase by 2% per annum until the date of the filing, if the resale registration statement is not filed by December 31, 2024.The interest rate on the Amended Chardan Note will increase to 19.99% per annum from March 31, 2025 until the date of effectiveness, if the resale registration statement is not effective by March 31, 2025.
Capital raiseThe company may require substantial funding to finance its operations, but adequate financing may not be available when needed.The company expects to continue to raise capital through public or private financing or other arrangements.The company has the right from time to time to direct Tau to purchase up to an aggregate of $12.25 million of shares of our Common Stock over a 24-month period, upon the terms thereof and subject to the satisfaction of certain conditions, at a discount to the VWAP of the Common Stock during the applicable pricing period.The company and Hanire entered into the Hanire Purchase Agreement for the purchase and sale, in a private placement, of (i) up to 333,333 shares of our Common Stock at a purchase price of $15.00 per share, and (ii) the Hanire Note in the principal amount of up to $40 million.
Summary
- AtlasClear Holdings has filed an amendment to its Form S-1 registration statement to register the resale of up to 34,532,737 shares of its common stock by selling stockholders.
- The shares consist of those issuable upon conversion of seller notes, shares issued to Chardan Capital Markets, shares issuable to Funicular Funds, shares issuable to Winston & Strawn, shares issuable to Commercial Bancorp shareholders, shares issued to Outside The Box Capital Inc., shares issued to Atlas FinTech Holdings Corp., and shares that may be issued to Tau Investment Partners LLC and Hanire LLC.
- The company will not receive any proceeds from the sale of these shares.
- The registration of these shares does not guarantee that the selling stockholders will offer or sell any of the shares.
- As of February 18, 2025, the number of shares that may be offered for resale is approximately 28.8 times larger than the number of outstanding shares of Common Stock.
- The company is an emerging growth company and a smaller reporting company, which may result in reduced disclosure obligations.
Sentiment
Score: 4
Explanation: The document contains both positive and negative elements. The potential for growth and innovation is positive, but the risks associated with the large number of shares being registered for resale and the company's financial condition contribute to a negative sentiment.
Negatives
- The potential sale of a large number of shares could significantly decrease the public trading price of the common stock.
- A significant portion of the shares being registered for resale may be acquired by selling stockholders at prices below the current market price, which could increase volatility or result in a decline in the stock price.
- The increased supply of shares may lead to heightened selling pressure, negatively affecting the public trading price.
Risks
- The resale of a substantial number of shares could adversely affect the market price of the common stock.
- The discrepancy in purchase prices among selling stockholders may impact market perception and increase volatility.
- The increased supply of common stock could lead to heightened selling pressure and negatively affect the stock price.
Future Outlook
The company expects to continue to make acquisitions as part of its growth strategy and plans to evaluate acquisition opportunities based on strategic parameters.
Industry Context
The document highlights the increasing demand for cost efficiencies and turnkey solutions in the financial services industry, as well as the convergence of financial services and the interest from non-financial services firms in offering financial products.
Comparison to Industry Standards
- The document mentions that the broker-dealer and clearing firm industries are dominated by a small number of very large broker-dealers and clearing firms.
- It also notes that Wilson-Davis competes with larger firms that have greater financial resources, vast customer networks, diverse business lines, and established relationships with regulatory and legislative institutions.
- The document states that Wilson-Davis faces competition from other brokers and clearing firms, and that the firms competitors are comparatively less impacted by adverse regulatory actions and rulemaking than Wilson-Davis as a smaller firm.
Stakeholder Impact
- Stockholders could incur substantial losses due to the volatility of the price of the common stock.
- Stockholders may experience potential dilution of their interests resulting from the issuance of equity securities.
- Stockholders may face a significant decline in the public trading price of the common stock due to sales of a substantial number of shares in the public markets.
Next Steps
- The company expects to continue to make acquisitions as part of its growth strategy.
- The company plans to evaluate acquisition opportunities based on a number of strategic parameters.
Key Dates
| Date | Description |
|---|---|
| 2021-02-04 | Date of Quantum IPO |
| 2022-04-15 | Date of Stock Purchase Agreement by and among Wilson-Davis, all of its stockholders and AtlasClear, Inc. |
| 2022-11-16 | Date of Business Combination Agreement by and among the Company, Quantum, and AtlasClear |
| 2023-08-01 | Date of non-redemption agreement between Quantum and Funicular |
| 2023-09-13 | Date of Marketing Services Agreement between the Company and OTB |
| 2024-01-09 | Date of Amendment No. 8 to Broker-Dealer Acquisition Agreement |
| 2024-02-05 | Date of at-the-market agreement between the Company and Tau |
| 2024-02-07 | Date of Amendment No. 9 to Broker-Dealer Acquisition Agreement |
| 2024-02-09 | Date of Funicular Purchase Agreement |
| 2024-02-19 | Date of Consulting Agreement between Carriage and the Company |
| 2024-02-26 | Date of First Amendment to Bank Acquisition Agreement |
| 2024-05-09 | Date of Quantum Ventures LLC transfer of shares |
| 2024-06-30 | Date of semi-annual interest payment for Funicular Note |
| 2024-07-01 | Date of Short Term Merger Financing |
| 2024-07-05 | Date of Pacsquare Member |
| 2024-07-10 | Date of Carriage House Capital Inc Member |
| 2024-07-31 | Date of At Market Agreement Member |
| 2024-08-09 | Date of Atlasfintech Holdings Corp Member |
| 2024-08-23 | Date of Company returning shares of Common Stock to Atlas FinTech |
| 2024-08-28 | Date of Wilson Davis Member |
| 2024-08-29 | Date of Lead Nectar Member |
| 2024-09-25 | Date of Marketing Services Agreement between the Company and OTB |
| 2024-10-13 | Date of subordinated demand notes funded |
| 2024-10-23 | Date of Settlement Agreement |
| 2024-11-14 | Date of Second Amendment to Bank Acquisition Agreement |
| 2024-12-31 | Date of securities and purchase agreement between the Company and Hanire |
| 2025-01-07 | Date of Funicular Amendment |
| 2025-02-05 | Date of Second ELOC Agreement |
| 2025-02-06 | Date of AtlasFintech Member |
| 2025-02-07 | Date of Wilson Davis Member |
| 2025-02-13 | Date of Chardan Note Member |
| 2025-02-18 | Date of Common Stock outstanding |
| 2025-02-27 | Last sale price of the Common Stock as reported on the NYSE |
| 2025-02-28 | Date of Prospectus |
| 2025-03-31 | Date of If Resale Registration Statement Is Not Effective |
| 2025-05-14 | Date of termination date of the Bank Acquisition Agreement |
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