S-1/A: Freedom Holdings Files S-1/A for Resale of Up to 105 Million Shares Amid Going Concern Uncertainty

Freedom Holdings, Inc. files an amended registration statement for the resale of up to 105 million shares of common stock by a selling stockholder, while facing substantial doubt about its ability to continue as a going concern.

Summary

• Freedom Holdings, Inc. has filed a Form S-1/A registration statement with the SEC to register the resale of up to 105,000,000 shares of its common stock.
• The shares are to be sold by ClearThink Capital Partners, LLC, the selling stockholder, under a Standby Share Purchase Agreement (SPA).
• Freedom Holdings will not receive any proceeds from the sale of these shares by the selling stockholder.
• The company may receive proceeds from the sale of securities pursuant to the STRATA Purchase Agreement.
• The price per share will be determined based on a percentage (80-90%) of the average of the two lowest volume-weighted average prices (VWAP) of the company's common stock, depending on the VWAP range.
• The company's auditor has expressed substantial doubt about its ability to continue as a going concern, estimating that it needs approximately $1,000,000 in capital to continue operations for the next twelve months.
• The company intends to raise capital through sales of multi-media and entertainment related products and services, borrowings, and private placements of its common stock.
• Pablo Diaz, the President and CEO, holds a majority of the voting rights through his ownership of common stock and Series A preferred stock.
• The company recently acquired a 51% ownership interest in Renewable Energy Products Manufacturing Corp. (REPM) and has an option to acquire the remaining 49% within the next twelve months.
• The company's common stock is traded on the OTC market under the symbol FHLD, with a closing price of $0.12 per share as of the filing date.
• The company is considered an emerging growth company and a smaller reporting company, allowing it to take advantage of reduced reporting requirements.

Sentiment

Score: 4

Explanation: The document presents a mixed picture. While there are positive aspects such as revenue growth and a recent acquisition, the going concern warning from the auditor and the potential for dilution create significant uncertainty. The sentiment is therefore cautiously negative.

Positives

• The company has a Standby Share Purchase Agreement (SPA) in place with a non-affiliated institutional investor for the sale of up to $10 million in common stock.
• The company recently acquired a 51% ownership interest in Renewable Energy Products Manufacturing Corp. (REPM), which is expected to accelerate its commercial solar strategy.
• The company's TAG GRID platform integrates financing, sales, procurement, and installation solutions for alternative energy projects.
• The company generated $14,793,455 in revenues during the three months ended December 31, 2024, and $1,272,800 in revenues during the year ended September 30, 2024.
• The company generated net income for the three months ended December 31, 2024, of $7,292,314.

Negatives

• The company's auditor has expressed substantial doubt about its ability to continue as a going concern.
• The company estimates that it will need approximately $1,000,000 in capital to continue operations for the next twelve months.
• The company has sustained significant net losses which have resulted in negative working capital and an accumulated deficit at December 31, 2024, and 2023 of $2,631,517 and $9,950,869, respectively.
• The shares issuable from the Equity Financing Agreement will dilute the ownership interest and voting power of existing stockholders.
• The company's auditor has been charged with violations by the Securities and Exchange Commission (SEC).

Risks

• The company's auditors have expressed substantial doubt about its ability to continue as a going concern.
• The company's continued operations are highly dependent upon its ability to increase revenues, decrease operating costs, and complete equity and/or debt financings.
• The shares issuable from the Equity Financing Agreement will dilute the ownership interest and voting power of existing stockholders.
• The company's auditor has been charged with violations by the Securities and Exchange Commission (SEC).
• The market price of the company's common stock may fluctuate significantly.
• The company's common stock is subject to the penny stock rules of the SEC and the trading market in its securities is limited.
• The company does not intend to pay any cash dividends on its common stock.
• The company may need to register additional shares to maximize the SPA.

Future Outlook

The company anticipates continued growth in revenues as it continues to execute on its business plan and growth strategies. The company expects future growth in TAG Capital and increased contribution from the Construction and Distribution silos.

Industry Context

The solar and alternative energy industry has evolved from vertically integrated models to more specialized, decentralized business models. This shift has created a significant need for support infrastructure that bridges the gap between sales and installation. TAG fills that role by allowing contractors and sales organizations to focus on their core functions while relying on us for operational, financial, and logistical support.

Stakeholder Impact

• Existing stockholders will experience dilution of their ownership interest and voting power as a result of the issuance of shares under the SPA.
• The company's ability to continue as a going concern is uncertain, which could impact stakeholders including shareholders, employees, and creditors.
• The company's acquisition of REPM is expected to enhance its renewable energy capabilities and benefit customers and partners.

Next Steps

• The selling stockholder may sell all or a portion of these common shares from time to time in market transactions.
• The company intends to raise capital to fund its operations through sales of multi-media and entertainment related products and services, borrowings, and private placements of its common stock.
• The company may need to register additional shares to maximize the SPA.

Key Dates

Keywords

Freedom Holdings, FHLD, registration statement, common stock, resale, ClearThink Capital Partners, Standby Share Purchase Agreement, SPA, going concern, Renewable Energy Products Manufacturing Corp, TAG GRID, alternative energy, dilution, OTC market, emerging growth company