SCHEDULE: SKYX Platforms: Insider Converts Debt, Lowers Price

SKYX Platforms' director and related entities converted a subordinated convertible note into common stock at a significantly reduced conversion price of $2.20 per share.

Summary

• Dov Shiff and related entities (Shiff Group Investments Ltd., Shiff Group Assets Ltd., DZDLUX s.a.r.l.) filed an Amendment No. 6 to their Schedule 13D.
• The amendment details changes to a Subordinated Convertible Promissory Note between SKYX Platforms Corp. and Shiff Group Investments Ltd. (SGI).
• The note's maturity date was extended to May 1, 2027, and the interest rate increased from 6.0% to 10.0% per annum, effective January 1, 2024.
• The Common Stock conversion price for the note was significantly reduced from $15.00 per share to $2.20 per share.
• On December 31, 2025, SGI converted the principal amount of $600,000 plus $235,900 in accrued interest into 379,955 shares of Common Stock.
• Dov Shiff and the reporting persons collectively beneficially own 15,438,237 shares of Common Stock, representing approximately 13.1% of the company's outstanding shares.
• Mr. Shiff also holds options to purchase an aggregate of 45,000 shares of Common Stock exercisable within 60 days, granted as director compensation.
• Mr. Shiff received an additional 14,423 shares of Common Stock on December 31, 2025, in lieu of cash retainer for his board service.

Sentiment

Score: 3

Explanation: The significant reduction in the convertible note's conversion price from $15.00 to $2.20 per share, coupled with an increased interest rate, indicates a substantial negative revaluation of the company's equity and significant dilution for existing shareholders. While debt reduction is positive, the terms of conversion are highly unfavorable.

Positives

• The conversion of the subordinated convertible note into equity reduces the company's debt obligations and immediate cash outflow for principal repayment.
• The extension of the note's maturity date to May 1, 2027, provides the company with more time before any remaining principal (if not fully converted) would be due.

Negatives

• The conversion price was drastically reduced from $15.00 to $2.20 per share, indicating a significant decrease in the company's perceived valuation and resulting in substantial dilution for existing shareholders.
• The interest rate on the note increased from 6.0% to 10.0% per annum, effective January 1, 2024, increasing the cost of the debt prior to its conversion.

Risks

• Reporting Persons may acquire additional shares or dispose of some or all of their holdings in open-market or privately negotiated transactions.
• Reporting Persons may engage in short selling, hedging, or similar transactions with respect to the Common Stock.
• The significant reduction in the conversion price from $15.00 to $2.20 per share implies a lower valuation for the company, which could negatively impact investor confidence and share price.

Future Outlook

The reporting persons acquired shares for investment purposes and may in the future acquire additional shares or dispose of current holdings. They may also engage in short selling or hedging transactions. No present plans for other actions described in Item 4 of Schedule 13D, except as may be proposed by Mr. Shiff in his capacity as a director of the Company or by the Board of Directors with his participation.

Management Comments

• The Company's Board of Directors approved the Amendment to the Subordinated Convertible Promissory Note.
• Mr. Shiff, as President and Chief Executive Officer of SGI and a controlling person of SGA and DZDLUX, may be deemed to have shared power to direct voting and disposition of shares held by these entities.

Industry Context

This filing primarily concerns an insider's beneficial ownership and a debt-to-equity conversion, which is an internal corporate finance event. It does not directly provide information on broader industry trends or competitive landscape, but the significant reduction in conversion price could reflect a challenging market or company-specific performance issues within its industry.

Corporate Governance

Related Party Transactions

• An amendment to the Subordinated Convertible Promissory Note was entered into between SKYX Platforms Corp. and Shiff Group Investments Ltd. (SGI), an entity controlled by Dov Shiff, a director and controlling person of other reporting entities.
• SGI subsequently converted the note into shares of Common Stock.
• Dov Shiff, a director, received 14,423 shares of Common Stock as part of his non-employee director compensation program, electing shares in lieu of cash.

Stakeholder Impact

• **Shareholders**: Experience significant dilution due to the conversion of the note at a substantially lower price ($2.20 vs. $15.00), which negatively impacts per-share value. The increased insider ownership (13.1%) could be seen as a vote of confidence or a concentration of control.
• **Creditors**: The conversion of debt to equity reduces the company's overall debt burden, potentially improving its balance sheet and credit profile.
• **Company (SKYX Platforms Corp.)**: Benefits from the reduction of a debt obligation and the extension of maturity for any remaining note principal, but at the cost of significant equity dilution and a higher interest rate on the debt prior to conversion.

Next Steps

• Reporting Persons may acquire or dispose of additional shares of Common Stock in the future.
• Reporting Persons may engage in short selling or hedging transactions.
• Mr. Shiff may propose actions in his capacity as a director of the Company.

Key Dates

Recommendation

The drastic reduction in the convertible note's conversion price from $15.00 to $2.20 per share, coupled with an increased interest rate on the debt, signals a severe deterioration in the company's valuation and financial health. This event results in significant dilution for existing shareholders and reflects a highly unfavorable outcome for the company's equity. While debt conversion reduces immediate cash obligations, the terms are indicative of underlying distress or a substantial re-rating of the company's prospects. Investors should consider selling to avoid further potential losses from continued dilution and negative sentiment.

Keywords

SKYX Platforms Corp., SKYX, Schedule 13D, Beneficial Ownership, Convertible Note, Debt Conversion, Dov Shiff, Shareholder Dilution, Corporate Governance, Insider Holdings