F-1/A: SMX (Security Matters) Public Limited Company Files Amendment No. 1 to Form F-1 Registration Statement

SMX (Security Matters) Public Limited Company has filed an amendment to its Form F-1 registration statement with the SEC, concerning the resale of ordinary shares.

Summary

• SMX (Security Matters) Public Limited Company filed Amendment No.
• 1 to its Form F-1 registration statement with the SEC on May 31, 2024.
• The registration statement concerns the resale of up to 27,543,449 ordinary shares.
• The document includes information on indemnification of directors and officers, recent sales of unregistered securities, exhibits, and undertakings.
• It details various agreements, including business combination agreements, scheme implementation deeds, and registration rights agreements.
• The company issued a significant number of ordinary shares and warrants in 2023 and 2024 in connection with various agreements, including a Standby Equity Purchase Agreement (SEPA) with YA II PN, LTD (Yorkville) and Securities Purchase Agreements with institutional investors.
• These issuances were often related to the conversion of convertible promissory notes and for services rendered.
• The company's authorized share capital is US$100,000,000 divided into 36,363,636,364 Ordinary Shares with a nominal value of US$0.0022 each, 200,000,000,000 Preferred Shares with a nominal value of US$0.0001 each, and 25,000 Deferred Ordinary Shares with a nominal value of 1.00 each.

Sentiment

Score: 5

Explanation: The document is primarily factual and descriptive, lacking strong positive or negative sentiment. The frequent issuance of shares and warrants suggests a need for capital, which could be viewed as neutral to slightly negative.

Positives

• The company has access to capital through various financing agreements, including the SEPA with Yorkville and Securities Purchase Agreements.
• The company is actively managing its debt by converting promissory notes into equity.
• The company is incentivizing employees and consultants through the grant of restricted stock units and options.
• The company is addressing its obligations by issuing shares for services rendered.

Negatives

• The company has issued a significant number of shares and warrants, which may dilute existing shareholders.
• The company relies heavily on convertible promissory notes, which can create uncertainty about future equity issuances.
• The company has a complex capital structure with multiple classes of shares and warrants.
• The company has a history of losses and may need to raise additional capital in the future.

Risks

• Continued reliance on convertible financing could lead to further dilution of existing shareholders.
• The company's ability to execute its business plan depends on its access to capital.
• Unfavorable market conditions could make it more difficult for the company to raise capital.
• The company's complex capital structure could make it difficult to attract new investors.

Future Outlook

The registration statement indicates the company intends to offer securities on a delayed or continuous basis pursuant to Rule 415 under the Securities Act of 1933.

Industry Context

This announcement reflects a company in the technology sector utilizing various financing methods, including equity and debt conversions, which is common for growth-stage companies seeking capital.

Comparison to Industry Standards

• Issuing shares for services is a common practice among startups and small companies to conserve cash.
• The use of Standby Equity Purchase Agreements (SEPAs) is a financing mechanism often employed by companies that may not have access to traditional funding sources.
• The level of detail provided in the filing is consistent with regulatory requirements for registration statements.
• The company's reliance on convertible notes and warrants is similar to other companies in the technology and biotech sectors, particularly those with limited operating history.

Stakeholder Impact

• Existing shareholders may experience dilution due to the issuance of new shares.
• Potential investors will have the opportunity to purchase shares in the company.
• Employees and consultants may benefit from the grant of restricted stock units and options.
• Creditors may be impacted by the conversion of debt into equity.

Next Steps

• The company will proceed with the offering of securities as outlined in the registration statement.
• The SEC will review the registration statement and may request additional information.
• The company will continue to execute its business plan and seek to create value for shareholders.

Key Dates

Keywords

ordinary shares, warrants, convertible notes, registration statement, securities, SMX, Security Matters, SEPA, Yorkville, issuance