F-1: SMX (Security Matters) Public Limited Company Files for Resale of Up to 212,287 Ordinary Shares

SMX (Security Matters) Public Limited Company has filed a prospectus for the resale of up to 212,287 ordinary shares by selling stockholders.

Summary

• SMX (Security Matters) Public Limited Company has filed a registration statement for the resale of up to 212,287 ordinary shares.
• The shares are to be sold by the selling stockholders, and SMX will not receive any proceeds from the sales, except for approximately $148 from warrant exercises.
• The registered shares consist of outstanding shares, shares issuable upon conversion of a promissory note, shares issuable upon transfer of interests in True Gold Consortium Pty Ltd, and shares underlying warrants.
• The company is an emerging growth company and a foreign private issuer, which allows for reduced disclosure requirements.
• The company's ordinary shares are listed on The Nasdaq Capital Market under the symbol SMX.
• A reverse stock split of 75:1 was implemented on July 15, 2024, to regain compliance with Nasdaq's minimum bid price requirement.
• The company recently entered into a Letter of Intent with PMB Partners, LP to restructure existing debt and exchange shares in True Gold Consortium Pty Ltd.
• The company also consummated a Securities Purchase Agreement with Canterbury Group Ltd. for gross proceeds of approximately US$615,000.
• The company has issued shares to certain debtholders in exchange for cancellation of debt and related obligations.
• The company announced a strategic partnership with Brinks to enhance gold marking, auditing, and storage using SMX's technology.
• The company entered into a Stock Purchase Agreement with Generating Alpha Ltd. for up to $30,000,000 of ordinary shares, subject to certain terms and conditions.
• The company closed an underwritten public offering of securities for gross proceeds of approximately $2.9 million on February 20, 2024.
• The company entered into a $5 million contract with R&I Trading of New York to enhance brand protection and ethical sourcing for the FMCG sector.

Sentiment

Score: 5

Explanation: The document presents a mixed sentiment. While it highlights positive developments such as partnerships and contracts, it also acknowledges the company's history of losses and dependence on future capital raises.

Positives

• The company has secured a strategic partnership with Brinks, enhancing its presence in the gold market.
• The company has entered into a Stock Purchase Agreement with Generating Alpha Ltd. for up to $30,000,000, providing potential future capital.
• The company has a $5 million contract with R&I Trading of New York, indicating market demand for its services.
• The company has successfully completed the marking of 21 tons of natural rubber sourced in Latin America from tree to tire.
• The company has successfully completed proof of concept for ethical sourcing and authentication of silver in cooperation with Sunshine Minting Inc.

Negatives

• The company will not receive any proceeds from the resale of shares, except for approximately $148 from warrant exercises.
• The company has a history of losses and negative cash flow.
• The company is dependent on raising additional capital to fund operations.
• The company is subject to the risk of delisting from Nasdaq if it cannot maintain compliance with listing requirements.
• The company has a limited operating history and faces challenges in managing growth.

Risks

• The company may not be able to maintain a market for its securities.
• The company's stock price may be volatile.
• The company may be unable to compete effectively in its industry.
• The company may be unable to protect its intellectual property.
• The company's operations in Israel are subject to political, economic, and military risks.
• The company may be subject to adverse tax consequences.
• The company may be unable to comply with Irish law.
• The company may lose its foreign private issuer status.
• The company's management has limited experience in operating a public company in the United States.

Future Outlook

The company expects that its existing cash and cash equivalents, along with amounts it may draw down from time to time under the $30,000,000 SPA, and receivables from clients once paid, will be sufficient to fund its operations for the foreseeable future but perhaps at a delayed or reduced scope.

Industry Context

The document highlights the company's focus on brand protection, authentication, and track and trace technology, which are increasingly important in the anti-counterfeit market and the circular economy.

Management Changes

Related Party Transactions

• The document discloses several related party transactions, including loans from related parties, services provided by related parties, and agreements with entities affiliated with directors and officers.

Stakeholder Impact

• The resale of ordinary shares may impact the share price and liquidity for existing shareholders.
• The company's ability to secure additional funding will impact its ability to execute its business plan and create value for shareholders.
• The company's success in developing and commercializing its technology will impact its ability to attract customers and generate revenue.

Next Steps

• The selling stockholders may sell all or a portion of the Ordinary Shares held by it and offered hereby from time to time directly or through one or more underwriters, broker-dealers or agents.
• The Company and PMB agree to negotiate in good faith the drafting and execution of the Convertible Note, the Note and any and all other ancillary documents, contracts, or agreements to give effect to the terms of the LOI not otherwise satisfied at or as of the Effective Date (the Definitive Agreements), which shall be executed no later than 30 days from the Effective Date.

Key Dates

Keywords

ordinary shares, resale, security matters, SMX, stockholders, warrants, capital, business combination, financing, debt