Hub Cyber Security Ltd. — Form 6-K Summary
Reporting period: Month of November 2023; filed November 29, 2023. The filing reports a November 28, 2023 amendment to the company’s financing arrangements with Lind Global Asset Management VI LLC.
Business Context and Transaction
Hub Cyber Security Ltd. amended its Securities Purchase Agreement, senior secured convertible promissory note, and ordinary share purchase warrant with Lind. The amendment modifies the funding amounts, debt principal, conversion price, and warrant terms.
Financial Terms and Capital Structure
| Item | Amended term |
|---|---|
| Additional immediate cash funding | $500,000 |
| Second Funding Amount | Reduced from $10.0 million to $9.5 million |
| Second Principal Amount | Reduced from $12.0 million to $11.4 million |
| Note principal amount | Increased from $9.0 million to $9.6 million |
| Note conversion price | Reduced from $0.45 to $0.35 per ordinary share |
| Total warrant shares | 8,928,572 ordinary shares, including 1,428,572 additional shares |
| Warrant exercise price | Reduced from $0.45 to $0.35 per ordinary share |
The note is described as senior secured and convertible. The filing does not provide revenue, profit, cash flow, margin, liquidity, or balance-sheet metrics for the period.
Material Changes Versus Prior Terms
- Lind agreed to provide an additional $500,000 in cash immediately upon execution of the Second Amendment.
- The Note principal increased by $600,000, from $9.0 million to $9.6 million.
- The Note conversion price and warrant exercise price each decreased from $0.45 to $0.35.
- The warrant was expanded by 1,428,572 shares, bringing the total potential warrant shares to 8,928,572.
- The Second Funding Amount and Second Principal Amount were reduced by $500,000 and $600,000, respectively.
Outlook, Risks, and Contingencies
- The company agreed to file or amend a registration statement within 15 days of the amendment to register shares issuable upon conversion of the Note and exercise of the Warrant.
- Conversion and warrant terms may result in substantial future equity dilution, depending on exercise and conversion.
- The senior secured debt increases the company’s financing obligations and may have priority over other claims, subject to the full transaction documents.
- The filing does not provide operating guidance, an earnings outlook, or management commentary on business performance.
Important Facts for Investors to Verify
- Whether the $500,000 additional funding was received as required and the timing of any remaining funding amounts.
- The complete terms, maturity, interest, security interests, repayment provisions, and default provisions of the amended Note.
- The potential number of ordinary shares issuable upon Note conversion at the $0.35 conversion price.
- Whether the registration statement was filed or amended within the required 15-day period.
- The company’s latest financial statements, cash position, liquidity needs, and ability to service or refinance the amended debt.