SmartKem, Inc. Files 8-K with Material Definitive Agreement

TL;DR

SmartKem signed a big deal, filing an 8-K today.

AI Summary

On December 17, 2024, SmartKem, Inc. entered into a Material Definitive Agreement. The filing also includes other events and financial statements and exhibits. SmartKem, Inc. is incorporated in Delaware and its principal executive offices are located in Manchester, U.K.

Why It Matters

This 8-K filing indicates a significant new agreement for SmartKem, Inc., which could impact its future operations and financial performance.

Risk Assessment

Risk Level: medium — Material Definitive Agreements can introduce new risks and opportunities that are not yet fully understood.

Key Players & Entities

• SmartKem, Inc. (company) — Registrant
• December 17, 2024 (date) — Date of earliest event reported
• Delaware (jurisdiction) — State of incorporation
• Manchester, U.K. (location) — Address of principal executive offices

FAQ

Key Financial Figures

• $0.0001 — ch registered Common Stock, par value $0.0001 per share SMTK The Nasdaq Stock Mar
• $10,000 — nvertible Preferred Stock, Stated Value $10,000 per share (the "Series A-1 Preferred St
• $4,000,000 — q "Minimum Price" resulting in at least $4,000,000 of gross proceeds to the Company. No Qu
• $4.00 — ce of the Series A-1 Preferred Stock to $4.00; and (iii) reduce the time period durin
• $15 million — eceived gross proceeds of not less than $15 million from one or more financing transactions
• $4.34 — ce of the Series A-1 Preferred Stock to $4.34; (v) prevent the conversion of the Seri
• $1,500,000 — GH") for so long as AIGH holds at least $1,500,000 in aggregate Stated Value of Series A-1
• $4 billion — oLED market is expected to grow to over $4 billion in 2030, a 59% compound annual growth r
• $150 million — growth rate ("CAGR") from approximately $150 million in 2024 with microLED displays expected
• $28 billion — et is expected to grow to approximately $28 billion in 2029, a 37% CAGR from approximately
• $4.3 billion — in 2029, a 37% CAGR from approximately $4.3 billion in 2023. According to a 2024 Omdia Rep
• $100 — ng price for display backplanes is over $100 per square meter. As a result, the Comp
• $20 billion — e market for its OTFT inks is more than $20 billion. Statements contained in this Current

Filing Documents

• tm2431273d1_8k.htm (8-K) — 39KB
• tm2431273d1_ex10-1.htm (EX-10.1) — 45KB
• tm2431273d1_ex10-2.htm (EX-10.2) — 23KB
• 0001104659-24-129550.txt ( ) — 300KB
• tmb-20241217.xsd (EX-101.SCH) — 3KB
• tmb-20241217_lab.xml (EX-101.LAB) — 33KB
• tmb-20241217_pre.xml (EX-101.PRE) — 22KB
• tm2431273d1_8k_htm.xml (XML) — 4KB

01 Entry into a Material Definitive Agreement

Item 1.01 Entry into a Material Definitive Agreement. On December 17, 2024, the Company entered into a Consent and Amendment Agreement (the "Agreement") with certain holders (the "Holders") of securities issued in the Company's June 2023 private placement (the "2023 Private Placement") pursuant to which, among other things, the Holders agreed to (i) amend certain of the terms of the Purchase Agreement, dated June 14, 2023 (as previously amended, the "Purchase Agreement"), as described below and (ii) amend and restate certain of the provisions of the Company's Series A-1 Convertible Preferred Stock, Stated Value $10,000 per share (the "Series A-1 Preferred Stock"), as described below, effective immediately prior to the closing of a "Qualified Offering" (the "Effective Time"). The Agreement defines a Qualified Offering as a sale of shares of the Company's common stock and/or common stock equivalents pursuant to an effective registration statement under the Securities Act of 1933, as amended, or in a side-by-side private placement, at an effective price per share at least equal to the then applicable Nasdaq "Minimum Price" resulting in at least $4,000,000 of gross proceeds to the Company. No Qualified Offering has occurred on or prior to the date of this Current Report on Form 8-K and no assurance can be given that a Qualified Offering will occur or as to the terms thereof. If no Qualifying Offering occurs the amendments and restatements summarized herein will not occur and the current terms of the Purchase Agreement and the Series A-1 Preferred Stock will remain in effect. Amendments to the Purchase Agreement In the Agreement, the parties agreed to amend the Purchase Agreement effective as of the Effective Time to (i) delete the provisions of (A) Section 4.12(a) of the Purchase Agreement, which had prevented the Company from effecting the issuance of its common stock and common stock equivalents for a period of 180 days after the initial closing of the 2023 Priva

01

Item 8.01 Other Events. The information contained in response to Item 1.01 above is incorporated herein by reference. According to the 2024 Omdia Report, the microLED market is expected to grow to over $4 billion in 2030, a 59% compound annual growth rate ("CAGR") from approximately $150 million in 2024 with microLED displays expected to represent approximately 7% to 8% of the total display market by 2030. According to a 2024 report by Yole Intelligence, the advanced packaging market is expected to grow to approximately $28 billion in 2029, a 37% CAGR from approximately $4.3 billion in 2023. According to a 2024 Omdia Report, "Top 10 Display Topics on 2024 Review and 2025 Prospect," approximately 200 million square meters of display backplanes are manufactured annually. According to a report from Hendy Consulting commissioned by the Company, the average selling price for display backplanes is over $100 per square meter. As a result, the Company believes that the potential annual addressable market for its OTFT inks is more than $20 billion. Form 8-K regarding matters that are not historical facts are "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995. Such statements may involve risks and uncertainties, such as statements related to potential market size and growth estimates, potential market penetration, backplane manufacturing levels, backplane costs and the timing and terms of any Qualified Offering. The risks and uncertainties involved include uncertainty surrounding the growth and adoption of new technologies, the Company's ability to address existing and new markets effectively, market acceptance and adoption of the Company's current and future products, costs of manufacturing microLED displays, and the Company's ability to consummate a Qualified Offering and the timing thereof, as well as other risks detailed from time to time in the Company's SEC filings,

01 Financial Statements and Exhibits

Item 9.01 Financial Statements and Exhibits. (d) Exhibits. Exhibit No. Description 10.1 Consent and Amendment Agreement dated December 17, 2024 10.2 General Release dated December 17, 2024 104 Cover Page Interactive Data File (embedded within the Inline XBRL document) SIGNATURE Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized. SMARTKEM, INC. Dated: December 18, 2024 By: /s/ Barbra C. Keck Name: Barbra C. Keck Title: Chief Financial Officer

View Full Filing

View this 8-K filing on SEC EDGAR