SMX (Security Matters) increased its Standby Equity Purchase Agreement with Target Capital 1 LLC to a $250 million commitment, up from the original $100 million. The amendment was executed on February 5 2026 and publicly disclosed on February 6 2026, giving the company a new source of liquidity that extends its capital runway into 2028.
The expanded equity line provides SMX with more than 22 months of capital headspace, addressing the severe liquidity constraints highlighted in its latest financial statements. The company’s operating cash burn has been high, and the additional funding is intended to bridge the gap between current cash reserves and the cash required to sustain operations and product development until revenue from pilot programs matures.
As of the amendment date, SMX had drawn approximately $8.9 million under the agreement and issued 685,471 ordinary shares. The placement agent, RBW Capital Partners LLC, received tiered placement fees, while the facility fee of 2 % on the original $100 million commitment has already been paid and will not increase with the new limit.
Management emphasized that the financing will provide the flexibility needed to fund ongoing product development, including the industrial rubber traceability platform and cotton fiber traceability initiatives, and to convert pilot partnerships into revenue‑generating contracts. The company plans to use the capital to accelerate development milestones and expand its verification infrastructure globally.
The use of an equity line of credit will dilute existing shareholders, as the company must issue new shares to raise capital. Management has indicated that it will monitor dilution closely and will only draw on the line as needed to support strategic priorities, thereby limiting the impact on share value.
SMX’s product development pipeline includes a robust industrial rubber traceability platform that is currently in advanced pilot stages, as well as a cotton fiber traceability solution that is moving from proof‑of‑concept to commercial deployment. These initiatives are expected to generate incremental revenue once the pilots convert to full contracts.
Several pilot programs are underway across different supply‑chain segments, and SMX expects to convert these into revenue‑generating contracts over the next 12 to 18 months. The company’s management has outlined a roadmap for scaling these pilots, with milestones tied to key performance indicators such as customer acquisition and contract signing.
Investor reaction to the announcement was largely positive, reflecting confidence in the company’s ability to secure additional liquidity. However, concerns about potential shareholder dilution tempered enthusiasm, leading to a cautious but supportive market stance.
The equity line increase strengthens SMX’s balance sheet and provides the financial flexibility needed to pursue growth initiatives while managing cash burn. The company’s focus on product development and pilot conversion, coupled with careful dilution management, positions it to navigate the current liquidity environment and pursue long‑term value creation.
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