Mail Stop 4631
August 10, 2020
Shy Datika
President
INX Limited
Unit 1.02, 1st Floor 6 Bayside Road
Gibraltar, GX11 1AA
Re: INX Limited
Amendment No. 9 to Registration Statement on Form F-1
Filed August 3, 2020
File No. 333-233363
Dear Mr. Datika:
We have reviewed your amended registration statement and have the
following
comments. In some of our comments, we may ask you to provide us with
information so we
may better understand your disclosure.
Please respond to this letter by amending your registration
statement and providing the
requested information. If you do not believe our comments apply to your
facts and
circumstances or do not believe an amendment is appropriate, please tell us
why in your
response.
After reviewing any amendment to your registration statement and the
information you
provide in response to these comments, we may have additional comments.
General
1. Please revise to provide your cumulative Adjusted Operating Cash
Flow as of March 31,
2020 consistent with your commitment to publicly disclose this
calculation within 60
days of each quarter.
2. We note your new disclosure that you will accept USD Coin ( USDC
) prior to reaching
your minimum offering amount, subject to your ability to convert
USDC to USD on a 1:1
basis within one business day, and that USDC will be returned to
subscribers in the event
that you do not meet the minimum offering requirement within one
year. Accordingly,
please:
Disclose the costs of converting between USD and USDC, and
identify the party
responsible for bearing such costs.
Shy Datika
INX Limited
August 10, 2020
Page 2
We note that your Escrow Agreement does not address the conversion
of USD to
USDC for subscribers who submitted payment in USDC where a closing
of INX
Tokens does not occur on or before the Termination Time. Instead
Section 2(a)
requires the Escrow Agent to return the funds held in the escrow
directly to the
subscriber by wire transfer. Please revise your disclosure and the
Escrow Agreement
to clarify how and by whom the funds will be converted and remitted
to subscribers
using USDC.
Disclose the source of funds that you will use to return escrowed
funds to subscribers
if you are unable to convert USD to USDC on a 1:1 basis, and clarify
the impact on
subscribers if this source of funds is insufficient. We note your
risk factor disclosure
that changes in the exchange ratio may subject the company to
exchange rate risk
with regard to potential reimbursements.
Disclose the type of consideration that you will return to
subscribers submitting
USDC in the event that you are unable to secure sufficient USDC, for
example if
USDC is discontinued.
Clarify how a fork in USDC during the period the funds are in
escrow, and/or
Downtime for USDC during the period that you would attempt to return
such funds to
subscribers, may impede your ability to return USDC to subscribers,
promptly or at
all.
Prospectus Cover Page
3. Please complete the information in the table showing net proceeds to the
company before
expenses.
Prospectus Summary
Our Development Plan
INX Digital Trading Platform, page 8
4. We note your disclosure that you will commence operations of the INX
Digital trading
platform twelve months after reaching the minimum offering amount of
$7,500,000,
and disclosure following the Use of Proceeds table on page 39 stating
that $7.5 million of
proceeds will be sufficient to operate up to commencement of the
launch of the
platform. However, we also note your July 2020 test-the-waters
presentation estimated
this platform s launch and revenue generation therefrom in or about Q4
2020. Please
explain or reconcile these apparent inconsistencies. Please further
revise to clarify the
number of states INX Digital will be qualified to operate in at the time
of its launch.
Shy Datika
INX Limited
August 10, 2020
Page 3
Business
Material Agreements
Material Service Agreements
Mr. Paz Diamant, page 68
5. Please disclose Mr. Diamant s monthly salary beginning two months
following the
effectiveness of this offering converted into USD.
Tokens Eligible for Future Sale
Lock-up Agreements, page 112
6. We note your Form of Lock-up Agreement attached at Ex. 10.39 appears to
contain only
the terms applicable to your officers, directors and holders of 5% or
more of your
outstanding INX Tokens or ordinary shares, as described on page 112. It
refers to a two-
year lockup and includes a provision whereby half of all tokens subject
to lock-up are
released midway through the lockup period. The agreement does not refer
to the six
month lockup period to which all other INX Token holders are subject.
Please revise or
advise to address these apparent discrepancies.
You may contact Lory Empie, Staff Accountant, at (202) 551-3714 or
Stephen Kim,
Assistant Chief Accountant, at (202) 551-3291 if you have questions regarding
comments on the
financial statements and related matters. Please contact Christopher Dunham,
Staff Attorney, at
(202) 551-3783 or, in his absence, Pamela A. Long at (202) 551-3765 with any
other questions.
Sincerely,
Division of
Corporation Finance
Office of Finance