SEC Comment Letter for HG Holdings, Inc. (STLY) (CIK 0000797465) (STLY) — Feb 3, 2020
HG Holdings, Inc. (STLY) (CIK 0000797465)
Date: Feb. 3, 2020 · CIK: 0000797465 · Accession: 0000000000-20-001009
AI Filing Summary & Sentiment
File numbers found in text: 333-235539
Letter
February 3, 2020 Brad G. Garner Principal Financial Officer HG Holdings, Inc. 2115 E. 7th Street, Suite 101 Charlotte, North Carolina 28204 Re:HG Holdings, Inc. Amendment No. 1 to Registration Statement on Form S-1 Filed January 21, 2020 File No. 333-235539 Dear Mr. Garner: 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. Unless we note otherwise, our references to prior comments are to comments in our January 10, 2020 letter. Form S-1 filed on January 21, 2020 General 1.We note your response to comment 1. We have referred your analysis to the Division of Investment Management and their review of your response is pending. We may have follow-up comments. Unaudited Pro Forma Financial Statements , page 6 2.We note your disclosure on page 2 that you anticipate using the proceeds of the rights offering to acquire a sufficient number of shares of HC Realty Series B Preferred or HC Realty Common Stock to control HC Realty as a result of your equity ownership of HC Realty. Please tell us how you determined no pro forma presentation was required as it
FirstName LastNameBrad G. Garner Comapany NameHG Holdings, Inc. February 3, 2020 Page 2 FirstName LastName Brad G. Garner HG Holdings, Inc. February 3, 2020 Page 2 relates to this acquisition. Reference is made to Rule 8-05 of Regulation S-X. Material US Federal Income Tax Consequences, page 28 3.We note the opinion that the receipt of subscription rights pursuant to the rights offering should not be treated as a taxable distribution. It appears certain aspects of that determination are not certain. Please expand the discussion to further explain the facts or circumstances resulting in this uncertainty. Provide appropriate risk factor disclosure. Please refer to Staff Legal Bulletin No. 19 Section III.C.4 for guidance. Also, please remove the statement on page 28 that the opinion is for general information only. Investors are entitled to rely on the opinion. You may contact Peter McPhun at 202-551-3581 or Shannon Menjivar at 202-551-3856 if you have questions regarding comments on the financial statements and related matters. Please contact Ruairi Regan at 202-551-3269 or David Link at 202-551-3356 with any other questions. Sincerely, Division of Corporation Finance Office of Real Estate & Construction cc: David W. Robertson, Esq.
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February 3, 2020
Brad G. Garner
Principal Financial Officer
HG Holdings, Inc.
2115 E. 7th Street, Suite 101
Charlotte, North Carolina 28204
Re:HG Holdings, Inc.
Amendment No. 1 to Registration Statement on Form S-1
Filed January 21, 2020
File No. 333-235539
Dear Mr. Garner:
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. Unless we note
otherwise, our references to prior comments are to comments in our January 10, 2020 letter.
Form S-1 filed on January 21, 2020
General
1.We note your response to comment 1. We have referred your analysis to the Division of
Investment Management and their review of your response is pending. We may have
follow-up comments.
Unaudited Pro Forma Financial Statements , page 6
2.We note your disclosure on page 2 that you anticipate using the proceeds of the rights
offering to acquire a sufficient number of shares of HC Realty Series B Preferred or HC
Realty Common Stock to control HC Realty as a result of your equity ownership of HC
Realty. Please tell us how you determined no pro forma presentation was required as it
FirstName LastNameBrad G. Garner
Comapany NameHG Holdings, Inc.
February 3, 2020 Page 2
FirstName LastName
Brad G. Garner
HG Holdings, Inc.
February 3, 2020
Page 2
relates to this acquisition. Reference is made to Rule 8-05 of Regulation S-X.
Material US Federal Income Tax Consequences, page 28
3.We note the opinion that the receipt of subscription rights pursuant to the rights offering
should not be treated as a taxable distribution. It appears certain aspects of that
determination are not certain. Please expand the discussion to further explain the facts or
circumstances resulting in this uncertainty. Provide appropriate risk factor disclosure.
Please refer to Staff Legal Bulletin No. 19 Section III.C.4 for guidance. Also, please
remove the statement on page 28 that the opinion is for general information only.
Investors are entitled to rely on the opinion.
You may contact Peter McPhun at 202-551-3581 or Shannon Menjivar at 202-551-3856
if you have questions regarding comments on the financial statements and related
matters. Please contact Ruairi Regan at 202-551-3269 or David Link at 202-551-3356 with any
other questions.
Sincerely,
Division of Corporation Finance
Office of Real Estate & Construction
cc: David W. Robertson, Esq.