SEC Company Response from Hyperscale Data, Inc. (GPUS, GPUS-PD) (CIK 0000896493) (GPUS) — Jun 3, 2019
Hyperscale Data, Inc. (GPUS, GPUS-PD) (CIK 0000896493)
Date: June 3, 2019 · CIK: 0000896493 · Accession: 0001214659-19-003968
AI Filing Summary & Sentiment
Reasoning
File numbers found in text: 001-12711
Letter
Securities and Exchange Commission Division of Corporate Finance Assistant Director Re: DPW Holdings, Inc. Preliminary Proxy Statement on Schedule 14A Filed May 16, 2019 File No. 001-12711
Dear Ms. Ravitz:
DPW Holdings, Inc. (the “Company”) hereby submits a response to certain questions raised by the staff (the “Staff”) of the Securities and Exchange Commission (the “Commission”) in a conversation held between a member of the Staff and the Company on May 31, 2019 relating to the Preliminary Proxy Statement on Schedule 14A referenced above.
The Company’s responses are numbered to correspond to the Staff’s orally provided comments and are filed in conjunction with the amended Proposal No. 5 attached hereto as Exhibit A to be included in the revised preliminary proxy statement (the “PRER 14A”) or the definitive proxy statement (the “DEF 14A”), as the case may be. For your convenience, each of the Staff’s orally provided comments has been restated below in its entirety, with the Company’s response set forth immediately beneath such comment.
General
Comment No. 1. Regarding the prior reverse split effectuated on March 14, 2019, provide your analysis of whether the reverse split achieved the intended, disclosed objectives or the objective disclosed in the pending proxy statement.
Response No. 1. The Company believes that the prior reverse split effectuated on March 14, 2019 (the “March Split”) did achieve the intended objectives, as the closing market price (“CMP”) on that date was $1.68, substantially above the $1.00 market price that the NYSE American prefers the issuers listed on this national securities exchange maintain, and well above the market prices that lead it to issue letters of various kinds to its listed issuers.
That being said, two significant events occurred that had a materially adverse impact on the market price of the Company’s common stock, one of which was entirely unrelated to the March Split, and one that may have been related to it. However, despite having looked into the matter in some detail, the Company cannot state definitively whether, and if so how, the March Split affected the market price, and therefore this assessment remains no more than informed speculation.
As the revised Proposal 5 explains, the first to occur of these events was a precipitous drop in the market price near the end of the trading day of March 15, 2019. As noted above, the CMP on March 14, 2019 was $1.68. While this price level was not fully sustained during the trading day of March 15, 2019, in the last few minutes the price dropped precipitously, with the CMP being $0.71. Given that this occurred on the first complete trading day following the announcement of the March Split, it is difficult to avoid the conclusion that the sudden drop in the market price was in fact associated with it in some manner. However, the Company remains unaware of how this occurred.
The second event that caused a significant slide in the market price of the Company’s common stock was the Company’s press release dated March 29, 2019, which announced the pricing of a public offering. On April 3, 2019, the Company announced that this public offering had closed on April 2, 2019. On March 28, 2019, the CMP was approximately $0.71, only slightly lower than the CMP on March 15, 2019, meaning that the CMP was substantially steady for the two weeks following the March Split. On March 29, 2019, however, the CMP was approximately $0.29. This drop in the market price was clearly occasioned by the announcement of the pricing of the public offering and was entirely unrelated to the March Split.
Consequently, the Company does believe that the March Split had its intended effect, with the caveat that it never assumed that the market price would be affected in precisely the proportion of the March Split itself, which rarely happens when any issuer effectuates a reverse stock split. As discussed above, while the first, entirely unforeseen, event could be seen as undermining this conclusion, the Company firmly believes that a thorough review of the events that occured subsequent to the March Split reinforces its conclusion that it did indeed have its intended effect.
Comment No. 2. Also tell us the basis for your belief that the information need not be disclosed in the pending proxy statement.
Response No. 2. While the Company originally believed that since all the information supplied above was a matter of public record no additional disclosure was required, after discussions with the Staff the Company no longer holds that belief, as reflected in the revised Proposal 5 attached hereto as Exhibit A, which the Company intends to insert into the pending proxy statement.
Should you have any questions regarding the foregoing, please do not hesitate to contact our general counsel Henry Nisser at (646) 650-5044.
Very truly yours,
/s/ Milton C. Ault, III
Show Raw Text
CORRESP
1
filename1.htm
DPW HOLDINGS, INC.
June 3, 2019
Securities and Exchange Commission
Division of Corporate Finance
100 F Street, NE
Washington, DC 20549
Attn: Amanda Ravitz
Assistant Director
Re: DPW Holdings, Inc.
Preliminary Proxy Statement
on Schedule 14A Filed May 16, 2019
File No. 001-12711
Dear Ms. Ravitz:
DPW Holdings, Inc. (the “Company”)
hereby submits a response to certain questions raised by the staff (the “Staff”) of the Securities and Exchange
Commission (the “Commission”) in a conversation held between a member of the Staff and the Company on May 31,
2019 relating to the Preliminary Proxy Statement on Schedule 14A referenced above.
The Company’s responses are numbered
to correspond to the Staff’s orally provided comments and are filed in conjunction with the amended Proposal No. 5 attached
hereto as Exhibit A to be included in the revised preliminary proxy statement (the “PRER 14A”)
or the definitive proxy statement (the “DEF 14A”), as the case may be. For your convenience, each of the Staff’s
orally provided comments has been restated below in its entirety, with the Company’s response set forth immediately beneath
such comment.
General
Comment No. 1. Regarding the
prior reverse split effectuated on March 14, 2019, provide your analysis of whether the reverse split achieved the intended, disclosed
objectives or the objective disclosed in the pending proxy statement.
Response No. 1. The Company believes
that the prior reverse split effectuated on March 14, 2019 (the “March Split”) did achieve the intended objectives,
as the closing market price (“CMP”) on that date was $1.68, substantially above the $1.00 market price that
the NYSE American prefers the issuers listed on this national securities exchange maintain, and well above the market prices that
lead it to issue letters of various kinds to its listed issuers.
That being said, two significant events
occurred that had a materially adverse impact on the market price of the Company’s common stock, one of which was entirely
unrelated to the March Split, and one that may have been related to it. However, despite having looked into the matter in some
detail, the Company cannot state definitively whether, and if so how, the March Split affected the market price, and therefore
this assessment remains no more than informed speculation.
As the revised Proposal 5 explains, the
first to occur of these events was a precipitous drop in the market price near the end of the trading day of March 15, 2019. As
noted above, the CMP on March 14, 2019 was $1.68. While this price level was not fully sustained during the trading day of March
15, 2019, in the last few minutes the price dropped precipitously, with the CMP being $0.71. Given that this occurred on the first
complete trading day following the announcement of the March Split, it is difficult to avoid the conclusion that the sudden drop
in the market price was in fact associated with it in some manner. However, the Company remains unaware of how this occurred.
The second event that caused a significant
slide in the market price of the Company’s common stock was the Company’s press release dated March 29, 2019, which
announced the pricing of a public offering. On April 3, 2019, the Company announced that this public offering had closed on April
2, 2019. On March 28, 2019, the CMP was approximately $0.71, only slightly lower than the CMP on March 15, 2019, meaning that the
CMP was substantially steady for the two weeks following the March Split. On March 29, 2019, however, the CMP was approximately
$0.29. This drop in the market price was clearly occasioned by the announcement of the pricing of the public offering and was entirely
unrelated to the March Split.
Consequently, the Company does believe
that the March Split had its intended effect, with the caveat that it never assumed that the market price would be affected in
precisely the proportion of the March Split itself, which rarely happens when any issuer effectuates a reverse stock split. As
discussed above, while the first, entirely unforeseen, event could be seen as undermining this conclusion, the Company firmly believes
that a thorough review of the events that occured subsequent to the March Split reinforces its conclusion that it did indeed have
its intended effect.
Comment No. 2. Also tell us the
basis for your belief that the information need not be disclosed in the pending proxy statement.
Response No. 2. While the Company
originally believed that since all the information supplied above was a matter of public record no additional disclosure was required,
after discussions with the Staff the Company no longer holds that belief, as reflected in the revised Proposal 5 attached hereto
as Exhibit A, which the Company intends to insert into the pending proxy statement.
Should you have any questions regarding the foregoing, please
do not hesitate to contact our general counsel Henry Nisser at (646) 650-5044.
Very truly yours,
/s/ Milton C. Ault, III
Milton C. Ault, III
Chief Executive Officer