SEC Company Response from Streamex Corp. (STEX) (CIK 0001530766) (STEX) — Oct 4, 2013
Streamex Corp. (STEX) (CIK 0001530766)
Date: Oct. 4, 2013 · CIK: 0001530766 · Accession: 0001185185-13-002173
AI Filing Summary & Sentiment
Reasoning
File numbers found in text: 333-190080
Referenced dates: September 27, 2013
Letter
Re:
biosigtech-corresp100313.htm
October 4, 2013
VIA EDGAR
Division of Corporation Finance
Securities and Exchange Commission
Washington, D.C. 20549
Attention: Russell Mancuso
BioSig Technologies, Inc.
Registration Statement on Form S-1, originally filed July 22, 2013
File No. 333-190080, as amended (the “Registration Statement”)
Ladies and Gentlemen:
On behalf of BioSig Technologies, Inc. (the “Company”), transmitted herewith for filing is Amendment No. 2 to Form S-1 (“Amendment No. 2”), marked to show changes from Amendment No. 1 to Registration Statement on Form S-1 of the Company (File No. 333-190080), filed with the Securities and Exchange Commission (the “Commission”) on September 11, 2013 (“Amendment No. 1”). We acknowledge receipt of the letter of comment dated September 27, 2013 (the “Comment Letter”) from the staff (the “Commission Staff”) of the Division of Corporation Finance of the Commission regarding the Registration Statement. The following are the Company’s responses to the Comment Letter. The Company’s responses are numbered to correspond to the Commission Staff’s comments as numbered in the Comment Letter. For your convenience, each of the Commission Staff’s comments contained in the Comment Letter have been restated below in their entirety, with the Company’s corresponding response set forth immediately under such comment.
Prospectus Cover
1.
We note your revisions in response to prior comment 6. Please tell us what you intend as the difference between “privately negotiated prices” and “transactions that are not in the public market” in the second paragraph under your logo on the prospectus cover and on page 54.
Response:
The Company has revised the disclosure in the second paragraph under its logo on the prospectus cover, in the Prospectus Summary section and in the Plan of Distribution section of Amendment No. 2 to clarify that after the Company’s common stock is quoted on the OTC Bulletin Board, the shares of common stock may be sold at prevailing market prices or in transactions that are not in the public market.
Prospectus Summary, page 1
U.S. Securities and Exchange Commission
October 4, 2013
Page 2
2.
Please highlight in your prospectus summary the information provided in response to prior comment 18.
Response:
The Company has included the information in the prospectus summary on page 1 of Amendment No. 2.
Risk Factors, page 2
3.
We note your revised disclosure on page 17 concerning your research and development expenses for the six months ended June 30, 2013. Please revise your risk factor disclosure to address how the funding constraints you reference have impacted your product development.
Response:
The Company has revised the risk factor on page 2 of Amendment No. 2 to disclose the impact that funding constraints have on the Company’s product development.
We are obligated to develop and maintain..., page 13
4.
Please refer to the Instructions to Regulation S-K, Item 308 and revise your disclosure concerning the December 31, 2013 date to reflect the correct fiscal year.
Response:
The Company has revised the disclosure on page 12 of Amendment No. 2 to reflect that it would be required to perform the annual review and evaluation of its internal controls no later than for the fiscal year ending December 31, 2014.
While we currently qualify as an “emerging growth company,” page 13
5.
We note the last paragraph of your response to prior comment 3. Please tell us why the material that you circulated in connection with this offering in reliance on Section 5(d) of the Securities Act indicates that this is a private offering and refers to an offering of securities that are not being sold in connection with this offering.
U.S. Securities and Exchange Commission
October 4, 2013
Page 3
Response:
The written material that was provided supplementally with the response letter accompanying Amendment No. 1 (the “PPM”) was distributed in connection with a private placement of the Company’s Series C Preferred Stock and related warrants and was not distributed in anticipation of the secondary offering being registered on Amendment No. 2. To clarify the Company’s response to prior comment 3, the PPM was distributed in connection with an offering that was exempt from registration pursuant to Regulation D promulgated under the Securities Act of 1933, as amended (the “Securities Act”), and was not distributed in reliance on Section 5(d) of the Securities Act in connection with this secondary offering being registered on Amendment No. 2. The Company supplementally provided the PPM in order to provide the Commission Staff with all distributed materials related to the securities that are convertible or exercisable into the shares of common stock that are being registered on Amendment No. 2.
Risks Related to our Series C Preferred Stock, page 14
6.
Please provide us your analysis of whether your dividend obligation to your preferred stockholders presents a risk to investors purchasing common stock in this offering.
Response:
The Company has added a risk factor addressing the dividend obligation to the holders of its Series C Preferred Stock on page 14 of Amendment No. 2.
Our Series C Preferred Stock and our warrants, page 14
7.
Please address that part of prior comment 8 that asked you to highlight in the risk factor the extent to which you historically have reduced the original conversion or exercise prices of outstanding securities.
Response:
The Company has made the requested revision by expanding the discussion in the risk factor beginning “Our Series C Preferred Stock and our warrants” on page 14 of Amendment No. 2.
Overview, page 21
8.
We note your revision mentioned in response to prior comment 20. Please disclose the criteria that you used to determine that the changes were “significant” and “material” as you mention in the first bullet point on page 23.
Response:
The Company has revised its disclosure in the first bullet point on page 23 of Amendment No. 2 to remove the terms that qualify the reduction in baseline wander, noise, and artifacts and the higher diagnostic value provided by the PURE EP System as compared to the original recordings.
Our Industry, page 23
U.S. Securities and Exchange Commission
October 4, 2013
Page 4
9.
Please tell us why you have revised your disclosure in the second paragraph in this section to remove discussion of the 2011 study and replaced it with 2010 information.
Response:
The Company removed the discussion of the 2011 study because the 2011 study used data that was collected in 2006, while the 2010 study employed more recent information. The Company has further revised its disclosure on page 23 of Amendment No. 2 with respect to ablation studies.
Treatment of Atrial Fibrillation..., page 24
10.
Please ensure that the disclosure that you present is balanced. For example, given the information that you present in this section, it is unclear how investors would know of the limitations mentioned at the bottom of page 61 of the material that you attached to your response letter and the issues mentioned in the first paragraph on page 62 of that material.
Response:
The Company has expanded the disclosure on page 24 of Amendment No. 2 to include the limitations and challenges relating to atrial fibrillation and ventricular tachycardia.
11.
Please clarify what you mean by “Mahapatra S.”
Response:
The Company has clarified that this is the name of a physician that published a relevant study cited on page 24 of Amendment No. 2.
Initial Analysis, page 26
12.
We note your response to prior comment 21; however, you did not tell us whether the recording from the “competitive” system represents a typical recording. Please address this aspect of the comment.
Response:
The Company has revised the caption on page 26 of Amendment No. 2 to clarify that the original recording was recorded in a challenging recording environment, which was more relevant to the initial analysis than the actual system that produced the recording.
Strategic Alliances, page 27
U.S. Securities and Exchange Commission
October 4, 2013
Page 5
13.
Please expand your disclosure in the second paragraph to clarify when your collaboration with Dr. Natale and Dr. Di Biase occurred.
Response:
The Company has expanded its disclosure on page 27 of Amendment No. 2 to include the duration of the Company’s collaboration with Dr. Natale and Dr. Di Biase.
Intellectual Property, page 29
14.
Please disclose the substance of your response to prior comment 25. In your revised disclosure, please clarify how you currently have rights to the technology if it has not yet been assigned to you. File all related agreements as exhibits to your registration statement.
Response:
The Company has expanded its disclosure on page 29 of Amendment No. 2 to explain its current rights to the intellectual property necessary for its products. There are no agreements related to the intellectual property used by the Company.
Government Regulation, page 29
15.
We note your revised disclosure in response to prior comment 26; however, you have not addressed the second sentence of the prior comment. Please disclose the implications in the event your belief concerning classification is incorrect, and add any material risk factors, as appropriate.
Response:
The Company has disclosed the implications if its belief concerning the classification of its product is incorrect on page 30 of Amendment No. 2. The Company believes that the likelihood of its product being classified as a Class III device is sufficiently remote that no material risk factor is necessary.
Biographical Information, page 32
16.
We note your revised disclosure in response to prior comment 30 concerning Mr. Chaussy's past service as the chief financial officer for “small publicly traded” companies. To the extent that he held any of these positions during the past five years, please disclose the information required by Regulation S-K, Item 401(e)(1) and ensure that the period during which Mr. Chaussy worked for those entities is clear.
U.S. Securities and Exchange Commission
October 4, 2013
Page 6
Response:
The Company notes that Mr. Chaussy has not held any executive officer positions for any public companies during the past five years.
Security Ownership of Certain Beneficial Owners and Management, page 37
17.
Please include the information in the tabular form indicated by Regulation S-K Item 403(b) for your management’s beneficial ownership of your series A and B shares. In addition, show the effect of this offering on your disclosure in this section, including the automatic conversion mentioned in response to prior comment 49.
Response:
The Company has made the requested revision by adding a table addressing its management’s beneficial ownership of its shares of Series B Preferred Stock and revising the existing beneficial ownership table for its shares of Series C Preferred Stock on page 39 of Amendment No. 2. No member of the Company’s management owns shares of the Company’s Series A Preferred Stock.
Selling Stockholders, page 39
18.
Regarding your response to prior comment 41:
·
Please explain to us how you determined the size of your public float. In this regard, we note the holdings of your officers and directors as disclosed in your beneficial ownership table. As appropriate, please provide us with a revised analysis concerning the relative size of the present offering.
Response:
The determination whether the offering covered by Amendment No. 2 is a valid secondary offering is based on all of the circumstances of the offering, including but not limited to those addressed by the Staff in its comment above. Therefore, before answering the Staff’s specific questions, the Company is providing some background regarding its overall analysis and all of the factors that the Company considered in concluding that the offering is a valid secondary offering.
Background
As described in our response to prior comment 41, in determining that none of the selling stockholders should be deemed underwriters with respect to the offering covered by the Registration Statement and that the offering is a valid secondary offering, the Company reviewed the guidance set forth in Interpretive Response 612.09, posted by the Staff on January 26, 2009, which provides that:
U.S. Securities and Exchange Commission
October 4, 2013
Page 7
“It is important to identify whether a purported secondary offering is really a primary offering, i.e., the selling shareholders are actually underwriters selling on behalf of an issuer. Underwriter status may involve additional disclosure, including an acknowledgment of the seller’s prospectus delivery requirements. In an offering involving Rule 415 or Form S-3, if the offering is deemed to be on behalf of the issuer, the Rule and Form in some cases will be unavailable (e.g., because of the Form S-3 ‘public float’ test for a primary offering, or because Rule 415(a)(l)(i) is available for secondary offerings, but primary offerings must meet the requirements of one of the other subsections of Rule 415). The question of whether an offering styled a secondary one is really on behalf of the issuer is a difficult factual one, not merely a question of who receives the proceeds. Consideration should be given to how long the selling shareholders have held the shares, the circumstances under which they received them, their relationship to the issuer, the amount of shares involved, whether the sellers are in the business of underwriting securities, and finally, whether under all the circumstances it appears that the seller is acting as a conduit for the issuer.” (emphasis added)
Applying the guidelines above, the Company analyzed (1) how long the selling stockholders have held the securities, (2) the circumstances under which the securities were received, (3) their relationship to the Company, (4) the amount of shares involved, (5) whether the selling stockholders are in the business of underwriting securities, and (6) whether the circumstances indicate that the selling stockholders are acting as a conduit for the Company. A description of the Company’s analysis with respect to each of these factors is set forth in detail in our response to prior comment 41. Below is a summary of the Company’s analysis with respect to each factor:
·
How long the selling stockholders have held the securities. To date, the selling stockholders holding a majority of the securities have held their shares of the Company’s Series C Preferred Stock and related warrants since February 2013. In addition, it is unlikely that the selling stockholders will be able to sell the shares of the Company’s common stock underlying the securities in any sort of immediate fashion and the selling stockholders will likely remain holders of the Company’s securities for an extended period of time due to the lack of a current market for the Company’s common stock, the anticipated time it will take for the Company’s common stock to be eligible for trading on the OTC Bulletin Board and the anticipated relative illiquidity of the Company’s common stock due to a lack of analyst coverage for, and investor interest, in the Company. Further, none of the selling stockholders have converted or exercised any portions of the securities, and no shares underlying the securities have therefore been issued. Finally, although the selling stockholders had registration rights for the common stock underlying the securities, registration rights, in and of themselves, do not evidence an intent on the part of the selling stockholders to sell shares. The fact that the Registration Rights Agreement originally contemplated a generous 120-day window before the filing of the registration statement (as opposed to a more typical 30-day period), which was subsequ
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CORRESP
1
filename1.htm
biosigtech-corresp100313.htm
October 4, 2013
VIA EDGAR
Division of Corporation Finance
Securities and Exchange Commission
Washington, D.C. 20549
Attention: Russell Mancuso
Re:
BioSig Technologies, Inc.
Registration Statement on Form S-1, originally filed July 22, 2013
File No. 333-190080, as amended (the “Registration Statement”)
Ladies and Gentlemen:
On behalf of BioSig Technologies, Inc. (the “Company”), transmitted herewith for filing is Amendment No. 2 to Form S-1 (“Amendment No. 2”), marked to show changes from Amendment No. 1 to Registration Statement on Form S-1 of the Company (File No. 333-190080), filed with the Securities and Exchange Commission (the “Commission”) on September 11, 2013 (“Amendment No. 1”). We acknowledge receipt of the letter of comment dated September 27, 2013 (the “Comment Letter”) from the staff (the “Commission Staff”) of the Division of Corporation Finance of the Commission regarding the Registration Statement. The following are the Company’s responses to the Comment Letter. The Company’s responses are numbered to correspond to the Commission Staff’s comments as numbered in the Comment Letter. For your convenience, each of the Commission Staff’s comments contained in the Comment Letter have been restated below in their entirety, with the Company’s corresponding response set forth immediately under such comment.
Prospectus Cover
1.
We note your revisions in response to prior comment 6. Please tell us what you intend as the difference between “privately negotiated prices” and “transactions that are not in the public market” in the second paragraph under your logo on the prospectus cover and on page 54.
Response:
The Company has revised the disclosure in the second paragraph under its logo on the prospectus cover, in the Prospectus Summary section and in the Plan of Distribution section of Amendment No. 2 to clarify that after the Company’s common stock is quoted on the OTC Bulletin Board, the shares of common stock may be sold at prevailing market prices or in transactions that are not in the public market.
Prospectus Summary, page 1
1
U.S. Securities and Exchange Commission
October 4, 2013
Page 2
2.
Please highlight in your prospectus summary the information provided in response to prior comment 18.
Response:
The Company has included the information in the prospectus summary on page 1 of Amendment No. 2.
Risk Factors, page 2
3.
We note your revised disclosure on page 17 concerning your research and development expenses for the six months ended June 30, 2013. Please revise your risk factor disclosure to address how the funding constraints you reference have impacted your product development.
Response:
The Company has revised the risk factor on page 2 of Amendment No. 2 to disclose the impact that funding constraints have on the Company’s product development.
We are obligated to develop and maintain..., page 13
4.
Please refer to the Instructions to Regulation S-K, Item 308 and revise your disclosure concerning the December 31, 2013 date to reflect the correct fiscal year.
Response:
The Company has revised the disclosure on page 12 of Amendment No. 2 to reflect that it would be required to perform the annual review and evaluation of its internal controls no later than for the fiscal year ending December 31, 2014.
While we currently qualify as an “emerging growth company,” page 13
5.
We note the last paragraph of your response to prior comment 3. Please tell us why the material that you circulated in connection with this offering in reliance on Section 5(d) of the Securities Act indicates that this is a private offering and refers to an offering of securities that are not being sold in connection with this offering.
2
U.S. Securities and Exchange Commission
October 4, 2013
Page 3
Response:
The written material that was provided supplementally with the response letter accompanying Amendment No. 1 (the “PPM”) was distributed in connection with a private placement of the Company’s Series C Preferred Stock and related warrants and was not distributed in anticipation of the secondary offering being registered on Amendment No. 2. To clarify the Company’s response to prior comment 3, the PPM was distributed in connection with an offering that was exempt from registration pursuant to Regulation D promulgated under the Securities Act of 1933, as amended (the “Securities Act”), and was not distributed in reliance on Section 5(d) of the Securities Act in connection with this secondary offering being registered on Amendment No. 2. The Company supplementally provided the PPM in order to provide the Commission Staff with all distributed materials related to the securities that are convertible or exercisable into the shares of common stock that are being registered on Amendment No. 2.
Risks Related to our Series C Preferred Stock, page 14
6.
Please provide us your analysis of whether your dividend obligation to your preferred stockholders presents a risk to investors purchasing common stock in this offering.
Response:
The Company has added a risk factor addressing the dividend obligation to the holders of its Series C Preferred Stock on page 14 of Amendment No. 2.
Our Series C Preferred Stock and our warrants, page 14
7.
Please address that part of prior comment 8 that asked you to highlight in the risk factor the extent to which you historically have reduced the original conversion or exercise prices of outstanding securities.
Response:
The Company has made the requested revision by expanding the discussion in the risk factor beginning “Our Series C Preferred Stock and our warrants” on page 14 of Amendment No. 2.
Overview, page 21
8.
We note your revision mentioned in response to prior comment 20. Please disclose the criteria that you used to determine that the changes were “significant” and “material” as you mention in the first bullet point on page 23.
Response:
The Company has revised its disclosure in the first bullet point on page 23 of Amendment No. 2 to remove the terms that qualify the reduction in baseline wander, noise, and artifacts and the higher diagnostic value provided by the PURE EP System as compared to the original recordings.
Our Industry, page 23
3
U.S. Securities and Exchange Commission
October 4, 2013
Page 4
9.
Please tell us why you have revised your disclosure in the second paragraph in this section to remove discussion of the 2011 study and replaced it with 2010 information.
Response:
The Company removed the discussion of the 2011 study because the 2011 study used data that was collected in 2006, while the 2010 study employed more recent information. The Company has further revised its disclosure on page 23 of Amendment No. 2 with respect to ablation studies.
Treatment of Atrial Fibrillation..., page 24
10.
Please ensure that the disclosure that you present is balanced. For example, given the information that you present in this section, it is unclear how investors would know of the limitations mentioned at the bottom of page 61 of the material that you attached to your response letter and the issues mentioned in the first paragraph on page 62 of that material.
Response:
The Company has expanded the disclosure on page 24 of Amendment No. 2 to include the limitations and challenges relating to atrial fibrillation and ventricular tachycardia.
11.
Please clarify what you mean by “Mahapatra S.”
Response:
The Company has clarified that this is the name of a physician that published a relevant study cited on page 24 of Amendment No. 2.
Initial Analysis, page 26
12.
We note your response to prior comment 21; however, you did not tell us whether the recording from the “competitive” system represents a typical recording. Please address this aspect of the comment.
Response:
The Company has revised the caption on page 26 of Amendment No. 2 to clarify that the original recording was recorded in a challenging recording environment, which was more relevant to the initial analysis than the actual system that produced the recording.
Strategic Alliances, page 27
4
U.S. Securities and Exchange Commission
October 4, 2013
Page 5
13.
Please expand your disclosure in the second paragraph to clarify when your collaboration with Dr. Natale and Dr. Di Biase occurred.
Response:
The Company has expanded its disclosure on page 27 of Amendment No. 2 to include the duration of the Company’s collaboration with Dr. Natale and Dr. Di Biase.
Intellectual Property, page 29
14.
Please disclose the substance of your response to prior comment 25. In your revised disclosure, please clarify how you currently have rights to the technology if it has not yet been assigned to you. File all related agreements as exhibits to your registration statement.
Response:
The Company has expanded its disclosure on page 29 of Amendment No. 2 to explain its current rights to the intellectual property necessary for its products. There are no agreements related to the intellectual property used by the Company.
Government Regulation, page 29
15.
We note your revised disclosure in response to prior comment 26; however, you have not addressed the second sentence of the prior comment. Please disclose the implications in the event your belief concerning classification is incorrect, and add any material risk factors, as appropriate.
Response:
The Company has disclosed the implications if its belief concerning the classification of its product is incorrect on page 30 of Amendment No. 2. The Company believes that the likelihood of its product being classified as a Class III device is sufficiently remote that no material risk factor is necessary.
Biographical Information, page 32
16.
We note your revised disclosure in response to prior comment 30 concerning Mr. Chaussy's past service as the chief financial officer for “small publicly traded” companies. To the extent that he held any of these positions during the past five years, please disclose the information required by Regulation S-K, Item 401(e)(1) and ensure that the period during which Mr. Chaussy worked for those entities is clear.
5
U.S. Securities and Exchange Commission
October 4, 2013
Page 6
Response:
The Company notes that Mr. Chaussy has not held any executive officer positions for any public companies during the past five years.
Security Ownership of Certain Beneficial Owners and Management, page 37
17.
Please include the information in the tabular form indicated by Regulation S-K Item 403(b) for your management’s beneficial ownership of your series A and B shares. In addition, show the effect of this offering on your disclosure in this section, including the automatic conversion mentioned in response to prior comment 49.
Response:
The Company has made the requested revision by adding a table addressing its management’s beneficial ownership of its shares of Series B Preferred Stock and revising the existing beneficial ownership table for its shares of Series C Preferred Stock on page 39 of Amendment No. 2. No member of the Company’s management owns shares of the Company’s Series A Preferred Stock.
Selling Stockholders, page 39
18.
Regarding your response to prior comment 41:
·
Please explain to us how you determined the size of your public float. In this regard, we note the holdings of your officers and directors as disclosed in your beneficial ownership table. As appropriate, please provide us with a revised analysis concerning the relative size of the present offering.
Response:
The determination whether the offering covered by Amendment No. 2 is a valid secondary offering is based on all of the circumstances of the offering, including but not limited to those addressed by the Staff in its comment above. Therefore, before answering the Staff’s specific questions, the Company is providing some background regarding its overall analysis and all of the factors that the Company considered in concluding that the offering is a valid secondary offering.
Background
As described in our response to prior comment 41, in determining that none of the selling stockholders should be deemed underwriters with respect to the offering covered by the Registration Statement and that the offering is a valid secondary offering, the Company reviewed the guidance set forth in Interpretive Response 612.09, posted by the Staff on January 26, 2009, which provides that:
6
U.S. Securities and Exchange Commission
October 4, 2013
Page 7
“It is important to identify whether a purported secondary offering is really a primary offering, i.e., the selling shareholders are actually underwriters selling on behalf of an issuer. Underwriter status may involve additional disclosure, including an acknowledgment of the seller’s prospectus delivery requirements. In an offering involving Rule 415 or Form S-3, if the offering is deemed to be on behalf of the issuer, the Rule and Form in some cases will be unavailable (e.g., because of the Form S-3 ‘public float’ test for a primary offering, or because Rule 415(a)(l)(i) is available for secondary offerings, but primary offerings must meet the requirements of one of the other subsections of Rule 415). The question of whether an offering styled a secondary one is really on behalf of the issuer is a difficult factual one, not merely a question of who receives the proceeds. Consideration should be given to how long the selling shareholders have held the shares, the circumstances under which they received them, their relationship to the issuer, the amount of shares involved, whether the sellers are in the business of underwriting securities, and finally, whether under all the circumstances it appears that the seller is acting as a conduit for the issuer.” (emphasis added)
Applying the guidelines above, the Company analyzed (1) how long the selling stockholders have held the securities, (2) the circumstances under which the securities were received, (3) their relationship to the Company, (4) the amount of shares involved, (5) whether the selling stockholders are in the business of underwriting securities, and (6) whether the circumstances indicate that the selling stockholders are acting as a conduit for the Company. A description of the Company’s analysis with respect to each of these factors is set forth in detail in our response to prior comment 41. Below is a summary of the Company’s analysis with respect to each factor:
·
How long the selling stockholders have held the securities. To date, the selling stockholders holding a majority of the securities have held their shares of the Company’s Series C Preferred Stock and related warrants since February 2013. In addition, it is unlikely that the selling stockholders will be able to sell the shares of the Company’s common stock underlying the securities in any sort of immediate fashion and the selling stockholders will likely remain holders of the Company’s securities for an extended period of time due to the lack of a current market for the Company’s common stock, the anticipated time it will take for the Company’s common stock to be eligible for trading on the OTC Bulletin Board and the anticipated relative illiquidity of the Company’s common stock due to a lack of analyst coverage for, and investor interest, in the Company. Further, none of the selling stockholders have converted or exercised any portions of the securities, and no shares underlying the securities have therefore been issued. Finally, although the selling stockholders had registration rights for the common stock underlying the securities, registration rights, in and of themselves, do not evidence an intent on the part of the selling stockholders to sell shares. The fact that the Registration Rights Agreement originally contemplated a generous 120-day window before the filing of the registration statement (as opposed to a more typical 30-day period), which was subsequ