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   Sphere 3D Corporation - SEC Correspondence - Filed by newsfilecorp.com

September 11, 2014

Barbara C. Jacobs
Assistant Director
Securities and
Exchange Commission
100 F Street, N.E.
Washington, D.C. 20549

    Re:
    Responses to the Securities
      and Exchange Commission

    Staff Comments dated August
      19, 2014, regarding

    Sphere 3D Corporation

    Joint
      Proxy/Registration Statement on Form F-4

    Filed July 23, 2014

    File No. 333-197569

Dear Ms. Jacobs:

This letter responds to the comments of the staff of the United
States Securities and Exchange Commission (the “Staff”) set forth in the
August 19, 2014 letter (the “Comment Letter”) regarding the
above-referenced Joint Proxy/Registration Statement on Form F-4 (the
“F-4”) of Sphere 3D Corporation (“Sphere 3D”) and Overland Storage
Inc. (“Overland”). For your convenience, the comments of the Staff are
included below in bold and we have numbered our responses accordingly.

Concurrently with the filing of this response to the Comment
Letter, Sphere 3D has filed an amendment to the F-4 (the “Amended
F-4”).

Our responses are as follows:

General

Staff Comment No. 1.

Please provide us with your analysis
as to whether you qualify as an “emerging growth company,” as defined in the
Jumpstart Our Business Startups Act. If you believe you qualify, please disclose
this status in the filing; and describe how and when a company may lose emerging
growth company status and provide a brief description of the exemption from
Section 404(b) of the Sarbanes-Oxley Act of 2002.

Sphere 3D Corporation’s Response:

            Sphere
3D believes that it qualifies as an “emerging growth company,” as defined in the
Jumpstart Our Business Startups Act. Sphere 3D has disclosed this status in the
Amended F-4 on pages 12, 36 and 119 and included disclosure in the Amended F-4
regarding how and when a company may lose its emerging growth status on pages 36 and 119 in response to the Staff’s comment.

Barbara C. Jacobs
Assistant Director
September 11, 2014

Page 2

Prospectus Cover Page/Letter to Shareholders

Staff Comment No. 2.

We refer to the second paragraph of
the letter to Overland shareholders describing in mathematical terms how the
number of shares of Sphere 3D common stock to be issued as merger consideration
is to be calculated. Please explain clearly the economic substance behind the
formula and inputs used to arrive at the agreed-upon merger consideration. As
one example, please indicate the source of the numerical inputs to the formula.

Sphere 3D Corporation’s Response:

            Through
arm’s length negotiations between Sphere 3D and Overland, the parties agreed to
the merger (the “Merger”) as described in the Amended F-4. During these
negotiations the parties agreed to a valuation of Overland‘s business of
$81,925,676 (the “Overland Valuation”). The Overland Valuation was
arrived at by (i) deducting $10,074,324, representing 105% of the aggregate
principal amount of Overland’s outstanding debt payable to private investment
funds (the “Cyrus Funds”) whose investment manager is Cyrus Capital
Partners, L.P. (“Cyrus Capital”) (the “Cyrus Debt”), from (ii) the
enterprise value of $91,160,000 which the parties agreed was attributable to
Overland’s business. The calculation of 105% of the principal amount of the
Cyrus Debt was used because as part of their consent to the Merger and the entry
into the Merger Agreement by Overland, the Cyrus Funds will receive an
additional payment equal to 5% of the principal balance of Cyrus Debt assumed by
Sphere 3D, payable in Sphere 3D shares.

            The
consideration payable by Sphere 3D to the Overland shareholders in connection
with the Merger shall be satisfied by Sphere 3D’s issuance to such shareholders
of Overland of common shares of Sphere 3D (the “Merger Consideration”),
with the number of shares determined as described below. In order to calculate
the exchange ratio of Sphere 3D common shares for each share of Overland common
stock, the number of Sphere 3D common shares issuable in satisfaction of the
Merger Consideration was estimated by dividing the Overland Valuation by the
$8.675 closing price (as quoted on the Toronto Venture Exchange (the
“TSXV”) and converted to US dollars based on the noon exchange rate
published by the Bank of Canada at that date) of Sphere 3D common shares on the
date of the merger agreement by and among Overland, Sphere 3D and S3D
Acquisition Company (the “Merger Agreement”). The exchange ratio (the
“Exchange Ratio”) of 0.510594 Sphere 3D common shares for each share of
Overland common stock was then determined by dividing the number of Sphere 3D
common shares estimated to be issuable in satisfaction of the Merger
Consideration by the number of shares of Overland common stock expected to be
outstanding on the date of the closing of the Merger. In determining the Exchange Ratio the parties divided
(i) the 9,443,882 common shares of Sphere 3D estimated to represent the Merger
Consideration, by (ii) the 18,495,865 Overland common shares (the “Overland
Shares”) expected to be outstanding on the date of the closing of the
Merger. The expected number of Overland Shares was determined by adding (a)
17,506,192 common shares of Overland issued and outstanding at the date of the
Merger Agreement, plus (b) 989,673 outstanding Overland restricted stock units
(representing 50% of the number of restricted stock units of Overland expected
to be outstanding at the closing of the Merger) which were unvested at the time
of the Merger Agreement but which would either (i) vest in accordance with their
terms prior to the Merger or (ii) be amended in accordance with the Merger
Agreement such that they would vest immediately prior to the closing of the
Merger.

Barbara C. Jacobs
Assistant Director
September 11, 2014

Page 3

            The
Merger Agreement provides that the Exchange Ratio shall be adjusted to (x)
proportionally increase the Merger Consideration to reflect an increase in
valuation of Overland which would occur as a result of any repayment of Cyrus
Debt after the date of the Merger Agreement and prior to the closing of the
Merger (i.e., debt that would not therefore be assumed by Sphere 3D), and
(y) proportionally increase the Merger Consideration as a result of the
retention of any common shares of Sphere 3D which were held by Overland (the
“Shares”) at the closing of the Merger. The latter adjustment is intended
to reflect value received by Sphere 3D from the return of Sphere 3D issued and
outstanding common stock and is calculated using the following portion of the
formula: “the quotient obtained by dividing (x) the number of common shares of
Sphere 3D held by Overland immediately prior to the closing of the merger by (y)
18,495,865.20. ” The number of shares of Sphere 3D held by Overland is divided
by the Overland Shares expected to be outstanding on the date of the Merger in
order to generate a fraction representing the number of such shares allocable to
each Overland shareholder.

            The
former adjustment (relating to the increase in valuation of Overland which would
occur as a result of any repayment of Cyrus Debt after the date of the Merger
Agreement and prior to the Merger) is calculated using the following portion of
the formula: “the quotient obtained by dividing (A) (i)105% of the principal
amount of any indebtedness of Overland to the Cyrus Funds repaid by Overland on
or after the date of the merger agreement and prior to the closing of the merger
divided by (ii) 8.675 by (B) 18,495,865.20. ”

The principal amount of such Cyrus Debt is multiplied by 105% in clause (A)(i)
to account for the shares that would otherwise be issuable to the Cyrus Funds in
connection with the assumption of such Cyrus Debt by Sphere 3D. The modified
principal amount of such Cyrus Debt is then divided by $8.675 (representing the
closing price of Sphere 3D common shares on the date of the Merger Agreement) in
clause (A)(ii) in order to determine the number of Sphere 3D shares that would
be attributable to the modified principal amount of the Cyrus Debt. Finally,
this number of attributable Sphere 3D shares is divided by the Overland Shares
expected to be outstanding on the date of the Merger in clause (B) in order to
generate a fraction representing the number of such shares allocable to each
Overland shareholder.

Barbara C. Jacobs
Assistant Director
September 11, 2014

Page 4

Staff Comment No. 3.

We again refer to the description of
the merger consideration payable to Overland shareholders. It states that for
each share of Overland common stock held as of the effective time, Overland
shareholders will receive 0.510594 share of Sphere 3D common plus a number of
additional Sphere 3D common shares to be determined based on the stated formula.
The calculation depends on the number of shares of Sphere 3D held by Overland as
of the effective time, as well as the amount of indebtedness repaid by Overland
between signing the merger agreement and closing the transaction. Please
present, in an appropriate place in the filing, a possible range of total Sphere
3D shares payable per Overland share based on recent and reasonable estimates of
the inputs into the formula for determining consideration (i.e., the number of
common shares of Sphere 3D expected to be held by Overland immediately prior to
the closing of the merger and the principal amount of any indebtedness of
Overland to the Cyrus Funds expected to be by Overland repaid between the
signing and closing of the merger). You may wish to provide disclosure regarding
the range of consideration payable elsewhere in the filing, with a
cross-reference on your cover page.

Sphere 3D Corporation’s Response:

            The
Sphere 3D common shares held by Overland (the “Shares”) have been pledged
as collateral for loans (the “Loans”) made by Sphere 3D to Overland at
the time of signing the Merger Agreement and subsequent thereto (as described on
page 77 of the Amended F-4). Overland expects that the Shares will either be
returned to Sphere 3D in satisfaction of the Loans immediately prior to the
closing of the Merger or sold in private transactions by Overland prior to the
closing of the Merger. As such, Sphere 3D and Overland do not expect that there
will be any adjustment to the Exchange Ratio as a result of Overland holding any
Sphere 3D shares at the closing of the Merger. In addition, Overland does not
expect to repay any indebtedness owed to the Cyrus Funds prior to the closing of
the Merger. As such, Sphere 3D and Overland do not expect that there will be any
adjustment to the Exchange Ratio as a result of Overland repaying any
indebtedness owed to the Cyrus Funds prior to the closing of the Merger. In
response to the Staff’s comment, Sphere 3D and Overland have included statements
to this effect in the Amended F-4 in the Prospectus Cover Page/Letter to
Shareholders and at pages 2 and 50 of the Amended F-4. However, Overland and
Sphere 3D respectfully advise the Staff that they believe the inclusion of a
range of shares issuable to the Overland shareholders by Sphere 3D at the
closing of the Merger would be misleading to the shareholders of Overland.

Staff Comment No. 4.

The fifth paragraph of the letter
states that the merger cannot be completed without the holders of a majority of
Overland’s outstanding shares of common stock entitled to vote at the special
meeting. We note from disclosure in the Q&A section and elsewhere in the
filing that the majority shareholder of Overland along with other Overland shareholders have entered
into a voting agreement pursuant to which they have agreed to vote their shares
representing approximately 65% of the outstanding shares of Overland as of the
record date in favor of the merger at the special meeting. Accordingly, please
state clearly in the cover page/letter to shareholders, if accurate, that as a
result of the voting agreement, the merger is expected to be approved by the
Overland shareholders at the special meeting, regardless of the votes of
Overland shareholders who are not party to the voting agreement. Please clarify
this matter where appropriate throughout your filing.

Barbara C. Jacobs
Assistant Director
September 11, 2014

Page 5

Sphere 3D Corporation’s Response:

            Sphere
3D and Overland have revised the disclosure in the fifth paragraph of the letter
and where appropriate throughout the Amended F-4, including in the Notice of
Special Meeting of Shareholders, on page 10 in response to the
Staff’s comment.

Questions and Answers about the Merger and Special
Meeting, page 1

 Staff Comment No. 5.

Please address in your Q&A
section what holders of Overland options, restricted stock units, and
convertible notes will receive in the merger, to the extent the treatment of
these securities is material to an Overland shareholder’s voting and investment
decision.

Sphere 3D Corporation’s Response:

            Sphere
3D and Overland have added an additional Q&A to the Amended F-4 disclosing
what holders of Overland options and restricted stock units will receive in the
Merger in response to the Staff’s comment. Sphere 3D and Overland have
added an additional Q&A to the Amended F-4 disclosing what holders of
Overland convertible notes will receive in the Merger in response to the
Staff’s comment.

            The
following paragraph has been included in the Amended F-4 to address the comment
received by the Staff:

            Q:
What will the holders of Overland options and restricted stock units receive in
the merger?

            A: At the Effective Time, each outstanding Overland
option will be converted into an option to acquire common shares of Sphere 3D,
on the same terms and conditions as were applicable to the stock option prior to
the merger, except that the number of shares subject to the option and the
exercise price of the option will be adjusted as to preserve the economic value
of such options. A total of 50% of all Overland restricted stock unit awards
that are outstanding and unvested on the closing date of the merger (including
any units that accelerate upon a change in control in accordance with their
terms) will accelerate and vest immediately prior to the effective time of the
merger. At the Effective Time, the accelerated restricted stock units will be
exchanged for Sphere 3D common shares at the Exchange Ratio. For more
information on the treatment of restricted stock units and options, please see
“Treatment of Overland Restricted Stock Units and Options” on page 72.

Barbara C. Jacobs
Assistant Director
September 11, 2014

Page 6

Q: What will the holders of Overland convertible notes receive in the merger?

            A:
At the Effective Time, each outstanding convertible promissory note of Overland
will be assumed by Sphere 3D. In addition, Sphere 3D will issue to the Cyrus
Funds additional Sphere 3D shares equal to 5% of the aggregate principal amount
of the convertible promissory notes held by the Cyrus Funds immediately prior to
the Effective Time.

Staff Comment No. 6.

Please provide a Q&A describing
the conditions to the merger. We note the related discussion in your summary.

Sphere 3D Corporation’s Response:

            Sphere
3D and Overland have added an additional Q&A to the Amended F-4 describing
the conditions to the Merger in response to the Staff’s comment.

            The
following paragraph has been included in the Amended F-4 to address the comment
received by the Staff:

Q: Are there any conditions to the closing of the merger?

A: Sphere 3D’s and Overland’s obligations to complete the merger depend on a
number of conditions being met. These include: (i) approval of the merger by the
holders of a majority of the outstanding Overland common shares; (ii) receipt or
filing of all consents, approvals and authorizations of, any governmental
authority required to be made or obtained b