SEC Comment Letter for Pangaea Logistics Solutions Ltd. (PANL) (CIK 0001606909) (PANL) — Jul 10, 2014
Pangaea Logistics Solutions Ltd. (PANL) (CIK 0001606909)
Date: July 10, 2014 · CIK: 0001606909 · Accession: 0000000000-14-034693
AI Filing Summary & Sentiment
File numbers found in text: 333-195910
Referenced dates: June 9, 2014
Letter
July 9 , 2014 Via E -mail Eric S. Rosenfeld President Quartet Holdco Ltd. 777 Third Avenue, 37th Floor New York, NY 10017
Re: Quartet Holdco Ltd. Amendment No. 1 to Registration Statement on Form S-4 Filed June 24 , 2014 File No. 333-195910 Quartet Merger Corp. Amendment No. 1 to Preliminary Proxy Statement on Schedule 14A Filed June 25 , 2014 File No. 001 -36139
Dear Mr. Rosenfeld :
We have reviewed your responses to the comments in our letter dated June 9, 2014 and have the following additional comments.
Summary of the Proxy Statement/Prospectus, page 1 1
Pangaea, page 1 2
1. We note your response to our prior comment 9 and reissue in part. Please clarify what is meant by the term “premium routes.”
The Merger Proposal, page 1 3
2. We note your responses to our prior comments 11 and 13. In an appropriate place in the summary, please provide the percentage ownership in the post -merger company of the various p arties , including the public shareholders, the original insiders of Quarter Merger Corp., and Pangaea securityholders. Please also expand the disclosure to illustrate the potential ownership percentages under the contingent payment schedule in Holdco Shar es to existing Pangaea securityholders, as discussed under “The Merger Proposal,” at page 13.
Eric S. Rosenfeld Quartet Holdco Ltd. July 9, 201 4 Page 2
The Merger Proposal, page 60
Quartet’s Board of Directors’ and Special Advisor’s Reasons for Approval, page 66
Comparable Company Analysis, page 71
3. We note your response to our prior comment 39 and reissue. Please revise to disclose in greater detail the criteria used to select the comparable companies. Please also explain the discrepancies between the comparable companies lists on page 71 and 78, and between the prospectus and the supplemental materials submitted to us. In this regard, we note that Diana Shipping Inc. is listed as a comparable company on page 71 but did not appear in the supplem ental material s from Pangaea to the Quartet board .
Opinion of Financial Advisor to the Board of Directors of Quartet, page 74
4. We note your response to our prior comment 42 and reissue. Because “certain financial projections” were disclosed to Quartet and Cassel Salpeter, and were used in determining the fairness of the transaction, please revise your registration statement to include those financial projections .
Business of Pangaea, page 122
Pangaea’s Competitive Strengths , page 123
5. We note your response to our prior comment 53 and reissue in part. Please identify any customers that represent 10% or more of your business. Refer to Item 101(c)(vii) of Regulation S -K.
Tax Considerations, page 169
6. We note your response to our prior comment 44 and reissue. Please have counsel provide a tax opinion re garding your status as a passive foreign investment company.
7. Similarly, w e note that there are numerous conclusions in this section regarding what appear to be material tax concerns. Only qualified tax counsel is permitted to make legal conclusions. Please revise to state all such beliefs as the opinion of counsel. For example, we note your disclosure on page 170 that you “believe [you] will satisfy the trading frequency and trading volume tests,” and your statement on page 171 that you “expect that [you] and each of [y]our subsidiaries qualify for this statutory tax exemption and [you] will take this position for United States federal income tax return reporting purposes.”
Eric S. Rosenfeld Quartet Holdco Ltd. July 9, 201 4 Page 3
Description of Holdco Securities, page 217
8. We note your response to our prior comment 65 and reissue. Please either identify and file the “relevant provisions of Bermuda law” that you refer to, or remove this statement.
Item 22. Undertakings, page II -3
9. Please revise to provide the appropriate undertaking pursuant to Item 51 2(a)(5) of Regulation S -K.
Preliminary Proxy Statement on Schedule 14A
10. We note your response to our prior comment 72. Please confirm you will continue to make conforming changes to the proxy statement , based on any comments we may have on the Form S -4 throughout the review process.
You may contact Kristin Shifflett at (202) 551 -3381 or Amy Geddes at (202) 551 -3304 if you have questions regarding comments on the financial statements and related matters. Please contact Ryan Adams at (202) 551 -3191 or me at (202) 551-3210 with any other questions.
Sincerely,
/s/ Susan Block
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July 9 , 2014 Via E -mail Eric S. Rosenfeld President Quartet Holdco Ltd. 777 Third Avenue, 37th Floor New York, NY 10017 Re: Quartet Holdco Ltd. Amendment No. 1 to Registration Statement on Form S-4 Filed June 24 , 2014 File No. 333-195910 Quartet Merger Corp. Amendment No. 1 to Preliminary Proxy Statement on Schedule 14A Filed June 25 , 2014 File No. 001 -36139 Dear Mr. Rosenfeld : We have reviewed your responses to the comments in our letter dated June 9, 2014 and have the following additional comments. Summary of the Proxy Statement/Prospectus, page 1 1 Pangaea, page 1 2 1. We note your response to our prior comment 9 and reissue in part. Please clarify what is meant by the term “premium routes.” The Merger Proposal, page 1 3 2. We note your responses to our prior comments 11 and 13. In an appropriate place in the summary, please provide the percentage ownership in the post -merger company of the various p arties , including the public shareholders, the original insiders of Quarter Merger Corp., and Pangaea securityholders. Please also expand the disclosure to illustrate the potential ownership percentages under the contingent payment schedule in Holdco Shar es to existing Pangaea securityholders, as discussed under “The Merger Proposal,” at page 13. Eric S. Rosenfeld Quartet Holdco Ltd. July 9, 201 4 Page 2 The Merger Proposal, page 60 Quartet’s Board of Directors’ and Special Advisor’s Reasons for Approval, page 66 Comparable Company Analysis, page 71 3. We note your response to our prior comment 39 and reissue. Please revise to disclose in greater detail the criteria used to select the comparable companies. Please also explain the discrepancies between the comparable companies lists on page 71 and 78, and between the prospectus and the supplemental materials submitted to us. In this regard, we note that Diana Shipping Inc. is listed as a comparable company on page 71 but did not appear in the supplem ental material s from Pangaea to the Quartet board . Opinion of Financial Advisor to the Board of Directors of Quartet, page 74 4. We note your response to our prior comment 42 and reissue. Because “certain financial projections” were disclosed to Quartet and Cassel Salpeter, and were used in determining the fairness of the transaction, please revise your registration statement to include those financial projections . Business of Pangaea, page 122 Pangaea’s Competitive Strengths , page 123 5. We note your response to our prior comment 53 and reissue in part. Please identify any customers that represent 10% or more of your business. Refer to Item 101(c)(vii) of Regulation S -K. Tax Considerations, page 169 6. We note your response to our prior comment 44 and reissue. Please have counsel provide a tax opinion re garding your status as a passive foreign investment company. 7. Similarly, w e note that there are numerous conclusions in this section regarding what appear to be material tax concerns. Only qualified tax counsel is permitted to make legal conclusions. Please revise to state all such beliefs as the opinion of counsel. For example, we note your disclosure on page 170 that you “believe [you] will satisfy the trading frequency and trading volume tests,” and your statement on page 171 that you “expect that [you] and each of [y]our subsidiaries qualify for this statutory tax exemption and [you] will take this position for United States federal income tax return reporting purposes.” Eric S. Rosenfeld Quartet Holdco Ltd. July 9, 201 4 Page 3 Description of Holdco Securities, page 217 8. We note your response to our prior comment 65 and reissue. Please either identify and file the “relevant provisions of Bermuda law” that you refer to, or remove this statement. Item 22. Undertakings, page II -3 9. Please revise to provide the appropriate undertaking pursuant to Item 51 2(a)(5) of Regulation S -K. Preliminary Proxy Statement on Schedule 14A 10. We note your response to our prior comment 72. Please confirm you will continue to make conforming changes to the proxy statement , based on any comments we may have on the Form S -4 throughout the review process. You may contact Kristin Shifflett at (202) 551 -3381 or Amy Geddes at (202) 551 -3304 if you have questions regarding comments on the financial statements and related matters. Please contact Ryan Adams at (202) 551 -3191 or me at (202) 551-3210 with any other questions. Sincerely, /s/ Susan Block Susan Block Attorney -Advisor cc: Via E -mail Jeffrey M. Gallant, Esq. Graubard Miller