SEC Comment Letter for Ehave, Inc. (EHVVF) (CIK 0001653606) (EHVVF) — Dec 14, 2015
Ehave, Inc. (EHVVF) (CIK 0001653606)
Date: Dec. 14, 2015 · CIK: 0001653606 · Accession: 0000000000-15-057592
AI Filing Summary & Sentiment
Reasoning
Referenced dates: October 21, 2015
Letter
Mail Stop 4561 December 11, 2015 Scott Woodrow President and Chief Executive Officer ehāve, Inc. 250 University Avenue, Suite 200 Toronto, ON M5H 3E5 Canada
Re: ehāve , Inc. (formerly 2304101 Ontario Inc.) Amendment No. 1 to Registration Statement on Form F -1 Filed November 16, 2015 File No. 333 -207107
Dear Mr. Woodrow:
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. Unless otherwise noted, references in this letter to prior comments refer to our letter dated October 21, 2015.
Please respond to this letter by ame nding 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.
Fee Table
1. You revised the fee table to include common shares issuable upon the exercise of warrants, which will be issued to each investor that purchases common stock. You do not appear to be registering these warrants. Please tell us what exemption you rely upon for the issuance of the warrants or revise your fee table to include the warrants. To the extent you include the warrants in the fee table , file a form of warrant agreement for the warrants that are issued with the common stock to be sold by you. In this regard, we note that t he agreement included in exhibit 10.4 refers to securities that are not registered .
Scott Woodrow ehāve, Inc. December 11 , 2015 Page 2
Overview, page 5
2. Regarding your response to prior comment 7, please tell us which part of the supplemental data provides support for your statement that the cognitive assessment and training market size is estimated at $2.4 billion in 2015.
Risk Factors, page 8
3. We note your response to prior comment 8; however, it is unclear without further disclosure how David Lubin & Associates, PLLC intends to resolve conflicts that may arise in situations where acting in your best interest conflicts with its obligations under the escrow agreement, for example in the event of a dispute between you and a purchaser over subscription proceeds held in escrow. It appears that risk factor disclosure addressing risks relating to the dual roles of David Lubin as couns el to the company and as escrow agent for this offering may be warranted. Please advise.
Development or assertions by us…, page 10
4. Regarding your response to prior comment 9 and consistent with the language in the last sentence of the third paragraph on page 36, please further clarify your risk factor to state that all the developed intellectual property belongs to the Hospital.
Dilution, page 26
5. Refer to prior comment 12 and further revise your disclosure to indicate the total cash consideration paid by directors, senior management, and affiliated persons and the amount to be paid under the proposed offering. To provide an appropriate comparison, you should consider disclosing for both existing and new investors the total amount of cash consideration paid, the number of shares received, and the average price per share.
Directors, Senior Management, and Employees
Background Information, page 46
6. We note the revisions to Mr. Woodrow’s business experience made in response to prior comment 17. Please cl arify his role at 2110345 Ontario and its relationship to NView. Also clarify his position at NView Management.
Certain Relationships and Related Party Transactions, page 49
7. We note that you have not included the loan to Mr. Woodrow for $8,770. Please revise to include the disclosure requ ired by Item 7.B.2 of Form 20 -F and clarify whether the loan remains outsta nding.
Scott Woodrow ehāve, Inc. December 11 , 2015 Page 3
Item 8. Exhibits and Financial Statement Schedules, page 53
8. We note you have included multiple Exhibits 101 that have not been filed wi th your registration statement. Please revise to remove these exhibit items from the Exhibit Index or advise.
Exhibit 5.1
9. Your legality opinion requires significant revision. Please file a legality opinion that opines on whether each of the securities you intend to register will be legally issued, fully paid, and non -assessable. Refer to section II.B.1.c of Staff Legal Bulletin No. 19 (October 14, 2011). If you are also registering warrants, you should note that counsel must opine that the warrants ar e a binding obligation in accordance with II.B.1.f of Staff Legal Bulletin No. 19. In addition, for shares to be offered by selling shareholders, the opinion must state that shares are legally issued, fully paid, and non -assessable. Finally, include any schedules referred to in your opinion.
Exhibit 10.19
10. The subscription agreement that you filed in response to prior comment 21 does not include the warrants that are issued to investors of the common stock. Please advise or file a subscription agreement that includes the warrants.
Exhibit 10.20
11. Please tell us how the escrow agreement complies with Exchange Act Rule 10b -9(a) to promptly return the funds to purchasers when the minimum amount is not sold within 90 days. I n this regard, we note that paragraph 5 of the agreement only obliges you to promptly notify the escrow agent that the offering is terminated and provide written instructions.
Statements of operations and other comprehensive loss, page F -3
12. We note that you revised your filing to include net loss per share as required by ASC 260-10-45-2. However, your current disclosures do not meet the requirements set forth in ASC 260 -10-50-1. Please revise.
Scott Woodrow ehāve, Inc. December 11 , 2015 Page 4
You may contact Juan Migone, Staff Accountant, at (202) 551-3312 or Stephen Krikorian, Accounting Branch Chief, at (202) 551 -3488 if you have questions regarding comments on the financial statements and related matters. Please contact Gabriel Eckstein, Staff Attorney, at (202) 551 -3286 or, in his absence, the undersigned at (202) 551 -3457 with any other questions. If you require further assistance, you may contact Barbara C. Jacobs, Assistant Director, at (202) 551 -3730.
Sincerely,
/s/ Maryse Mills -Apenteng
Show Raw Text
Mail Stop 4561
December 11, 2015
Scott Woodrow
President and Chief Executive Officer
ehāve, Inc.
250 University Avenue, Suite 200
Toronto, ON M5H 3E5
Canada
Re: ehāve , Inc. (formerly 2304101 Ontario Inc.)
Amendment No. 1 to Registration Statement on Form F -1
Filed November 16, 2015
File No. 333 -207107
Dear Mr. Woodrow:
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. Unless otherwise noted, references in this letter to prior
comments refer to our letter dated October 21, 2015.
Please respond to this letter by ame nding 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.
Fee Table
1. You revised the fee table to include common shares issuable upon the exercise of
warrants, which will be issued to each investor that purchases common stock. You do
not appear to be registering these warrants. Please tell us what exemption you rely upon
for the issuance of the warrants or revise your fee table to include the warrants. To the
extent you include the warrants in the fee table , file a form of warrant agreement for the
warrants that are issued with the common stock to be sold by you. In this regard, we note
that t he agreement included in exhibit 10.4 refers to securities that are not registered .
Scott Woodrow
ehāve, Inc.
December 11 , 2015
Page 2
Overview, page 5
2. Regarding your response to prior comment 7, please tell us which part of the
supplemental data provides support for your statement that the cognitive assessment and
training market size is estimated at $2.4 billion in 2015.
Risk Factors, page 8
3. We note your response to prior comment 8; however, it is unclear without further
disclosure how David Lubin & Associates, PLLC intends to resolve conflicts that may
arise in situations where acting in your best interest conflicts with its obligations under
the escrow agreement, for example in the event of a dispute between you and a purchaser
over subscription proceeds held in escrow. It appears that risk factor disclosure
addressing risks relating to the dual roles of David Lubin as couns el to the company and
as escrow agent for this offering may be warranted. Please advise.
Development or assertions by us…, page 10
4. Regarding your response to prior comment 9 and consistent with the language in the last
sentence of the third paragraph on page 36, please further clarify your risk factor to state
that all the developed intellectual property belongs to the Hospital.
Dilution, page 26
5. Refer to prior comment 12 and further revise your disclosure to indicate the total cash
consideration paid by directors, senior management, and affiliated persons and the
amount to be paid under the proposed offering. To provide an appropriate comparison,
you should consider disclosing for both existing and new investors the total amount of
cash consideration paid, the number of shares received, and the average price per share.
Directors, Senior Management, and Employees
Background Information, page 46
6. We note the revisions to Mr. Woodrow’s business experience made in response to prior
comment 17. Please cl arify his role at 2110345 Ontario and its relationship to NView.
Also clarify his position at NView Management.
Certain Relationships and Related Party Transactions, page 49
7. We note that you have not included the loan to Mr. Woodrow for $8,770. Please revise
to include the disclosure requ ired by Item 7.B.2 of Form 20 -F and clarify whether the
loan remains outsta nding.
Scott Woodrow
ehāve, Inc.
December 11 , 2015
Page 3
Item 8. Exhibits and Financial Statement Schedules, page 53
8. We note you have included multiple Exhibits 101 that have not been filed wi th your
registration statement. Please revise to remove these exhibit items from the Exhibit Index
or advise.
Exhibit 5.1
9. Your legality opinion requires significant revision. Please file a legality opinion that
opines on whether each of the securities you intend to register will be legally issued, fully
paid, and non -assessable. Refer to section II.B.1.c of Staff Legal Bulletin No. 19
(October 14, 2011). If you are also registering warrants, you should note that counsel
must opine that the warrants ar e a binding obligation in accordance with II.B.1.f of Staff
Legal Bulletin No. 19. In addition, for shares to be offered by selling shareholders, the
opinion must state that shares are legally issued, fully paid, and non -assessable. Finally,
include any schedules referred to in your opinion.
Exhibit 10.19
10. The subscription agreement that you filed in response to prior comment 21 does not
include the warrants that are issued to investors of the common stock. Please advise or
file a subscription agreement that includes the warrants.
Exhibit 10.20
11. Please tell us how the escrow agreement complies with Exchange Act Rule 10b -9(a) to
promptly return the funds to purchasers when the minimum amount is not sold within 90
days. I n this regard, we note that paragraph 5 of the agreement only obliges you to
promptly notify the escrow agent that the offering is terminated and provide written
instructions.
Statements of operations and other comprehensive loss, page F -3
12. We note that you revised your filing to include net loss per share as required by ASC
260-10-45-2. However, your current disclosures do not meet the requirements set forth
in ASC 260 -10-50-1. Please revise.
Scott Woodrow
ehāve, Inc.
December 11 , 2015
Page 4
You may contact Juan Migone, Staff Accountant, at (202) 551-3312 or Stephen
Krikorian, Accounting Branch Chief, at (202) 551 -3488 if you have questions regarding
comments on the financial statements and related matters. Please contact Gabriel Eckstein, Staff
Attorney, at (202) 551 -3286 or, in his absence, the undersigned at (202) 551 -3457 with any other
questions. If you require further assistance, you may contact Barbara C. Jacobs, Assistant
Director, at (202) 551 -3730.
Sincerely,
/s/ Maryse Mills -Apenteng
Maryse Mills -Apenteng
Special Counsel
Office of Information
Technologies and Services
cc: David Lubin, Esq.
David Lubin & Associates, PLLC