SecProbe.io

CORRESP
1
filename1.htm

        Kenneth R. Koch

(212) 692-6768

        krkoch@mintz.com

        Chrysler Center

        666 Third Avenue

        New York, NY 10017

        212 935 3000

        mintz.com

February 7, 2020

VIA EDGAR

Division of Corporation Finance

Office of Real Estate & Construction

United States Securities and Exchange Commission

100 F Street, N.E.

Washington, D.C.  20549

    Attention:
    Mr. Jeffery Lewis

    Ms. Kristina Marrone

    Mr. Ruairi Regan

    Mr. James Lopez

    Re:
    KBL Merger CORP. IV

    Registration Statement on Form S-4

    Filed November 12, 2019

    File No. 333-234650

Ladies and Gentlemen:

On behalf of our client, KBL Merger Corp.
IV (“KBL” or the “Company”), we are submitting responses to the comments of the staff (the
“Staff”) of the Securities and Exchange Commission (the “SEC”) set forth in your letter dated
December 9, 2019 with respect to the above-referenced Registration Statement on Form S-4 (the “Registration Statement”),
which has been filed in connection with KBL’s proposed acquisition (the “Transaction”) of 180
Life Sciences Corp. (formerly known as CannBioRx Life Sciences Corp.) (“180”).  We have also included
in this letter, where applicable, responses communicated to us by counsel to, and/or representatives of, 180.

KBL has filed today Amendment No. 1
to the Registration Statement (“Amendment No. 1”) together with this letter via EDGAR correspondence.
We are also providing supplementally to the Staff an electronic copy of Amendment No. 1, marked to show changes made to the
Registration Statement since the filing of the Registration Statement on November 12, 2019.

For your convenience, the text of the Staff’s
comments is set forth in bold below, followed by the response to each comment.  Unless otherwise indicated, all page references
in the responses set forth below are to the pages of Amendment No. 1 as filed on EDGAR.  Capitalized terms used
herein and not otherwise defined shall have the meanings set forth in Amendment No. 1.

Merger Consideration, page 4

1. Please clarify the terms under which special voting shares
will be authorized for issuance and issued to the Trustee and identify the Trustee. Odyssey Trust Company does not appear to be
a party to the Business Combination Agreement.

Response: The Company acknowledges the Staff’s
comment and notes that the Trustee is Odyssey Trust Company (“Odyssey”), which was appointed pursuant to the
Voting and Exchange Agreements. Odyssey was not required to be a party to the Business Combination Agreement as it will be a party
to the subscription agreements entered into upon the Closing which are described below. Odyssey is a party to the Voting and Exchange
Agreements and the Support Agreements, both of which require the parties thereto to take all steps necessary to ensure that KBL
becomes bound by the terms and provisions of each respective agreement and adopts the Exchangeable Share Structures.

Boston       London       Los
Angeles       New York       San Diego       San
Francisco      Washington

MINTZ,
LEVIN, COHN, FERRIS, GLOVSKY AND POPEO, P.C.

    MINTZ

February 7, 2020

Page 2

In connection with the Reorganization in July 2019, 180 issued
one “Class C Special Voting Share” and one “Class K Special Voting Share” to the Trustee. Pursuant to Section
2.1(e)(i)(C) of the Business Combination Agreement, these special voting shares, which will be outstanding immediately prior to
the Effective Time, shall be converted solely into the right to receive a “Class C Special Voting Share” and “Class
K Special Voting Share” out of KBL Preferred Stock on a one-for-one basis. Pursuant to Section 2.1(d)(i) of the Business
Combination Agreement, as a condition of Closing, KBL’s certificate of incorporation shall be amended to provide for KBL
Preferred Stock on substantially the same terms as 180’s preferred stock so that KBL may adopt the Exchangeable Share Structures.
KBL and Odyssey will enter into subscription agreements for the issuance of KBL’s “Class C Special Voting Share”
and “Class K Special Voting Share” upon Closing on substantially the same terms as the subscription agreements entered
into between 180 and Odyssey.

In response to the Staff’s comment, the Company has revised
the disclosure on page 2 of Amendment No. 1.

Summary, page 19

2. Please revise the chart on page 26 to identify the Trustee
and holders of the Exchangeable Shares. Please advise us of the approximate number of holders of Exchangeable Shares. Additionally,
please advise us if the registration statement is meant to cover future exchanges of Exchangeable Shares for KBL securities.

Response: The Company acknowledges the Staff’s
comment and notes that the organizational structure chart on page 26 of Amendment No. 1 is intended to solely illustrate the
post-combination entity structure of KBL, which does not include Odyssey. The Exchangeable Shares were issued by CannBioRex
Purchaseco ULC and Katexco Purchaseco ULC to approximately 67 holders and 62 holders, respectively. The Registration Statement
is meant to cover the issuance of KBL’s shares of Common Stock upon future exchanges of Exchangeable Shares.

Unaudited Pro Forma Condensed Combined Financial Information,
page 67

3. We note that in the business combination between KBL
and the newly combined CannBioRx, the business combination was accounted for as a reverse recapitalization and CannBioRx has been
identified as the accounting acquirer. Please explain to us in greater detail how you identified CannBioRx as the accounting acquirer,
specifically addressing how you considered each of the criteria outlined within ASC 805-10-55-10 to 15.

Response: The Company acknowledges the Staff’s
comment and notes that in the business combination between KBL (the legal acquirer) and the newly combined 180 (formerly known
as CannBioRx), 180 (the operating company) has been determined to be the accounting acquirer, such that the accounting for the
transaction will be similar to that of a capital infusion (reverse recapitalization), because the only pre-combination asset of
KBL (a special purpose acquisition company or “SPAC”) is cash.

The factors supporting the determination that 180 will be the
accounting acquirer in the business combination are summarized below:

(a)       When a SPAC acquires
a business for all cash consideration, the SPAC is usually the accounting acquirer. Here, the business combination will be an exchange
of equity interests, which requires further evaluation.

(b)       Accounting Standards Codification (“ASC”) 805-10-55-10
indicates that the accounting acquirer is the entity that obtains a controlling financial interest in the post-combination entity.
Here, the former 180 shareholders will hold greater than a 50% controlling interest in post-combination KBL.

    MINTZ

February 7, 2020

Page 3

(c)       ASC
805-10-55-11 indicates that the entity that transfers cash or incurs liabilities is the accounting acquirer. Here, the
structure of the business combination is an exchange of equity interests.

(d)       ASC 805-10-55-12
indicates that there are several additional factors that should be considered in an exchange of equity interests. Here, the former
shareholders of 180 have a controlling financial interest in post-combination KBL and 180 will have one more Board member designee
than KBL on the initial Board post-combination. In addition, while the Chief Executive Officer and Chief Operating Officer of post-combination
KBL will be the Chief Executive Officer and Chief Operating Officer of pre-combination KBL, the Chief Scientific Officer of post-combination
KBL was the Chief Executive Officer and Chief Scientific Officer of pre-combination 180 and the Co-Chairmen of post-combination
KBL were the Co-Chairmen of pre-combination 180, which are critical positions with respect to scientific matters for the post-combination
entity. Furthermore, the Board post-combination, over which 180 Board designees will have significant influence, has the ability
to appoint/replace members of the senior management of post-combination KBL.

4. We note that the pro forma benefit for income taxes is
the same as the historical CannBioRx benefit for income taxes for all periods presented. Please tell us why the pro forma adjustments
have not been tax effected.

Response: The Company acknowledges the Staff’s
comment and notes that for all periods presented, the pro forma condensed combined operating results reflect no revenues and a
substantial net loss. Given that future profitability does not meet the “more likely than not” criteria and there are
no current taxes payable, any deferred tax assets recognized would be subject to a full valuation allowance. Accordingly, no net
deferred income tax benefit is recognized against the pro forma condensed combined net loss because any deferred tax benefit will
be fully offset by the recording of a corresponding valuation allowance. Substantially all of the deferred tax liability represents
a “naked credit” related to the indefinite-lived in-process research and development. The nominal tax benefit recognized
in the pro forma operating results represents the release of the deferred tax liability (that was recognized in the acquisition
accounting due to the book-tax basis difference in the intangible assets) as the definite-lived intangible assets are amortized.
The Company intends to revisit the acquisition accounting during the one year measurement period once the Company has progressed
with its tax planning.

5. Please disclose the terms of the 1,050,000 holdback shares excluded from the calculation of weighted average number of shares
outstanding on pages 75, 76 and 77, including how this amount was determined.

Response: The Company acknowledges the Staff’s
comment and notes that pursuant to the Business Combination Agreement, 1,050,000 shares of KBL Common Stock (6% of the 17,500,000
shares scheduled to be paid by KBL as consideration to 180 shareholders) will be held in escrow for a period of 12 months from
the Closing. Those escrowed shares will be KBL’s sole remedy for the satisfaction of indemnity claims, if any, arising from
the terms of the Business Combination Agreement.

In response to the Staff’s comment, the Company has revised
the disclosure on pages 73, 74 and 75 of Amendment No. 1.

6. Please clarify the pre-reorganization ownership structure of Katexco, CBR Pharma and 180. Tell us your basis for applying
the acquisition method of accounting in the reorganization and how you determined that Katexco was the accounting acquirer.

Response: The Company acknowledges the Staff’s
comment and notes the following with respect to your inquiries.

    MINTZ

February 7, 2020

Page 4

Pre-Organization Ownership Structure

The pre-reorganization ownership structure included a single
40% voting interest and three 20% voting interests at 180 LP, three 10% voting interests at Katexco, plus one 15% voting interest
and one 10% voting interest at CBR Pharma (all approximate and inclusive of direct and indirect voting interests).

While the pre-reorganization ownership structure of Katexco,
CBR Pharma and 180 LP (collectively the “Operating Companies”) included some overlapping investors, there were no written
voting arrangements or agreements and no single investor (directly or indirectly) had a controlling (greater than 50%) voting interest
in any of the three Operating Companies. Of the most significant overlapping ownership interests, one investor had a 40% voting
interest in 180 LP, a 7% voting interest in Katexco and a 10% voting interest in CBR Pharma, while a founder of all three Operating
Companies had a 20% voting interest in 180 LP, a 10% voting interest in Katexco and a 15% voting interest in CBR Pharma (all approximate
and inclusive of direct and indirect voting interests).

Acquisition Method of Accounting

If the three Operating Companies were deemed to be under common
control, the Company would be precluded from applying the acquisition method of accounting. While the accounting principles generally
accepted in the United States (“U.S. GAAP”) do not define “common control,” the Company understands that
most companies apply Staff guidance that an individual or enterprise would have to, directly or indirectly, hold more than a 50%
voting interest in each of the entities in order to conclude that such individual or enterprise has common control over the entities.
Therefore, given that no individual or enterprise owns a 50% voting interest in any of the Operating Companies and there are no
written voting arrangements or agreements, the Company is not precluded from applying the acquisition method of accounting.

The Company applied the acquisition method of accounting because
it concluded that the Reorganization represented the acquisition of businesses. First, the Company applied the Accounting Standards
Update 2017-01 screen test and determined that the Reorganization qualified for further analysis because substantially all of the
fair value of the assets being acquired was not concentrated in a single asset group. Rather, the Operating Companies have a broad
and diverse pipeline of licensed technology, in-process research and development and product candidates. Second, the Company determined
that the Operating Companies constituted businesses because they had inputs (licensed technology and in-process research and development)
and processes (world renowned scientists with significant experience and significant previous success in drug discovery) and the
Operating Companies are pursuing a plan to produce outputs (eventual commercialization of product candidates).

Determination of the Accounting
Acquirer

The factors considered in analyzing whether Katexco was the
accounting acquirer in the Reorganization are summarized below:

(a) ASC 805-10-55-15 indicates that a new entity formed to effect a business combination can only be considered to be an accounting
acquirer if it has significant pre-combination activities. The Company determined that 180 (the legal acquirer and new entity formed
for the purpose of facilitating the Reorganization), did not have significant pre-combination activities and was formed solely
to issue equity interests to the three Operating Companies. Therefore, ASC 805-10-55-15 precludes 180 from being identified as
the accounting acquirer.

(b) ASC 805-10-55-10 indicates that the accounting acquirer is the entity that obtains a controlling financial interest. In the
Reorganization, none of the three Operating Companies will obtain a controlling financial interest in 180. Each shareholder group
will obtain a voting interest of between 29% and 40% in 180, so no single operating company will control 180.

(c) ASC 805-10-55-11 indicates that the entity that transfers cash or incurs liabilities is the accounting acquirer. The structure
of the Reorganization was an exchange of equity interests.

    MINTZ

February 7, 2020

Page 5

(d) ASC 805-10-55-12 indicates that there are several additional factors that should be considered in an exchange of equity interests.

 (i) The post-combination 180 voting interests of the shareholder groups range from 29% to 40%, so no shareholder group has a controlling
financial interest and no shareholder group will dominate.

 (ii) There are only two shareholders who have greater than 10% voting interests in post-combination 180 and there are no written
voting arrangements or agreements among shareholders. However, the two significant shareholders had pre-combination interests in
all three Operating Companies, so their minority interests do not favor any of the Operating Companies as the accounting acquirer.

 (iii) While the 180 Board will be up for re-election annually based on shareholder majority vote, the initial 180 Board is comprised
of three individuals that are affiliated with Katexco, one individual that is affiliated with CBR P