Correspondence 0001193125-22-300149 from GRIID Infrastructure Inc. (GRDI, GRDIW) (CIK 0001830029)
GRIID Infrastructure Inc. (GRDI, GRDIW) (CIK 0001830029)
Date: Dec. 7, 2022 · CIK: 0001830029 · Accession: 0001193125-22-300149
AI Filing Summary & Sentiment
File numbers found in text: 333-261880
Referenced dates: March 21, 2022
Letter
SEC Response Letter
December 7, 2022
VIA EDGAR AND FEDERAL EXPRESS
U.S. Securities and Exchange Commission
Division of Corporate Finance
Office of Technology
100 F Street, N.E.
Washington, D.C. 20549
Attn: Melissa Walsh
Stephen Krikorian
Patrick Faller
Jan Woo
Re: Adit EdTech Acquisition Corp.
Amendment No. 2 to Registration Statement on Form S-4
Filed May 16, 2022
File No. 333-261880
Ladies and Gentlemen:
On behalf of Adit EdTech Acquisition Corp. (“Adit EdTech” or the “Company”), we are submitting this letter in response to a letter, dated June 15, 2022, from the staff (the “Staff”) of the Securities and Exchange Commission (the “Commission”) with respect to the Company’s Registration Statement on Form S-4 filed with the Commission on December 23, 2021 (the “Registration Statement”), as amended by Amendment No. 1 thereto filed with the Commission on March 22, 2022 and Amendment No. 2 thereto filed with the Commission on May 16, 2022 (“Amendment No. 2”). The Company is concurrently filing Amendment No. 3 to the Registration Statement (the “Amended Registration Statement”), which includes changes to reflect responses to the Staff’s comments and other updates.
The numbering of the paragraphs below corresponds to the numbering of the comments in the letter from the Staff. For the Staff’s convenience, we have incorporated the text of the Staff’s comments into this response letter in italics. Unless otherwise indicated, page references in the responses correspond to the page numbers in the Amended Registration Statement, and page references otherwise correspond to the page numbers in Amendment No. 2. Capitalized terms used in this letter but otherwise not defined herein shall have the meanings set forth in the Amended Registration Statement.
U.S. Securities and Exchange Commission
Division of Corporate Finance
Office of Technology
December 7, 2022
Page
The responses provided herein are based upon information provided to Covington & Burling LLP by the Company.
Amendment No. 2 to Registration Statement on Form S-4 Filed on May 16, 2022
General
1. We understand that Wells Fargo Securities, LLC (“Wells Fargo”) has terminated its engagement in its roles as your advisor and capital markets advisor and as lead placement agent for a potential PIPE offering (which we understand was not consummated for the reasons set forth in your disclosure) and has waived its entitlement to certain fees otherwise owed to it upon the closing of the business combination. Please disclose the amount of the fees that have already been paid to Wells Fargo and the amount of fees waived, how the waiver of fees was obtained and why it was agreed to. Revise your pro forma financial information and relevant disclosure. In addition, with respect to the resignation:
•
Please clarify the role that Wells Fargo played in any part of the business combination (i.e., the identification or evaluation of business combination targets) as well as the current relationship between Wells Fargo and the merger parties (i.e. whether there are other relationships with Wells Fargo after its resignation). Disclose both the extent of the work already performed and the work agreed to be performed by Wells Fargo prior to its resignation.
•
Revise the background of the business combination to clearly note when Wells Fargo was present in discussions or at board meetings and qualify their presence by noting Wells Fargo subsequently resigned.
•
Discuss the potential impact on the business combination related to the resignation of Wells Fargo, including, but not limited to, any impact on the PIPE financing. For example, if Wells Fargo would have played a role in the closing, please revise to identify the party who will be filling any such role.
•
Disclose in the forepart of the filing that Wells Fargo claims no remaining role in your business combination transaction and has affirmatively disclaimed any responsibility for any of the disclosure in this registration statement.
•
Please disclose whether Wells Fargo was involved in the preparation of any disclosure that is included in the Form S-4 registration statement, including but not limited to any analysis underlying disclosure in the registration statement. If so, clarify the involvement of Wells Fargo, whether it has retracted any work product associated with the transaction, and the risk of such withdrawal and reliance on Wells Fargo’s expertise.
U.S. Securities and Exchange Commission
Division of Corporate Finance
Office of Technology
December 7, 2022
Page
•
Disclose whether Wells Fargo provided you with any reasons for its respective resignation or why it was unable to complete its engagement. If there was no dialogue and/or you did not seek out the reasons why Wells Fargo was resigning (and waiving deferred fees, as applicable) or unable to complete its engagement, despite already providing and/or completing their services, please indicate so in your registration statement.
•
Please advise if you are aware of any disagreements with Wells Fargo regarding the scope of its engagement or their ability to complete its engagement prior to resigning.
•
Please advise whether you are aware of any disagreements with Wells Fargo regarding the disclosure in your registration statement.
•
Please add a risk factor that clarifies Wells Fargo was to be compensated, in part, for services that it has already rendered, yet Wells Fargo will waive such fees and disclaim responsibility for the Form S-4 registration statement. Clarify the unusual nature of such a fee waiver and the impact of it on the evaluation of the Business Combination.
•
Disclose whether Wells Fargo or affiliates of Wells Fargo are lenders to ADEX or GRIID. Advise whether any credit or financing agreements entered into by ADEX or GRIID are impacted by the resignation of Wells Fargo.
Response to Comment 1: The Company respectfully acknowledges the Staff’s comment and has revised the Amended Registration Statement at pages 9, 35-36, 90-91, 136-139 and F-44 in response to the Staff’s comment.
2. Please disclose what consideration the ADEX Board has given to reconsidering its assessment of the business combination given the subsequent resignation of Wells Fargo. Expand your disclosure to address the ADEX Board’s consideration of the business combination without the advice of Wells Fargo and disclose the impact this will have on investors.
Response to Comment 2: The Company respectfully acknowledges the Staff’s comment and has revised the Amended Registration Statement at pages 9, 35-36, 90-91, 136-139 and F-44 in response to the Staff’s comment.
U.S. Securities and Exchange Commission
Division of Corporate Finance
Office of Technology
December 7, 2022
Page
3. Please provide us with a letter from Wells Fargo stating whether it agrees with the statements made in your proxy statement/prospectus related to its resignation and, if not, stating the respects in which it does not agree. Please revise your disclosure accordingly to reflect that you have discussed the disclosure with Wells Fargo and it either agrees or does not agree with the conclusions and the risks associated with such outcome. If Wells Fargo does not respond, please revise your disclosure to indicate you have asked and not received a response and disclose the risks to investors. Additionally, please indicate that Wells Fargo withdrew from its respective role(s) in your transaction and forfeited its fees, if applicable, and that Wells Fargo refused to discuss the reasons for its resignation and forfeiture of fees, if applicable, with management. The disclosure should clarify whether Wells Fargo performed substantially all the work to earn its fees.
Response to Comment 3: The Company respectfully acknowledges the Staff’s comment and informs the Staff that it has provided Wells Fargo with a copy of the statements concerning Wells Fargo and its resignation included in the proxy statement/prospectus, but that Wells Fargo has not responded. The Company has revised the Amended Registration Statement at pages 9, 35-36, 90-91, 136-139 and F-44 in response to the Staff’s comment.
4. Please revise your disclosure to highlight for investors that Wells Fargo’s withdrawal indicates that it does not want to be associated with the disclosure or underlying business analysis related to the transaction. In addition, your disclosure should caution investors that they should not place any reliance on the fact that Wells Fargo has been previously involved with the transaction.
Response to Comment 4: The Company respectfully acknowledges the Staff’s comment and has revised the Amended Registration Statement at pages 9, 35-36, 90-91, 136-139 and F-44 in response to the Staff’s comment.
5. Please supplementally provide us with the engagement letter with Wells Fargo and other agreements, if any, entered into by ADEX or GRIID with Wells Fargo or any of its affiliates. Please disclose any ongoing obligations of the parties pursuant to the engagement letter that will survive termination of the engagement, such as indemnification provisions, rights of first refusal, and lockups, and discuss the impacts of those obligations on the company in the registration statement. Please also provide us with any correspondence between Wells Fargo and ADEX and/or GRIID relating to Wells Fargo’s resignation.
Response to Comment 5: The Company respectfully acknowledges the Staff’s comment and has revised the Amended Registration Statement at pages 9, 35-36, 90-91, 136-139 and F-44 in response to the Staff’s comment. The Company is supplementally providing the Staff with copies of its engagement letters with and the resignation letters received from Wells Fargo under separate cover.
U.S. Securities and Exchange Commission
Division of Corporate Finance
Office of Technology
December 7, 2022
Page
Q: Did the board of directors of ADEX obtain a fairness opinion in determining whether or not to proceed with the merger?, page 11
6. We note you removed language on page 11 advising that the fairness opinion addressed the fairness to all stockholders of ADEX as a group as opposed to only those unaffiliated with the sponsor or its affiliates. As it appears Lincoln International LLC’s financial opinion was addressed solely to ADEX, please include the language that was removed in your amendment or advise.
Response to Comment 6: The Company respectfully acknowledges the Staff’s comment and advises the Staff that Lincoln International LLC’s fairness opinion was addressed solely to ADEX.
Unaudited Pro Forma Condensed Combined Financial Information
Introduction, page 159
7. We note that you omitted the pro forma condensed statement of comprehensive income for the year ended December 31, 2020 in response to prior comment 9. Please revise to give effect to the merger and related adjustments as if they were made as of the beginning of the fiscal year presented. In this regard, you should give effect to the transaction as if it had occurred on January 1, 2021. Also, please explain why you continue to adjust operating expenses for transaction costs that had been accrued as of December 31, 2021 in adjustment (D).
Response to Comment 7: The Company respectfully acknowledges the Staff’s comment and has revised the Amended Registration Statement at pages 185 and 187 in response to the Staff’s comment.
Material Agreements, page 190
8. We note GRIID entered into a Mining Services Agreement with Blockchain Access UK Ltd. on March 21, 2022, which you filed as Exhibit 10.20 to your registration statement. Please disclose the material terms of this agreement in your proxy statement/prospectus, including the term and termination provision.
Response to Comment 8: The Company respectfully acknowledges the Staff’s comment and has revised the Amended Registration Statement at pages 213 and 214 in response to the Staff’s comment.
U.S. Securities and Exchange Commission
Division of Corporate Finance
Office of Technology
December 7, 2022
Page
Management’s Discussion and Analysis of Financial Condition and Results of Operations of GRIID, page
9. Please clearly state that all references to “cryptocurrency” or “cryptocurrencies” in this section refer to bitcoin or advise.
Response to Comment 9: The Company respectfully acknowledges the Staff’s comment and has revised the Amended Registration Statement at page 221 in response to the Staff’s comment.
Liquidity and Capital Resources, page 211
10. We note your disclosure that Blockchain funded a request to draw down $6 million of the 2nd Tranche Loans notwithstanding that Blockchain believed certain conditions precedent to such draw were not satisfied. Please disclose the conditions precedent that Blockchain believes were not satisfied or advise.
Response to Comment 10: The Company respectfully acknowledges the Staff’s comment and advises the Staff that GRIID has entered into a Fourth Amended and Restated Credit Agreement dated as of October 9, 2022 with the lenders from time to time party thereto and Blockchain Access UK Limited as agent (the “Fourth Amended and Restated Credit Agreement”). In connection with the entry into the Fourth Amended and Restated Credit Agreement, the parties resolved the issues relating to the $6 million draw down and all outstanding borrowings under GRIID’s prior credit agreement with Blockchain Access UK Limited, which are governed by the Fourth Amended and Restated Credit Agreement. The Company has revised the Amended Registration Statement at pages 201 and 242 to disclose the terms of the Fourth Amended and Restated Credit Agreement and related agreements.
U.S. Federal Income Tax Consequences for U.S. Holders, page 262
11. We note your response to prior comment 21 and reissue our comment in part. The revised disclosure on page 262 appears to say that your opinion depends on “if the merger qualifies as an exchange described in Section 351(a) of the Code.” Please revise your disclosure and opinion to state, if true, that the merger will qualify as an exchange described in Section 351(a) of the Code or advise.
Response to Comment 11: The Company respectfully acknowledges the Staff’s comment and has revised the Amended Registration Statement at page 296 in response to the Staff’s comment.
U.S. Securities and Exchange Commission
Division of Corporate Finance
Office of Technology
December 7, 2022
Page
GRIID Infrastructure LLC and Subsidiaries
Consolidated Statements of Operations, page F-25
12. We note your response to prior comment 44 in your letter dated March 21, 2022 and continue to evaluate your analysis.
Response to Comment 12: The Company respectfully acknowledges the Staff’s comment and advises the Staff that it has modified the presentation of realized gains on the sales of cryptocurrency as operating expense (income) and reflected the reclassification in all relevant sections of the Amended Registration Statement.
Consolidated Statements of Cash Flows, page F-28
13. We note your response to prior comment 45 in your letter dated March 21, 2022 and continue to evaluate your analysis.
Response to Comment 13: The Company respectfully acknowledges the Staff’s comment and understands that pursuant to subsequent discussions between the Staff and the Company’s outside counsel that the Staff is no longer evaluating the Company’s analysis regarding the Company’s response to prior comment 45.
Notes to Consolidated Financial Statements
Note 3. Basis of Presentation, Summary of Significant Accounting Policies and Recent
Accounting Pronouncements
Cryptocurrencies, page F-34
14. In response to prior comment 26, you state that “If the market price is below the per unit value of the bitcoin, it is more likely than not that the bitcoin is impaired,” however you have adopted an acco
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CORRESP 1 filename1.htm SEC Response Letter December 7, 2022 VIA EDGAR AND FEDERAL EXPRESS U.S. Securities and Exchange Commission Division of Corporate Finance Office of Technology 100 F Street, N.E. Washington, D.C. 20549 Attn: Melissa Walsh Stephen Krikorian Patrick Faller Jan Woo Re: Adit EdTech Acquisition Corp. Amendment No. 2 to Registration Statement on Form S-4 Filed May 16, 2022 File No. 333-261880 Ladies and Gentlemen: On behalf of Adit EdTech Acquisition Corp. (“Adit EdTech” or the “Company”), we are submitting this letter in response to a letter, dated June 15, 2022, from the staff (the “Staff”) of the Securities and Exchange Commission (the “Commission”) with respect to the Company’s Registration Statement on Form S-4 filed with the Commission on December 23, 2021 (the “Registration Statement”), as amended by Amendment No. 1 thereto filed with the Commission on March 22, 2022 and Amendment No. 2 thereto filed with the Commission on May 16, 2022 (“Amendment No. 2”). The Company is concurrently filing Amendment No. 3 to the Registration Statement (the “Amended Registration Statement”), which includes changes to reflect responses to the Staff’s comments and other updates. The numbering of the paragraphs below corresponds to the numbering of the comments in the letter from the Staff. For the Staff’s convenience, we have incorporated the text of the Staff’s comments into this response letter in italics. Unless otherwise indicated, page references in the responses correspond to the page numbers in the Amended Registration Statement, and page references otherwise correspond to the page numbers in Amendment No. 2. Capitalized terms used in this letter but otherwise not defined herein shall have the meanings set forth in the Amended Registration Statement. U.S. Securities and Exchange Commission Division of Corporate Finance Office of Technology December 7, 2022 Page 2 The responses provided herein are based upon information provided to Covington & Burling LLP by the Company. Amendment No. 2 to Registration Statement on Form S-4 Filed on May 16, 2022 General 1. We understand that Wells Fargo Securities, LLC (“Wells Fargo”) has terminated its engagement in its roles as your advisor and capital markets advisor and as lead placement agent for a potential PIPE offering (which we understand was not consummated for the reasons set forth in your disclosure) and has waived its entitlement to certain fees otherwise owed to it upon the closing of the business combination. Please disclose the amount of the fees that have already been paid to Wells Fargo and the amount of fees waived, how the waiver of fees was obtained and why it was agreed to. Revise your pro forma financial information and relevant disclosure. In addition, with respect to the resignation: • Please clarify the role that Wells Fargo played in any part of the business combination (i.e., the identification or evaluation of business combination targets) as well as the current relationship between Wells Fargo and the merger parties (i.e. whether there are other relationships with Wells Fargo after its resignation). Disclose both the extent of the work already performed and the work agreed to be performed by Wells Fargo prior to its resignation. • Revise the background of the business combination to clearly note when Wells Fargo was present in discussions or at board meetings and qualify their presence by noting Wells Fargo subsequently resigned. • Discuss the potential impact on the business combination related to the resignation of Wells Fargo, including, but not limited to, any impact on the PIPE financing. For example, if Wells Fargo would have played a role in the closing, please revise to identify the party who will be filling any such role. • Disclose in the forepart of the filing that Wells Fargo claims no remaining role in your business combination transaction and has affirmatively disclaimed any responsibility for any of the disclosure in this registration statement. • Please disclose whether Wells Fargo was involved in the preparation of any disclosure that is included in the Form S-4 registration statement, including but not limited to any analysis underlying disclosure in the registration statement. If so, clarify the involvement of Wells Fargo, whether it has retracted any work product associated with the transaction, and the risk of such withdrawal and reliance on Wells Fargo’s expertise. U.S. Securities and Exchange Commission Division of Corporate Finance Office of Technology December 7, 2022 Page 3 • Disclose whether Wells Fargo provided you with any reasons for its respective resignation or why it was unable to complete its engagement. If there was no dialogue and/or you did not seek out the reasons why Wells Fargo was resigning (and waiving deferred fees, as applicable) or unable to complete its engagement, despite already providing and/or completing their services, please indicate so in your registration statement. • Please advise if you are aware of any disagreements with Wells Fargo regarding the scope of its engagement or their ability to complete its engagement prior to resigning. • Please advise whether you are aware of any disagreements with Wells Fargo regarding the disclosure in your registration statement. • Please add a risk factor that clarifies Wells Fargo was to be compensated, in part, for services that it has already rendered, yet Wells Fargo will waive such fees and disclaim responsibility for the Form S-4 registration statement. Clarify the unusual nature of such a fee waiver and the impact of it on the evaluation of the Business Combination. • Disclose whether Wells Fargo or affiliates of Wells Fargo are lenders to ADEX or GRIID. Advise whether any credit or financing agreements entered into by ADEX or GRIID are impacted by the resignation of Wells Fargo. Response to Comment 1: The Company respectfully acknowledges the Staff’s comment and has revised the Amended Registration Statement at pages 9, 35-36, 90-91, 136-139 and F-44 in response to the Staff’s comment. 2. Please disclose what consideration the ADEX Board has given to reconsidering its assessment of the business combination given the subsequent resignation of Wells Fargo. Expand your disclosure to address the ADEX Board’s consideration of the business combination without the advice of Wells Fargo and disclose the impact this will have on investors. Response to Comment 2: The Company respectfully acknowledges the Staff’s comment and has revised the Amended Registration Statement at pages 9, 35-36, 90-91, 136-139 and F-44 in response to the Staff’s comment. U.S. Securities and Exchange Commission Division of Corporate Finance Office of Technology December 7, 2022 Page 4 3. Please provide us with a letter from Wells Fargo stating whether it agrees with the statements made in your proxy statement/prospectus related to its resignation and, if not, stating the respects in which it does not agree. Please revise your disclosure accordingly to reflect that you have discussed the disclosure with Wells Fargo and it either agrees or does not agree with the conclusions and the risks associated with such outcome. If Wells Fargo does not respond, please revise your disclosure to indicate you have asked and not received a response and disclose the risks to investors. Additionally, please indicate that Wells Fargo withdrew from its respective role(s) in your transaction and forfeited its fees, if applicable, and that Wells Fargo refused to discuss the reasons for its resignation and forfeiture of fees, if applicable, with management. The disclosure should clarify whether Wells Fargo performed substantially all the work to earn its fees. Response to Comment 3: The Company respectfully acknowledges the Staff’s comment and informs the Staff that it has provided Wells Fargo with a copy of the statements concerning Wells Fargo and its resignation included in the proxy statement/prospectus, but that Wells Fargo has not responded. The Company has revised the Amended Registration Statement at pages 9, 35-36, 90-91, 136-139 and F-44 in response to the Staff’s comment. 4. Please revise your disclosure to highlight for investors that Wells Fargo’s withdrawal indicates that it does not want to be associated with the disclosure or underlying business analysis related to the transaction. In addition, your disclosure should caution investors that they should not place any reliance on the fact that Wells Fargo has been previously involved with the transaction. Response to Comment 4: The Company respectfully acknowledges the Staff’s comment and has revised the Amended Registration Statement at pages 9, 35-36, 90-91, 136-139 and F-44 in response to the Staff’s comment. 5. Please supplementally provide us with the engagement letter with Wells Fargo and other agreements, if any, entered into by ADEX or GRIID with Wells Fargo or any of its affiliates. Please disclose any ongoing obligations of the parties pursuant to the engagement letter that will survive termination of the engagement, such as indemnification provisions, rights of first refusal, and lockups, and discuss the impacts of those obligations on the company in the registration statement. Please also provide us with any correspondence between Wells Fargo and ADEX and/or GRIID relating to Wells Fargo’s resignation. Response to Comment 5: The Company respectfully acknowledges the Staff’s comment and has revised the Amended Registration Statement at pages 9, 35-36, 90-91, 136-139 and F-44 in response to the Staff’s comment. The Company is supplementally providing the Staff with copies of its engagement letters with and the resignation letters received from Wells Fargo under separate cover. U.S. Securities and Exchange Commission Division of Corporate Finance Office of Technology December 7, 2022 Page 5 Q: Did the board of directors of ADEX obtain a fairness opinion in determining whether or not to proceed with the merger?, page 11 6. We note you removed language on page 11 advising that the fairness opinion addressed the fairness to all stockholders of ADEX as a group as opposed to only those unaffiliated with the sponsor or its affiliates. As it appears Lincoln International LLC’s financial opinion was addressed solely to ADEX, please include the language that was removed in your amendment or advise. Response to Comment 6: The Company respectfully acknowledges the Staff’s comment and advises the Staff that Lincoln International LLC’s fairness opinion was addressed solely to ADEX. Unaudited Pro Forma Condensed Combined Financial Information Introduction, page 159 7. We note that you omitted the pro forma condensed statement of comprehensive income for the year ended December 31, 2020 in response to prior comment 9. Please revise to give effect to the merger and related adjustments as if they were made as of the beginning of the fiscal year presented. In this regard, you should give effect to the transaction as if it had occurred on January 1, 2021. Also, please explain why you continue to adjust operating expenses for transaction costs that had been accrued as of December 31, 2021 in adjustment (D). Response to Comment 7: The Company respectfully acknowledges the Staff’s comment and has revised the Amended Registration Statement at pages 185 and 187 in response to the Staff’s comment. Material Agreements, page 190 8. We note GRIID entered into a Mining Services Agreement with Blockchain Access UK Ltd. on March 21, 2022, which you filed as Exhibit 10.20 to your registration statement. Please disclose the material terms of this agreement in your proxy statement/prospectus, including the term and termination provision. Response to Comment 8: The Company respectfully acknowledges the Staff’s comment and has revised the Amended Registration Statement at pages 213 and 214 in response to the Staff’s comment. U.S. Securities and Exchange Commission Division of Corporate Finance Office of Technology December 7, 2022 Page 6 Management’s Discussion and Analysis of Financial Condition and Results of Operations of GRIID, page 197 9. Please clearly state that all references to “cryptocurrency” or “cryptocurrencies” in this section refer to bitcoin or advise. Response to Comment 9: The Company respectfully acknowledges the Staff’s comment and has revised the Amended Registration Statement at page 221 in response to the Staff’s comment. Liquidity and Capital Resources, page 211 10. We note your disclosure that Blockchain funded a request to draw down $6 million of the 2nd Tranche Loans notwithstanding that Blockchain believed certain conditions precedent to such draw were not satisfied. Please disclose the conditions precedent that Blockchain believes were not satisfied or advise. Response to Comment 10: The Company respectfully acknowledges the Staff’s comment and advises the Staff that GRIID has entered into a Fourth Amended and Restated Credit Agreement dated as of October 9, 2022 with the lenders from time to time party thereto and Blockchain Access UK Limited as agent (the “Fourth Amended and Restated Credit Agreement”). In connection with the entry into the Fourth Amended and Restated Credit Agreement, the parties resolved the issues relating to the $6 million draw down and all outstanding borrowings under GRIID’s prior credit agreement with Blockchain Access UK Limited, which are governed by the Fourth Amended and Restated Credit Agreement. The Company has revised the Amended Registration Statement at pages 201 and 242 to disclose the terms of the Fourth Amended and Restated Credit Agreement and related agreements. U.S. Federal Income Tax Consequences for U.S. Holders, page 262 11. We note your response to prior comment 21 and reissue our comment in part. The revised disclosure on page 262 appears to say that your opinion depends on “if the merger qualifies as an exchange described in Section 351(a) of the Code.” Please revise your disclosure and opinion to state, if true, that the merger will qualify as an exchange described in Section 351(a) of the Code or advise. Response to Comment 11: The Company respectfully acknowledges the Staff’s comment and has revised the Amended Registration Statement at page 296 in response to the Staff’s comment. U.S. Securities and Exchange Commission Division of Corporate Finance Office of Technology December 7, 2022 Page 7 GRIID Infrastructure LLC and Subsidiaries Consolidated Statements of Operations, page F-25 12. We note your response to prior comment 44 in your letter dated March 21, 2022 and continue to evaluate your analysis. Response to Comment 12: The Company respectfully acknowledges the Staff’s comment and advises the Staff that it has modified the presentation of realized gains on the sales of cryptocurrency as operating expense (income) and reflected the reclassification in all relevant sections of the Amended Registration Statement. Consolidated Statements of Cash Flows, page F-28 13. We note your response to prior comment 45 in your letter dated March 21, 2022 and continue to evaluate your analysis. Response to Comment 13: The Company respectfully acknowledges the Staff’s comment and understands that pursuant to subsequent discussions between the Staff and the Company’s outside counsel that the Staff is no longer evaluating the Company’s analysis regarding the Company’s response to prior comment 45. Notes to Consolidated Financial Statements Note 3. Basis of Presentation, Summary of Significant Accounting Policies and Recent Accounting Pronouncements Cryptocurrencies, page F-34 14. In response to prior comment 26, you state that “If the market price is below the per unit value of the bitcoin, it is more likely than not that the bitcoin is impaired,” however you have adopted an acco