SEC Comment Letter 0000000000-24-003185 to Nakamoto Inc. (NAKA)
Nakamoto Inc.
Date: March 22, 2024 · CIK: 0001946573 · Accession: 0000000000-24-003185
AI Filing Summary & Sentiment
Reasoning
File numbers found in text: 333-274606
Letter
United States securities and exchange commission logo March 22, 2024 Timothy Pickett Chief Executive Officer Kindly MD, Inc. 5097 South 900 East Suite 100 Salt Lake City, UT 84117 Re:Kindly MD, Inc. Amendment No. 7 to Registration Statement on Form S-1 Filed March 12, 2024 File No. 333-274606 Dear Timothy Pickett: We have reviewed your amended registration statement and have the following comment(s). Please respond to this letter by amending your registration statement and providing the requested information. If you do not believe a comment applies 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 this letter, we may have additional comments. Amendment No. 7 to Registration Statement on Form S-1 filed March 12, 2024 Recent Developments Bridge Financings, page 6 1.We note the disclosure that from December 2023 to January 2024, you issued convertible promissory notes in the aggregate principal amount of $444,444 to certain investors. Please revise to disclose the investors and the material terms of the related Securities Purchase Agreements, including the convertible feature and pricing terms. 2.Please provide us with a detailed analysis as to why the proposed secondary offering is not an indirect primary offering on your behalf and thus appropriate to characterize the transaction as a valid secondary offering under Securities Act Rule 415(a)(1)(i). For example, we note your new disclosure regarding the issuance of convertible promissory notes from December 2023 to January 2024. Elsewhere, you note that these convertible
FirstName LastNameTimothy Pickett Comapany NameKindly MD, Inc. March 22, 2024 Page 2 FirstName LastNameTimothy Pickett Kindly MD, Inc. March 22, 2024 Page 2 notes will convert into shares of common stock at the assumed initial public offering price of $5.50 per share. Given that the investment in the promissory notes appeared to be made with a view towards the resale of the underlying common stock following the Company’s initial public offering, it appears the resale of these shares of common stock could be deemed an indirect primary offering being conducted by or on behalf of the Issuer. Explain why the selling shareholders should not be deemed to be underwriters, or revise your prospects to include a statement that the selling shareholders are deemed underwriters and fix a price at which the resale shares will sell for the duration of the offering. For guidance, please refer to Securities Act Rules Compliance and Disclosure Interpretations Question 612.09. Last, please tell us whether the sales by the selling shareholders are needed to meet Nasdaq listing requirements. Results of Operations, page 31 3.Please substantially expand your disclosure to fully explain the specific facts and circumstances that caused the fluctuations in salaries and wages and general and administrative expenses. Specifically address the significant change in stock compensation expense reflected on page F-6. Also, please clarify how your "focus on improvement of operational efficiency and standardization of operational processes" impacted your reported revenue. Further, regarding the change in other income, please provide a disclosure that fully describes the Uplift charity program and how the program's income and expenses are accounted for and classified in your financial statements. See Item 303 of Regulation S-K. Stock-Based Compensation, page 34 4.Please disclose the amount of stock compensation expense that you expect to recognize in 2024 based on the awards that are currently outstanding. Note 6, page F-12 5.Please tell us why the discount rate used in your lease accounting appears to be materially different from the borrowing rates disclosed in Note 8. See ASC 842-20-30-3. Please contact Julie Sherman at 202-551-3640 or Al Pavot at 202-551-3738 if you have questions regarding comments on the financial statements and related matters. Please contact Conlon Danberg at 202-551-4466 or Lauren Nguyen at 202-551-3642 with any other questions. Sincerely, Division of Corporation Finance Office of Industrial Applications and Services
FirstName LastNameTimothy Pickett Comapany NameKindly MD, Inc. March 22, 2024 Page 3 FirstName LastName Timothy Pickett Kindly MD, Inc. March 22, 2024 Page 3 cc: Callie Tempest Jones, Esq.
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United States securities and exchange commission logo
March 22, 2024
Timothy Pickett
Chief Executive Officer
Kindly MD, Inc.
5097 South 900 East
Suite 100
Salt Lake City, UT 84117
Re:Kindly MD, Inc.
Amendment No. 7 to Registration Statement on Form S-1
Filed March 12, 2024
File No. 333-274606
Dear Timothy Pickett:
We have reviewed your amended registration statement and have the following
comment(s).
Please respond to this letter by amending your registration statement and providing the
requested information. If you do not believe a comment applies 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 this letter, we may have additional comments.
Amendment No. 7 to Registration Statement on Form S-1 filed March 12, 2024
Recent Developments
Bridge Financings, page 6
1.We note the disclosure that from December 2023 to January 2024, you issued convertible
promissory notes in the aggregate principal amount of $444,444 to certain
investors. Please revise to disclose the investors and the material terms of the related
Securities Purchase Agreements, including the convertible feature and pricing terms.
2.Please provide us with a detailed analysis as to why the proposed secondary offering is not
an indirect primary offering on your behalf and thus appropriate to characterize the
transaction as a valid secondary offering under Securities Act Rule 415(a)(1)(i). For
example, we note your new disclosure regarding the issuance of convertible promissory
notes from December 2023 to January 2024. Elsewhere, you note that these convertible
FirstName LastNameTimothy Pickett
Comapany NameKindly MD, Inc.
March 22, 2024 Page 2
FirstName LastNameTimothy Pickett
Kindly MD, Inc.
March 22, 2024
Page 2
notes will convert into shares of common stock at the assumed initial public offering price
of $5.50 per share. Given that the investment in the promissory notes appeared to be made
with a view towards the resale of the underlying common stock following the Company’s
initial public offering, it appears the resale of these shares of common stock could be
deemed an indirect primary offering being conducted by or on behalf of the Issuer.
Explain why the selling shareholders should not be deemed to be underwriters, or revise
your prospects to include a statement that the selling shareholders are deemed
underwriters and fix a price at which the resale shares will sell for the duration of the
offering. For guidance, please refer to Securities Act Rules Compliance and Disclosure
Interpretations Question 612.09. Last, please tell us whether the sales by the selling
shareholders are needed to meet Nasdaq listing requirements.
Results of Operations, page 31
3.Please substantially expand your disclosure to fully explain the specific facts and
circumstances that caused the fluctuations in salaries and wages and general and
administrative expenses. Specifically address the significant change in stock
compensation expense reflected on page F-6. Also, please clarify how your "focus on
improvement of operational efficiency and standardization of operational processes"
impacted your reported revenue. Further, regarding the change in other income, please
provide a disclosure that fully describes the Uplift charity program and how the program's
income and expenses are accounted for and classified in your financial statements. See
Item 303 of Regulation S-K.
Stock-Based Compensation, page 34
4.Please disclose the amount of stock compensation expense that you expect to recognize in
2024 based on the awards that are currently outstanding.
Note 6, page F-12
5.Please tell us why the discount rate used in your lease accounting appears to be materially
different from the borrowing rates disclosed in Note 8. See ASC 842-20-30-3.
Please contact Julie Sherman at 202-551-3640 or Al Pavot at 202-551-3738 if you have
questions regarding comments on the financial statements and related matters. Please contact
Conlon Danberg at 202-551-4466 or Lauren Nguyen at 202-551-3642 with any other questions.
Sincerely,
Division of Corporation Finance
Office of Industrial Applications and
Services
FirstName LastNameTimothy Pickett
Comapany NameKindly MD, Inc.
March 22, 2024 Page 3
FirstName LastName
Timothy Pickett
Kindly MD, Inc.
March 22, 2024
Page 3
cc: Callie Tempest Jones, Esq.