Ms. Nakada
Ms. Vanjoske
Securities and Exchange Commission
October 11, 2019
Page 2
originally confidentially submitted to the Commission on August 2, 2019, resubmitted to the Commission on September 6, 2019, resubmitted to the Commission on September 20, 2019, and subsequently publicly filed by the Company with the Commission on September 30, 2019 (FileNo. 333-234017) (the “Registration Statement”), we submit this supplemental letter to further address comment 12 of the Original Comment Letter. This supplemental letter revises and replaces the letter previously submitted on October 9, 2019.
The Company respectfully requests that the bracketed information contained in this letter be treated as confidential information pursuant to Rule 83 promulgated by the Commission, 17 C.F.R. §200.8, and that the Commission provide timely notice to Anup Marda, Chief Financial Officer, Cabaletta Bio, Inc., 2929 Arch Street, Suite 600, Philadelphia, Pennsylvania, 19104 before it permits any disclosure of the bracketed information in this letter.
For the convenience of the Staff, we have recited the prior comment from the Staff in italicized type and have followed the comment with the Company’s response.
Critical Accounting Policies and Significant Judgments and Estimates–Stock Based-Compensation, page 103
12.Once you have an estimated offering price or range, please explain to us the reasons for any differences between the recent valuations of your common stock leading up to the initial public offering and the estimated offering price. This information will help facilitate our review of your accounting for equity issuances including stock compensation and beneficial conversion features.
The Company advises the Staff that the approach taken by the Company in determining the fair value of its common stock was to obtain third-party valuations on specific dates, including as of (a) October 10, 2018, (b) as of January 2, 2019, (c) as of February 11, 2019, and (d) as of August 2, 2019, which third-party valuations were used for awards issued near or after these dates where the Company’s equity valuation did not materially change. This information is set forth on pages 103 and 104 of the preliminary prospectus included in the Registration Statement and included in the table below, with all such information presented before giving effect to a reverse stock split to be implemented prior to the Company’s proposed initial public offering (“IPO”).
| | | | | | | | | | | | | | |
Grant Date | | Type of Award | | Number of Shares Subject to Awards Granted | | | Per share Exercise Price or Purchase Price | | | Fair Value of Common Stock Used for Financial Reporting Purposes | |
October 2018 | | Options | | | 1,367,023 | | | $ | 0.67 | | | | 1.60 | |
November 2018 | | Options | | | 90,000 | | | $ | 0.67 | | | | 1.60 | |
January 2019 | | Options | | | 208,922 | | | $ | 2.82 | | | | 3.45 | |
February 2019 | | Options | | | 97,331 | | | $ | 4.20 | | | | 4.20 | |
FOIA CONFIDENTIAL TREATMENT REQUESTED BY CABALETTA BIO, INC.