June 25, 2019
Ronald P. Erickson
Chairman of the Board
Know Labs, Inc.
500 Union Street, Suite 810
Seattle, WA 98101
Re: Know Labs, Inc.
Registration Statement on Form S-1
Filed May 30, 2019
File No. 333-231829
Dear Mr. Erickson:
We have limited our review of your registration statement to those
issues we have
addressed in our comments. In some of our comments, we may ask you to provide
us with
information so we may better understand your disclosure.
Please respond to this letter by amending 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.
Registration Statement on Form S-1 filed May 30, 2019
Fee table, page i
1. We note from footnote 3(v) to your fee table that you are registering
for resale an
indeterminate number of shares issuable upon conversion of the Series D
Convertible
Preferred Stock. Please note that you may not rely on Rule 416 to
register for resale an
indeterminate number of shares that you may issue under a conversion
formula. Revise
your filing to register for resale the maximum number of shares that you
think you may
issue upon conversion, based on a good-faith estimate and, if the
estimate turns out to be
insufficient, the company must file a new registration statement to
register the additional
shares for resale. For guidance, see the Division of Corporation
Finance's Securities Act
Rules Compliance and Disclosure Interpretations Question 213.02 which
can be found on
the Commission's web site.
Ronald P. Erickson
FirstName LastNameRonald P. Erickson
Know Labs, Inc.
Comapany NameKnow Labs, Inc.
June 25, 2019
Page 2
June 25, 2019 Page 2
FirstName LastName
2. Please provide us your analysis of how your calculation of the
"Maximum Offering Price"
is consistent with Rule 457.
Selling Security Holders, page 30
3. Given the nature and size of the transaction being registered, provide
us your analysis
supporting your conclusion that the transaction is appropriately
characterized as a
transaction that is eligible to be made on a shelf basis under Rule
415(a)(1)(i). In your
analysis, please address the following among any other relevant
factors:
any relationships among the selling stockholders;
the discount at which the selling stockholders have purchased or
will purchase the
offered securities;
whether any selling stockholder is in the business of buying and
selling securities;
whether all securities offered by a broker-dealer were received as
compensation for
underwriting activities;
whether all securities offered by an affiliate of a broker were
purchased by the seller in
the ordinary course of business, and, at the time of the purchase
of the securities to be
resold, the seller had no agreements or understandings, directly
or indirectly, with any
person to distribute the securities;
the dollar amount of each payment in connection with the
transactions that you have
made or may be required to make to any selling stockholder, any
affiliate of a selling
stockholder, or any person with whom any selling stockholder has a
contractual
relationship regarding the transactions (including any interest
payments, liquidated
damages, payments made to "finders" or "placement agents," and any
other payments
or potential payments);
the net proceeds to the issuer from the sale of the convertible
notes, preferred stock
and warrants, and the total possible payments to all selling
stockholders and any of
their affiliates in the first year following the sale of those
securities;
a description of the method by which the company determined the
number of shares it
seeks to register in connection with this registration statement.
In this regard, please
ensure that the number of shares registered for sale in the fee
table is consistent with
the shares listed in the "Selling Security Holders" section of the
prospectus;
the nature of the adjustments that can be made to the exercise and
conversion prices of
the notes, preferred stock, and warrants related to the offered
common stock;
whether based on information obtained from the selling
stockholders - any of the
selling stockholders has an existing short position in the
company's securities and, if
any of the selling stockholders has an existing short position,
the following additional
information: (1) the date on which such selling stockholder
entered into that short
position, and (2) the relationship of the date on which such
selling stockholder entered
into that short position to the date of the announcement of the
transactions
contemplated by the offerings and agreements that you disclose on
pages 32 and 33
and the filing of the registration statement;
Ronald P. Erickson
FirstName LastNameRonald P. Erickson
Know Labs, Inc.
Comapany NameKnow Labs, Inc.
June 25, 2019
June 25, 2019 Page 3
Page 3
FirstName LastName
the current relationship of each selling stockholder with the
issuer, including an
analysis of whether such selling stockholder is an affiliate of
the issuer;
the relationships and arrangements that have existed in the past
three years or are to be
performed in the future between the issuer (or any of its
predecessors) and the selling
stockholders, any affiliates of the selling stockholders, or any
person with whom any
selling stockholder has a contractual relationship regarding the
transaction (or any
predecessors of those persons) the information provided should
include, in
reasonable detail, a complete description of the rights and
obligations of the parties in
connection with the sale of the shares or the related notes,
preferred shares or warrants;
prior securities transactions between the issuer (or any of its
predecessors) and the
selling stockholders, any affiliates of the selling stockholders,
or any person with
whom any selling stockholder has a contractual relationship
regarding the transaction
(or any predecessors of those persons);
whether the issuer has the intention, and a reasonable basis to
believe that it will have
the financial ability, to make all payments on the overlying
securities; and
whether under all the circumstances it appears that the selling
stockholders,
individually or in the aggregate, are acting as a conduit for the
issuer.
Also provide us copies of all agreements between the issuer (or any of
its predecessors)
and the selling stockholders, any affiliates of the selling
stockholders, or any person with
whom any selling stockholder has a contractual relationship regarding
the transactions (or
any predecessors of those persons) in connection with the sale of the
shares or the related
notes, preferred shares or warrants.
If it is your view that the description of the relationships and
arrangements sought by this
comment already is presented in the registration statement and that
all agreements sought
by this comment are included as exhibits to the registration
statement, please provide us
with confirmation of your view in this regard.
Consolidated Balance Sheets, page F-27
4. We note the column for the interim period March 31, 2019 is labeled as
"audited." Since
the filing does not include an auditor's report for that period,
please revise the filing to
label this column as "unaudited" and to appropriately label the
September 30, 2018
column as "audited."
Signatures, page 74
5. Please indicate below the second paragraph of text required on the
Signatures page who
signed your filing in the capacity of controller or principal
accounting officer.
We remind you that the company and its management are responsible for
the accuracy
and adequacy of their disclosures, notwithstanding any review, comments, action
or absence of
action by the staff.
Ronald P. Erickson
Know Labs, Inc.
June 25, 2019
Page 4
Refer to Rules 460 and 461 regarding requests for acceleration. Please
allow adequate
time for us to review any amendment prior to the requested effective date of
the registration
statement.
You may contact David Burton at (202) 551-3626 or Kevin Kuhar,
Accounting Branch
Chief, at (202) 551-3662 if you have questions regarding comments on the
financial statements
and related matters. Please contact Tim Buchmiller at (202) 551-3635 or Russel
Mancuso, Legal
Branch Chief, at (202) 551-3617 with any other questions.
Sincerely,
FirstName LastNameRonald P. Erickson
Division of
Corporation Finance
Comapany NameKnow Labs, Inc.
Office of
Electronics and Machinery
June 25, 2019 Page 4
cc: Jessica M. Lockett, Esq.
FirstName LastName