July 1, 2019
Dean Petkanas
Chief Executive Officer
Kannalife, Inc.
3805 Old Easton Road
Doylestown, PA 18902
Re: Kannalife, Inc.
Amendment No. 5 to Registration Statement on Form S-1
Filed June 17, 2019
File No. 333-227736
Dear Mr. Petkanas:
We have reviewed your amended registration statement and have the
following
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. Unless
we note
otherwise, our references to prior comments are to comments in our June 7, 2019
letter.
Amendment No. 5 to Registration Statement on Form S-1
Notes to the Consolidated Financial Statements March 31, 2019 (Unaudited)
Note 12. Marketable Securities, page F-36
1. We have read your revisions in response to our prior comment 4. In this
regard, the
revisions still do not provide us support for your determination of
realized loss on
marketable security of $228,039 and unrealized loss on marketable
security of $101,307
for the quarter ended March 31, 2019 as well as support for the
corresponding amounts
disclosed in Note 14. Nevertheless, it appears that you determined "Net
gains and losses
recognized during the period on equity securities sold during the
period" herein and in
Note 14 based on original cost basis rather than the beginning of the
period (i.e. January 1,
2019) fair value, which also impacted the amount you determined for
"Unrealized gains
Dean Petkanas
Kannalife, Inc.
July 1, 2019
Page 2
and losses recognized during the period on equity securities still held
at the reporting
date." Please revise or tell us why no revision is necessary.
General
2. In response to comment 6, you state that the Company satisfies the
requirement in rule 3a-
8(a)(6)(iv) because the Company has "evidence of a business other than
investing in
securities through resolutions of its board of directors `or comparable
documents." The
response states that when the Company's board of directors approves
business
transactions, it does so at convened board meetings or by written
consents, each
evidencing the Company's engagement as a pharmaceutical company.
Paragraph (a)(6)(iv) of the rule requires that the board of directors of
a research and
development company relying on the rule's safe harbor adopt and record a
resolution that
the company is primarily engaged in a business or businesses other than
that of investing,
reinvesting, owning, holding, or trading in securities. See Certain
Research and
Development Companies, Investment Company Act Release No. 26077 (June
16, 2003),
at 37051 [68 FR 37045] [June 20, 2003]. It is not clear that the Company
has satisfied
this requirement of the rule. Please supplementally address how the
Company meets this
requirement (for example, by referring to the Company's board resolution
stating the
Company is primarily engaged in a non-investment business). If the
Company determines
that it cannot rely on the rule and to the extent that the Company plans
to rely on section
3(b)(1) of the 1940 Act for its excepted investment company status,
please revise the risk
factor disclosure on investment company status in the registration
statement, as
appropriate, and to include a discussion on the applicability of section
3(b)(1). Also,
please revise the current risk factor disclosure on the consequences to
the Company as it
relates to certain restrictions under the 1940 Act should the Company be
deemed an
investment company to re-characterize those consequences as definite,
rather than
presenting a possibility.
You may contact Paul Cline at 202-551-3851 or Jim Rosenberg at
202-551-3679 if you
have questions regarding comments on the financial statements and related
matters. Please
contact Jeffrey Gabor at 202-551-2544 or Joe McCann at 202-551-6262 with any
other
questions.
Sincerely,
FirstName LastNameDean Petkanas
Division of
Corporation Finance
Comapany NameKannalife, Inc.
Office of
Healthcare & Insurance
July 1, 2019 Page 2
cc: Christopher L. Tinen, Esq.
FirstName LastName