June 12, 2020
Via E-mail
Gary Simon, Esq.
Hughes Hubbard & Reed LLP
One Battery Park Plaza, 12th Floor
New York, NY 10004
Re: Broadway Financial Corporation
PREC14A Preliminary Proxy Statement on Schedule 14A
Filed June 9, 2020 by Commerce Home Mortgage, LLC; The Capital
Corps,
LLC; TCC Manager, LLC; Sugarman Enterprises, Inc.; Steven
A.
Sugarman; Carlos Salas; and Antonio Villaraigosa
File No. 001-39043
Amendment No. 5 to Schedule 13D
Filed May 29, 2020 by Commerce Home Mortgage, LLC et al.
File No. 005-46823
Dear Mr. Simon:
We have reviewed the above-captioned filings and have the following
comments.
Please respond to this letter by amending the referenced filings and/or
by providing the
requested information. After reviewing any amendments to your filings and any
information
provided in response to these comments, we may have additional comments.
If you do not believe our comments apply to your facts and
circumstances, and/or do not
believe an amendment is appropriate, please tell us why in a written response.
Preliminary Proxy Statement on Schedule 14A
General
1. Please ensure that your revised preliminary proxy statement includes page
numbers. Refer to
Exchange Act Rule 0-3(b).
2. We note that you filed this preliminary proxy statement just two weeks
before the annual
meeting. Given this timing and the issues raised in our comments below,
please provide us
with your analysis as to whether stockholders will have sufficient time to
make an informed
voting decision.
Gary Simon, Esq.
Hughes Hubbard & Reed LLP
June 12, 2020
Page 2
3. Please revise the statements that each of the participants in the
solicitation and your Nominee
"may be deemed" to have shared voting power and thus beneficial ownership of
the
1,846,154 shares of Voting Common Stock owned by Commerce Home Mortgage to
remove
the uncertainty.
4. Refer to the following assertion: "Each of the participants named herein
disclaims beneficial
ownership of any Shares, except to the extent of his, her or its pecuniary
interest therein."
Please note that beneficial ownership is not determined based on pecuniary
interest. Refer to
Rule 13d-3(a). Please revise accordingly.
5. We note that you are recommending stockholders withhold votes for the two
nominees
named in the registrant's proxy statement, and that you have provided a
space on the proxy
card whereby stockholders may "withhold from all Company nominees except the
nominee
listed below." Please disclose the method by which "withhold" votes will be
counted. Refer
to Item 21(b) of Schedule 14A.
6. We note your disclosure that broker non-votes have no impact on the election
of directors.
Please revise to clarify the effect of broker non-votes with respect to each
proposal.
Specifically, indicate, if true, that in a contested election, a broker does
not have
discretionary authority to vote on any proposals to be voted on at the
meeting regardless of
whether such proposals are routine or not.
7. Please highlight, if true, that stockholders will be disenfranchised with
respect to one board
seat if they vote using your proxy card. Also, revise your proxy card to
include this
information.
8. We note that, as described in Amendment 5 to your amended Schedule 13D,
Commerce
Home Mortgage recently filed a lawsuit against Broadway Financial in the
Superior Court of
California in efforts to remedy alleged fiduciary breaches. Instruction 4 to
Item 103 of
Regulation S-K requires that you disclose material proceedings in which the
participants are
adverse to the registrant. Refer to Item 7(a) of Schedule 14A.
9. Please advise us, with a view toward revised disclosure, of the specific
line items of Schedule
14A that the participants intend to satisfy by reference to Broadway
Financial's definitive
proxy statement through reliance upon Rule 14a-5(c). You must make a clear
reference to
the particular document containing such information.
Proposal #1
10. Revise to include the disclosure required by Item 401 of Regulation S-K.
For example,
disclose the positions Mr. Villaraigosa held with Banc of California and
The Capital Corps,
LLC.
Gary Simon, Esq.
Hughes Hubbard & Reed LLP
June 12, 2020
Page 3
11. Specify the ways in which you believe Broadway Financial's Board would be
enhanced if
stockholders elect Mr. Villaraigosa to the Board. With respect to the
"positive change" you
believe he will bring, please provide sufficient detail about the change
you seek.
12. Please supplementally provide us with support for your assertion that Mr.
Villaraigosa has a
"proven track record of finding solutions for the Los Angeles community and
working with
financial services businesses to fulfill this purpose."
13. We note your disclosure that your nominee "would not be barred from being
considered
independent under the independence requirements of The Nasdaq Stock Market
LLC or the
independence standards applicable to the Company under paragraph (a)(1) of
Item 407 of
Regulation S-K ..." Please revise to disclose if Mr. Villaraigosa would be
independent under
the applicable standards.
Form of Proxy
14. Please revise the disclosure regarding the intended use of the
discretionary authority
available under Rule 14a-4(c) so it conforms to the disclosure standard
codified in that
provision. At present, the disclosure suggests the right to use
discretionary authority is
absolute inasmuch as it can unconditionally be exercised on any "such other
business."
Amendment No. 5 to Schedule 13D
15. Please tell us whether you intend to amend your Schedule 13D to reflect
your nomination of
Mr. Villaraigosa to the Board. If you have no plans to file an amendment,
provide us with an
analysis addressing why the nomination and your engagement in a
solicitation does not
constitute a material change within the meaning of Rule 13d-2. Refer also
to Item 4(d) of
Schedule 13D.
* * *
We remind you that the filing persons are responsible for the accuracy
and adequacy of
their disclosures, notwithstanding any review, comments, action or absence of
action by the staff.
Please direct any questions to me at (202) 551-7951. You may also
contact Perry Hindin,
Special Counsel, at (202) 551-3444.
Sincerely,
/s/ Joshua
Shainess
Joshua Shainess
Special Counsel
Office of Mergers
and Acquisitions