United States securities and exchange commission logo
December 18, 2020
Ezra Beyman
Chief Executive Officer
Reliance Global Group, Inc.
300 Blvd. of the Americas, Suite 105
Lakewood, NJ 08701
Re: Reliance Global
Group, Inc.
Amendment No. 1 to
Registration
Statement on Form S-1
Filed December 4,
2020
File No. 333-249381
Dear Mr. Beyman:
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
November 4, 2020 letter.
Amendment No. 1 to Form S-1, filed December 4, 2020
Prospectus Summary
Our Business, page 1
1. We note your response
to our prior comment 1 and reissue in part. We note the disclosure
that Reliance Holdings
might facilitate an acquisition by acquiring the asset, acting as a
placeholder and
ultimately transferring it to you. Please clarify that your company will
ultimately pay the
consideration for the asset, if true, or advise.
Ezra Beyman
FirstName LastNameEzra Beyman
Reliance Global Group, Inc.
Comapany18,
December NameReliance
2020 Global Group, Inc.
December
Page 2 18, 2020 Page 2
FirstName LastName
Risk Factors
Risks Related to Our Business
If we fail to comply with the covenants contained in certain of our agreements,
our liquidity,
results of operations and financial condition, page 11
2. We note your response to comment 13. Please expand your disclosure to
discuss the
event(s) that gave rise to the covenant waiver on June 30, 2020 and
identify the covenant
that was waived.
Use of Proceeds, page 23
3. We note your response to comment 15 that the acquisition that was
referenced in your
Summary section is not reasonably likely to close; however, you have
not revised
disclosure at page 27 stating that you plan to use some of the
proceeds for acquisitions, in
addition to other funds. Please revise to identify this anticipated
use of proceeds here, if
applicable, or revise the two sections for consistency. Refer to Item
504 of Regulation S-
K.
Dilution, page 25
4. We note the changes made in response to comment 16. Please revise to
add a column
reflecting the total consideration paid for each issuance.
Management's Discussion and Analysis of Financial Condition and Results of
Operations
Business
Insurance Operations, page 27
5. We note the revisions you made at the bottom of page 27 in response to
comment 18
reflecting the geographic scope of your operations and the products
you offer. However,
please further revise to explain your principal products and services,
the markets you
serve within the insurance sector, and your distribution methods are.
Please also revise to
provide additional detail. Refer to Item 101(h)(b) of Regulation S-K.
Reliance Global Group, Inc.
Notes to condensed financial information (Unaudited)
Note 4. Investment in NSURE, Inc., page F-56
6. We note disclosure that on September 21, 2020 you purchased the domain
5minuteinsure.com, which utilizes artificial intelligence and data
mining to provide
competitive insurance quotes within five minutes, with minimal data
input. Please revise
your filing to clearly disclose whether you purchased only the domain
name or a pre-
existing, fully operating website, a business, etc. Please revise MD&A
to provide
additional material details regarding this transaction including the
purchase price, how this
acquisition is expected to impact current and future financial
results, how this acquisition
impacts your strategy related to your investment in Nsure, and any
other relevant
Ezra Beyman
Reliance Global Group, Inc.
December 18, 2020
Page 3
information.
Note 6. Goodwill and Other Intangible Assets, page F-57
7. Please refer to comment 28. We note your response and revised
disclosures that beginning
in January 2020 you began to consolidate your insurance operations to
streamline
management of operations and achieve operational efficiencies, which has
resulted in
closing certain offices and transferring several policy holders to other
entities. As a result,
you assert that you have lost the ability to discretely report
meaningful results for your
legal entities and therefore aggregate your insurance agencies as they
are all economically
similar and can be expected to have essentially the same prospects. We
also note your
disclosure on page F-57 that beginning with the October 1, 2020
impairment test, you will
test for impairment at the insurance agency level. Additionally, we note
that you have
goodwill totaling $9.3 million as of September 30, 2020, representing
51% of total assets
and have realized losses since the recapitalization and common control
transactions in
2018.
Please revise to clarify what "at the insurance agency level" means
in your goodwill
impairment disclosure. For example, disclose whether you test for
impairment at each
individual insurance agency or only at the consolidated level.
Please provide us with a summary of your goodwill impairment
analysis as of
October 1, 2020 in accordance with ASC 350-20-35.
For each reporting unit that is at risk of failing step one of the
impairment test please
revise MD&A to disclose the following information:
o The percentage by which fair value exceeded carrying value as
of the date of the
most recent test;
o The amount of goodwill allocated to the reporting unit;
o A description of the methods and key assumptions used and how
the key
assumptions were determined;
o A discussion of the degree of uncertainty associated with the
key assumptions.
The discussion regarding uncertainty should provide specifics
to the extent
possible (e.g., the valuation model assumes recovery from a
business downturn
FirstName LastNameEzra Beyman
within a defined period of time); and
o A description of potential events and/or changes in
circumstances that could
Comapany NameReliance Global Group, Inc.
reasonably
December 18, 2020 Page 3 be expected to negatively affect the key
assumptions.
FirstName LastName
Ezra Beyman
FirstName LastNameEzra Beyman
Reliance Global Group, Inc.
Comapany18,
December NameReliance
2020 Global Group, Inc.
December
Page 4 18, 2020 Page 4
FirstName LastName
You may contact John Spitz at 202-551-3484 or Michael Volley at
202-551-3437 if you
have questions regarding comments on the financial statements and related
matters. Please
contact David Gessert at 202-551-2326 or Susan Block at 202-551-3210 with any
other
questions.
Sincerely,
Division of Corporation
Finance
Office of Finance
cc: Jolie Kahn, Esq.