United States securities and exchange commission logo
January 8, 2021
Gerome Daren Sapp
Chief Executive Officer
370 Markets LLC
8545 W. Warm Springs Road, Ste A4 #192
Las Vegas, NV 89113
Re: 370 Markets LLC
Offering Statement
on Form 1-A
Filed December 14,
2020
File No. 024-11383
Dear Mr. Sapp:
We have reviewed your offering 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 offering 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 offering statement and
the information you
provide in response to these comments, we may have additional comments.
Offering Statement on Form 1-A Filed December 14, 2020
Offering Summary and Summary of Risk Factors
Company Information, page 18
1. We were unable to
locate your manager's website, www.rares.io. Considering your
disclosure on page 52
that investors must subscribe through the Rares Platform, please tell
us why the platform's
website appears to be currently unavailable. If applicable, please
amend your filing to
disclose that the website is not yet operational, disclose when you
expect the website to
be operational, and describe alternative procedures, if any, for
investing in your
offerings.
Total Shares and Maximum Amount, page 25
2. We note your
disclosures discussing the minimum and maximum amount of shares
you may offer for each
of the series described in this section. However, you disclose on
Gerome Daren Sapp
FirstName LastNameGerome Daren Sapp
370 Markets LLC
Comapany
January Name370 Markets LLC
8, 2021
January
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your offering circular cover page that "no offering minimum other than
the minimum per
investor amount" applies to each series offering, and you disclose on
page 20 that "[t]he
initial Closing of an Offering will occur on the earliest to occur of
(i) the date
subscriptions for the maximum number of Shares for each Series have
been accepted or
(ii) a date determined by the Manager in its sole discretion provided
that subscriptions for
the Series in question have been accepted." Please clarify whether the
minimum amount
of shares described in this section relates to a minimum amount
required for a closing of
the relevant series offering, and if so, please amend your disclosures
on the offering
circular cover page and throughout your filing accordingly.
Alternatively, if you intend to
offer a range in volume of interests for each series with no minimum
required for a
closing, please amend your filing to remove these volume ranges and
fix a volume for
each of the series offerings. In this regard, Rule 253(b)(4) requires
a fixed volume for
Regulation A offerings.
Use of Proceeds, page 47
3. You disclose that proceeds may be used to pay the entity from whom the
underlying assets
were acquired, which may have been paid off prior to the offering by
the Manager or
another entity. Also, you disclose on page 26 that "[t]he Manager
presently owns 100%
of each of the Underlying Assets of each Series," and on page 61 that
the Manager
"will convey title for each asset into the various Series prior to the
Offering against a note
payable back to the Manager for the cost." Therefore, please amend
your filing to
disclose whether a portion of the proceeds will be used for each
series to pay the manager
for the cost of the underlying asset, pursuant to the notes payable.
If so, please quantify
the amount of proceeds you intend to use for this purpose for each
series offering. As a
related matter, please clarify when you expect the Manager to convey
the series assets to
each series, and confirm that you will file the notes payable as
exhibits to your filing,
when applicable. Finally, please amend your disclosure to clarify the
use of the "cash
portion" of each of the series proceeds.
4. We note that your use of proceeds disclosure for each series presents
your use of proceeds
for the maximum aggregate offering for each series. Considering that
your series
offerings are best efforts offerings, please amend your disclosure to
describe any
anticipated material changes in the use of proceeds if all of the
securities being qualified
for each series offering are not sold. Consider presenting use of
proceeds disclosure for
the sale of 25%, 50%, and 75% of the relevant series offering. See
Instruction 4. to Item
6. of Form 1-A.
Management's Discussion and Analysis of Financial Condition and Results of
Operations
Plan of Operation, page 51
5. We note your disclosure that "[r]evenues are generated at the series
level," and your
disclosure elsewhere that you intend to "monetize" underlying assets
in the future. Please
amend your disclosure to clarify how you intend to generate revenue
from your
Gerome Daren Sapp
FirstName LastNameGerome Daren Sapp
370 Markets LLC
Comapany
January Name370 Markets LLC
8, 2021
January
Page 3 8, 2021 Page 3
FirstName LastName
underlying assets in the future, and the steps you have taken to
implement your plans to
monetize your underlying assets. Include a discussion of when you
expect to begin
generating revenues from the underlying assets of each series.
Description of the Business, page 60
6. Please amend your disclosure to describe the significance of the
"Rares Market Category"
as referenced in your tables throughout this section. In your amended
disclosure, please
include a discussion of the different categories referenced, and their
significance to your
business, including, if applicable, whether the category influences
how you select
underlying assets for your series offerings.
Business of the Company, page 81
7. Please briefly describe the specific "innovative digital products" you
aspire to offer
through the Rares Platform.
Exclusive Jurisdiction, page 96
8. We note your disclosure that "[a]ny dispute in relation to the
Operating Agreement is
subject to the exclusive jurisdiction of the Court of Chancery of the
State of Delaware,
and each Investor will covenant and agree not to bring any such claim
in any other
venue." Please amend your filing to disclose the extent to which your
exclusive forum
provision is intended to apply to actions arising under the Securities
Act or Exchange Act.
In that regard, we note that Section 27 of the Exchange Act creates
exclusive federal
jurisdiction over all suits brought to enforce any duty or liability
created by the Exchange
Act or the rules and regulations thereunder, and Section 22 of the
Securities Act creates
concurrent jurisdiction for federal and state courts over all suits
brought to enforce any
duty or liability created by the Securities Act or the rules and
regulations thereunder. If
the provision applies to Securities Act claims, please also revise
your offering circular to
state that there is uncertainty as to whether a court would enforce
such provision and that
investors cannot waive compliance with the federal securities laws and
the rules and
regulations thereunder. If this provision does not apply to actions
arising under the
Securities Act or Exchange Act, please also ensure that the exclusive
forum provision in
the Operating Agreement states this clearly, or tell us how you will
inform investors in
future filings that the provision does not apply to any actions
arising under the Securities
Act or Exchange Act.
Part F/S
Financial Statements, page 101
9. Please tell us and disclose what financial statements you intend to
include here and in your
annual and semiannual reports, once you and each Series are
capitalized on other than a
nominal basis. Also, address whether the audit reports provided will
cover 370 Markets,
LLC in total and each Series.
Gerome Daren Sapp
370 Markets LLC
January 8, 2021
Page 4
Balance Sheet, page 106
10. Please revise to disclose the title and the "as of" date of the
balance sheet.
We will consider qualifying your offering statement at your request. If
a participant in
your offering is required to clear its compensation arrangements with FINRA,
please have
FINRA advise us that it has no objections to the compensation arrangements
prior to
qualification.
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. We also remind you that, following qualification of your
Form 1-A, Rule 257
of Regulation A requires you to file periodic and current reports, including a
Form 1-K which
will be due within 120 calendar days after the end of the fiscal year covered
by the report.
You may contact Stephen Kim at (202) 551-3291 or Rufus Decker at (202)
551-3769 if
you have questions regarding comments on the financial statements and related
matters. Please
contact Katherine Bagley at (202) 551-2545 or Dietrich King at (202) 551-8071
with any other
questions.
FirstName LastNameGerome Daren Sapp Sincerely,
Comapany Name370 Markets LLC
Division of
Corporation Finance
January 8, 2021 Page 4 Office of
Trade & Services
FirstName LastName