United States securities and exchange commission logo
September 15, 2022
Alan Baratz
President & Chief Executive Officer
D-Wave Quantum Inc.
3033 Beta Avenue
Burnaby, British Columbia V5G 4M9
Canada
Re: D-Wave Quantum Inc.
Registration
Statement on Form S-1
Filed August 29,
2022
File No. 333-267126
Dear Dr. Baratz:
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 August 29, 2022
Cover Page
1. Please disclose on your
cover page the price (and formula for determining it) at which
Lincoln Park will
receive your shares pursuant to the Purchase Agreement and the term of
the Purchase Agreement.
2. We note you are
registering the 381,540 Common Shares previously issued to Lincoln
Park as consideration
for its commitment to purchase your Common Shares under the
Purchase Agreement.
Disclose the price per share at which the shares were effectively
issued to Lincoln Park
on August 5, 2022 and August 25, 2022, respectively.
Alan Baratz
FirstName LastNameAlan Baratz
D-Wave Quantum Inc.
Comapany 15,
September NameD-Wave
2022 Quantum Inc.
September
Page 2 15, 2022 Page 2
FirstName LastName
3. You disclose on the cover page that you have filed a separate
registration statement
registering the issuance to and resale by certain third parties
unrelated to Lincoln Park.
Quantify and disclose the percentage of your public float that will
become available for
resale in the market pursuant to your registration statements in the
aggregate.
4. Please revise the cover page to disclose that you have a majority
shareholder and will be a
"controlled company" under the NYSE listing rules upon the date you
file your first
annual report on Form 10-K pursuant to your side letter agreement with
the Public Sector
Pension Investment Board ("PSP") at which time PSP is no longer
restricted from
exercising its voting rights attached to your shares (unless the
agreement is terminated and
you become a "controlled company" at an earlier date or PSP otherwise
disposes of its
controlling interest in your shares after any applicable lock-up
period). Please ensure this
disclosure identifies your controlling shareholder, discloses the
controlling shareholder's
total voting power and cross-references a longer discussion of the
effects of your status as
a "controlled company."
Prospectus Summary, page 11
5. Please revise your prospectus summary to discuss the material terms of
the Purchase
Agreement with Lincoln Park under a separate heading. Disclose the
floor price and the
maximum number of shares that may be issued to Lincoln Park pursuant
to the Purchase
Agreement.
Risk Factors
Risks Related to the Offering, page 17
6. Disclose whether there is a risk that investors can engage in
short-selling activities and, if
so, how any sales activities after announcement of a put may
negatively affect your share
price.
The sale or issuance of Common Shares to Lincoln Park may cause dilution. . .,
page 17
7. We note your disclosure of the Common Shares being registered for
resale by certain third
parties unrelated to Lincoln Park pursuant to a separate registration
statement, which
represents a substantial majority of your Common Shares outstanding as
of August 5,
2022. Revise to clarify the percentage of shares you are concurrently
seeking to register
for resale in the aggregate.
The terms of the Purchase Agreement limit the amount of Common Shares we may
issue to
Lincoln Park, which may limit. . ., page 18
8. Advise whether there is a risk that the potential depressive effect on
your share trading
price due to the substantial number of shares you are registering for
resale may also limit
your ability to utilize the Purchase Agreement to enhance your cash
resources. For
example, advise whether a decline in the trading price of your Common
Shares
may affect the ability or rate at which Lincoln Park sells its shares
of your Common
Alan Baratz
FirstName LastNameAlan Baratz
D-Wave Quantum Inc.
Comapany 15,
September NameD-Wave
2022 Quantum Inc.
September
Page 3 15, 2022 Page 3
FirstName LastName
Shares and, as a result, may restrict the amount or timing of
additional financing you are
able to obtain pursuant to the Purchase Agreement in light of the
Beneficial Ownership
Limitation.
Dilution, page 56
9. You disclose that the lower the price of your Common Shares is at the
time you exercise
your right to sell Common Shares to Lincoln Park, the more Common
Shares you will
issue to Lincoln Park pursuant to the Purchase Agreement, causing your
existing
shareholders to experience greater dilution. Disclose the maximum
number of shares that
can be issued pursuant to the Purchase Agreement to show the full
extent of dilution your
existing shareholders may experience. Revise your risk factors to
better illustrate this
dilutive effect on your share price as a result of the pricing formula
through which you
will issue shares to Lincoln Park and the full extent of the dilution
your shareholders may
experience.
D-Wave Systems Inc.'s Management's Discussion and Analysis of Financial
Condition and
Results of Operations, page 89
10. We note that the projected revenues for 2022 were $11 million, as set
forth in the
unaudited prospective financial information management prepared and
provided to the
DPCM Board and DPCM s financial advisors in connection with the
evaluation of the
Business Combination. We also note that your actual revenues for the
Six Months Ended
June 30, 2022 were approximately $3.083 million. It appears that you
will miss your 2022
revenue projection. Please update your disclosure in Liquidity and
Capital Resources, and
elsewhere, to provide updated information about the company s
financial position and
further risks to the business operations and liquidity in light of
these circumstances.
11. Please revise your discussion about how your registration statements
may impact the
market price of the company s Common Stock to highlight the fact
that Public Sector
Pension Investment Board, a beneficial owner of over 50% of your
outstanding shares,
will be able to sell all of its shares for so long as the separate
registration statement
registering the issuance to and resale by certain third parties
unrelated to Lincoln Park is
available for use.
Liquidity and Capital Resources, page 98
12. In light of the significant number of DPCM public stockholders who
exercised their
redemption rights prior to the business combination closing and the
unlikelihood that the
company will receive significant proceeds from exercises of the
warrants because of the
disparity between the exercise price of the warrants and the current
trading price of your
Common Stock, expand your discussion of capital resources to address
any changes in the
company s liquidity position since the business combination. If the
company is likely to
have to seek additional capital, discuss the effect of this offering
on the company s ability
to raise additional capital.
Alan Baratz
D-Wave Quantum Inc.
September 15, 2022
Page 4
Lincoln Park Transaction, page 160
13. Specify the "time period" referred to in the definition of an Accelerated
Purchase Date.
14. Revise to disclose that the Purchase Agreement prohibits the company from
directing
Lincoln Park to purchase any Common Shares if the closing price of your
shares is less
than the floor price of $1.00.
Effect of Performance of the Purchase Agreement on Our Stockholders, page 162
15. We note that your tabular disclosure showing the gross proceeds you would
receive from
the sale of your shares to Lincoln Park begins with the assumed price per
share of $8.53,
the closing sale price of your shares on August 25, 2022. However, your
common stock
has recently traded below this price and the Purchase Agreement allows
for issuances to
Lincoln Park at prices below $8.53. Revise to include a complete range of
possible
purchase prices, including the number of shares that would be issued at
the floor price of
$1.00.
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.
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.
Please contact Patrick Faller, Staff Attorney, at (202) 551-4438 or Jan
Woo, Legal
Branch Chief, at (202) 551-3453 with any questions.
Sincerely,
FirstName LastNameAlan Baratz
Division of
Corporation Finance
Comapany NameD-Wave Quantum Inc.
Office of Technology
September 15, 2022 Page 4
cc: Adam M. Givertz
FirstName LastName