United States securities and exchange commission logo
March 15, 2023
Robert McBey
Chief Executive Officer
Calculator New Pubco, Inc.
4221 W. Boy Scout Blvd. Suite 300
Tampa, FL 33607
Re: Calculator New
Pubco, Inc.
Draft Registration
Statement on Form S-4
Filed February 14,
2023
CIK No. 0001963088
Dear Robert McBey:
We have reviewed your draft 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 providing the requested
information and either submitting
an amended draft registration statement or publicly filing your
registration statement on
EDGAR. 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 the information you provide in response to these
comments and your
amended draft registration statement or filed registration statement, we
may have additional
comments.
Draft Registration Statement Form S-4 submitted February 14, 2023
General
1. Please file the stock
purchase agreement with Wilson-Davis and the Pacsquare LOI and
any amendments thereto
as exhibits pursuant to Item 601(b)(10) of Regulation S-K or tell
us why you do not
believe you are required to file these agreements.
2. With a view toward
disclosure, please tell us whether your sponsor is, is controlled by, or
has substantial ties
with a non-U.S. person. Please also tell us whether anyone or any
entity associated with
or otherwise involved in the transaction, is, is controlled by, or has
substantial ties with a
non-U.S. person. If so, also include risk factor disclosure that
addresses how this fact
could impact your ability to complete your initial business
combination. For
instance, discuss the risk to investors that you may not be able to
Robert McBey
Calculator New Pubco, Inc.
March 15, 2023
Page 2
complete an initial business combination with a U.S. target company
should the
transaction be subject to review by a U.S. government entity, such as
the Committee on
Foreign Investment in the United States (CFIUS), or ultimately
prohibited. Further,
disclose that the time necessary for government review of the
transaction or a decision to
prohibit the transaction could prevent you from completing an initial
business
combination and require you to liquidate. Disclose the consequences of
liquidation to
investors, such as the losses of the investment opportunity in a
target company, any price
appreciation in the combined company, and the warrants, which would
expire worthless.
Notice to Shareholders, page 3
3. We note your disclosure that if a public stockholder, alone or acting
in concert as a group,
seeks to redeem more than 20% of the public shares, then any such
shares in excess of that
20% limitation would not be redeemed for cash, without your prior
consent. Please
highlight in the Risk Factors section this disclosure and discuss the
implications it may
have on public stockholders.
Did the Quantum Board obtain a third-party valuation or fairness opinion, page
8
4. Please revise here to include an explanation as to the reason the
fairness opinion was
obtained.
Questions and Answers About the Proposals, page 8
5. Where you present information regarding voting interests or equity
ownership
immediately after the consummation of the business combination, please
include a
sensitivity analysis showing a range of redemption scenarios that
includes interim
redemption levels. Please make conforming changes throughout the
registration statement.
What will AtlasClear's equity holder's receive, page 8
6. We note the disclosure regarding the Earn Out Shares. Please explain
to us how you
anticipate those shares will be issued, such as whether you anticipate
it being a registered
transaction or an exempt transaction.
7. We note your disclosure that Atlas FinTech has agreed to transfer shares
of Quantum
Common Stock and Quantum Private Warrants that it holds to potential
sources of
financing and will forfeit any remaining following any transfers. Please
clarify what will
happen to those shares if financing is not entered into. In regards to
potential other
sources of funding, please highlight material differences in the terms
and price of
FirstName LastNameRobert McBey
securities issued at the time of the IPO as compared to private
placements contemplated at
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the time New
of the business Pubco, Inc. Disclose if the SPAC's
sponsors, directors, or
combination.
March officers
15, 2023will
Pageparticipate
2 in the private placement.
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What interests do our initial stockholders, current officers, directors and
advisors, page 10
8. Please quantify in the question and answer section the aggregate
dollar amount and
describe the nature of what the sponsor and its affiliates have at
risk that depends on the
completion of the business combination. Include the current value of
securities held, loans
extended, fees due, and out-of-pocket expenses for which the sponsor
and its affiliates are
awaiting reimbursement. Please provide similar disclosure for the
company's officers and
directors, if material.
What vote is required, page 17
9. Please disclose what percentage of public shareholders need to vote in
favor of the
business combination for it to be approved.
Summary of the Proxy Statement/Prospectus, page 21
10. Please include a brief explanation of what you mean by small and
middle market financial
services firms.
11. Please expand on page 27 and elsewhere as appropriate your disclosure
regarding the
Pacsquare acquisition to discuss the nature of the technology assets
that will be transferred
to AtlasClear.
12. We note your disclosure on page 32 that your directors and members of
the Special
Committee were aware of and considered certain conflicts of interest
in evaluating and
recommending the business combination. Please revise the conflicts of
interest discussion
to clarify how the board considered those conflicts in negotiating and
recommending the
business combination.
13. Refer to the pre-completion and post-completion organizational charts
on pages 36 and
37. Please include disclosure accompanying the charts, explaining the
various affiliations
that exist.
14. Please provide, in comparative columnar form, the information required
by Item 3(g) of
Form S-4.
Commercial Bancorp Merger Agreement, page 26
15. Please revise to disclose the amount of the proceeds expected to be
utilized in the
acquisition of Commercial Bancorp.
Risk Factors, page 41
16. Please disclose the material risks related to the Pacsquare
acquisition, as applicable.
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17. Please revise the last risk factor disclosure on page 46 to include
risk factor disclosure
related to the nature of the board s role in overseeing your
cybersecurity risk management,
the manner in which the board administers this oversight function, and
any effect this has
on the board s leadership structure.
18. We note your second full risk factor disclosure on page 49 regarding
changes in interest
rates and economic conditions. Please clarify here Commercial
Bancorp's primary service
area.
19. Please highlight the material risks to public warrant holders,
including those arising from
differences between Quantum Private Warrants and Quantum Public
Warrants. By way of
example only, please highlight that Quantum Public Warrants are
non-redeemable and
discuss the impact this may have on public warrant holders. Clarify
whether recent
common stock trading prices exceed the threshold that would allow the
company to
redeem public warrants. Clearly explain the steps, if any, the company
will take to notify
the shareholders, including beneficial owners, regarding when the
warrants become
eligible for redemption.
20. Please expand your discussion of the last risk factor on page 52
relating to the nominal
purchase price paid by the initial stockholders for the founder shares
to include any loans
extended, fees due, and out-of-pocket expenses for which the
Co-Sponsors and their
affiliates are awaiting reimbursement. Please also highlight in the
title of this risk factor
the disclosure that initial stockholders of Quantum holding founder
shares may be
economically incentivized to complete a business combination with a
riskier, weaker-
performing or less-established target business, or on terms less
favorable to the public
stockholders.
The Company intends to use the net proceeds, page 42
21. Please clarify here what is meant by the "net proceeds" from the
Business Combination.
Please include a separate risk factor, with its own subheading, to
discuss the risk to your
business goals if you are not able to consummate the CB Merger. Please
also include a
Question and Answer regarding the risk that you may not be able to
consummate the CB
Merger and explaining the potential consequences to your business
goals if you are not
able to consummate the CB Merger.
Wilson-Davis and certain of its personnel are subject to various regulatory
disciplinary orders,
page 44
22. Please revise to clarify if any of the disciplinary orders or
sanctions are still in effect and if
you believe you are in current compliance with such orders or
sanctions, so that investors
can assess the risk, or advise. Please also briefly explain the
subject matter of the orders
or sanctions, to the extent applicable, or advise.
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Quantum Ventures or Quantum's directors, executive officers or advisors, page
52
23. We note the disclosure that Quantum Ventures or Quantum's directors,
executive officers
or advisors or their respective affiliates may purchase shares in
privately negotiated
transactions or in the open market prior to the completion of the
business transaction and
that the purpose of such purchase could be to vote such shares in
favor of the Business
Combination. Please provide your analysis on how such potential
purchase would comply
with Rule 14e-5.
Quantum's stockholders may be liable for claims, page 60
24. Please clarify here if the Extension Amendment has been approved,
consistent with your
disclosure under "Extension Amendment," at page 128. Similarly revise
to update the
term "Extend Date," under Frequently Used Terms, or advise.
Conditions to the Closing of the Business Combination, page 82
25. Please clarify which of the following conditions are waivable, and by
which parties.
Background of the Business Combination, page 89
26. Please expand your disclosures regarding the background of the
transaction to include:
a description of how the target was identified and by whom, and
how the negotiations
were started and by whom;
identification of the two potential acquisition targets, including
a description of the
non-binding letters of intent entered into with the two potential
acquisition targets;
any discussions with the target about the potential loss of
clients in the near future or
any other events that may materially affect the target's prospects
or its financial
projections for future performance of the business;
any discussions relating to the assumptions underlying any target
projections;
whether there were any valuations or other material information
about the companies
involved in this transaction provided to potential investors that
have not been
disclosed publicly;
the negotiation of any contingent payments to be received by
target shareholders; and
the negotiation of any arrangements whereby any shareholder agrees
to waive its
redemption rights.
See Item 6 of Form S-4.
27. Please expand your disclosure on page 91 to clarify which members of
the board were
present for the board meeting to discuss implementation of a Special
Committee for the
proposed transaction with AtlasClear on August 12, 2022.
28. If applicable, please disclose for each Co-Sponsor whether it has
other SPACs in the
process of searching for a target company, whether the SPAC's
Co-Sponsors considered
more than one active SPAC to be the potential acquirer and how the
final decision was
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reached.
29. We note that pursuant to the Business Combination Agreement that Atlas
Financial
Technologies Corp. will complete the acquisition of Wilson-Davis and
consummate the
transaction with Pacsquare, as well as AtlasClear plans to acquire
Commerical Bancorp.
Please briefly expand the Background discussion to discuss more
specifically how these
entities were considered.
30. Your charter waived the corporate opportunities doctrine. Please
address this potential
conflict of interest and whether it impacted your search for an
acquisition target.
Recommendation of the Quantum Board and Reasons for the Business Combination,
page 93
31. Please disclose whether and how the board took the consideration to be
paid for the target
companies into account in recommending the transaction and, if not,
why not.
32. Please define PFOF regulation.
33. We note your disclosure on page 95 that Quantum stockholders will hold
a minority
interest in AtlasClear. Please include a risk factor addressing this
and the impact it may
have on Quantum stockholders.
Opinion of SHEUMACK GMA, page 94
34. We note several statements here and in Annex D to the effect that
SHEUMACK GMA
assumes no responsibility for projections, financial analyses,
estimates, forecasts and
similar data used in its analyses. While it may be acceptable to
include qualifying
language concerning data provided by other parties, the financial
advisor should
not disclaim responsibility. Please revise.
35. We note your disclosure that financial forecasts of AtlasClear,
inclusive of the Target
Acquisitions, were used in the analyses done by SHEUMACK GMA. Please
dislcose
these financial projections, to the extent material, or advise.
36. Please disclose the fees the financial advisor will receive upon
completion of the business
combination and any amount that is contingent upon completion of the
transaction. Please
also provide a clear description of any additional services the
financial advisor or its
affiliates provided in connection with the transaction, the related
fees, and whether those
fees are conditioned upon completion of the transaction. Please
describe any material
relationship that existed during the past two years or is mutually
understood to be
contemplated and any compensation received or to be received as a
result of the
relationship between SHEUMACK GMA or its affiliates and AtlasClear or
its affiliates.
Refer to Item 1015(b)(4) of Regulation M-A.
The Advisory Charter Proposals, page 113
37. Please revise the heading for Proposal No. 2F to ensure the heading
reflects the content of
the following disclosure.
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38. Please revise the disclosure related to Proposal No. 2G to reconcile
the statements that
Quantum opted out of the provisions of Section 203 and that the
company will be subject
to the provisions of Section 203 of the DGCL.
The Incentive Plan Proposal, page 117
39. Please present the information specified in Section 229.201(d)(2) of
Regulation S-K in
tabular format as required by Section 229.201(d)(1) of Regulation S-K.
Termination of the TradeStation Merger Agreement, page 129
40. We note your disclosure that you received a notice from TradeStation
that purported to
terminate the Merger Agreement on August 2, 2022. Please include this
disclosure in the
Background to the Business Combination on page 89. Please also expand
your disclosure
in the Background to the Business Combination section to briefly
explain why the merger
with TradeStation was ultimately not pursued.
Redemption Rights for Public Stockholders, page 130
41. We note your disclosure that the Co-Sponsors did not receive any
compensation exchange
for the agreement to waive their redemption rights. Please also
disclose whether the Co-
Sponsors received any consideration, outside of monetary compensation,
in exchange for
the waiver.
Facilities and Executive Office, page 131
42. Please disclose the general description and approximate square footage
of the properties
you own and lease. Please make conforming changes throughout the
registration statement. Refer to Item 102 of Regulation S-K.
Executive Officer and Director Compensation, page 134
43. Please quantify here the amount of unpaid fees due to Quantum
Ventures.
Information about the Proposed Combined Company, page 144
44. We note your disclosure that AtlasClear expects to receive certain
intellectual property
from Atlas Fintech and Atlas Financial Technologies and will acquire
certain assets of
Pacsquare. We also note the disclosure in regard to the planned
acquisition of Commercial
Bancorp. Please revise to address the following:
Explain in detail the nature and terms of each of these
transactions as well as your
accounting treatment for each, indicating how you evaluated ASC
805 as well as the
financial statement requirements of Rule 8-04(a) of Regulation
S-X;
Specifically, tell us and provide us with a thorough accounting
analysis, citing
authoritative literature, supporting your determination of whether
each of the
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acquisitions were an asset acquisition vs. a business
combination;
Provide us with an analysis explaining how you evaluated
whether each of these
acquisitions are probable; and
Address the purchase price and the how the components of each
individual
transaction will be reflected in the financial statements.
Technology Assets to be Acquired from Pacsquare, page 150
45. Please revise your disclosures to further describe the nature,
functionality and amounts
of the assets which the company plans to acquire from Pacsquare.
Further, explain how
you anticipate and plan to use those assets in the future business
plans. For example,
revise your disclosure to clearly define the term "innovative
financial products" and
exactly what that encompasses.
Trading Level 1 Application, page 150
46. We note your disclosure that this application is expected to offer
stock trading and options
level 1 and fractional trading. Please revise to describe how you plan
and expect the
organizational and transactional structure to look, in order to
operate and offer stock
trading and fractional trading. For example, revise to provide a
detailed discussion of the
fractional share trading activities, how fractional trades will be
executed, cleared, settled
and held and by whom. Further, explain how you have considered the
accounting impact
from these fractional trading activities.
47. Please revise to address whether Pacsquare s business services
include offering to a
customer the ability to invest or trade in cryptocurrencies and
disclose if customers can
participate in any type of staking. If so, please revise to provide a
detailed discussion of
these services as well as the related accounting for each service.
Information about Wilson-Davis
Overview, page 151
48. We note your disclosure that for the years ended June 30, 2022 and
2021, 20.2% and
39.6% of revenues were attributable to activities engaged in the legal
cannabis industry
referred by Canaccord Genuity. Further, we note that the termination
or material reduction
in the securities liquidation for customers of Canaccord Genuity would
have a material
adverse effect on the revenues and results of operation of
Wilson-Davis. Please tell us
and revise to disclose the nature and material contractual terms of
the arrangements with
Canaccord Genuity and describe the Company's promised goods and
services for this
arrangement. Please file such agreements as exhibits. In addition,
provide us with the
Company's five step accounting analysis for the arrangement in
accordance with ASC
606. In addition, revise your revenue recognition policy footnote on
page F-59 to more
clearly describe the Company's accounting policy for these revenue
streams.
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Clearing Services, page 152
49. We note that Wilson-Davis generates revenue from the service charges to
Glendale
Securities Inc. ("Glendale") for the clearing services. Please tell us
and revise to disclose
the nature and material contractual terms of the arrangements with
Glendale and describe
the Company's promised goods and services for this arrangement. In
addition, provide us
FirstName LastNameRobert McBey
with the Company's five step accounting analysis for the arrangement in
accordance with
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606. In addition,New Pubco,
revise yourInc.
revenue recognition policy footnote
on page F-59 to
March more clearly
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9 the Company's accounting policy for these revenue
streams.
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Margin Accounts, page 152
50. Please revise to provide a comprehensive discussion of your margin
lending activities.
Please ensure to address the Company s procedures as it relates to
the collateral held and
the requirement to obtain more collateral for margin trading
activities. In addition,
disclose the types of securities held as collateral.
Net Capital Requirements, page 155
51. Please revise to indicate if Wilson-Davis is currently in compliance
with the excess net
capital regulatory requirements and if not provide a specific detailed
discussion addressing
the plans to meet these requirements.
Results of Operations, page 165
52. Please expand your discussion of changes in revenue and results of
operations to discuss
by individual revenue stream, as well as to provide additional
quantitative and qualitative
factors driving the changes in results of operations. For example,
clarify and
disclose quantitative and qualitative changes relating to the
following:
Fees and commissions charged on the liquidation of restricted and
control microcap
securities;
Clearing services charged to introducing brokers;
Fully paid stock lending;
Margin lending activities; and
Other financial services which includes the selling of mutual
funds and real estate
investment trusts.
53. We note your reference to increased interest expense due to
Wilson-Davis's letter of
credit, yet your disclosure on page 166 states that there were no
draws on this credit line
during the year ended June 30, 2022. Please revise to clarify and
explain the reason for
increased interest expense related to Wilson-Davis's letter of credit.
54. We note your reference to $1,446,190 in regulatory, professional fees
and related
expenses resulting from additional legal fees incurred for defending
an enforcement action
and a FINRA fine. Please revise, here or where appropriate, to include
a clear summary of
the circumstances leading to the enforcement action and FINRA fine and
discreet results
from these events.
Index to Financial Statements, page 212
55. We note that the financial statements included within this filing do
not include those for
Calculator New Pubco, Inc. Please tell us, and revise to clarify
(where
appropriate) whether or not Calculator New Pubco, Inc. is consolidated
within any of the
Financial Statements provided and how you concluded this to be
appropriate given that
the financial statements are not of the issuer.
Robert McBey
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56. Please tell us and revise to clarify (where appropriate) the basis on
which you concluded
that the financial statements for Commercial Bancorp are not required
to be included in
this offering. Cite the specific authoritative literature considered
in your response.
Wilson-Davis & Company, Inc.
Notes to Financial Statements
Note 1. Summary of Significant Accounting Policies
c. Revenue Recognition, page F-59
57. Please revise to provide detailed discussions of each of the below
mentioned revenue
generating activities and provide us with a comprehensive revenue
recognition analysis
under ASC 606 addressing each activity:
The liquidation of restricted and control microcap and exchange
traded securities;
Clearing activities on behalf of introducing broker-dealers;
Fully paid stock lending;
Margin lending activities;
Market making activities; and
Other which includes the selling of mutual funds and real estate
investment trusts.
Note 4. Receivables & Payables With Broker Dealers and Clearing Organization,
page F-61
58. Please revise to disclose if there have been any losses recognized on
the receivables from
broker dealers or clearing organizations during the periods presented.
You may contact Lory Empie at 202-551-3714 or Marc Thomas at
202-551-3452 if you
have questions regarding comments on the financial statements and related
matters. Please
contact Madeleine Mateo at 202-551-3465 or Susan Block at 202-551-3210 with any
other
questions.
Sincerely,
Division of
Corporation Finance
Office of Finance
cc: Jason Simon