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United States securities and exchange commission logo
November 24, 2020
Niv Krikov
Chief Financial Officer
Agrify Corporation
101 Middlesex Turnpike
Suite 6, PMB 326
Burlington, MA 01803
Re: Agrify Corp
Amendment No. 2 to
Draft Registration
Statement on Form S-1
Submitted November
12, 2020
CIK No. 0001800637
Dear Mr. Krikov:
We have reviewed your amended 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.
Amendment No. 2 to Draft Registration Statement on Form S-1 Submitted
November 12, 2020
Prospectus Summary, page 1
1. We note from page F-25
you disclosed additional wholly or partly owned subsidiaries and
added disclosure that
both Agrify Brands LLC and Agrify Valliant LLC are variable
interest entities..
Revise to provide a diagram of your corporate structure. Revise the
summary to clarify what
aspects of your business are owned and controlled by Agrify
Corporation, and what
aspects are controlled by the VIEs and any other affiliates. Please
file the relevant
contracts for your contractual arrangements with Agrify Brands, LLC as
exhibits to this
filing, or advise.
Niv Krikov
FirstName LastNameNiv Krikov
Agrify Corporation
Comapany 24,
November NameAgrify
2020 Corporation
November
Page 2 24, 2020 Page 2
FirstName LastName
Our Competitive Strengths, page 6
2. We note your response to comment 4. Revise the summary to disclose the
information
from your response, particularly that you have no contract or
agreement with
Inventronics. Add a risk factor addressing the risks associated with
your lack of
agreement. Disclose your transactions with Inventronics as required by
Item 404 of
Regulation S-K or tell us why you believe such disclosure is not
required.
Risk Factors, page 16
3. Please revise this section to relocate any generic risk factors you
present to the end of the
section, under the caption "General Risk Factors." See Item 105(a) of
Regulation S-K.
Use of Proceeds, page 35
4. We note your revised disclosure on page 54 that "We anticipate that
our depreciation and
amortization expense will increase in fiscal 2020 due to expected
capital expenditures in
fiscal 2020 on property and equipment to expand research, development,
and testing
capabilities." Revise your Use of Proceeds to address these planned
expenditures.
Results of Operations, page 49
5. We reissue comment 11. As requested in reissued comment 24 from our
initial letter,
revise the discussion to not only recite the changes in your results,
but to provide an
analysis by which potential investors may better understand what drove
the changes.
Refer to Item 303 of Regulation S-K and Release Nos. 33-5835 (May 18,
1989) and 33-
8350 (Dec. 29, 2003).
Liquidity and Capital Resources
Cashflow, page 53
6. Please remove the subtotal lines presented below operating and
investing activities so as
to eliminate the appearance that the sum total of these amounts equals
cash provided by
financing activities.
Management's Discussion and Analysis of Financial Condition and Results of
Operations
Liquidity and Capital Resources, page 53
7. We note your updated disclosure in response to comment 12. As
discussed in our
comment above, please revise the disclosure to not only report the
changes in results, but
to analyze the changes.
Business
Property and Employees, page 80
8. Please revise to provide a description of your human capital resources
as required by Item
101(c)(2)(ii) of Regulation S-K.
Niv Krikov
Agrify Corporation
November 24, 2020
Page 3
Intellectual Property, page 80
9. We note your response to comment 13 and the agreement transferring
intellectual property
between The Holden Company and your subsidiary, Agrify Brands, LLC. We
note the
nature of the intellectual property transferred in the agreement. On
page 1, you disclose,
"While we do not cultivate, come in contact with, distribute or dispense
cannabis, hemp-
derived cannabinoid products, cannabidoil or any cannabis derivatives
that are currently
prohibited under United States federal law, our cultivation solutions
can be used within
indoor grow facilities by cannabis cultivators." Tell us whether Brands,
the company or
any of its wholly or partly owned subsidiaries is involved in the
marketing or sale of
cannabis, hemp-derived cannabinoid products, cannabidoil or any cannabis
derivatives or
similar products, regardless of whether they are prohibited under United
States federal
law, or intends to do so once this registration statement becomes
effective. Tell us the
business purpose for the purchase of these brands from The Holden
Company.
Item 15. Recent Sales of Unregistered Securities, page II-2
10. We note the revision to include the October 19, 2020 stock options
granted. Please revise
this Item to include all information required by Item 701 of Regulation
S-K for each
transaction, including the name of the person or the class of persons to
whom the
securities were sold, the date of sale and amount.
You may contact Julie Sherman at (202) 551-3640 or Kevin Kuhar at (202)
551-3662 if
you have questions regarding comments on the financial statements and related
matters. Please
contact Abby Adams at (202) 551-6902 or Mary Beth Breslin at (202) 551-3625
with any other
questions.
Sincerely,
FirstName LastNameNiv Krikov
Division of
Corporation Finance
Comapany NameAgrify Corporation
Office of Life
Sciences
November 24, 2020 Page 3
cc: David Levine, Esq.
FirstName LastName