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United States securities and exchange commission logo
March 8, 2022
Adam Gerchen
Chief Executive Officer
L&F Acquisition Corp.
150 North Riverside Plaza, Suite 5200
Chicago, IL 60606
Re: L&F Acquisition
Corp.
Registration
Statement on Form S-4
Filed February 7,
2022
File No. 333-262570
Dear Mr. Gerchen:
We have reviewed your 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.
Registration Statement on Form S-4 Filed February 7, 2022
Summary of the Proxy Statement/Prospectus
Organizational Structure, page 3
1. Please revise the
diagram on page 5 to identify the range of economic and voting interests
to be held by each
category of investors in the registrant with an eye towards highlighting
the economic and voting
rights L&F public stockholders will have post-combination.
The Shareholder Meeting
Quorum and Vote of L&F Shareholders, page 13
2. We note your disclosure
that L&F Initial Shareholders have agreed to vote all of their
L&F Ordinary Shares in
favor of the proposals being presented at the Shareholder
Meeting. Please amend
your disclosure here and elsewhere as appropriate to clarify the
Adam Gerchen
FirstName LastNameAdam Gerchen
L&F Acquisition Corp.
Comapany
March NameL&F Acquisition Corp.
8, 2022
March2 8, 2022 Page 2
Page
FirstName LastName
number of votes by public shareholders not subject to these voting
agreements that are
required to approve each of the proposals.
Interests of Certain Persons in the Business Combination, page 17
3. Please revise your disclosure here and elsewhere as appropriate to
quantify the aggregate
dollar amount and describe the nature of what the Sponsor and its
affiliates have at risk
that depends on completion of a business combination. Please 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. Please refer
to Item 18(a)(5)(i) of
Form S-4.
Certain Other Interests in the Business Combination, page 19
4. We note that you engaged Jefferies to perform additional services
after the IPO and part of
the IPO underwriting fee was deferred and conditioned on completion of
the business
combination. Please quantify the aggregate fees payable to Jefferies
that are contingent
on completion of the business combination.
Anticipated Accounting Treatment of the Business Combination
Scenario 2, Maximum Redemption Scenario, page 23
5. Please provide us with your analysis in concluding L&F is the
accounting acquirer in this
scenario, which differs from the accounting treatment in scenario 1,
when ZeroFox
shareholders will control the merged entity in both scenarios. Please
provide the
accounting guidance relied upon in supporting your analysis.
Questions and Answers About the Proposals
"Q: Will L&F obtain new financing in connection with the Business
Combination?", page 27
6. Please highlight material differences in the terms and price of
securities issued at the time
of the IPO as compared to private placements contemplated at the time
of the business
combination. Please disclose if the SPAC s sponsors, directors,
officers or their affiliates
will participate in the private placements.
"Q: What happens if a substantial number of the Public Shareholders vote in . .
..", page 29
7. Please quantify the value of warrants, based on recent trading prices,
that may be retained
by redeeming stockholders assuming maximum redemptions and identify
any material
resulting risks.
8. It appears that underwriting fees remain constant and are not adjusted
based on
redemptions. Please revise your disclosure here and elsewhere as
appropriate to disclose
the effective underwriting fee on a percentage basis for shares at
each redemption level
presented in your sensitivity analysis.
Adam Gerchen
FirstName LastNameAdam Gerchen
L&F Acquisition Corp.
Comapany
March NameL&F Acquisition Corp.
8, 2022
March3 8, 2022 Page 3
Page
FirstName LastName
"Q: May our Sponsor and the other L&F Initial Shareholders purchase Class A . .
..", page 44
9. We note your disclosure that the "L&F Initial Shareholders, including
the Sponsor, the
Target Companies and/or their respective affiliates may purchase Class
A Ordinary Shares
and/or L&F Public Warrants from investors, or they may enter into
transactions with such
investors and others to provide them with incentives to acquire Class
A Ordinary Shares
or vote their shares in favor of the Business Combination Proposal."
Please tell us how
these purchases comply with Rule 14e-5 of the Exchange Act.
Risk Factors
Risks Related to Ownership of New ZeroFox Common Stock Following the Business
Combination, page 87
10. Please highlight the material risks to public warrant holders,
including those arising from
differences between private and public warrants. Please clarify
whether recent common
stock trading prices exceed the threshold that would allow the company
to redeem public
warrants. Please clearly explain the steps, if any, the company will
take to notify all
shareholders, including beneficial owners, regarding when the warrants
become eligible
for redemption.
Risks Related to L&F, the Business Combination and the Company
"The Company will be a holding company . . .", page 96
11. In view of this risk factor, please explain to us your consideration
of Rules 4-08(e), 5-
04(c) Schedule I and 12-04 of Regulation S-X.
"The L&F Warrant Agreement designates the courts of the State of New York or .
.. .", page 100
12. We note that the forum selection provision in the L&F Warrant
Agreement applies to
claims arising under the Securities Act of 1933. Please state in your
disclosure that
investors cannot waive compliance with the federal securities laws and
the rules and
regulations thereunder.
Background of the Business Combination, page 140
13. Please substantially revise the disclosure in this section to include
a description of the
negotiations relating to how L&F and ZeroFox reached an agreement as
to the pre-money
equity value of approximately $1.25 billion and the post-money, pro
forma enterprise
valuation of approximately $1.4 billion. For example, it is not clear
who proposed
an initial valuation and what the initial proposal was, if and how the
amount evolved
throughout the negotiations, and when the final valuation and type of
consideration was
agreed upon by the parties. In addition, please discuss the specific
projected financial
information considered and how it was used in determining these
valuations.
14. Please discuss the negotiations surrounding the L&F Board's
determination on August 18,
2021 that the parties would pursue external financing for the deal at
an initial valuation of
Adam Gerchen
L&F Acquisition Corp.
March 8, 2022
Page 4
up to $150 million. Please also discuss how this valuation changed and
the negotiations
surrounding the determination that the external financing to be
included in the proposed
business combination would be valued at $175 million.
The L&F Board's Reasons for the Approval of the Business Combination, page 156
15. Based on the factors discussed here, it does not appear that the L&F
Board considered the
consideration to be offered in the Business Combination in evaluating
and recommending
the Business Combination. Please explain whether the L&F Board took
this factor into
account in recommending the transaction.
16. Please disclose whether the L&F Board also considered ZeroFox's
history of net losses in
making its determination to recommend the transaction to shareholders.
Certain Projected Financial Information, page 159
17. We note your disclosure that, "Neither L&F, ZeroFox not IDX nor any of
their respective
affiliates intends to, and, except to the extent required by
applicable law, each of them
expressly disclaims any obligation to, update, revise or correct the
Projections to reflect
circumstances existing or arising after the date such Projections were
generated or to
reflect the occurrence of future events, even in the event that any or
all of the assumptions
underlying the Projections are shown to be in error." In light of the
fact that the
projections were last updated in November 2021, please revise to
confirm whether or not
the projections still reflect management's views on future
performance.
18. Please revise to include a description of the material assumptions
that underlie each line
item of these projections. Please also disclose how and why the
timeframe leading out to
2026 projected financial results was selected and disclose whether or
not the projections
are in line with historic operating trends and, if not, explain why
the change in trends is
appropriate.
Certain Material United States Federal Income Tax Considerations, page 196
19. We note that the "Recitals" section of the Business Combination
Agreement provides that,
"for U.S. federal income Tax purposes . . . each of the Parties intends
that (i) the ZF
Merger be treated as a transaction that qualifies as a 'reorganization'
within the meaning of
Section 368(a) of the Code, [and] (ii) the IDX Merger and the IDX
Forward Merger, taken
together, be treated as an integrated transaction that qualifies as a
reorganization within
the meaning of Section 368(a) of the Code." Please provide disclosure as
to the tax
consequences of these mergers in this section and file an opinion, as
necessary. In this
regard, we note that if the tax consequences are material to the
transaction as a whole,
FirstName LastNameAdam Gerchen
which we believe to be the case with respect to these mergers, then
disclosure and
Comapany NameL&F
appropriate Acquisition
tax opinions are Corp.
required with respect to the transaction
as a whole. Please
March refer to Item
8, 2022 Page4(a)(6)
4 of Form S-4.
FirstName LastName
Adam Gerchen
FirstName LastNameAdam Gerchen
L&F Acquisition Corp.
Comapany
March NameL&F Acquisition Corp.
8, 2022
March5 8, 2022 Page 5
Page
FirstName LastName
Unaudited Pro Forma Condensed Combined Financial Information
Unaudited Pro Forma Condensed Combined Balance Sheet as of October 31, 2021,
page 212
20. You disclose elsewhere that the convertible notes associated with the
$150 million
convertible notes financing have varying rates of interest depending
on whether interest is
paid in cash or in kind. It is not clear if the pro forma financial
information reflects both
options. Please advise or revise as appropriate. Please refer to Rule
11-02(a)(10) of
Regulation S-X.
21. We note your disclosure in the bullet on page 210 that, "Assuming
Maximum
Redemptions (Scenario 2) the pro forma financial information has been
prepared without
taking into account offering expenses." Please explain to us and
disclose as appropriate
the basis for this treatment.
22. We note the amount of historical September 30, 2021 total shareholders
equity (deficit)
in the LNFA column of $151,876 is inconsistent with the presentation
for the
corresponding figure on page FS-24 of ($23,212). Please revise for
consistency.
Business of ZeroFox
Government Regulation & Legal Affairs, page 287
23. We note your disclosure that ZeroFox's business is "potentially
subject to a variety of
domestic and international laws and regulations relating to the
collection, use, retention,
protection, transfer, and processing of business data, personal data,
and other sensitive
information." You also disclose that these "laws and regulations and
related risks are
discussed in more detail in 'Risk Factors - Legal Proceedings.'" To
enhance investors'
understanding of the effect of governmental regulations on ZeroFox's
business, please
amend your disclosure in this section to describe the specific
regulations referenced
generally in the disclosure noted above. Please disclose how each of
these regulations
applies to you specifically, and whether you are currently in
compliance with these
regulations.
Management's Discussion and Analysis of Financial Condition and Results of
Operations of IDX
IDX's Management's Discussion and Analysis of Financial Condition and Results
From
Operations
The Business, page 307
24. Please disclose the measure by which IDX is a "leading provider of
data breach response
services, and associated identity and privacy protection services to
both commercial and
government entities." For example, please disclose whether they lead
by revenues, market
share, or some other metric.
Beneficial Ownership of Securities, page 349
25. Please revise the footnotes to the table to identify the individuals
who exercise voting and
Adam Gerchen
L&F Acquisition Corp.
March 8, 2022
Page 6
investment power over the securities owned by Redline Capital,
Lookingglass Cyber
Solutions, Inc., Corbin Capital Partners GP, LLC, and Sculptor Capital
LP.
Comparison of Corporate Governance and Shareholder Rights, page 357
26. Your charter waived the corporate opportunities doctrine. In an
appropriate place in your
filing, please address this potential conflict of interest and whether it
impacted your search
for an acquisition target.
Annex B, page B-4
27. Please revise Article X, Section 2 of the Proposed Certificate of
Incorporation to clearly
state that it will not apply to claims arising under the Exchange Act of
1934, as you have
on pages 107 and 362 of the registration statement. In the alternative,
please tell us how
you will make future investors aware of the provision's limited
applicability.
General
28. Please revise to include a conflicts of interest discussion and highlight
all material
interests in the transaction held by the Sponsor and the company s
officers and directors.
This could include fiduciary or contractual obligations to other entities
as well as any
interest in, or affiliation with, the target companies. In addition,
please clarify how the
board considered those conflicts in negotiating and recommending the
business
combination. For guidance, please refer to CF Disclosure Guidance: Topic
No. 11.
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.
You may contact Blaise Rhodes at 202-551-3774 or Doug Jones at
202-551-3309 if you
have questions regarding comments on the financial statements and related
matters. Please
contact Nicholas Lamparski at 202-551-4695 or Dietrich King at 202-551-8071
with any other
questions.
Sincerely,
FirstName LastNameAdam Gerchen
Division of
Corporation Finance
Comapany NameL&F Acquisition Corp.
Office of Trade &
Services
March 8, 2022 Page 6
cc: Tamar Donikyan
FirstName LastName