View:
United States securities and exchange commission logo
January 19, 2021
Leonard Tannenbaum
Chief Executive Officer
AFC Gamma, Inc.
525 Okeechobee Blvd.
Suite 1770
West Palm Beach, FL 33401
Re: AFC Gamma, Inc.
Form S-11
Filed December 28,
2020
File No. 333-251762
Dear Mr. Tannenbaum:
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.
Form S-11 filed December 28, 2020
General
1. We note your response
to comment 1 of our letter. Please note that we referred your
response to the
Division of Investment Management and may have further comment.
2. We note your response
to comment 2 and we reissue our comment. As you recently
commenced operations on
July 31, 2020, you do not have a significant track record at this
time for investors to
make an informed decision. We further note that you do not appear to
have executed
agreements with respect to 75% of the proceeds. We are therefore not able
to agree with your
assertion that you are not subject to Guide 5 and reissue our comment.
Accordingly, please
tell us how you considered the applicability of Industry Guide 5, or
Leonard Tannenbaum
FirstName LastNameLeonard Tannenbaum
AFC Gamma, Inc.
Comapany
January 19,NameAFC
2021 Gamma, Inc.
January
Page 2 19, 2021 Page 2
FirstName LastName
revise to provide the disclosure required by Industry Guide 5. See
Securities Act Release
33-6900 (June 17, 1991), Industry Guide 5 and CF Disclosure Guidance:
Topic No. 6 for
guidance.
3. We note assumption 5 in the draft legal opinion. This is an improper
assumption as it
assumes the number of shares that will be available for issuance.
Please have counsel
revise the legal opinion to delete the assumption and to clarify
separately that, as of the
date of the opinion, you have a sufficient number of authorized
shares. Refer to the
Division of Corporation Finance s Staff Legal Bulletin No. 19 for
guidance.
4. Pleas revise your risk factor disclosure to comply with Item 105 of
Regulation S-K.
Recent Developments, page 12
5. We note your disclosure that there will be a seven-for-one stock split
of your common
stock, which will occur immediately prior to consummation of this
offering. Please
clarify for us and in your filing if the stock split will occur
immediately before, at, or after
the effectiveness of the registration statement. We may have further
comment.
Management Compensation, page 125
6. We note your response to comment 11 of our letter. In addition to the
information
provided, please provide a summary compensation table. In the table,
please ensure that
you disclose all fees to be paid to your manager, including, but not
limited to, the
syndication fee, structuring fee, diligence fee, monitoring fee, and
agency fee.
Additionally, please explain the services that the manager will
provide in order to receive
these fees and how these services are distinct from the services
covered under the
management fee. Please refer to Item 4 of Industry Guide 5 for
guidance.
Index to the Financial Statements, page F-1
7. We note your response to our comment 16. Please address the following:
Please clarify for us how you determined that you do not have a
substantial asset
concentration in properties securing loans. Reference is made to
SAB 1I.
Please clarify your statement that the loans are not secured or
repaid by operating
properties. In this regard, please reconcile this statement to your
additional statement
that you make loans which are secured by multiple collateral
sources, including
mortgages on the borrower's real estate and to your disclosure
throughout your filing
of real estate collateral.
Please clarify your statement that the properties are not
operating properties in the
sense of a traditional mortgage. In this regard, please tell us if
there is not any
operating activity occurring at these properties.
We note in your response that you have provided a narrative
description of the
general character of the properties. Please clarify for us where
you have disclosed the
property types and locations for the properties securing the loans.
Leonard Tannenbaum
AFC Gamma, Inc.
January 19, 2021
Page 3
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 Babette Cooper at 202-551-3396 or Jennifer Monick at
202-551-3295 if
you have questions regarding comments on the financial statements and related
matters. Please
contact Stacie Gorman at 202-551-3585 or Maryse Mills-Apenteng at 202-551-3457
with any
other questions.
Sincerely,
FirstName LastNameLeonard Tannenbaum
Division of
Corporation Finance
Comapany NameAFC Gamma, Inc.
Office of Real
Estate & Construction
January 19, 2021 Page 3
cc: Jeeho M. Lee, Esq.
FirstName LastName