United States securities and exchange commission logo
April 12, 2022
Paul Russo
Chief Executive Officer
Kyto Technology & Life Science, Inc.
13050 La Paloma Road
Los Altos. CA 94022
Re: Kyto Technology &
Life Science, Inc.
Schedule TO-I filed
April 1, 2022
SEC File No.
5-80125
Dear Mr. Russo:
We have reviewed your filing 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 these comments by providing the requested
information or advise
us as soon as possible when you will respond. If you do not believe our
comments apply to your
facts and circumstances, please tell us why in your response.
Given the nature of these comments, we are likely to have
follow-up questions on your
revised materials. In addition, given the nature of these comments, it
will likely be necessary to
disseminate a revised disclosure document in the same manner as the
original offer materials.
All defined terms used here have the same meaning as in the Offer to
Exercise, unless otherwise
indicated.
Schedule TO-I filed April 1, 2022
Summary of Terms, page 1
1. We note the disclosure
that all tendering holders must submit an Accredited Investor
Questionnaire with
their tendered Original Warrants. Please explain supplementally, with
a view to revised
disclosure, how this complies with your obligation to extend the
Exercise Offer to all
holders of Original Warrants under Rule 13e-4(f)(8)(i).
How to Participate in the Exercise Offer, page 2
2. On the cover page and
elsewhere in the offer materials, you state that the number of
common shares
underlying the Amended Warrants is equal to three times the number of
common shares
underlying the Original Warrants. However, in other places in the offer
materials, including
here, you state that the number of underlying common shares is one
and half times the
number underlying the Original Warrants. Please revise generally to
Paul Russo
FirstName LastNamePaul Russo Inc.
Kyto Technology & Life Science,
Comapany
April NameKyto Technology & Life Science, Inc.
12, 2022
April 212, 2022 Page 2
Page
FirstName LastName
clarify the correct number.
Resales of Warrant Shares, page 3
3. Clarify how the disclosure here is consistent with the fact that the
Company s common
shares are not publicly traded and that you do not intend to list the
Original Warrants or
the Amended Warrants for trading on any exchange or market. This
disclosure is
confusing because, with respect to the Amended Warrants, it appears
that tendering
Original Warrant holders will never receive Amended Warrants, but
rather, will receive
underlying common shares pursuant to their exercise of the new
securities, which will
expire at the expiration of the Exercise Offer. Please revise or
advise.
Risk Factors, page 6
4. See our comments below. Please expand the Risk Factors section to
address the
uncertainties about the Company s status as an investment company,
the risks that it is
operating as such without a valid exemption and the risks associated
with its attempt to
register KI Investments as a business development company ("BDC"). In
addition,
discuss the impact of the Company s transition on its existing
Exchange Act registration.
A substantial number of shares of our common stock may be sold in the Exercise
Offer..., page 7
5. Clarify how the disclosure here is consistent with the fact that the
Company s common
shares are not publicly traded.
Although we intend to list our common stock on a national securities exchange,
such as
NASDAQ or NYSE, page 7
6. The heading of this Risk Factor subsection is confusing because it
appears inconsistent
with the disclosure that follows that states that the Company does not
qualify for such
listing. In addition, it is not clear how it is consistent with the
disclosure elsewhere in the
offer materials that the Company is in the process of converting to an
investment company
or a business development corporation. Please revise to remove the
implication that you
are listing on a national exchange.
Section 1. Forward-Looking Statements, page 8
7. The safe harbor provisions of the Private Securities Litigation Reform
Act do not apply to
statements made in connection with a tender offer. Therefore, please
remove all
references to the Reform Act, or clarify that the statements made in
the offer materials are
not subject to its safe harbor for forward-looking statements.
Section 3. Eligible Original Warrants, page 8
8. Disclose earlier in the Offer to Exercise that the Original Warrants
will expire in August
2022, including in the Summary Term Sheet.
Paul Russo
FirstName LastNamePaul Russo Inc.
Kyto Technology & Life Science,
Comapany
April NameKyto Technology & Life Science, Inc.
12, 2022
April 312, 2022 Page 3
Page
FirstName LastName
Section 5. Terms of Amended Warrants, page 9
9. Revise to clarify that only tendered Original Warrants will expire on
the Expiration Date
of this Offer and that non-tendered Original Warrants will remain
outstanding and subject
to their original terms.
Section 6. Condition to the Exercise Offer, page 9
10. You appear to be conditioning the Exercise Offer on satisfactory
responses to the
Accredited Investor Questionnaire by reserving the right to cancel the
Exercise Offer if
we determine, after reviewing the representations and warranties and
Accredited Investor
Questionnaires of all participating warrant holders, that a valid
exemption is not available
from the registration requirements of applicable federal and/or state
securities laws.
However, the registration requirements of Section 5 of the Securities
Act extend to both
the offer and the sale of securities, which may mean that Section 5
would be implicated
before the issuance of securities pursuant to this Offer. In addition,
elsewhere in the offer
materials, you state that qualifying as an accredited investor is not
necessarily required to
participate in the Exercise Offer. Please revise or advise.
11. Under the all-holders requirements of Rule 13e-4(f)(8)(i), the Offer
to Exercise must be
open to all holders of Original Warrants. Please revise the language
in the first sentence
on page 10 accordingly.
Section 10. Withdrawal Rights, page 11
12. See our comment above. Tendering holders of Original Warrants must be
permitted to
withdraw their tenders and receive their Original Warrants back. The
disclosure here
speaks only to a refund of the exercise price in connection with the
tender. It is not clear
how issuing the common shares underlying the Amended Warrants while
this Offer to
Exercise remains open in consistent with the withdrawal rights
provisions of Rule 13e-4
that your undertaking to cancel the Offer if you cannot identify a
valid exemption as to
each tendering holder.
Section 12. Trading Market of Original Warrants, Amended Warrants and Common
Stock, page
11
13. Revise to include recent trading prices of the common shares on the
OTCQB.
Financial Information, page 12
14. Revise to include the pro forma financial information required by Item
1010(b) of
Regulation M-A. The financial information that appears under
Accounting
Consequences of the Exercise Offer does not appear include all of
the information
required by that Item.
Paul Russo
FirstName LastNamePaul Russo Inc.
Kyto Technology & Life Science,
Comapany
April NameKyto Technology & Life Science, Inc.
12, 2022
April 412, 2022 Page 4
Page
FirstName LastName
Interests of Directors and Executive Officers in the Exercise Offer, page 13
15. The disclosure here that directors and executive officers do not hold
Original Warrants
contradicts the disclosure on page 4 in the Summary Terms Sheet, which
states that some
do hold Original Warrants and may participate in the Exercise Offer.
Please revise.
Tax Treatment of Exercise Offer, page 14
16. We note the disclosure here that you have chosen to treat the
amendment of the Original
Warrants and the exercise of the Amended Warrants as two separate
events for U.S. tax
purposes. However, as we understand your disclosure, tendering holders
of Original
Warrants will never receive Amended Warrants and will instead receive
only underlying
common shares in the Offer when they tender and pay their exercise
fees. Discuss how
this fact was considered in reaching your determination of the
appropriate tax treatment of
the Exercise Offer.
Section 20. Fees and Expenses, page 15
17. Disclose the fees and expenses incurred in making the Exercise Offer.
See Item 9 of
Schedule TO and Item 1009 of Regulation M-A.
Section 22. Additional Information, page 15
18. You reference a Form 10-K filed on August 10, 2022, as amended on
August 12, 2022.
Since those are future dates, these appear to be typographical errors.
Please correct.
General
19. In your response letter, identify the specific exemption from Section
5 of the Securities
Act you are relying on for both the offer and issuance of the Amended
Warrants, and the
offer and issuance of the common shares underlying the Amended
Warrants. In addition,
describe the facts that you believe support your reliance on any
exemption claimed for
both the offer and issuance of each such security.
20. See our comment immediately above. To the extent that any exemption
claimed relies
upon the accredited status of Original Warrant Holders, please explain
how you will
determine the accredited status of investors in a manner consistent
with the exemption
claimed and in a timely manner, in order to comply with your prompt
payment obligation
in this exchange offer and consistent with the requirements of the
exemption claimed.
21. We note the disclosure in your Form 10-Q filed on February 22, 2022,
that the Company
determined that it was an investment company as of March 2020 and that
it formed a new
entity, KI Investments, Inc. seeking to be regulated as a BDC. Revise
the disclosure
throughout the Offer to Exercise, including the Risk Factors section,
to address the
significant risks associated with the uncertainty surrounding the
Company s status as an
unregistered investment company for over two years, including but not
limited to, the
Paul Russo
Kyto Technology & Life Science, Inc.
April 12, 2022
Page 5
following:
Disclosure that explains any and all of the Investment Company
Act exemption(s) on
which it currently relies (and has relied, if different at any
time) and the basis for the
reliance on any exemptions claimed;
The risk that the Company has incorrectly concluded that it may
rely on such
Investment Company Act exemption(s);
The risk that the Company has been operating for a significant
period of time without
complying with the requirements of the Investment Company Act of
1940 and
without a valid exemption from being required to do so, and the
potential impact on
the Company;
The fact that you currently contemplate that the Company will
merge into a new
entity, KI Investments and how that will impact the Company s
existing security
holders, including those who participate in the Exercise Offer and
receive common
shares and those who opt to retain their Original Warrants;
The potential impact of your inability to register KI Investments
as a BDC as
currently contemplated;
How any conversion into a BDC or other investment company will
impact the
Company s registration under the Exchange Act, its future
operations and the
transferability of its common and other shares.
22. We note that under Rule 13e-4(f)(2), the Company must permit tendered
Original
Warrants to be withdrawn. However, it appears that you are requiring
tendering security
holders to pay the exercise price of the Amended Warrants with their
tenders and will
issue common shares underlying the Amended Warrants before the
expiration date of this
Offer. Please explain how this is consistent with the requirement to
provide withdrawal
rights under Rule 13e-4(f)(2).
We remind you that the filing persons are responsible for the accuracy
and adequacy of
their disclosures, notwithstanding any review, comments, action or absence of
action by the
staff.
Please direct any questions to Christina Chalk, Senior Special Counsel,
at (202) 551-
3263.
Sincerely,
FirstName LastNamePaul Russo
Division of
Corporation Finance
Comapany NameKyto Technology & Life Science, Inc.
Office of
Mergers & Acquisitions
April 12, 2022 Page 5
cc: Terrence Kelly, Esq.
FirstName LastName