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United States securities and exchange commission logo
March 18, 2021
Alan Mnuchin
Chief Executive Officer and Chairman
Falcon Capital Acquisition Corp.
660 Madison Avenue, 12th Floor
New York, NY 10065
Re: Falcon Capital
Acquisition Corp.
Form S-4
Filed February 16,
2021
File No. 333-253113
Dear Mr. Mnuchin:
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-4 filed February 16, 2021
Cover Page
1. Please ensure you are
registering the Earnout Shares and shares of common stock
underlying the
contingent options to be issued to holders of Sharecare options, or advise.
2. Please also provide the
maximum amount of redemptions that allow the company to
satisfy the Minimum
Proceeds Condition and the Balance Sheet Threshold andclarify that
Cash Consideration will
be paid only if the Balance Sheet Threshold is met and that no
Cash Consideration will
be paid if the Balance Sheet Threshold is not met.
3. It is unclear what
consideration Sharecare stockholders can expect to receive in exchange
for their Sharecare
shares. Please revise to clarify how many shares of New Sharecare
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FirstName LastNameAlan
Falcon Capital AcquisitionMnuchin
Corp.
Comapany
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and how much cash consideration a Sharecare stockholder can expect to
receive in the
merger. Once source of confusion is that the Exchange Ratio is defined
by reference to
the Per Share Consideration Value and the Per Share Consideration
Value is defined by
reference to the Exchange Ratio. Additionally, your cover page
indicates each
stockholder will receive shares of common stock of New Sharecare and
its pro rata
portion of the cash consideration; disclosure on page 10 references a
"proper election" to
receive cash without explanation of the election available; and page
83 indicates each
share will be converted into the right to receive the Per Share Merger
Consideration less
its pro rata share of the Cash Consideration. Please revise to clarify
what options are
available to Sharecare stockholders, how stockholders can calculate
their estimated
consideration, what factors may impact the estimate and the effect the
factors will have.
Please consider an illustrative example in the "Questions and Answers
About the Business
Combination and The Special Meeting" section or other appropriate
location in your
document.
4. Additionally, disclose the Earnout Ratio as of a recent practicable
date and identify the
factors that will impact the ratio.
5. Please explain why you are only registering 253,137,887 shares of
Class A common stock
when you expect to issue a maximum of 253,896,804 shares plus options
and warrants
convertible into common shares when exercised.
Summary of the Proxy Statement/Prospectus
Conditions to the Completion of the Business Combination, page 26
6. Please amend your disclosure to identify each condition that is
subject to being waived.
Please make conforming changes to your Conditions to Closing
discussion beginning on
page 112.
Directors and Officers of FCAC have potential conflicts of interest in
recommending..., page 40
7. Please revise the third bullet to quantify the sponsor officers' and
directors' aggregate
investment in dollars, which is subject to loss if you do not complete
a business
combination.
The information that we provide to our partners, clients and members..., page
54
8. Please also clarify that incorrect or incomplete data may expose you
to liability to your
members or explain why you believe it does not present a material
risk.
Our ability to use our net operating loss carryforwards and certain other tax
attributes may be
limited., page 66
9. Please revise to clarify whether the proposed combination will be
considered an
"ownership change" under the Code and any expected limitations on your
ability to utilize
NOLs if it is considered an "ownership change." If there is
uncertainty, explain the
Alan Mnuchin
FirstName LastNameAlan
Falcon Capital AcquisitionMnuchin
Corp.
Comapany
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reasons for such uncertainty
The Business Combination Proposal
Background of the Business Combination, page 85
10. Please expand this section to discuss the following:
Why did the parties decide to merge at this time?
What process did the board undertake in arriving at its decision
to enter into the
merger?
How did the board address any potential conflicts of interest?
What were the material terms agreed to in the non-binding letter
of intent and term
sheet?
How did the board determine to modify its term sheet to provide
Sharecare with the
ability to pursue an acquisition of doc.ai?
How were the deal value and the pricing mechanism determined?
How were the material terms of the merger negotiated from the
non-binding letter of
intent until the execution of the merger agreement? For example,
what was proposed
by one party with respect to the deal value and other material
terms and agreed to by
the other party or was a counteroffer made? If there was a
counteroffer, how did the
parties come to an agreement on the final material term?
11. Please describe the selection criteria FCAC used to identify the five
companies it
considered appropriate targets. Explain how FCAC eliminated the other
four targets and
decided to proceed with Sharecare, including why it was determined
they did not meet the
selection criteria or reasons why Sharecare was determined to be a
better option.
12. Please explain the decision to offer both cash and stock and how the
Balance Sheet
Threshold was determined.
Certain Projected Financial Information , page 92
13. Please describe the estimates and assumptions used in preparing the
projections.
Interests of FCAC's Directors and Officers in the Business Combination, page 93
14. Please revise to individually quantify the interests of each director,
executive officer, and
affiliate. Please refer to Item 18(a)(5)(i) of Form S-4 and Item 5 of
Schedule 14A.
Satisfaction of 80% Test, page 93
15. Please include discussion of the quantitative basis for determining
that the business
combination had a fair market value of at least 80% of the balance of
the funds in the trust
account at the time of execution of the merger agreement. Please
include the material
details of the specific analyses used, what sources of information
were used to make the
determination, and any quantitative or qualitative factors considered.
Business of New Sharecare
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FirstName LastNameAlan
Falcon Capital AcquisitionMnuchin
Corp.
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Growth Strategies, page 163
16. Please revise to disclose the basis for your opinion that promoting
your marketplace of
existing targeted digital therapeutics to close gaps in care in
high-cost areas represents a
$1 billion revenue opportunity within your currently contracted
clients.
Our Platform, page 166
17. We note your disclosure on page 167 that some of the digital
therapeutics and other tools
you offer are subject to agreements and arrangements with third-party
marketplace
solution providers. In an appropriate location in your prospectus,
please expand your
disclosure to provide information about material licensing and
collaboration agreements,
if any. Please also file any such agreements as exhibits or tell us
why you do not believe
it is required under Item 601(b)(10) of Regulation S-K.
Intellectual Property, page 178
18. Please revise this section to specifically identify all material
foreign jurisdictions where
patents are granted or patent applications are pending, the patent
expiration dates and
expected expiration dates for pending patent applications, the
specific products, product
groups and technologies to which such patents relate, whether the
patents are owned or
licensed, and the type of patent protection you have.
Management's Discussion and Analysis of Financial Condition and Ressults of
Operations of
Sharecare
Results of Operations
Revenue, page 188
19. In order to increase a reader's understanding of the changes in your
various revenue
sources, please revise to disaggregate your revenues for each period
by revenue channel
and underlying business line, as well as domestic versus
international. Please also
describe the extent to which changes in revenues are attributable to
changes in prices or to
changes in volumes. In this regard, we note that revenue from your
enterprise channel is
recognized on a PMPM basis. As such, price vs volume information may
be particularly
informative.
Cost of Revenue, page 189
20. You attribute the 12% decrease in cost of revenue to products or
services with higher cost
profiles. Please enhance your discussion to address the specific
underlying factors
contributing to material changes in cost of revenue
period-over-period. Where a material
change is attributed to two or more factors, including any offsetting
factors, the
contribution of each identified factor should be described in
quantified terms to provide
your readers with better insight into the underlying reasons behind
the changes in your
results. This comment is applicable throughout MD&A where appropriate.
Refer to Item
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FirstName LastNameAlan
Falcon Capital AcquisitionMnuchin
Corp.
Comapany
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303(a)(3) of Regulation S-K or SEC Release 33-8350 for additional
guidance.
Liquidity and Capital Resources
Operating Activities, page 192
21. Please revise your discussion of cash provided by operating activities
to include a
discussion of the underlying reasons for changes in working capital
items that affect
operating cash flows. Specially, describe how changes in deferred
revenue, accounts
receivable and other receivables contributed to the changes in cash
flows from operating
activities. Refer to FRC Section 501.13.b and 13.b.1 for guidance.
Management's Discussion and Analysis of Financial Condition and Results of
Operations of
Doc.AI
Comparison of Results of Operations for the Nine Months Ended September 30,
2020 and
September 30, 2019
Operating Expenses, page 199
22. Please revise your discussion to address the specific underlying
factors contributing to the
change in R&D, sales and marketing and G&A period-over-period.
Instances where you
identify multiple contributing factors for a change in a specific line
item, please quantify
each factor to allow investors to assess the significance of each
contributing factor. Refer
to Item 303(a)(3) of Regulation S-K or SEC Release 33-8350 for
additional guidance.
Liquidity and Capital Resources, page 200
23. Please revise your disclosure to provide a more robust discussion of
changes
in operating, investing and financing cash flows for each period
presented. Your
should provide detailed explanations of the reasons for the
fluctuations. Please refer to the
SEC Interpretive Release No. 33-8350.
Certain Relationships and Related Party Transactions
New Sharecare Related Party Transaction, page 237
24. Please disclose the standards that will be applied in determining
whether to approve
related person transactions. Refer to Item 404(b)(1)(ii) and (iii) of
Regulation S-K.
ShareCare, Inc. - Notes to Unaudited Consolidated Financial Statements
1. Nature of Business and Significant Accounting Policies
Deferred Revenue, page F-38
25. Please disclose revenue recognized during the reporting period that
was included
in deferred revenue at the beginning of the period. Refer to ASC
606-10-50-8.
Doc.AI Incorporated - Notes to Unaudited Interim Financial Statements
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FirstName LastNameAlan
Falcon Capital AcquisitionMnuchin
Corp.
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Note 9 - Simple Agreement for Future Equity, page F-98
26. Please revise to disclose how the acquisition by Sharecare is expected
to impact the SAFE
agreements held by Doc.AI. Please also tell us your consideration of
whether the
termination or conversion of these agreements as a result of the
Sharecare acquisition
should be reflected in your pro forma financial statements.
Item 21. Exhibits and Financial Statement Schedules, page II-2
27. Please file the doc.ai Acquisition Agreement as an exhibit or provide
your analysis
identifying how you determined that the agreement did not need to be
filed as an exhibit.
Please refer to Items 601(b)(2) and 601(b)(10) of Regulation S-K.
28. We note that you have filed a form of short-form tax opinion as
Exhibit 8.1. We also note
that the opinion states that the disclosures under the heading
Material U.S. Federal
Income Tax Considerations constitute accurate summaries of such
matters in all material
respects. Please have counsel revise its opinion to clearly state that
the disclosure in the
tax consequences section of the prospectus is the opinion of counsel.
Please also revise
your disclosures to clarify the discussion addresses all material U.S.
federal income tax
considerations and to state the same and express a firm opinion for
each material tax
consequence or explain why such an opinion cannot be given. Refer to
Section III.B.2 of
Staff Legal Bulletin 19.
General
29. Your statements under "Market and Industry Data" that (i) you have not
independently
verified the data from third parties, (ii) there can be no assurance
as to the accuracy or
completeness of such data and (iii) such data may not be reliable, may
imply an
inappropriate disclaimer of responsibility with respect to the third
party information.
Please either delete these statements or specifically state that you
are liable for such
information.
30. Please include a form of proxy card marked as preliminary in
your next amendment.
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 Tracey McKoy at 202-551-3772 or Angela Connell at
202-551-3426 if
you have questions regarding comments on the financial statements and related
matters. Please
contact Kasey Robinson at 202-551-5880 or Suzanne Hayes at 202-551-3675 with
any other
questions.
Alan Mnuchin
Falcon Capital Acquisition Corp.
March 18, 2021
Page 7
Sincerely,
FirstName LastNameAlan Mnuchin
Division of Corporation Finance
Comapany NameFalcon Capital Acquisition Corp.
Office of Life Sciences
March 18, 2021 Page 7
cc: Joel Rubinstein
FirstName LastName