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September 10, 2021
VIA EDGAR AND ELECTRONIC MAIL
United States Securities and Exchange Commission
Division of Corporation Finance
Mail Stop 3628
100 F Street, N.E.
Washington, D.C. 20549
| Re: | Supplemental Response |
P10, Inc.
Amendment No. 2 to
Draft Registration Statement on Form S-1
Submitted May 13, 2021
CIK No. 0001841968
This letter sets forth the supplemental response of P10, Inc., a Delaware corporation (the “Company”), in response to a request by the staff of the Division of Corporation Finance (the “Staff”) for additional information responsive to Comment No. 1 in the comment letter, dated June 23, 2021, of the Staff with respect to the draft Amendment No. 2 to Registration Statement on Form S-1, CIK No. 0001841968, submitted confidentially to the Securities and Exchange Commission on May 13, 2021. In order to facilitate your review, we have reproduced Comment No. 1 in its entirety, with the Company’s supplemental response set out below the comment.
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September 10, 2021
Page 2
Comment 1
| 1. | We note your response to comment 11 and your disclosure on page 71 that the 67%-33% economic ownership split was based on the relative fair market values of the assets contributed by each of ECG and ECP, as determined by management. Please tell us why you used the fair market value of gross assets as the basis for the economic ownership and how you considered whether using net assets is more appropriate noting that the information provided in response 10 shows ECG contributed net liabilities with a carrying value of $0.6 million and ECP contributed net assets with a carrying value of $20.6 million. |
September 10, 2021
Page 3
Supplemental Response:
| ECG | ||||||||||||||||||||||||||||
| ECP contributed | ECG contributed | Balance Sheet | ||||||||||||||||||||||||||
| to Enhanced PC | ECP | to Enhanced PC | Changes | ECG | ||||||||||||||||||||||||
| December 14, | Fair Value | ECP | December 14, | December 14-31, | Fair Value | ECG | ||||||||||||||||||||||
| 2020 | Adjustments | Fair Value | 2020 | 2021 | Adjustments | Fair Value | ||||||||||||||||||||||
| Assets |
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| Cash and cash equivalents |
$ | 6,584,577 | $ | — | $ | 6,584,577 | $ | 1,011,055 | $ | 10,927,936 | $ | — | $ | 11,938,991 | ||||||||||||||
| Restricted cash |
— | — | — | 1,216,640 | — | — | 1,216,640 | |||||||||||||||||||||
| Due from Related Party |
— | — | — | — | 35,143 | — | 35,143 | |||||||||||||||||||||
| Accounts receivable |
— | — | — | — | — | — | — | |||||||||||||||||||||
| Interest Receivable |
330,045 | — | 330,045 | 3,116,086 | 315,364 | (2,916,755 | )(1) | 514,695 | ||||||||||||||||||||
| Prepaid management fees |
— | — | — | — | — | — | — | |||||||||||||||||||||
| Credit Enhancement Fee |
101,520 | (101,520 | )(2) | — | 687,270 | (13,589 | ) | (673,681 | )(2) | — | ||||||||||||||||||
| State NMTC notes receivable |
— | — | — | 13,187,738 | — | 12,649,262 | (3) | 25,837,000 | ||||||||||||||||||||
| Investments (at fair value) |
24,825,521 | — | 24,825,521 | 56,560,086 | — | 12,860,302 | (4) | 69,420,388 | ||||||||||||||||||||
| Investment in Sub |
— | — | — | — | — | — | — | |||||||||||||||||||||
| Investment in Unconsolidated Sub |
1,406,323 | — | 1,406,323 | 534 | — | — | 534 | |||||||||||||||||||||
| Investment in allocable state tax credits |
— | — | — | — | — | — | — | |||||||||||||||||||||
| Payment Undertaking Agreement |
17,252,997 | (17,252,997 | )(5) | — | — | 19,862 | — | (5) | 19,862 | |||||||||||||||||||
| Other assets |
— | — | — | — | — | — | — | |||||||||||||||||||||
| Earned premium tax credits |
41,303,735 | (41,303,735 | )(6) | — | — | 334,655 | (334,655 | )(6) | — | |||||||||||||||||||
| Deferred premium tax credits |
— | — | — | — | 44,670,666 | (44,670,666 | )(7) | — | ||||||||||||||||||||
| Goodwill |
— | — | — | — | 5,995,081 | (5,995,081 | )(8) | — | ||||||||||||||||||||
| Identifiable Intanglible Assets |
— | — | — | — | — | — | — | |||||||||||||||||||||
| Debt Issuance Costs |
332,991 | (332,991 | ) | — | 210,562 | — | (210,562 | ) | — | |||||||||||||||||||
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| Total assets |
$ | 92,137,709 | $ | (58,991,243 | ) | $ | 33,146,466 | $ | 75,989,971 | $ | 62,285,118 | $ | (29,291,836 | ) | $ | 108,983,253 | ||||||||||||
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| Liabilities and equity |
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| Accrued Interest Payable |
$ | 1,131,764 | $ | (1,131,764 | ) | $ | — | $ | 2,000,058 | $ | 573,691 | $ | (1,173,226 | ) | 1,400,523 | |||||||||||||
| Accrued Expenses |
67,428 | — | 67,428 | 72,919 | 100,000 | — | 172,919 | |||||||||||||||||||||
| Current Tax—FIN 48 |
— | — | — | — | — | — | — | |||||||||||||||||||||
| Unearned Management Fees |
— | — | — | — | — | — | — | |||||||||||||||||||||
| Due to Related Party |
— | — | — | 125,000 | — | — | 125,000 | |||||||||||||||||||||
| State tax credit deposits |
— | — | — | — | — | — | — | |||||||||||||||||||||
| Revolving credit facility state tax credits, net |
— | — | — | — | — | — | — | |||||||||||||||||||||
| Tax credit notes payable |
65,668,078 | (65,668,078 | )(9) | — | 27,499,531 | (472,246 | ) | (27,027,285 | )(9) | — | ||||||||||||||||||
| State program notes payable |
— | — | — | 34,590,803 | (27,662,110 | ) | 71,307 | (10) | 7,000,000 | |||||||||||||||||||
| Investment firm notes payable |
— | — | — | — | 38,521,215 | 1,478,785 | (10) | 40,000,000 | ||||||||||||||||||||
| Redemption notes payable |
— | — | — | — | — | — | — | |||||||||||||||||||||
| Accrued Profits Interests |
4,677,775 | — | 4,677,775 | — | 3,327,000 | — | 3,327,000 | |||||||||||||||||||||
| Unearned Premium Tax Credits |
— | — | — | 9,318,333 | — | (9,318,333 | )(9) | — | ||||||||||||||||||||
| Deferred Tax Liability |
— | — | — | — | — | — | — | |||||||||||||||||||||
| State program obligation |
— | — | — | 3,012,448 | — | (3,012,448 | )(4) | — | ||||||||||||||||||||
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| Total liabilities |
$ | 71,545,045 | $ | (66,799,842 | ) | $ | 4,745,203 | $ | 76,619,092 | $ | 14,387,550 | $ | (38,981,200 | ) | $ | 52,025,442 | ||||||||||||
| Equity |
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| Member’s equity |
20,222,300 | 7,808,599 | 28,030,899 | (6,633,209 | ) | 47,897,568 | 9,689,364 | 50,953,723 | ||||||||||||||||||||
| Minority Interest |
370,364 | — | 370,364 | 6,004,088 | — | — | 6,004,088 | |||||||||||||||||||||
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| Total equity |
20,592,664 | 7,808,599 | 28,401,263 | (629,121 | ) | 47,897,568 | 9,689,364 | 56,957,811 | ||||||||||||||||||||
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| Total liabilities and member’s equity |
$ | 92,137,709 | $ | (58,991,243 | ) | $ | 33,146,466 | $ | 75,989,971 | $ | 62,285,118 | $ | (29,291,836 | ) | $ | 108,983,253 | ||||||||||||
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| ECP & ECG Ownership Split at FV | ||||||||||||||||||||||||||||
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ECP Net Assets at FV (Total Equity) |
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$ | 28,401,263 | 33.3 | % | ||||||||||||||||||||||
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ECG Net Assets at FV (Total Equity) |
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56,957,811 | 66.7 | % | |||||||||||||||||||||||
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| Total | $ | 85,359,074 | ||||||||||||||||||||||||||
Adjustment Notes:
| (1) | Remove interest receivable associated with UT and NV NMTC receivables that is captured in the state NMTC notes receivable to avoid double counting |
| (2) | Remove deferred charge for credit enhancement fee prepaid |
| (3) | Adjust to future realizable value of UT & NV assets flowing through the note structure |
| (4) | Remove Jobs for Texas assets that are attributable to the TX Dept of Agriculture & add TN, PA and RI projects per Sale & Purchase Agreement |
| (5) | Remove PUA used to defease tax credit debt and associated accrued interest |
| (6) | Remove tax credits used to defease tax credit debt and associated accrued interest |
| (7) | Remove Intangible recorded in business combination (offsets tax credits) |
| (8) | Remove Intangible recorded in business combination for Goodwill |
| (9) | Remove tax credit notes defeased through use of PUA & tax credits by Investors |
| (10) | Remove unamortized debt issuance costs to state at Face Value of the obligation |
The Company would appreciate receiving any further questions or comments that the Staff may have regarding this letter at the Staff’s earliest convenience and hope, that the Staff is satisfied with the response to the Staff’s request for supplemental information. If you have any questions regarding the contents of this letter, please do not hesitate to contact me at the above number.
Sincerely,
/s/ Adam W. Finerman
Adam W. Finerman