onfoliosecresponseletterd
Onfolio Holdings Inc.
April 25, 2022
Office
of Financial Technology
Division of Corporation Finance
United States Securities and Exchange Commission
100 F Street, N.E.
Washington, D.C. 20549
Attn:
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Claire DeLabar,
Senior Staff Accountant
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Robert Littlepage,
Accounting Branch Chief
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Kyle Wiley, Staff
Attorney
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Jeff Kauten, Staff
Attorney
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Re:
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Onfolio
Holdings Inc.
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Registration
Statement on Form S-1
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Filed
April 7, 2022
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File
No. 333-264191
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Dear Staff Members:
At the request of the U.S. Securities and Exchange Commission (the
“Commission”), Onfolio Holdings Inc.
(the “Company”) is
providing this letter in response to the comments made in the
Commission’s letter dated April 20, 2022. Your comments and
the Company’s responses are set forth below. Capitalized
terms not otherwise defined herein shall have the meanings given to
such terms in the Company’s Form S-1/A filed with the
Commission concurrently with this letter.
Registration Statement on Form S-1
Cover Page
1.
We note your
response to prior comment 1 and your statements throughout the
prospectus that you do not have a principal executive office.
Please revise the cover page to provide the address and phone
number of your principal executive offices as required by the form
and to facilitate compliance with Securities Exchange Act Rules
14a-8 and 14d-3(a)(2)(i).
Response: The disclosure on the Cover Page and other
applicable sections of the prospectus been revised
accordingly.
Office
of Financial Technology
Division of Corporation Finance
United States Securities and Exchange Commission
April 25, 2022
Page 2
Provisions in our certificate of incorporation and bylaws, page
43
2.
We note your
response to prior comment 6 and prior comment 18. To the extent
true, please revise paragraph four of your risk factor to clarify
that your state exclusive forum provision does not apply to actions
arising under the Securities Act or Exchange Act and make
corresponding revisions to Section 7.06 of your
bylaws.
Response: The disclosure in paragraph four of the risk
factor and the text of Section 7.06 of the bylaws has been revised
accordingly.
Management's Discussion and Analysis of Financial Condition and
Results of Operations Components of Results of Operations, page
50
3.
We note that Cost
of Revenue on page 50 only pertains to product revenues and that
your Cost of Revenue has increased from $14,008 to $1,073,509 and
from 2% to 59% of sales from 2020 to 2021. We also note on page 52
that you incurred larger costs associated with growth in service
revenue. Please expand the discussion to include a detailed
description of the costs of revenues related to service revenues,
including the types of costs allocated to your service revenues.
Refer to Item 303 of Regulation S-K to describe any significant
components of cost of revenues expenses that would be material to
an understanding of your results of operations. Please revise the
financial statements and MD&A narrative
accordingly.
Response:
We have revised our disclosures on page 50 to note
the costs of our service revenue included within total Cost of
Revenue and expanded our discussion of the comparison between
periods.
Results of Operations, page 51
4.
Please expand the
discussion of revenues and costs of revenues to address any known
trends or uncertainties that have had or that are reasonably likely
to have a material favorable or unfavorable impact on net sales or
revenues or income from continuing operations, pursuant to Item 303
of Regulation S-K. Please separately discuss changes in revenues
due to changes in price and volume from period to
period.
Response: We have revised our disclosures
accordingly.
Financial Statements
Note 1 - Nature of Business and Organization, page F-7
5.
Refer to your
response to previous comment 10. Please expand the disclosure to
clarify that the full results of Onfolio LLC since its creation are
included in the historical financial statements pursuant to ASC
805-50-45 and the transaction is recorded as though the transaction
occurred at the beginning of 2020, the period of the transaction,
pursuant to ASC 805-50-45-4.
Office
of Financial Technology
Division of Corporation Finance
United States Securities and Exchange Commission
April 25, 2022
Page 3
Response: We have revised our disclosure in Note 1
accordingly to refer to the full results of Onfolio LLC being
included since its inception in 2019.
Investment in Unconsolidated Entities - Equity and Cost Method
Investments, page F-7
6.
We note the revised
disclosure on page 75. Please clarify in your policy disclosure how
the value of the investments in the joint ventures were determined
at the time of acquisition.
Response: We have revised our disclosures
accordingly.
Note 2 - Summary of Significant Accounting Policies
Variable Interest Entities, page F-7
7.
Refer to your
response to comment 15. Please expand the disclosure on page F-7 to
include the proposed disclosure in your response regarding the
detailed description of the characteristics of the joint ventures
that preclude VIE accounting treatment.
Response: We have revised our disclosures
accordingly.
Note 10 - Subsequent Events, page F-16
8.
Please expand the
disclosure of stock options awarded subsequent to year end to
disclose the amount of expense for the shares that vest immediately
and the grant date fair value for 236,000 and 110,000 option
grants.
Response: We have revised our disclosures
accordingly.
9.
Please revise the
disclosure to include disclosure of the additional 4,000 Series A
Preferred Stock issued on March 28, 2022, including the per share
issuance price, aggregate proceeds and whether the terms are
identical to the outstanding Series A Preferred Stock.
Response: We have revised our disclosures
accordingly.
Office
of Financial Technology
Division of Corporation Finance
United States Securities and Exchange Commission
April 25, 2022
Page 4
The
following comment is previous comment 19 contained in the
Commission’s February 17, 2022 letter that was inadvertently
not addresses by the Company in its April 7, 2022 response
letter.
General
[19].
Please
supplementally provide us with copies of all written
communications, as defined in Rule 405 under the Securities Act,
that you, or anyone authorized to do so on your behalf, present to
potential investors in reliance on Section 5(d) of the Securities
Act, whether or not they retain copies of the
communications.
Response: No written communications were presented to
potential investors in reliance on Section 5(d) of the Securities
Act.
Sincerely,
/s/Dominic
Wells
Dominic
Wells,
Chief
Executive Officer,
Onfolio Holdings Inc.
EF Hutton, division of Benchmark Investments, LLC
Carmel, Milazzo & Feil LLP
BF
Borgers CPA PC