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United States securities and exchange commission logo
July 12, 2021
Jeffrey E. Kirt
Chief Executive Officer
Greenidge Generation Holdings Inc.
590 Plant Road
Dresden, NY 14441
Re: Greenidge
Generation Holdings Inc.
Amendment No. 1 to
Registration Statement on Form S-4
Filed June 25, 2021
File No. 333-255741
Dear Mr. Kirt:
We have reviewed your amended 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.
Unless we note
otherwise, our references to prior comments are to comments in our June
7, 2021 letter.
Amendment No. 1 to Form S-4
Cover page
1. Please move the
disclosure provided in response to prior comment 1 from the registration
statement cover page to
the proxy statement/prospectus cover page.
Note 1 - Description of Transaction and basis of Presentation, page 28
2. You state that your pro
forma information has been prepared based on a preliminary
estimate of fair value
from a third-party valuation firm. To the extent you relied upon a
third-party valuation
specialist, please disclose the name of the specialist and include the
expert's consent
pursuant to Securities Act Rule 436(b) of Regulation C. Alternatively,
clarify your reference
to this third-party valuation. Refer to Question 141.02 of our
Jeffrey E. Kirt
FirstName LastNameJeffrey E. Kirt
Greenidge Generation Holdings Inc.
Comapany
July NameGreenidge Generation Holdings Inc.
12, 2021
July 12,
Page 2 2021 Page 2
FirstName LastName
Compliance and Disclosure Interpretations on Securities Act Sections
for additional
guidance.
Note 4 - Pro forma adjustments, page 29
3. As your intangible assets expected to be recorded are comprised of
different assets that
will be amortized over different periods, please revise footnote (f)
to separately present
the portion of the adjustment related to each intangible.
Alternatively, revise to disclose
the estimated intangible asset separately for each type of intangible.
Also, disclose
the method used to determine the amortization expense Refer to Article
11-02(a)(8) of
Regulation S-X.
4. We note that footnote (h) includes adjustments for D&O insurance yet
to be incurred.
Please tell us whether this is related to your reorganization or to
the merger with Support.
To the extent that this, or any other adjustment included, relates to
your reorganization,
please revise your footnote to provide separate quantification of the
portion of the
adjustment related to the reorganization and the merger. Refer to
Article 11-02(b)(4)(ii)
of Regulation S-X. You also state that this adjustment includes an
amount for the
estimated value of the Investor Fee based upon the percent ownership
and the estimated
valuation of the combined entity; however, this is separately
reflected in adjustment (e).
Please explain or revise.
5. Please refer to prior comment 3. We note that you present the income
tax impacts for both
the merger and your reorganization in one adjustment. Please revise
footnote (i) to
separately quantify the portion of the adjustment related to the
merger and the portion
related to your reorganization.
Reasons for the Merger, page 73
6. In response to prior comment 12, you indicate that Greenidge does not
believe that any
changes in mining economics since the announcement of the proposed
Merger have
materially affected the projected financial information included in
the materials
disseminated by Greenidge and Support in connection with the
announcement of the
proposed Merger. Please disclose and discuss the decrease in the price
of bitcoin since the
Greenidge projections were prepared and why this would not materially
impact the
Greenidge projections. In this regard, you indicate on page 89 that
the Greenidge
projections were based on a revenue rate of $325/MWh, implying a
bitcoin price of
approximately $51,000.
Support Projections, page 88
7. We note the assumptions underlying the Support projections disclosed
in response to prior
comment 13. Please discuss the extent to which the assumptions do not
reflect recent
historical trends experienced by Support and why these assumptions
were made.
Jeffrey E. Kirt
FirstName LastNameJeffrey E. Kirt
Greenidge Generation Holdings Inc.
Comapany
July NameGreenidge Generation Holdings Inc.
12, 2021
July 12,
Page 3 2021 Page 3
FirstName LastName
Greenidge Projections, page 89
8. We note the assumptions underlying the Greenidge projections disclosed
in response to
prior comment 14. Please provide more information about the bases for
the assumptions
and why they were chosen. For example,
Disclose how each assumption compares to the then-current rates as
well as to
historical trends.
In light of volatility in both the bitcoin and gas and power
markets, explain why
Greenidge prepared projections through 2025 and applied the same
assumptions to all
periods.
Disclose whether the projections take into consideration the
bitcoin block reward
halving expected to occur in 2024.
The Power Generation Industry in New York State, page 125
9. The following disclosures you added on page 125 in response to prior
comment 20 appear
to be inconsistent. Please revise or clarify your disclosure to better
explain the distinction:
"It is possible that supply side constraints may impact the
ability of our suppliers to
timely fulfill our open orders."
"Greenidge does not anticipate any supply side constraints to
impact the ability of its
suppliers to deliver on the remaining miners not yet
manufactured."
Legal Proceedings, page 133
10. Please provide all the disclosure required by Item 103 of Regulation
S-K for the six
complaints filed since the announcement of the merger, including the
name of the court or
agency in which the proceedings are pending, the date instituted, the
principal parties
thereto.
Management's Discussion and Analysis of Financial Condition and Results of
Operations for
Greenidge
Overview, page 134
11. We note your revisions provided in response to prior comment 23.
Please further revise to
address the following:
You disclose that your behind-the-meter power generation
capability provides a
stable, cost-effective source of power. However, you disclose in a
risk factor that
market prices for natural gas, among other things, is volatile,
unpredictable and tends
to fluctuate substantially. Please disclose the reasons why you
believe you have a
stable, cost-effective source of power in light of your risk
factor disclosure.
Discuss the trends in the natural gas market during your reported
periods and whether
those trends are consistent with past or future expected trends.
Disclose the material factors that could cause volatility in the
natural gas supply
market and discuss the steps you are taking to mitigate such
factors on your results of
operations, if any.
Jeffrey E. Kirt
FirstName LastNameJeffrey E. Kirt
Greenidge Generation Holdings Inc.
Comapany
July NameGreenidge Generation Holdings Inc.
12, 2021
July 12,
Page 4 2021 Page 4
FirstName LastName
Disclose specifically whether any of your natural gas purchase
contracts are hedged
at the balance sheet dates or were hedged during the reporting
periods and discuss
any impacts on your results of operations.
Results of Operations
Comparison of Quarters Ended March 31, 2021 and 2020, page 135
12. You disclose that there are no specific cryptocurrency customers due
to the nature of
bitcoin. However, in your financial statements, you state that your
contracts are with the
mining pool operators. Please tell us whether you consider the mining
pool operator to be
your customer and if so, disclose any concentrations accordingly.
13. You disclose that the 293.1% increase in cryptocurrency mining revenue
in the quarter
ended March 31, 2021 compared to the prior year's quarter was
attributable to your
increased mining fleet and average hash rate. However, on page 139,
you disclose that the
number of bitcoins mined for this quarter was 212 compared to 282 for
the prior year's
quarter. Please discuss how the price of bitcoin factored into the
amount of revenues
generated from cryptocurrency mining. Provide a discussion of trends
in bitcoin pricing
and how it impacts your results of operations.
Key Metrics and Non-GAAP Financial Measures, page 139
14. We note that you present cash cost for MWh for both your bitcoin
mining and power
generation activities. As cash cost appears to be a non-GAAP measure,
please revise to
disclose the relevant GAAP measure with greater prominence, reconcile
this measure to
the GAAP measure and provide disclosure about why cash cost provides
useful
information to investors. Refer to Item 10(e) of Regulation S-K and
SEC Release No. 33-
8176.
Consolidated Financial Statements
Report of Independent Registered Public Accounting Firm, page F-2
15. Please tell us why your auditors appear to have issued their audit
report in draft form and
revise to include a properly dated and signed opinion pursuant to Rule
2-02(a) of
Regulation S-X. Also, tell us why you have not filled in the date
through which
subsequent events were evaluated in Note 13 of your unaudited interim
financial
statements. Refer to ASC 855-10-50-1(a).
Consolidated Statement of Operations, page F-4
16. We note your response to prior comment 36. As the generation of power
appears directly
related to the generation of both your digital assets and power
generation revenues, please
provide additional information as to why you do not allocate any plant
infrastructure
depreciation to your cost of revenue for either revenue stream. Tell
us what assets the
depreciation on plant infrastructure relates to as well as how you
concluded that these
assets do not contribute to revenue generation.
Jeffrey E. Kirt
Greenidge Generation Holdings Inc.
July 12, 2021
Page 5
Note 11. Subsequent Events, page F-21
17. Please revise the share information presented herein to reflect your 4
for 1 stock split in
March of 2021. Refer to ASC 855-10-25-4 and SAB Topic 4.C.
Condensed Consolidated Financial Statements (Unaudited)
Condensed Consolidated Balance Sheets, page F-24
18. You state that as a result of the corporate restructuring in January
2021, Greenidge is the
successor entity for accounting purposes to GGH LLC and the financial
information
presented is that of GGH LLC through January 29, 2021 and Greenidge
thereafter. Please
revise to reflect the units that were outstanding at December 31, 2020 in
your interim
period balance sheet disclosures. Also, include a discussion in Note 2 to
such financials
regarding the predecessor/successor financial statement presentation.
Condensed Consolidated Statements of Operations (Unaudited), page F-25
19. Please present a measure of earnings per share on the face of your income
statement for
the period during which your common stock was outstanding. Refer to ASC
260-10-45-2.
You may contact Rebekah Lindsey, Senior Staff Accountant, at (202)
551-3303 or
Kathleen Collins, Accounting Branch Chief, at (202) 551-3499 if you have
questions regarding
comments on the financial statements and related matters. Please contact
Kathleen Krebs,
Special Counsel, at (202) 551-3350 or Jan Woo, Legal Branch Chief, at (202)
551-3453 with any
other questions.
Sincerely,
FirstName LastNameJeffrey E. Kirt
Division of
Corporation Finance
Comapany NameGreenidge Generation Holdings Inc.
Office of
Technology
July 12, 2021 Page 5
cc: Christopher M. Zochowski, Esq.
FirstName LastName