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Sustainable Opportunities Acquisition Corp.
1601 Bryan Street, Suite 4141
Dallas, Texas 75201
May 26, 2021
VIA EDGAR
Securities and Exchange Commission
Division of Corporation Finance
Office of Energy & Transportation
100 F Street, NE
Washington, D.C. 20549
Attention: Kevin Dougherty and Loan Lauren Nguyen
Re: Sustainable Opportunities Acquisition Corp.
Registration Statement on Form S-4
Filed April 8, 2021
File No. 333-255118
Dear Sir or Madam:
This letter sets forth responses of Sustainable Opportunities
Acquisition Corp. ( SOAC ) to the comments
of the staff of the Division of Corporation Finance (the Staff ) of the
Securities and Exchange Commission set
forth in your letter, dated May 5, 2021, with respect to the above referenced
Registration Statement on Form S-4
(File No. 333-255118) (the Registration Statement ). Capitalized terms
used but not otherwise defined herein shall
have the meanings ascribed thereto in the Registration Statement.
The text of the Staff s comments has been included in this letter
for your convenience, and we have
numbered the paragraphs below to correspond to the numbers in the Staff s
letter. For your convenience, we have
also set forth SOAC s response to each of the numbered comments immediately
below each numbered comment.
In addition, SOAC has revised the Registration Statement in response
to the Staff s comments and SOAC is
concurrently filing Amendment No. 1 to the Registration Statement with this
letter, which reflects these revisions
and updates certain other information. Page numbers in the text of SOAC s
responses correspond to page numbers
in the Registration Statement, as so amended (the Amended Registration
Statement ).
Registration Statement on Form S-4 filed April 8, 2021
Cover Page
1. Staff s Comment:
We note your disclosure in bolded language that public shareholders
may elect to redeem their Public
Shares even if they vote for the Business Combination Proposal. We further note
your disclosures on pages 17 and
F-8 that each Public Shareholder may elect to redeem their Public Shares
irrespective of whether they vote for or
against the proposed transaction. Please clarify your disclosures here and
elsewhere to address the redemption
rights if a public shareholder elects to redeem their public shares, without
voting, and if they do vote, irrespective of
whether they vote for or against the Business Combination Proposal and the
other proposals herein.
Response:
SOAC respectfully acknowledges the Staff s comment and advises the
Staff that it has revised the
disclosure on the cover page and pages 17, 34 and 98 of the Amended
Registration Statement.
***Copyrighted Material Omitted***
2. Staff s Comment:
We note that you have included as separate proposals, Proposal 3, the
Charter Proposal, and Proposal 4,
the Organizational Documents Proposals. The Charter proposal appears to be a
vote to approve the TMC Notice
and Articles, and you direct investors to refer to Proposal 4 the
Organizational Documents Proposals to see a
summary of the key differences between the Memorandum and Articles of
Association of SOAC under Cayman
Islands law and the TMC Notice and Articles under the BCBCA. We note that the
approval of the Charter Proposal
(with the exception of the change in authorized share capital which requires an
ordinary resolution) requires a
special resolution under Cayman Islands law, whereas the Organizational
Documents Proposals require only a a
non-binding advisory resolution. It appears that under the Cayman Islands
Companies Act and SOAC s Amended
and Restated Memorandum and Articles of Association a company may, by special
resolution, alter its memorandum
of association with respect to any objects, powers or other matters specified
therein. See e.g., Section 10 of the
Cayman Islands Companies Act and Section 18.3 of the SOAC amended and restated
memorandum. Please clarify
why you have included the Charter Proposal and the Organizational Documents
Proposal as separate proposals,
and tell us whether you will provide stockholders with a separate vote
regarding the the material changes to
SOAC s Memorandum and Articles of Association and subject such proposals to a
special resolution under Cayman
Islands law. For guidance, see also Question 201.01 of the Division s
Exchange Act Rule 14a-4(a)(3) Compliance
and Disclosure Interpretations. Also include in your subsequent amendment the
form of proxy card for review and
clarify whether any proposal is conditioned upon another proposal.
Response:
SOAC respectfully acknowledges the Staff s comment and advises the
Staff that it has included the Charter
Proposal because, pursuant to Section 10 of the Cayman Islands Companies Law
(the Companies Law ) and
Article 18 of SOAC s Amended and Restated Memorandum and Articles of
Association (the SOAC Memorandum
and Articles ), a special resolution is required to adopt the TMC Notice and
Articles as the governing documents of
TMC, with the exception that the change in authorized share capital requires
only an ordinary resolution. Under the
Companies Law, no separate vote is required on the individual changes to the
SOAC Memorandum and Articles
and, therefore, the entirety of the amendments reflected in the TMC Notice and
Articles, including the changes in
authorized share capital, are being submitted for shareholder approval by
special resolution. SOAC has revised the
disclosure on the cover page and pages 8, 22, 33, 94, 97, 100, 204, and 236 of
the Amended Registration Statement
to clarify that no separate ordinary resolution is being proposed to approve
the change in authorized share capital.
Separately, SOAC is providing shareholders with a non-binding advisory
vote on the unbundled Proposals
4A through 4F (which are collectively referred to as the Organizational
Documents Proposals ) described in the
section of the Registration Statement entitled Proposal No. 4 - The
Organizational Documents Proposals to
satisfy the Staff s unbundling guidance and Question 201.01 of the Division
s Exchange Act Rule 14a-4(a)(3)
Compliance and Disclosure Interpretations ( Question 201.01 ). SOAC
respectfully submits that providing
shareholders a non-binding advisory vote with respect to the unbundled
proposals in the Organizational Documents
Proposal is consistent with Question 201.01 and public statements made by the
Staff regarding the proxy rules.
Specifically, Question 2.01 provides that shareholders should have an
opportunity to express their views separately
on...material provisions that will establish their substantive rights as
shareholders, even if as a matter of state law
these provisions might not require a separate vote. However, the Staff has
emphasized in public statements that the
proxy rules are meant to replicate the opportunity that shareholders would have
to exercise their voting rights if they
were personally present at a meeting of shareholders, and that the Commission
has sought to use its authority in a
manner that does not conflict with the primary role of states in regulating
corporate governance. Accordingly, the
Staff has not taken a position on whether a matter unbundled in accordance with
Question 201.01 is presented as
binding or non-binding where state law would not require a separate vote. SOAC
believes that such statements
regarding state law are equally applicable to the laws of the Cayman Islands.
Therefore, SOAC is providing its
shareholders with a separate non-binding advisory vote on each unbundled
Organizational Documents Proposal so
that shareholders may express their views separately on these proposals, but
SOAC is not subjecting the
Organizational Documents Proposals to separate special resolutions, as such
special resolutions are not required by
Cayman Islands law.
SOAC has included the form of proxy card as Exhibit 99.1 to the
Amended Registration statement.
2
Questions and Answers, page 8
3. Staff s Comment:
Please include a separate question and answer to address the separate
steps to the initial business
combination and why you are including a Charter Proposal and a non-binding
advisory Organizational Documents
Proposal.
Response:
SOAC respectfully acknowledges the Staff s comment and advises the
Staff that it has included the
requested questions and answers on pages 10 and 17 of the Amended Registration
Statement.
4. Staff s Comment:
Please include a separate question and answer to address the
conflicts of interest considered by the SOAC
Board in its recommendation to enter into an initial business combination with
DeepGreen, including a discussion
of the Sponsor Earnout Shares. We note your disclosure on page 214 that SOAC
Board also considered that some
officers and directors of SOAC might have interests in the Business Combination
as individuals that are in addition
to, and that may be different from, the interests of SOAC s shareholders.
Response:
SOAC respectfully acknowledges the Staff s comment and advises the
Staff that it has included the
requested question and answer on pages 11 through 12 of the Amended
Registration Statement.
Risk Factors
Risks Relating to the Business Combination and SOAC, page 63
5. Staff s Comment:
We note that you are registering only a portion of the common shares
to be issued upon closing of the
business combination and related transactions, as well as your summary risk
factor disclosure on page 39 that a
significant portion of your total outstanding shares are restricted from
immediate resale but may be sold into the
market in the near future which could cause the market price of your Class A
ordinary shares to drop significantly,
even if TMC s business is doing well. Please disclose the risks attendant to
this scenario in your risk factors section,
and within this revision, please quantify the number of such shares that could
be sold into the market in the near
future.
Response:
SOAC respectfully acknowledges the Staff s comment and advises the
Staff that it has included the
requested disclosure on page 73 of the Amended Registration Statement.
3
Information About DeepGreen Overview, page 113
6. Staff s Comment:
We note your overview of all your mineral properties. Please state
which of your properties you consider to
be material and describe to us the basis underlying your materiality
determination.
Response:
Item 102 of Regulation S-K requires disclosure of the registrant s
principal physical properties to the extent
that the properties are material. Pursuant to Instruction 2 to Item 102, in
determining materiality under this Item,
the registrant should take into account both quantitative and qualitative
factors as per Instruction 1 to Item 101 of
Regulation S-K. DeepGreen believes that the NORI and TOML Contract Areas are
currently its only material
mineral properties after due consideration of both quantitative and qualitative
factors. DeepGreen has identified the
NORI and TOML Contract Areas as DeepGreen s material mineral properties on
page 121 of the Amended
Registration Statement. The NORI Contract Area is the seafloor parcel where
DeepGreen has performed the most
resource definition and environmental work to date, including the establishment
of measured, indicated and inferred
mineral resources based on NORI s exploration activities in such areas as
described in the NORI Technical Report
Summary, dated March 2021, prepared by AMC Consultants Ltd. The NORI Technical
Report Summary included
an initial assessment and an economic analysis of NORI Area D and a development
plan has been created with
respect to the NORI Contract Area. As part of DeepGreen s acquisition of TOML
in 2020, DeepGreen benefitted
from existing environmental studies and resource definition included in a
Canadian NI 43-101 compliant technical
resource report with established measured, indicated and inferred mineral
resources as described in the TOML
Technical Report Summary, dated March 2021, prepared by AMC Consultants Ltd.
DeepGreen intends to develop
the resources in the NORI Contract Area initially and then focus on the TOML
Contract Area given the resource
definition work and environmental studies performed to date and has development
plans for each such area as set
forth in the Technical Report Summaries. To date, very limited offshore marine
resource definition activities in the
Marawa Contract Area have occurred and DeepGreen expects to commit future
resources as contractually agreed
with Marawa Research and Exploration Limited (MREL) to evaluate the future
commercial viability of any project
in such area. DeepGreen has not completed adequate research to establish the
economic viability of any project in
the Marawa Contract Area. Further work will need to be conducted in order to
assess the viability of any potential
project in the Marawa Contract Area and such work will take several years until
such assessment can be made.
Accordingly, given the lack of substantive mineral resource definition
activities to date in the Marawa Contract Area
and the uncertain viability of any project in such area, DeepGreen does not
believe that the Marawa Contract Area
property is currently a material property after due consideration of both the
quantitative and qualitative factors as per
Item 102 of Regulation S-K.
Environmental Market Opportunity, page 117
7. Staff s Comment:
You disclose that DeepGreen believes that it is positioned to become
one of the lowest ESG footprint metal
companies in the industry, offering an expected 70-99% reduction of most
lifecycle ESG impacts. Please define what
you consider lifecycle ESG impacts and your basis for your belief that
DeepGreen will achieve a 70-99% reduction
in such impacts. Please also address any limitations to this belief. For
example, in terms of per-kilogram emissions
from DeepGreen s production, it appears this may be relative to land ore
averages depending on if your contractor
does not use hydropower or another renewable source to process the nodule, as
discussed in your White Paper
Questions and Answers as available on DeepGreen s website.
Response:
SOAC respectfully acknowledges the Staff s comment and advises the
Staff that it has provided additional
information on pages 124 through 126 of the Amended Registration Statement
about what DeepGreen considers
lifecycle ESG impacts and the basis for DeepGreen s belief that it will
achieve 70-99% reduction in such impacts. In
that regard, a table has been included that provides details for the 70-99%
reduction numbers and also describes the
limitations on such belief, such as DeepGreen s commitment to locate its
onshore processing facilities in places with
access to renewable power. The white papers referenced in the revised
disclosure can be accessed by the Staff as
follows: https://metals.co/research and
https://www.sciencedirect.com/science/article/pii/S0959652620338671.
4
Summary of Mineral Resources, page 120
8. Staff s Comment:
Please state your point of reference, such as in-situ, for all your
resource estimates. See Item 1303(b)(3)(v)
of Regulation S-K.
Response:
SOAC respectfully acknowledges the Staff s comment and advises the
Staff that it has revised the headers
to each of the mineral resource estimate tables on pages 128, 148, 149 and 164,
respectively, of the Amended
Registration Statement to state that such mineral resource estimates are
In-Situ .
Mineral resource estimate, page 139
9. Staff s Comment:
We note you report wet tons quantities and abundance, along with dry
weight percentages for your
respective metal analyses. Please clarify this mixed disclosure and include
your estimated moisture content along
with the overall resource recovery factors as a footnote to your resource
estimates.
Response:
SOAC respectfully acknowledges the Staff s comment and advises the
Staff that it has included a footnote
to the mineral resources estimate tables on pages 129, 148, 149 and 164 of the
Amended Registration Statement that
clarify the mixed disclosure and included the estimated moisture content along
with the statement that estimates are
presented on an undiluted basis without adjustment for resource recovery.
Mineral resource estimate, page 140
10. Staff s Comment:
We note your mineral resource estimate for NORI Area D was determined
using a 4 kg/m2 abundance cut-
off which was derived from the estimates of your costs and revenues presented
in the NORI Technical Report
Summary. Please disclose the method of calculation using your metal prices,
mining/processing costs, and
metallurgical recoveries.
Response:
SOAC respectfully acknowledges the Staff s comment and advises the
Staff that it has added disclosure
relating to the method of calculation on page 148 of the Amended Registration
Statement.
Assumed Economic Inputs, page 147
11. Staff s Comment:
We note your price estimate forecasts were provided by CRU
International Limited. Please disclose the
preparation date for this market report, confirm this is the same report
utilized in Exhibits 96.1 and 96.2, and
provide a copy supplementally of this report.
Response:
SOAC respectfully acknowledges the Staff s comment and advises the
Staff that it has disclosed the
preparation date for the CRU report (October 23, 2020) and confirms that this
is the same report utilized in the
Technical Report Summaries filed as Exhibits 96.1 and 96.2 to the Registration
Statement. Attached as Annex A to
this letter is a copy of the CRU Report dated October 23, 2020.
5
Production schedule, page 147
12. Staff s Comment:
We note your cash flow analysis includes inferred resources which
amount to approximately 2% of your
total production. Please note Item 1302(d)(4)(ii)(C) of Regulation S-K requires
disclosure, with equal prominence,
of the results of the economic analysis excluding inferred resources in
addition to the results that include inferred
resources. In the event there is not a significant difference, make a statement
to that effect.
Response:
SOAC respectfully acknowledges the Staff s comment and advises the
Staff that it has included disclosure
on page 157 of the Amended Registration Statement that discloses with equal
prominence the cash flow analysis
results of the economic analysis excluding the inferred mineral resources and
have also stated that the inclusion of
such inferred resources in the economic analysis did not result in a
significant difference.
Employment Arrangements, page 163
13. Staff s Comment:
We note the disclosures related to DeepGreen s employment
agreements with several of its officers that are
currently in effect. We further note the disclosure that you are currently
negotiating employment agreements with
these officers for the post-close merger entity. Please file as exhibits to the
registration statement the employment
agreements with DeepGreen s members of management.
Response:
SOAC respectfully acknowledges the Staff s comment and advises the
Staff that it has filed the existing
employment agreements with each of the named executive officers of DeepGreen as
Exhibits 10.17, 10.18 and 10.19
to the Amended Registration Statement. SOAC expects such officers to enter into
new employment agreements with
TMC following the closing of the Business Combination.
DeepGreen s Management s Discussion and Analysis of Financial Condition and
Results of Operations
Contractual Obligations and Commitments, page 174
14. Staff s Comment:
You disclose here that as at December 31, 2020, DeepGreen s original
commitment of $30 million in cash
and 10 million common shares still remained to be completed as such obligation
is dependent upon successful
completion by Allseas of the collector test. In terms of the $30 million owed,
please disclose here the timing of such
payments disclosed on page 123-124, including that DeepGreen would pay to
Allseas $10,000,000 on June 30, 2021
on confirmation of placing an order for certain equipment and demonstrating
certain progress on construction of
the collector vehicle. Please disclose if this payment is expected to be due on
June 30, 2021.
Response:
SOAC respectfully acknowledges the Staff s comment and advises the
Staff that it has disclosed on pages
132 and 185 through 186 of the Amended Registration Statement the required
timing of the payments to Allseas and
DeepGreen s expectation of the timing of the $10,000,000 payment anticipated
to be due on June 30, 2021.
6
Governing Law, page 203
15. Staff s Comment:
We note the disclosure that the Business Combination Agreement is
governed by and construed in
accordance with the laws of the State of Delaware, without giving effect to any
choice of law or conflict of law
provision or rule (whether of the State of Delaware or any other jurisdiction)
that would cause the application of the
law of any jurisdiction other than the State of Delaware (except that the (i)
Cayman Islands Companies Act (as
Revised) also applies to the Continuance and (ii) laws of the Province of
British Columbia, Canada also applies to
the Continuance, the Preferred Share Conversion, the Convertible Debenture
Conversion and corporate matters
related to the DeepGreen Information Circular, the DeepGreen Securityholders
meeting and the Plan of
Arrangement). Please expand the disclosure here to provide additional details
to this brief reference and explain the
instances when both the Cayman Islands Companies Act (as Revised) and the laws
of the Province of British
Columbia, Canada would apply to the Continuance.
Response:
SOAC respectfully acknowledges the Staff s comment and advises the
Staff that it has revised the
disclosure on pages 216 through 217 of the Amended Registration Statement. The
Continuance will be authorized
by the shareholders of SOAC in accordance with the requirements (including the
requisite level of shareholder
approval) of the Cayman Islands Companies Act (as Revised), and SOAC will be
continued out of the Cayman
Islands in accordance with and pursuant to the Cayman Islands Companies Act (as
Revised). The continuance of
SOAC into the Province of British Columbia, Canada will be effected in
accordance with and pursuant to Division 8
of Part 9 of the Business Corporations Act (British Columbia) (the BCBCA
). As such, while both the Cayman
Islands Companies Act (as Revised) and the laws of the Province of British
Columbia, Canada apply to the
Continuance, each such corporate law apply to different steps of the process.
Further, the laws of the Province of British Columbia, Canada apply to
the Preferred Share Conversion, the
DeepGreen Information Circular, the DeepGreen Securityholders meeting and the
Plan of Arrangement as those are
matters of domestic corporate laws relating to DeepGreen, which is a company
incorporated under and governed by
the BCBCA. Similarly, since the convertible debenture is governed by the laws
of the Province of British Columbia,
Canada, the Convertible Debenture Conversion is governed by such laws.
PIPE Financing, page 205
16. Staff s Comment:
We note that concurrently with the execution of the Business
Combination Agreement, SOAC entered into
the Subscription Agreements with each of the PIPE Investors, pursuant to which
the PIPE Investors have agreed to
subscribe for and purchase, and SOAC has agreed to issue and sell to the PIPE
Investors, an aggregate of
33,030,000 TMC Common Shares, for aggregate gross proceeds of $330,300,000, and
that SOAC will grant the
PIPE Investors certain registration rights in connection with the PIPE
Financing. We further note that the PIPE
Investors will own approximately 11% of the outstanding TMC common stock after
the initial business combination.
Please revise to identify the PIPE Investors.
Response:
SOAC respectfully acknowledges the Staff s comment and advises the
Staff that it has revised the
beneficial ownership table on pages 198 through 200 of the Amended Registration
Statement to include the PIPE
Investor expected to beneficially own more than 5% of the TMC Common Shares
outstanding immediately
following the Business Combination.
7
Proposal No. 2 --The Business Combination Proposal
Background to the Business Combination, page 205
17. Staff s Comment:
Please revise your disclosure to discuss how the nature and amount of
consideration, and transaction
structure and other material terms were determined, including how the parties
agreed to and the basis underpinning
the pre-transaction equity value ascribed to DeepGreen of $2.25 billion.
Response:
SOAC respectfully acknowledges the Staff s comment and advises the
Staff that it has revised the
disclosure on pages 220 through 222 of the Amended Registration Statement.
18. Staff s Comment:
Please discuss the key finding with the respect to the due diligence
review of DeepGreen that each of K&E,
ERM Consulting & Engineering, Inc. and Riveron Consulting, LLC provided SOAC
between January 27, 2021 and
March 3, 2021.
Response:
SOAC respectfully acknowledges the Staff s comment and advises the
Staff that it has revised the
disclosure on page 222 to remove references to the K&E, ERM Consulting&
Engineering, Inc. and Riveron
Consulting, LLC diligence reports.
19. Staff s Comment:
You disclose on page 206 that SOAC submitted non-binding term sheets
or proposals to six potential
business combination targets (including DeepGreen) that SOAC believed, based
on, among other things, its and its
advisors preliminary due diligence and evaluation and analysis, were most
suitable for a business combination.
You further disclose on page 208 that in connection with the execution of the
Letter of Intent that contained a
binding exclusivity period, SOAC abandoned the other potential business
combination opportunities. Revise to
provide additional details explaining why SOAC did not pursue a potential
business combination with each of the
five alternative proposals.
Response:
SOAC respectfully acknowledges the Staff s comment and advises the
Staff that it has revised the
disclosure on pages 220 and 221 of the Amended Registration Statement.
20. Staff s Comment:
We note the disclosure that following a discussion on or about
December 18, 2020 with Nomura Securities
International, Inc. (Nomura), DeepGreen s financial advisor, SOAC informed
Nomura that it wished to begin
discussions regarding a potential business combination involving SOAC and
DeepGreen. Please clarify who
initiated contact related to the initial business combination involving
DeepGreen.
Response:
SOAC respectfully acknowledges the Staff s comment and advises the
Staff that it has revised the
disclosure on page 220 of the Amended Registration Statement.
8
The SOAC Board s Reasons for the Business Combination
Valuation supported by financial analysis and due diligence, page 213
21. Staff s Comment:
You disclose that the SOAC Board determined that the valuation
analysis conducted by SOAC s
management team, based on the trading levels of comparable companies and the
materials and financial projections
provided by DeepGreen, supported the equity valuation of DeepGreen. Please
disclose the financial projections
provided by DeepGreen, including qualitative and quantitative disclosure of the
material assumptions underlying
these financial projections. In this regard, for example, we note the financial
projections provided on slide 17 of the
investor presentation filed in Exhibit 99.2 to your Form 8-K filed March 4,
2021.
Response:
SOAC respectfully acknowledges the Staff s comment and advises the
Staff that it has included
DeepGreen s financial projections for the years 2021 through 2027 on pages
228 through 229 of the Amended
Registration Statement. SOAC s valuation analysis for the transaction was
supported by multiples of projected
EBITDA for NORI-D for the years 2026 and 2027 and, therefore, SOAC has only
disclosed DeepGreen s financial
projections though 2027 in the Amended Registration Statement. A summary of the
material assumptions underlying
these projections is included on pages 153 through 159 of the Amended
Registration Statement and in Section 19 of
the NORI Technical Report Summary, which is filed as Exhibit 96.1 to the
Amended Registration Statement.
Exhibits
22. Staff s Comment:
Please file the Option and Services Agreement with Marawa and Kiribati.
See Item 601(b)(10) of
Regulation S-K.
Response:
SOAC respectfully acknowledges the Staff s comment and advises the
Staff that, upon due consideration of
Item 601(b)(10) of Regulation S-K, it has concluded that the Option Agreement
and Services Agreement with
Marawa are not material contracts under Item 601(b)(10). This conclusion is
based on a number of factors, including
that such agreements (i) were made in the ordinary course of DeepGreen s
business and DeepGreen is not
substantially dependent upon any of such agreements or (ii) are otherwise
currently immaterial to DeepGreen s
business. It is DeepGreen s business to acquire the rights to areas in the
Clarion Clipperton Zone where polymetallic
nodules may be collected, explore such properties and extract mineral resources
from such properties. To date, very
limited offshore marine resource definition activities in the Marawa Contract
Area have occurred and DeepGreen
expects to commit future resources as contractually agreed with Marawa
Research and Exploration Limited (MREL)
to evaluate the future commercial viability of any project in such area.
DeepGreen has not completed adequate
research to establish the economic viability of any project in the Marawa
Contract Area. Further work will need to
be conducted in order to assess the viability of any potential project in the
Marawa Contract Area and such work
will take several years until such assessment can be made. Given the lack of
substantive mineral resource definition
activities to date in the Marawa Contract Area and the uncertain viability of
any project in such area, DeepGreen
does not believe that the Marawa Contract Area property is currently a material
property, as further explained in the
response to Comment 6 above. Accordingly, DeepGreen is not substantially
dependent on either of the Option
Agreement or Services Agreement with MREL and such agreements are currently not
material to DeepGreen s
business. Based on the foregoing, SOAC has concluded that the agreements with
MREL are not material contracts
under Item 601(b)(10) of Regulation S-K. SOAC, DeepGreen and/or TMC intend to
monitor and review such
agreements with MREL and Kiribati and file the applicable agreements in the
event that such agreements become
material to DeepGreen in the future.
Exhibit 96.1 - Introduction, page 31
23. Staff s Comment:
Please state the qualified persons responsible for sections 8.4 and
8.5 of your technical report.
Response:
SOAC respectfully acknowledges the Staff s comment and advises the
Staff that AMC Consultants Ltd.
( AMC ) has revised Table 2.1 of the revised NORI Technical Report Summary
filed as Exhibit 96.1 to the
Amended Registration Statement to state that AMC is the Qualified Person
responsible for Sections 8.4 and 8.5.
9
Exhibit 96.1 - Sample preparation, analysis, and security, page 97
24. Staff s Comment:
Please revise to discuss the opinion of the qualified person in regards
to the adequacy of sample
preparation, security, and analytical procedures, as required by Item 601
paragraph (96)(iii)(b)(8)(iv) of
Regulation S-K or, alternatively tell us where this information is located in
your technical report summary.
Response:
SOAC respectfully acknowledges the Staff s comment and advises the
Staff that the opinion of the
Qualified Person in regards to the adequacy of sample preparation, security,
and analytical procedures is stated in
Section 9 (Data verification) of the NORI Technical Report Summary filed as
Exhibit 96.1 to the Amended
Registration Statement. AMC has also added such opinion to the first paragraph
in Section 8 of the revised NORI
Technical Report Summary.
Exhibit 96.1 - Mineral Resource Estimate, page 127
25. Staff s Comment:
We note your mineral resource estimate for NORI Area D was determined
using a 4 kg/m2 abundance cut-
off which was derived from the estimates of your costs and revenues presented
in this Technical Report Summary.
Please disclose the detailed method of calculation using your metal prices,
mining/processing costs, and
metallurgical recoveries. See Item 601 paragraph (96)(iii)(b)(11)(iii) of
Regulation S-K.
Response:
SOAC respectfully acknowledges the Staff s comment and advises the
Staff that AMC has added
disclosure relating to the method of calculation on pages 160 and 176 of the
revised NORI Technical Report
Summary filed as Exhibit 96.1 to the Amended Registration Statement.
Exhibit 96.1 - Mineral Resource Classification, page 172
26. Staff s Comment:
Please revise to discuss the qualified person s opinion on whether
all issues relating to relevant technical
and economic factors likely to influence the prospect of economic extraction
can be resolved with further work as
required by Item 601 paragraph (96)(iii)(b)(11)(vii) of Regulation S-K.
Response:
SOAC respectfully acknowledges the Staff s comment and advises the
Staff that AMC has revised the
disclosures in Section 11.2.16 and Section 11.3.10 of the revised NORI
Technical Report Summary filed as Exhibit
96.1 to the Amended Registration Statement to include the Qualified Person s
opinion that all issues relating to all
relevant technical and economic factors likely to influence the prospect of
economic extraction can be resolved with
further work.
10
Exhibit 96.1 - Market Studies, page 241
27. Staff s Comment:
We note your price estimate forecasts were provided by CRU
International Limited. Please disclose the
preparation date for this market report and explain, with particularity, your
reasons for using the selected prices,
including the material assumptions underlying those price selections. This
explanation must include disclosure of
the time frame used to estimate the commodity price and unit costs for cut-off
grade estimation, and the reasons
justifying the selection of that time frame. See Item 601 paragraph
(96)(iii)(b)(11)(iii) of Regulation S-K.
Response:
SOAC respectfully acknowledges the Staff s comment and advises the
Staff that AMC has disclosed the
preparation date for the CRU report (October 23, 2020) in Section 16 of the
revised NORI Technical Report
Summary filed as Exhibit 96.1 to the Amended Registration Statement and has
included a detailed explanation of
AMC s reasons for using the selected prices, including the material
assumptions underlying those price selections.
We note that AMC has disclosed the time frame used to estimate the commodity
prices and unit costs for cut-off
grade estimation and the reason for justifying the selection of that time frame
in Section 11.2.15 (Cut-off grade) of
the revised NORI Technical Report Summary.
Exhibit 96.2 - Cut-off grade, page 175
28. Staff s Comment:
We note your mineral resource estimate for TOML Areas were determined
using a 4 kg/m2 abundance cut-
off which was derived from the estimates of your costs and revenues presented
in the NORI Technical Report
Summary. Please disclose the detailed method of calculation using your metal
prices, mining/processing costs, and
metallurgical recoveries. See Item 601 paragraph (96)(iii)(b)(11)(iii).
Response:
SOAC respectfully acknowledges the Staff s comment and advises the
Staff that AMC has added
disclosure relating to the method of calculation on page 177 of the revised
TOML Technical Report Summary filed
as Exhibit 96.2 to the Amended Registration Statement.
Exhibit 96.2 - Mineral Resource Classification, page 176
29. Staff s Comment:
We note your summary disclosure of the TOML Resources. Please
separately report the TOML resources
for Areas A, B, C, D, E, and F.
Response:
SOAC respectfully acknowledges the Staff s comment and advises the
Staff that AMC revised Table 11.9
on page 178 of the revised TOML Technical Report Summary filed as Exhibit 96.2
to the Amended Registration
Statement to separately report the TOML estimated mineral resources for TOML
Areas A, B, C, D, E and F.
11
Exhibit 96.2 - Market Studies, page 196
30. Staff s Comment:
We note your price estimate forecasts were provided by CRU
International Limited. Please disclose the
preparation date for this market report and explain, with particularity, your
reasons for using the selected prices,
including the material assumptions underlying those price selections. This
explanation must include disclosure of
the time frame used to estimate the commodity price and unit costs for cut-off
grade estimation, and the reasons
justifying the selection of that time frame. See Item 601 paragraph
(96)(iii)(b)(11)(iii) of Regulation S-K.
Response:
SOAC respectfully acknowledges the Staff s comment and advises the
Staff that AMC has disclosed the
preparation date for the CRU report (October 23, 2020) in Section 16 of the
revised TOML Technical Report
Summary filed as Exhibit 96.2 to the Amended Registration Statement and has
included a detailed explanation of
AMC s reasons for using the selected prices, including the material
assumptions underlying those price selections.
We note that AMC has disclosed the time frame used to estimate the commodity
prices and unit costs for cut-off
grade estimation and the reason for justifying the selection of that time frame
in Section 11.6 (Cut-off grade) of the
revised TOML Technical Report Summary.
General
31. Staff s Comment:
Please provide your analysis to explain the vote threshold required
thereunder for shareholder approval
for the Business Combination Proposal to approve and adopt the Business
Combination Agreement. In this regard,
please tell us whether Sections 237.7 and 233.6 of the Caymans Islands
Companies Act under the Cayman Islands
Companies Act (a plan of merger or consolidation shall be authorised by each
constituent company by way of a
special resolution) would be applicable.
Response:
SOAC acknowledges the Staff s comment and respectfully advises that
SOAC is seeking shareholder
approval of the Business Combination Proposal pursuant to Article 49 of its
Amended and Restated Memorandum
and Articles of Association (the Articles ). In particular, Section
49.2(a) of the Articles provides that SOAC must
either submit a Business Combination (as defined in the Articles) to its
shareholders for approval or provide its
shareholders with the opportunity to have their public shares repurchased by
means of a tender offer. Section 49.4
further provides that at any general meeting called for the purposes of
approving a Business Combination, SOAC
may consummate the Business Combination if it is approved by an ordinary
resolution. Accordingly, as SOAC has
determined to submit the Business Combination to its shareholders for approval,
the Business Combination Proposal
may be adopted upon the approval by holders of at least a majority of the
ordinary shares present virtually, in person
or represented by proxy, entitled to vote and actually vote at the
extraordinary general meeting.
Because the Business Combination Agreement contemplates that the
Continuance will occur prior to the
Share Exchange and Amalgamation, we respectfully advise the Staff that the
Cayman Islands Companies Act will
not be applicable to the Share Exchange and Amalgamation.
32. Staff s Comment:
Please include the Annexes within the table of contents.
Response:
SOAC respectfully acknowledges the Staff s comment and advises the
Staff that it has revised the table of
contents to include the Annexes.
12
We hope that the foregoing has been responsive to the Staff s
comments. If you have any questions related
to this letter, please contact Julian Seiguer at (713) 836-3334 of Kirkland &
Ellis LLP.
Sincerely
By: /s/ Scott Leonard
Name: Scott Leonard
Title: Chief Executive Officer
Via E-mail:
cc: Julian Seiguer
Kirkland & Ellis LLP
ANNEX A
CRU Report