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United States securities and exchange commission logo
March 13, 2023
Thomas Pike
Chief Executive Officer
Silver Spinco Inc.
358 South Main Street
Burlington, North Carolina 27215
Re: Silver Spinco Inc.
Draft Registration
Statement on Form 10
Submitted February
13, 2023
CIK No. 0001965040
Dear Thomas Pike:
We have reviewed your filing 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 these comments within ten business days by
providing the requested
information or advise us as soon as possible when you will respond. If
you do not believe our
comments apply to your facts and circumstances, please tell us why in
your response.
After reviewing your
response to these comments, we may have additional comments.
Draft Registration Statement on Form 10, submitted February 13, 2023
Cover Page
1. We note your disclosure
on page 56 that you expect that the spinoff will be completed
provided that "[y]our
common stock shall have been approved for listing on
NASDAQ[.]" We also note
your disclosure that Labcorp may waive one or more of the
closing conditions set
forth on pages 56-57 and that Labcorp has reserved the right to
abandon any and all
terms of the distribution. Please revise your cover page to clarify
whether the spinoff is
contingent upon NASDAQ's approval of your listing application.
2. Please revise your
disclosure to specify whether the shares of Fortrea common stock will
be distributed pro rata
to the holders of Labcorp's common stock.
Market and Industry Data, page ii
3. We note your disclosure
that the "information statement includes estimates regarding
Thomas Pike
FirstName LastNameThomas Pike
Silver Spinco Inc.
Comapany
March NameSilver Spinco Inc.
13, 2023
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market and industry data and forecasts, which are based on publicly
available information,
industry publications and surveys, reports from government agencies,
reports by market
research firms, and [y]our own estimates based on [y]our management's
knowledge of,
and experience in, the markets in which [you] compete." We also note
your disclosure
that you "have not independently verified market and industry data
from third-party
sources." It is not appropriate to directly or indirectly disclaim
liability for statements in
your registration statement. Please revise the disclosure or
specifically state that you take
liability for these statements.
Questions and Answers About the Spinoff, page 1
4. Please revise to address any material changes in stockholder rights
between the existing
Labcorp common stock and the Fortrea common stock. If none, please
include a negative
statement to that effect. Additionally, please revise your Q&A section
to discuss any
material consequences to stockholders if Labcorp waives any conditions
and proceeds
with the spinoff.
Summary, page 6
5. The disclosure in the "Summary" should be a balanced presentation of
your business.
Please revise your disclosure to provide a more balanced discussion of
the opportunity
you see in your market, your value proposition and your growth
strategy with equally
prominent disclosure of the challenges you face and the risks and
limitations that could
harm your business or inhibit your strategic plans.
Growth Strategy
Create an Inclusive Culture of Careers with Meaning as a Competitve Advantage,
page 11
6. We note your disclosure that you "have a proprietary execution program
to deliver
results[.]" Please revise your disclosure to explain how your
execution program is
proprietary. To the extent the proprietary nature of your program
involves the utilization
of specific intellectual property, please revise your "Intellectual
Property" section
accordingly.
Summary Unaudited Pro Forma Combined Financial Information, page 22
7. Please revise to provide the pro forma earnings per share information
when available.
Risk Factors
Risks Relating to Technology and Cybersecurity
Security breaches and unauthorized access to our or our customers' data could
harm our
reputation and adversely affect our business., page 36
8. We note your disclosure here that you have experienced and expect to
continue to
experience attempts by computer programmers and threat actors to
attack and penetrate
your layered security controls. Please disclose whether the attempts
by computer
Thomas Pike
FirstName LastNameThomas Pike
Silver Spinco Inc.
Comapany
March NameSilver Spinco Inc.
13, 2023
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programmers and threat actors to attack and penetrate your layered
security controls led to
any material breaches of your customers data. If so, please explain
the steps you took to
remedy those breaches.
Unaudited Pro Forma Combined Financial Information
Management Adjustments, page 67
9. Please tell us whether you have included any synergies as part of the
management
adjustments, and if so, please separately disclose them in the
narrative and the table. Also
revise your disclosure to include the estimated time frame for
achieving the synergies and
dis-synergies for each adjustment. See Rule 11-02(a)(7)(ii)(D) of
Regulation S-X.
Management's Discussion and Analysis of Financial Condition and Results of
Operations
Results of Operations, page 70
10. To the extent possible, revise your results of operations to
separately disclose the
estimated impact of each of the factors you cited, including
offsetting, for the changes in
your revenues and expenses. Refer to Item 303 of Regulation S-K.
Relationship With Labcorp After The Spinoff
Agreements Between Labcorp and Us
Transition Services Agreement, page 101
11. Please disclose the termination provisions set forth in this
agreement.
Other Arrangements, page 102
12. Please disclose the termination provisions for each of the agreements
listed in this
section.
Index to Combined Financial Statements, page F-1
13. Since it is unlikely that you would include the audited financial
statements of Fortrea
Holdings Inc. as part of the registration statements due to its late
incorporation date
of January 31, 2023, please revise your Note 1 to disclose the date
Fortrea Holdings Inc.
was incorporated, and disclose, if true, that Fortrea Holdings Inc.
has no assets, liabilities,
operations, or commitments and contingencies during the period
presented and until the
date of the transfer of the Clinical Development and Commercialization
Services
Business to Fortrea Holdings Inc.
Financial Statements for Clinical Development and Commercialization Services
Business
Note 13. Commitments and Contingent Liabilities, page F-30
14. Please confirm with us whether any of the contingent liability items
previously disclosed
by Labcorp in its 2021 and 2022 10-Ks are related to the Clinical
Development and
Commercialization Services Business. And if so, please revise to
disclose them here, or
Thomas Pike
Silver Spinco Inc.
March 13, 2023
Page 4
explain to us how you have determined that they are not required to be
disclosed under
ASC 450 Contingencies.
Note 18. Business Segment Information, page F-35
15. Please revise the filing to disclose the specific types of material
amounts included in the
Corporate costs not allocated to segments captions for each period
presented. Refer to
ASC paragraphs 280-10-50-29(b).
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.
You may contact Li Xiao at 202-551-4391 or Kevin Kuhar at 202-551-3662
if you have
questions regarding comments on the financial statements and related matters.
Please contact
Cindy Polynice at 202-551-8707 or Joshua Gorsky at 202-551-7836 with any other
questions.
Sincerely,
FirstName LastNameThomas Pike
Division of
Corporation Finance
Comapany NameSilver Spinco Inc.
Office of Life
Sciences
March 13, 2023 Page 4
cc: Thomas Short, Esq.
FirstName LastName