DLA Piper LLP (US)
	2525 East Camelback Road,
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	Phoenix, Arizona 85016-4232
	www.dlapiper.com
	Steven D. Pidgeon
	Steven.Pidgeon@dlapiper.com
	T   480.606.5124
	F   480.606.5524

December 22, 2021

United States Securities and Exchange Commission

Division of Corporation Finance

Office of Trade & Services

100 F Street, N.E.

Washington, D.C. 20549

Attention: Suying Li

Lyn Shenk

Cara Wirth

Mara Ransom

Ladies and Gentlemen:

On behalf of our client, Lionheart Acquisition Corp. II (“LCAP II” or the “Company”), we submit this letter setting forth the responses of the Company to the comments that were provided by the staff (the “Staff”) of the Division of Corporation Finance of the United States Securities and Exchange Commission (the “Commission”) by your letter dated December 10, 2021 (the “Comment Letter”), regarding the above-referenced filing (the “Registration Statement”). Concurrently with the filing of this letter, the Company is filing its Amendment No. 1 to Registration Statement on Form S-4 (the “Amended Registration Statement”), which includes changes to reflect responses to the Staff’s comments and other updates.

We are authorized by the Company to provide the responses contained in this letter on its behalf. For your convenience, the text of each comment of the Staff in the Comment Letter is included in italics below and the Company’s responses appear below each comment. The references in the captions below correspond to the numbered paragraphs of the Comment Letter.

Company Response: The Staff’s comment is noted. Pursuant to the Staff’s request, the Company has revised the disclosure on page viii of the Amended Registration Statement to reflect the Staff’s comment.

Company Response: The Staff’s comment is noted. The Company confirms to the Staff that the amount of the deferred underwriting commission payable to the underwriters of the Company’s initial public offering is not required to be adjusted for any shares that are redeemed in connection with the Company’s initial business combination. The Company has revised the disclosures on page 2 of the Amended Registration Statement to reflect the Staff’s comment.

Company Response: The Staff’s comment is noted. Pursuant to the Staff’s request, the Company has revised the disclosure on page 15 of the Amended Registration Statement to reflect the Staff’s comment.

Company Response: The Staff’s comment is noted. Pursuant to the Staff’s request, the Company has revised the disclosure on page 61 of the Amended Registration Statement to discuss the material risks to unaffiliated investors presented by taking the Company public through a merger rather than an underwritten offering.

Company Response: The Staff’s comment is noted. Pursuant to the Staff’s request, the Company has revised the disclosure on page 34 of the Amended Registration Statement to reflect the Staff’s comment.

Company Response: The Staff’s comment is noted. Pursuant to the Staff’s request, the Company has revised the disclosure on page 43 of the Amended Registration Statement to reflect the Staff’s comment.

Company Response: The Staff’s comment is noted. The Company respectfully advises the Staff that all of the personal and financial interests of the Sponsor and the Company’s officers and directors are described on page 51 of the Amended Registration Statement and under the heading Conflicts of Interest.

Company Response: The Staff’s comment is noted. Pursuant to the Staff’s request, the Company has revised the disclosure on page 53 of the Amended Registration Statement to disclose all possible sources of dilution that shareholders who elect not to redeem their shares may experience in connection with the business combination. The Company has also included a cross-reference in the Risk Factor notifying the reader of additional information contained in the redemption sensitivity analysis.

Company Response: The Staff’s comment is noted. Pursuant to the Staff’s request, the Company has revised the disclosure on page 53 of the Amended Registration Statement.

Company Response: The Staff’s comment is noted. Pursuant to the Staff’s request, the Company has revised the disclosure on page 54 of the Amended Registration Statement to reflect the Staff’s comment.

Company Response: The Staff’s comment is noted. Pursuant to the Staff’s request, the Company has revised the disclosure on page 63 of the Amended Registration Statement, to highlight the material risks to public warrant holders, including those arising from differences between Private Warrants and Public Warrants as well as including the steps the Company will take to notify all shareholders regarding when warrants become eligible for redemption.

Company Response: The Staff’s comment is noted. The Company respectfully advises the Staff that the New Warrants contain terms and provisions that differ from those of the existing Public Warrants and Private Warrants that are expected to be remain liability-classified warrants following the consummation of the Business Combination. The Company considered the following in determining that equity classification of the New Warrants is appropriate:

The New Warrants were determined to not require liability classification under ASC 480, as the New Warrants do not represent an obligation to repurchase shares and are not themselves puttable under ASC 480-10-25-8, nor are they settled in a variable number of shares with a monetary value based predominantly on the factors in ASC 480-10-25-14. The New Warrants were determined to meet the criteria under the definition of a derivative in ASC 815-10-15-83, and therefore were evaluated under the equity scope exception from derivative accounting in ASC 815-10-15-74(a) for derivatives meeting both of the following conditions:

In considering the first step of the Indexation Guidance, the New Warrants contain exercise contingencies which were evaluated and determined not to preclude indexation, as there are no contingencies that are based on observable markets or indices not related to the Company’s own stock or own operations. As it pertains to the analysis of settlement amount adjustments under the second step of the Indexation Guidance and unlike the terms of the Private Warrants, the Company respectfully advises the Staff that the New Warrants do not contain clauses producing variability in settlement mechanics based on the holder of the instrument. Specifically, the New Warrants, which will be publicly traded upon the consummation of the Business Combination, are subject to redemption regardless of the holder and do not contain other provisions that provide variability in settlement amount based on the nature of the holder. Further, other provisions in the New Warrants that adjust the exercise price and number of underlying shares are standard anti-dilution adjustments for transactions and based on inputs that are consistent with indexation as provided in Example 17 in ASC 815-40-55-42 and 55-43.

In evaluating the Equity Classification Guidance, the Company considered whether the New Warrants may in any scenario outside the Company’s control require net cash settlement. Specifically, the Company advises the Staff that following the consummation of the Business Combination, the combined company will have two classes of voting common stock, Class A Common Stock and Class V Common Stock, and the holders of Class V Common Stock will control the combined company. Section 4.4 of the Existing Warrant Agreement provides holders of the Public Warrants and Private Warrants with the ability to receive cash or other assets in settlement upon a tender or exchange offer where more than 50% of the outstanding shares of Class A Common Stock are exchanged and also receive such alternative consideration. The same clause (Section 4.4) in the New Warrant Agreement provides that holders of the New Warrants are only entitled to receive cash or other assets in settlement upon a tender or exchange offer where (1) more than 50% of the “outstanding voting interest” and (2) greater than 50% of the outstanding shares of the Class A Common Stock are exchanged and also receive the alternative consideration. Said differently, because the Company has multiple classes of voting common shares, the Public Warrants and Private Warrants may be net cash settled in scenarios that do not in all cases result in a change in control or fundamental change in ownership, whereas net cash settlement of the New Warrants is only provided for in scenarios where (1) a change of control occurs (due to the change in the outstanding voting interest described above) and (2) the holders of the New Warrants receive the same form of consideration as the holders of the underlying Class A Common Stock. ASC 815-40-55-3 provides that change-in-control provisions requiring or permitting the counterparty to deliver the same form of consideration as holders of the shares underlying the contract do not preclude permanent equity classification. Therefore, the Company concluded that the limited scope exception in ASC 815-40-55-2 through 55-5 is applicable to the New Warrants, and Section 4.4 of the New Warrant Agreement does not preclude equity classification.

Further, the Company analyzed whether the additional conditions necessary to meet equity classification in ASC 815-40-25-8 through 25-35 are met and has confirmed the settlement of the New Warrants in shares is fully within the Company’s control.

Based on the analysis above, the Company determined that the provisions in the New Warrants meet the scope exception from derivative accounting in ASC 815-10-74(a) and therefore will be equity-classified upon consummation of the Business Combination.

Company Response: The Staff’s comment is noted. Pursuant to the Staff’s request, the Company has revised the disclosure on page 82 of the Amended Registration Statement to reflect the Staff’s comment.

Company Response: The Staff’s comment is noted. Pursuant to the Staff’s request, the Company has revised the disclosure on page 89 of the Amended Registration Statement to reflect the Staff’s comment.

Company Response: The Staff’s comment is noted. The Company respectfully advises the Staff that the term “affiliate” is not defined in the relevant provision of the charter cited in the Staff’s comment.  Accordingly, the Company’s board of directors (the “Board”) determined to evaluate the comment in light of the SEC’s definition of affiliate (defined in Rule 405 under the Securities Act of 1933, as amended (the “Act”)), which is based on the concept of “control” (in turn defined in Rule 405 under the Act ). The Board concluded that neither Messrs. Sternberg and Ruiz, the CEOs of the companies party to the transaction subject to the Registration Statement, nor the contracting parties themselves, are affiliates. Moreover, the Company and MSP are not affiliates of each other as they do not control each other, nor are they under common control.

In reaching this conclusion, the Board took special note of the residential real estate and Cigarette Boat company transactions cited by the Staff and disclosed in the Registration Statement. The Board determined, based on discussions with Messrs. Ruiz and Sternberg and their representatives, that: (i) none of the transactions between such principals or their companies are material to either person; (ii) Mr. Sternberg has no ownership interest in or position with MSP; (iii) Mr. Ruiz has no ownership interest in or position with LCAP or its sponsor, or any other company within the Lionheart SPAC group; and (iv) Mr. Ruiz and Mr. Sternberg disclaim that either has any control over the other or consider themselves beholden to the other. Accordingly, the Board determined no fairness opinion was required under its charter.

Notwithstanding this conclusion, Company management and the Board did consider the potential utility of seeking a fairness opinion from an independent financial advisor. At the Board’s request, Nomura assembled public data regarding the relative frequency in precedent SPAC transactions of the SPAC board engaging or not engaging any independent financial advisor to render a fairness opinion. In those cases in which a fairness opinion has been secured in a SPAC transaction, it has generally been provided by an investment bank not otherwise involved in the business transaction or related capital transactions.

The Board also discussed with Nomura the potential difficulties and costs of engaging an independent financial advisor to render an opinion given that MSP was essentially a first mover in a new industry with limited operating history. The Company held discussions with potential financial advisors but mutually decided not to pursue a formal engagement.

The Company engaged an external law firm to provide a report on the bona fides of the legal positions underpinning MSP’s business thesis, and a litigation consulting firm to assess the recovery assumptions used in MSP’s financial projections. Company management and MSP management met numerous times to review and discuss MSP’s projections and the assumptions underlying them. Representatives of KBW and Nomura attended these meetings. The Board and Company management also met several times to review and evaluate the projections and related assumptions and the reports of the Company’s special external counsel and litigation consulting firm. Representatives of the Company’s special counsel, litigation consulting firm, Nomura and the Company’s other advisors attended these meetings. The Board believes that these steps adequately discharged its fiduciary duties and relevant charter provisions.

Reference is made to page 127 of the Amended Registration Statement relating to the analysis of Mr. Sternberg’s fiduciary duties or contractual arrangements.

The Company has updated the disclosure in page 129 of the Amended Registration Statement to reflect the fiduciary duties or contractual obligations owed by Ophir Sternberg in the agreements described on page 231 of the Amended Registration Statement.

Company Response: The Staff’s comment is noted. Pursuant to the Staff’s request, the Company has revised the disclosure on page 128 of the Amended Registration Statement to reflect that the approximate value of the Sponsor’s interest in the Post Combination Company is $56.1 million, consisting of 5,642,000 shares of Class A Common Stock. The approximate value was calculated based on a trailing 30-day average price of $9.94 per share. The cost basis of this investment was approximately $5,975,000, consisting of 595,000 private placement units at $10.00 per unit, or $5,950,000, plus the purchase of 5,667,500 shares of Class B Common Stock for $24,641.

Company Response: The Staff’s comment is noted. Pursuant to the Staff’s request, the Company has revised the disclosure on page 130 of the Amended Registration Statement to reflect the Staff’s comment.

Company Response: The Staff’s comment is noted. The Company has revised the disclosure on page 134 and 135 of the Amended Registration Statement to reflect the beneficial ownership of officers and directors of the Company pre-Business Combination, 5% holders of the Company pre-Business Combination and Messrs. Ruiz and Quesada, assuming exercise and conversion of the New Warrants.

Company Response: The Staff’s comment is noted. Pursuant to the Staff’s request, the Company has revised its disclosure on page 140 and 144 of the Amended Registration Statement to reflect the Staff’s comment.

Company Response: The Staff’s comment is noted.

MSP respectfully advises the Staff that MSP’s Amazon Web Services agreement is such as ordinarily accompanies the kind of business conducted by MSP under Item 601(b)(10)(ii) of Regulation S-K. In addition, MSP’s Amazon Web Services agreement is a standard vendor contract and not a contract upon which MSP’s business is substantially dependent under Item 601(b)(10)(ii)(B) of Regulation S-K. Further, none of the other categories under Item 601(b)(10)(ii)(A), (C) or (D) of Regulation S-K are applicable.

MSP has reviewed the agreements to which it is a party, and respectfully advises the Staff that, other than as already included in the Exhibit index to the Amended Registration Statement, MSP has determined that it is not currently party to any agreement of the type required to be filed pursuant to Item 21 of Form S-4 and Item 601(b)(10) of Regulation S-K.

Company Response: The Staff’s comment is noted. Pursuant to the Staff’s request, the Company has revised the disclosure on page 147 of the Amended Registration Statement to reflect the Staff’s comment.

Company Response: The Staff’s comment is noted. Pursuant to the Staff’s request, the Company has revised the disclosure on page 151 of the Amended Registration Statement to reflect the Staff’s comment.

Company Response: The Staff’s comment is noted. Pursuant to the Staff’s request, the Company has revised the disclosure on page 154 of the Amended Registration Statement to reflect the Staff’s comment.

Company Response: The Staff’s comment is noted. Pursuant to the Staff’s request, the Company has revised the disclosure on page 156 of the Amended Registration Statement to reflect the Staff’s comment.

Company Response: The Staff’s comment is noted. Pursuant to the Staff’s request, the Company has revised the disclosure on page 157 of the Amended Registration Statement to reflect the Staff’s comment.

Company Response: The Staff’s comment is noted. Pursuant to the Staff’s request, the Company has revised the disclosure on page 157 of the Amended Registration Statement to reflect the Staff’s comment.

Company Response: The Staff’s comment is noted. The Company has revised the disclosure on page 158 of the Amended Registration Statement to reflect the Staff’s comment.

Company Response: The Staff’s comment is noted. Pursuant to the Staff’s request, the Company has revised the disclosure on page 158 of the Amended Registration Statement. In addition, the Company respectfully advises the Staff that this information is outlined within the Company’s unaudited financial statements on page F-50 and the Company’s audited financial statements on page F-63.

Company Response: The Staff’s comment is noted. Pursuant to the Staff’s request, the Company has revised the disclosure on page 178 of the Registration Statement to reflect the Staff’s comment.

Company Response: The Staff’s comment is noted. Pursuant to the Staff’s request, the Company has revised the disclosure on page 179 of the Registration Statement to reflect the Staff’s comment.

Company Response: The Staff’s comment is noted. The Company respectfully requests the Staff to refer to the disclosure on page 179 of the Amended Registration Statement under the heading “Background of the Business Combination.”

Company Response: The Staff’s comment is noted. The Company respectfully advises that no materials were prepared or circulated in connection with the February 18, 2021 and March 19, 2021 meetings. The Company has revised its disclosures on pages 177-183 of the Amended Registration Statement to reflect the Staff’s comment.

Company Response: The Staff’s comment is noted. Pursuant to the Staff’s request, the Company has revised the disclosure on pages 179 and 180 of the Amended Registration Statement to reflect the Staff’s comment.

Company Response: The Staff’s comment is noted. Pursuant to the Staff’s request, the Company has revised the disclosure on page 180 of the Amended Registration Statement to reflect the Staff’s comment

Company Response: The Staff’s comment is noted. Pursuant to the Staff’s request, the Company has revised the disclosure on page 180 of the Amended Registration Statement to reflect the Staff’s comment

Company Response: The Staff’s comment is noted. Pursuant to the Staff’s request, the Company has revised the disclosure on page 181 of the Amended Registration Statement to reflect the Staff’s comment.

Company Response: The Staff’s comment is noted. Pursuant to the Staff’s request, the Company has revised the disclosure on page 182 of the Amended Registration Statement to reflect the Staff’s comment.

Company Response: The Staff’s comment is noted. The Company respectfully advises that none of Nomura, Stifel, or KBW prepared any documents that constitute “reports” for purposes of Item 1015(b) of Regulation M-A. The Company has revised its disclosure on pages 177-183 of the Amended Registration Statement to reflect the Staff’s comment.

Company Response: The Staff’s comment is noted. We also note that the Company and MSP have entered into Amendment No. 2 to the MIPA which modifies the minimum cash condition applicable to MSP. The Amendment is described on page 183 of the Amended Registration Statement. Apart from that change, the Company does not believe that the Amendments materially alter the terms of the transaction and specifically that the business to be acquired and purchase price remain fundamentally unchanged.

Company Response: The Staff’s comment is noted. The Company respectfully advises that, in this context, “reasonable” means (i) given the uniqueness of the MSP business model, that the work done by the third party due diligence advisors supported the “reasonableness” of the assumptions used to validate the business model, (ii) that the variables considered by the Board in relation to the financial analysis for the MSP Recovery Business and the Government Claims were a reasonable basis to compute the valuation, and (iii) given the inherent uncertainties in any long-term projections, particularly in a business like MSP’s where there is limited historical financial information to extrapolate, the inclusion of the New Warrants as partial consideration to the LCAP shareholders provides a meaningful counter-balance to the uncertainties in the projections.

Company Response: The Staff’s comment is noted. The Company respectfully advises that it believes the factors described in page 184 of the Amended Registration Statement, as well as the uniqueness of the MSP business model, served as a reasonable basis for the Board to evaluate the operating and financial metrics of MSP’s business. In addition, as noted on page 183 of the Amended Registration Statement, the LCAP Board did review certain financial data provided to the Company, including certain unaudited prospective financial information of MSP (including, where applicable, the assumptions underlying such unaudited prospective financial information). After review of the MSP historical financial statements, the LCAP Board continued to believe that it was reasonable to recommend the transaction. 

Company Response: The Staff’s comment is noted. The Company respectfully refers the Staff to our response to question 53 discussing Nomura’s fees in connection with the IPO and Business Combination. The deferred underwriting fees and M&A success fee were disclosed to the Board but such fees were not considered to be a conflict of interest that would impact Nomura’s serving as financial advisor to LCAP in evaluating and advising on the business combination. The fees are customary for these types of transactions. However, the Company has updated the risk factor disclosure on page 51 of the Amended Registration Statement to reflect the Staff’s comment.

Company Response: The Staff’s comment is noted. Pursuant to the Staff’s request, MSP has revised its disclosure on page 190 of the Amended Registration Statement to reflect MSP’s approach to preparing the projections as well as the material assumptions underlying the projections.

Company Response: The Staff’s comment is noted. Pursuant to the Staff’s request, MSP has revised its disclosure on page 190 of the Amended Registration Statement to disclose (i) how the 6-year timeframe for the projected financial information was selected and (ii) material assumptions underlying the projections, including assumptions with respect to growth in Medicare and Medicaid spend and proportions of such spend that are accident or fraud and misconduct related, in each case consistent with historical market data. In addition, MSP respectfully advises the Staff that, because MSP had achieved limited actual recoveries under its claims portfolio at the time the projected financial information was prepared, the projected financial information does not reflect historic operating trends specific to MSP’s business. Instead, as disclosed on page 190 of the Amended Registration Statement, MSP’s projections reflect MSP management’s good faith estimates of forecasted recoveries based on the nature of the claims then held and forecasted to be held in MSP’s claim’s portfolio, the stages of MSP’s claims portfolio in terms of the recovery process, as well as MSP management’s good faith estimates of MSP’s potential upside from recoveries, based on MSP management’s experience with claims recovery.

Company Response: The Staff’s comment is noted. Pursuant to the Staff’s request, MSP has revised its disclosure on pages 190 of the Amended Registration Statement to disclose the material assumptions underlying its projections. In addition, MSP respectfully advises the Staff that MSP had achieved limited actual recoveries under its claims portfolio at the time the projections were prepared. Total Claims Recovery of $13.9 million for the year ended December 31, 2020 comprises $13.6 million of recovery claims service income, of which $13.1 million constitutes recovery services income from VRM MSP pursuant to a service agreement whereby VRM MSP pays service fees to MSP commensurate with MSP’s operational expenses as part of VRM’s investment in VRM MSP that is not related to claims recovery income, and $255,000 of claims recovery income. However, MSP management estimates that MSP will achieve recoveries over time as its claims are adjudicated or settled through the claims recovery process, and that these recoveries will increase commensurately with growth in MSP’s claims portfolio. As a result, the projections reflect this forecasted growth over time.

Company Response: The Staff’s comment is noted. Please refer to the Company’s response to question 16. The Sponsor and its affiliates provided the risk capital ($5.95 million in total) to the Company to pay for formation related costs and for general working capital. In return for which, they collectively own 5,642,500 shares of the Company (as more fully described in the table “Security Ownership of Certain Beneficial Owners and Management of MSP, the Company and the Post-Combination Company” on pages 134 and 135 of the Amended Registration Statement). These securities have an estimated value of approximately $56 million (at a $10/share price) and would have zero value if a business combination is not completed. The Sponsor and its affiliates have no other loans, contingent fees, or reimbursement of out-of-pocket expenses, to which they would receive compensation if a business combination is completed. Other than the above, the only other amount of compensation due at the time of the consummation of the Business Combination will be the granting of 10,000 shares of Class A Common Stock to certain of the Company’s independent directors (approximate value of $100,000 (at a $10/share price). These shares will come from the pool of Founder Shares and will not result in any dilution to Public Stockholders or the Members. The Company has revised the disclosure on pages 190 and 191 of the Amended Registration Statement to include this additional detail.

Company Response:

The Company acknowledges the Staff’s comment and has revised its disclosure on pages 190 and 191 of the Amended Registration Statement and in the risk factor on page 51 of the Amended Registration Statement to highlight the risk that the sponsor will benefit from the completion of a business combination and may be incentivized to complete an acquisition of a less favorable target company.

Company Response: The Staff’s comment is noted. Pursuant to the Staff’s request, the Company has revised the disclosure on pages 190 and 191 of the Amended Registration Statement and in the risk factor on page 51 of the Amended Registration Statement to reflect the Staff’s comment.

Company Response: The Staff’s comment is noted. Pursuant to the Staff’s request, the Company has revised the disclosure on page 192 of the Amended Registration Statement to reflect the Staff’s comment.

Company Response: The Staff’s comment is noted. Pursuant to the Staff’s request, the Company has revised the disclosure on page 192 of the Amended Registration Statement to reflect the Staff’s comment.

Company Response: The Staff’s comment is noted. Pursuant to the Staff’s request, the Company has revised the disclosure on page 212 of the Amended Registration Statement to reflect the Staff’s comments. Additionally, the Company has included the tax opinion of Weil, Gotshal & Manges LLP as Exhibit 8.1.

Company Response: The Staff’s comment is noted. Pursuant to the Staff’s request, the Company has revised the disclosure on page 231 of the Amended Registration Statement to reflect who will receive the payment from 4701 Meridian Lakehouse, LLC on or before May 31, 2026. In addition, the Company respectfully advises the Staff that Item 404(a) of Regulation S-K is not applicable to the Cigarette Holdings LLC transaction because the registrant is not a party to such transaction. The disclosure was provided solely for informational purposes for the Company’s stockholders.

Company Response: The Staff’s comment is noted. The contingent fees owing to Nomura upon the successful completion of the Business Combination consists of (a) an M&A fee of $20 million and (b) deferred underwriting fees of $4.4275 million ($8.05 million x 0.55). We have revised the disclosure on page 51 of the Amended Registration Statement to include this information.

The Company and its management acknowledge they are responsible for the accuracy and adequacy of their disclosures, notwithstanding any review, comments, action or absence of action by the Staff.

If you have any questions regarding the matters discussed above, please telephone the outside counsel to the Company, Steven Pidgeon at (480) 606-5124 or via email at Steven.Pidgeon@us.dlapiper.com.

Very truly yours,

/s/ Steven Pidgeon

Steven Pidgeon

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