United States securities and exchange commission logo
June 15, 2020
Alec Shkolnik
President and Chief Executive Officer
LiquidPiston, Inc.
1292a Blue Hills Avenue
Bloomfield, CT 06002
Re: LiquidPiston, Inc.
Offering Statement
on Form 1-A
Filed May 20, 2020
File No. 024-11219
Dear Mr. Shkolnik:
We have reviewed your offering 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 offering 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 offering statement and
the information you
provide in response to these comments, we may have additional comments.
Form 1-A Regulation Offering Statement
We are and may continue to be significantly impacted by the worldwide
economic downturn due
to the COVID-19 pandemic. , page 6
1. We note that you have
received $323,507 in government (SBA) assistance including
partially forgivable
loans under the Paycheck Protection Program. Please disclose the
following: (i) the
material terms of the loan; (ii) how you intend to use the loan proceeds;
and (iii) whether you
expect the loan to be forgiven.
Management's Discussion and Analysis of Financial Condition and Results
of Operations
Trend Information, page 19
2. Please expand your
disclosure to describe how you expect the COVID-19 pandemic to
impact your future
operating results and near-and-long-term financial condition.
Alec Shkolnik
FirstName LastNameAlec Shkolnik
LiquidPiston, Inc.
Comapany NameLiquidPiston, Inc.
June 15, 2020
June 15, 2020 Page 2
Page 2
FirstName LastName
Selling Stockholders, page 31
3. We note your disclosure that Selling stockholders will participate on
a pro rata basis.
Please revise your disclosure to explain the mechanics for how
investors will purchase
shares from the selling stockholders.
Notes to the Consolidated Financial Statements, page F-7
4. Please revise your notes to the consolidated financial statements to
include your policy for
the recognition of grant revenue. Your disclosures should include the
conditions, if any,
that must be meet in order for revenue to be recognized and why you
believe it is
appropriate to classify such amounts as revenue rather than income or
reduction of
expense.
5. We note from your disclosures elsewhere in the filing that your DOD
awards through
DARPA and the Army concluded in 2019 as you successfully delivered all
contractual
deliverables of these programs. Please tell us whether such
deliverables represented
performance obligations under ASC 606. As part of your response,
please describe for us
in greater detail the nature and terms of the arrangements with the
respective government
entities, including any goods or services you provided in exchange for
the grant, and your
consideration of the arrangements under the guidance ASC 606 as it is
not apparent from
your notes to the consolidated financial statements.
General
6. We note that bonus shares are being offered to investors that
qualifies as a StartEngine
OWNers. We also note that bonus shares are being offered to investors
who meet certain
investment thresholds set forth on page 32. Please revise your
disclosures to clarify
whether the bonus shares being offered by the selling shareholders are
shares that they
currently own.
7. It appears that StartEngine Crowdfunding, Inc. may be acting as an
underwriter. Please
identify StartEngine Crowdfunding, Inc. as such or explain why it is
not an underwriter.
8. We note that you have a limited pool of bonus shares and that you are
offering two types
of bonus shares. Please revise your disclosure to address whether
certain investors will be
unable to receive the bonus shares if you have issued all of the
shares from the bonus
share pool. Please consider including appropriate risk factor
disclosures.
We will consider qualifying your offering statement at your request. If
a participant in
your offering is required to clear its compensation arrangements with FINRA,
please have
FINRA advise us that it has no objections to the compensation arrangements
prior to
qualification.
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
Alec Shkolnik
LiquidPiston, Inc.
June 15, 2020
Page 3
action by the staff. We also remind you that, following qualification of your
Form 1-A, Rule 257
of Regulation A requires you to file periodic and current reports, including a
Form 1-K which
will be due within 120 calendar days after the end of the fiscal year covered
by the report.
You may contact Charles Eastman, Staff Accountant, at 202-551-3794 or
Jean Yu, Staff
Accountant, at 202-551-3305 if you have questions regarding comments on the
financial
statements and related matters. Please contact Asia Timmons-Pierce, Special
Counsel, at 202-
551-3754 or Jay Ingram, Legal Branch Chief, at 202-551-3397 with any other
questions.
FirstName LastNameAlec Shkolnik Sincerely,
Comapany NameLiquidPiston, Inc.
Division of
Corporation Finance
June 15, 2020 Page 3 Office of
Manufacturing
FirstName LastName