United States securities and exchange commission logo
September 13, 2021
Eddie Ni
Chief Executive Officer
Goldenstone Acquisition Limited
4360 E. New York St.
Aurora, IL 60504
Re: Goldenstone
Acquisition Limited
Amendment No. 1 to
Registration Statement on Form S-1
Filed August 24,
2021
File No. 333-257209
Dear Mr. Ni:
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
29, 2021 letter.
Amendment No. 1 to Registration Statement on Form S-1
Cover Page
1. We note that a majority
of your executive officers and directors are located in or have
significant ties to
China or Hong Kong. Please disclose this prominently on the
prospectus cover page.
Your disclosure also should describe the legal and operational
risks associated with
being based in or acquiring a company that does business in China.
Your disclosure should
make clear whether these risks could result in a material change in
your or the target
company s post-combination operations or the value of your common
stock or could
significantly limit or completely hinder your ability to offer or continue to
offer securities to
investors and cause the value of such securities to significantly decline
or be worthless. Your
disclosure should address how recent statements and regulatory
Eddie Ni
FirstName LastNameEddie Ni
Goldenstone Acquisition Limited
Comapany 13,
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2021 Acquisition Limited
September
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actions by China s government, such as those related to the use of
variable interest entities
and data security or anti-monopoly concerns, has or may impact the
company s ability to
conduct its business, accept foreign investments, or list on an U.S.
or other foreign
exchange. Your prospectus summary should address, but not necessarily
be limited to, the
risks highlighted on the prospectus cover page.
Prospectus Summary, page 1
2. Given that you may be seeking to acquire a company that uses or may
use a variable
interest entity structure to conduct China-based operations, please
describe what that
organizational structure would entail. Explain that the entity in
which investors may hold
their interest may not be the entity or entities through which the
company s operations
may be conducted in China after the business combination. Discuss how
this type of
corporate structure may affect investors and the value of their
investment, including how
and why the contractual arrangements may be less effective than direct
ownership and that
the company may incur substantial costs to enforce the terms of the
arrangements.
Disclose the uncertainties regarding the status of the rights of a
holding company with
respect to its contractual arrangements with a VIE, its founders and
owners and the
challenges the company may face enforcing these contractual agreements
due to
uncertainties under Chinese law and jurisdictional limits.
3. In your summary of risk factors, disclose the risks that being based
in or acquiring a
company whose corporate structure or whose operations in China poses
to investors. In
particular, describe the significant regulatory, liquidity, and
enforcement risks with cross-
references to the more detailed discussion of these risks in the
prospectus. For example,
specifically discuss risks arising from the legal system in China,
including risks and
uncertainties regarding the enforcement of laws and that rules and
regulations in China
can change quickly with little advance notice; and the risk that the
Chinese government
may intervene or influence your operations at any time, or may exert
more control over
offerings conducted overseas and/or foreign investment in China-based
issuers, which
could result in a material change in your operations and/or the value
of your common
stock. Acknowledge any risks that any actions by the Chinese
government to exert more
oversight and control over offerings that are conducted overseas
and/or foreign investment
in China-based issuers could significantly limit or completely hinder
your ability to offer
or continue to offer securities to investors and cause the value of
such securities to
significantly decline or be worthless.
4. Disclose each permission that you are required to obtain from Chinese
authorities to
operate and issue these securities to foreign investors. State
affirmatively whether you
have received all requisite permissions and whether any permissions
have been denied.
5. Provide a clear description of how cash will be transferred through
the post-combination
organization if you acquire a company based in China. Describe any
restrictions on
foreign exchange and your ability to transfer cash between entities,
across borders, and to
U.S. investors that may apply after a business combination with a
company based in
Eddie Ni
Goldenstone Acquisition Limited
September 13, 2021
Page 3
China. Describe any restrictions and limitations on your ability to
distribute earnings
from your businesses, including subsidiaries and consolidated VIEs, to
the parent
company and U.S. investors as well as the ability to settle amounts
owed under the VIE
agreements.
6. Disclose that trading in your securities may be prohibited under the
Holding Foreign
Companies Accountable Act if the PCAOB determines that it cannot
inspect or fully
investigate your auditor or the auditor of a company you may target
for an initial business
combination, and that as a result an exchange may determine to delist
your securities. If
the PCAOB has been or is currently unable to inspect your auditor,
revise your disclosure
to so state.
Risk Factors, page 31
7. To the extent that you may acquire a company that uses or may use a
variable interest
entity structure to conduct China-based operations, please revise your
risk factors to
acknowledge that if the PRC government determines that the contractual
arrangements
constituting part of your VIE structure do not comply with PRC
regulations, or if these
regulations change or are interpreted differently in the future, your
shares may decline in
value or be worthless if you are unable to assert your contractual
control rights over the
assets of your PRC subsidiaries that may conduct all or substantially
all of your
operations.
8. Please expand your risk factor disclosure to address specifically any
PRC regulations
concerning mergers and acquisitions by foreign investors that your
initial business
combination transaction may be subject to, including PRC regulatory
reviews, which may
impact your ability to complete a business combination in the
prescribed time period.
9. Given the Chinese government s significant oversight and discretion
over the conduct
of the business of any China-based company that you may target for an
initial business
combination, please revise to separately highlight the risk that the
Chinese government
may intervene or influence your operations at any time, which could
result in a material
change in your operations and/or the value of your common stock. Also,
given recent
statements by the Chinese government indicating an intent to exert
more oversight and
control over offerings that are conducted overseas and/or foreign
investment in China-
based issuers, acknowledge the risk that any such action could
significantly limit or
completely hinder your ability to offer or continue to offer
securities to investors and
cause the value of such securities to significantly decline or be
worthless.
10. In light of recent events indicating greater oversight by the Cyberspace
Administration of
China over data security, particularly for companies seeking to list on
a foreign exchange,
FirstName LastNameEddie Ni
please revise your disclosure to explain how this oversight could impact
the process of
Comapany NameGoldenstone
searching Acquisition
for a target and completingLimited
an initial business
combination, and/or your
business
September on a Page
13, 2021 post-combination
3 basis.
FirstName LastName
Eddie Ni
FirstName LastNameEddie Ni
Goldenstone Acquisition Limited
Comapany 13,
September NameGoldenstone
2021 Acquisition Limited
September
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FirstName LastName
Exhibits
11. Refer to your response to comments 3 and 4 that you have revised
Exhibits 4.5 and 4.6. It
does not appear that you have refiled these exhibits. Please ensure
that the exclusive
forum provision in the warrant agreement filed as Exhibit 4.5 states
that it does not apply
to actions arising under the Securities Act or tell us how you will
inform investors in
future filings that the provision does not apply to any actions
arising under the Securities
Act. In addition, please ensure that the exclusive forum provision in
the Rights
Agreement filed as Exhibit 4.6 clearly states that it does not apply
to actions arising under
the Exchange Act or the Securities Act or tell us how you will inform
investors in future
filings that the provision does not apply to any actions arising under
the Exchange Act or
Securities Act.
You may contact John Spitz at 202-551-3484 or Amit Pande, Accounting
Branch Chief,
at 202-551-3423 if you have questions regarding comments on the financial
statements and
related matters. Please contact Sonia Bednarowski at 202-551-3666 or Justin
Dobbie at 202-
551-3469 with any other questions.
Sincerely,
Division of
Corporation Finance
Office of
Finance