United States securities and exchange commission logo
April 7, 2022
Boaz Shetzer
Chief Executive Officer
ParaZero Technologies Ltd.
30 Dov Hoz
Kiryat Ono, 5555626, Israel
Re: ParaZero
Technologies Ltd.
Draft Registration
Statement on Form F-1
Submitted March 11,
2022
CIK No. 0001916241
Dear Mr. Shetzer:
We have reviewed your draft 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 providing the requested
information and either submitting
an amended draft registration statement or publicly filing your
registration statement on
EDGAR. 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 the information you provide in response to these
comments and your
amended draft registration statement or filed registration statement, we
may have additional
comments.
Draft Registration Statement on Form F-1 submitted March 11, 2022
Market, Industry and Other Data, page iii
1. We note that the
prospectus includes market, industry and other data based on information
from several
third-party sources. Please tell us if you commissioned any of the industry or
other data that you
reference in the prospectus and, if so, file consents of such third parties
pursuant to Rule 436 of
the Securities Act as exhibits to your registration statement or
advise.
Risk Factors, page 12
2. We note your disclsoure
that Delta Drone and its subsidiaries have the right to purchase
from the company all of
the company s commercial products that are sold by the company
Boaz Shetzer
FirstName LastNameBoaz
ParaZero Technologies Ltd.Shetzer
Comapany
April NameParaZero Technologies Ltd.
7, 2022
April 27, 2022 Page 2
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FirstName LastName
at any time during the specified period. Please consider including
risk factor
disclosure regarding your obligations under the SPA.
Risk Factors
Our principal shareholders, and related officers and directors..., page 28
3. We note your disclosure that your principal shareholders, and related
officers and
directors beneficially own approximately 59% of your ordinary shares.
Please tell us
whether you will be a "controlled company" under Nasdaq listing rules
after the
completion of the offering and, if so, disclose the corporate
governance exemptions that
will be available to you and the related risks to investors.
Use of Proceeds, page 38
4. You disclose that you will use a portion of proceeds for possible
future acquisitions.
Please revise to provide a brief description of your acquisition
plans, including types of
opportunities you intend to explore. Alternatively, clarify that
management has not yet
determined the types of businesses that you will target or the terms
of any potential
acquisitions. See Item 3.C.3 of Part 1 of Form 20-F.
Liquidity and Capital Resources, page 47
5. Please quantify and more fully disclose and discuss your short and
long
term liquidity requirements and priorities, including potential
changes in your priorities
based on the impact of variations in the amount of cash available to
the company from
offering proceeds.
Business, page 52
6. We note your disclosure that you rely on licensing partners and
licensees. Please discuss
your licensing arrangements. For each material licensing agreement you
have entered into
disclose the material terms of the agreement, including the duration
and termination
provisions and the royalty term and any royalty term expiration
provisions.
Milestones, page 54
7. We note that throughout your registration statement you provide
footnotes citing
hyperlinks to third-party websites to support factual assertions,
statistical data or
otherwise. Please be advised that where you include a hyperlink in
your filing, you
assume responsibility for the information on the hyperlinked website
and the information
accessible through the hyperlinked website as if it were part of your
filing. Please refer to
Release No. 34-42728 for further guidance regarding the use of
hyperlinks in your filing.
Please revise.
8. Please revise to elaborate on your partnership with Allianz Global
Corporate & Specialty.
Boaz Shetzer
FirstName LastNameBoaz
ParaZero Technologies Ltd.Shetzer
Comapany
April NameParaZero Technologies Ltd.
7, 2022
April 37, 2022 Page 3
Page
FirstName LastName
Intellectual Property, page 62
9. We note you hold a number of patents, including patents in China.
Please include or
revise risk factors discussing any risks associated with protecting
intellectual property in
China.
Notes to Financial Statements
Note 2 - Significant Accounting Policies
I. Revenue Recognition, page F-13
10. Please expand your disclosures consistent with the requirements in
IFRS 15 and
considering the appropriate level of detail based on materiality to
provide company-
specific information for:
The nature of the goods and services that you have promised to
transfer. See
paragraph 119 of IFRS 15;
The performance obligation(s) you have determined from your
contracts with
customers. For each performance obligation highlight whether you
have bundled any
goods or services that are not considered distinct pursuant to
paragraphs 26 through
30 of IFRS 15;
Your typical payment terms for your performance obligations. See
paragraph 119 of
IFRS 15. We note your disclosure that the Company "usually has a
present right to
receive payment." Please clarify under what circumstances the
Company would not
have a right to receive payment, but would record revenue;
The timing of when you recognize revenue (i.e., point in time or
over time). See
paragraph 124 of IFRS 15;
Provide disclosures for each type of variable consideration
included in the transaction
price and the significant judgments used, if applicable. See
paragraph 126 of IFRS
15; and
If material, the amount of any contract assets and liabilities
that result from your
arrangement. See paragraph 116 through 118 of IFRS 15.
Note 3 - Critical Accounting Estimates and Judgments
Inventory Net Realized Value, page F-16
11. Based on the material impact that net realizable value adjustments had
on operating results
during 2020, it appears to us you should expand your disclosures to
provide additional
insights into the impairments you recorded and address the following:
Explain the specific reasons for the impairments you recorded in
2020.
Quantify and discuss the significant estimates and assumptions you
used to determine
net realizable values.
Discuss material uncertainties associated with your key
assumptions and potential
events and/or circumstances that could have a negative impact on
estimated realizable
values.
Item 7. Recent Sales of Unregistered Securities., page II-2
Boaz Shetzer
ParaZero Technologies Ltd.
April 7, 2022
Page 4
12. For each of the issuances discussed in this section, please identify the
exemption from
registration pursuant to which you issued these securities. Please also
identify the persons
or class of persons to whom the equity investment agreements were sold.
See Item 701 of
Regulation S-K.
General
13. Please supplementally provide us with copies of all written
communications, as defined in
Rule 405 under the Securities Act, that you, or anyone authorized to do
so on your behalf,
present to potential investors in reliance on Section 5(d) of the
Securities Act, whether or
not they retain copies of the communications. Please contact the staff
member associated
with the review of this filing to discuss how to submit such copies.
You may contact Mindy Hooker at (202) 551-3732 or Kevin Woody at (202)
551-3629 if
you have questions regarding comments on the financial statements and related
matters. Please
contact Patrick Fullem at (202) 551-8337 or Asia Timmons-Pierce at (202)
551-3754 with any
other questions.
Sincerely,
FirstName LastNameBoaz Shetzer
Division of
Corporation Finance
Comapany NameParaZero Technologies Ltd.
Office of
Manufacturing
April 7, 2022 Page 4
cc: David Huberman
FirstName LastName