United States securities and exchange commission logo
April 29, 2022
Yoav Leibovitch
Chief Financial Officer
SatixFy Communications Ltd.
12 Hamada St., Rehovot 670315
Israel
Re: SatixFy
Communications Ltd.
Draft Registration
Statement on Form F-4
Submitted March 31,
2022
CIK No. 0001915403
Dear Mr. Leibovitch :
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-4
Summary, page 28
1. Please highlight the
material risks to public warrant holders of EDNCU, including those
arising from
differences between the private and public warrants. Clarify whether recent
common stock trading
prices exceed the threshold that would allow EDNCU to redeem
public warrants.
Clearly explain the steps, if any, you will take to notify all shareholders,
including beneficial
owners, regarding when the warrants become eligible for redemption.
2. We note that certain
shareholders agreed to waive their redemption rights. Please describe
any consideration
provided in exchange for this agreement.
3. Please provide an
organizational chart outlining your post-business combination corporate
Yoav Leibovitch
FirstName LastNameYoavLtd.
Leibovitch
SatixFy Communications
Comapany
April NameSatixFy Communications Ltd.
29, 2022
April 229, 2022 Page 2
Page
FirstName LastName
structure and illustrating the relationships of the various entities
discussed throughout the
registration statement.
Subscription Agreements, page 30
4. Please clearly disclose the closing conditions to the Subscription
Agreement. Please
clearly disclose whether PIPE investors are obligated to close if the
Minimum Cash
Condition or Aggregate Transaction Proceeds conditions are waived or
modified.
Interests of EDNCU's Directors and Officers in the Business Combination, page
38
5. Please revise to disclose the consideration paid by the Sponsor for
the Price Adjustment
Shares and disclose the approximate dollar value of such interest.
6. Please revise to describe the consideration received by the Sponsor
for the 1,430,000
Founder Shares that it no longer owns.
7. Please revise to quantify the aggregate dollar amount of loans
extended for which the
Sponsor and its affiliates are awaiting reimbursement.
8. In your next amendment please fill in the various blanks as of the
most recent practicable
date.
9. Please disclose the amount the Sponsor paid per share for the Founder
Shares.
10. Please disclose the Sponsor and its affiliates total potential
ownership interest in the
combined company, assuming exercise and conversion of all securities.
We rely on third parties for manufacturing of our chips and other satellite
communications
system components, page 48
11. We note that a majority of your chips are supplied by a single
foundry,
GlobalFoundries. Please disclose any disruptions that you have
experienced due to such
reliance.
Proposal One - The Business Combination Proposal, page 113
12. Please elaborate on the role of the financial advisors. Please clarify
whether the financial
advisors delivered any reports to the boards that were materially
related to the transaction.
13. We note that EDNCU s amended and restated memorandum and articles of
association
provide that, to the fullest extent permitted by applicable law,
neither the Sponsor nor any
individual serving as a director or officer shall have any duty,
except and to the extent
expressly assumed by contract, to refrain from engaging directly or
indirectly in the same
or similar business activities or lines of business as EDNCU. Please
address this potential
conflict of interest and disclose whether it impacted EDNCU's search
for an acquisition
target.
Yoav Leibovitch
FirstName LastNameYoavLtd.
Leibovitch
SatixFy Communications
Comapany
April NameSatixFy Communications Ltd.
29, 2022
April 329, 2022 Page 3
Page
FirstName LastName
Unaudited Prospective Financial Information of SatixFy, page 127
14. We note that SatixFy provided forecasts through 2026. Please provide
an explanation for
the basis of the projections beyond the third year. Disclose whether
the projections are in
line with historic operating trends. Address why the change in trends
is appropriate or the
assumptions are reasonable. While you have a history of operating
losses, the forecasts
project increasing total gross profit, including $374 million in 2026.
Clearly describe the
basis for such projections and the factors or contingencies that would
affect those
projections.
15. We note your disclosure that the 2021E information contained in the
presentation deck
prepared for the PIPE Investors and certain accredited investors was
previously filed with
the SEC under Rule 425. We could not find the presentation deck that
included 2021E
information. Please advise.
Certain Engagements in Connection with the Business Combination and Related
Transactions,
page 132
16. We note your disclosure that Cantor and Barclays are acting as joint
placement agents to
EDNCU and SatixFy in connection with the PIPE Financing and will
receive fees and
expense reimbursements customary for such transactions. Please
disclose the fees
payable to each of Cantor and Barclays in connection with the PIPE
Financing. Please
also disclose the aggregate fees that each advisor is entitled to
receive in connection with
the business combination and EDNCU IPO.
17. We note your disclosure that additional fees will be paid to the
financial advisors
depending on the amount of Proceeds involved in the Business
Combination. Please
disclose the threshold that would trigger any additional proceeds to
the financial advisors.
Satixfy's Business, page 204
18. Please revise to include a breakdown of total revenues by geographic
market and disclose
what your key targeted markets are. Refer to Item 4.B.2 of Form 20-F.
Market Trends and Uncertainties, page 220
19. We note that you have experienced supply chain disruptions. Revise to
discuss known
trends or uncertainties resulting from mitigation efforts undertaken,
if any. Explain
whether any mitigation efforts introduce new material risks, including
those related to
product quality, reliability, or regulatory approval of products.
U.S. Federal Income Tax Considerations, page 254
20. We note the disclosure that it is intended that the Business
Combination qualify as a
reorganization within the meaning of Section 368(a) of the Code.
Please revise your
disclosures here to more clearly state counsel's tax opinion on
whether the transaction will
qualify as a reorganization. Also, state in your disclosure here that
the discussion is the
Yoav Leibovitch
FirstName LastNameYoavLtd.
Leibovitch
SatixFy Communications
Comapany
April NameSatixFy Communications Ltd.
29, 2022
April 429, 2022 Page 4
Page
FirstName LastName
opinion of tax counsel and identify counsel. Whenever there is
significant doubt about the
tax consequences of the transaction, it is permissible for the tax
opinion to use should
rather than will, but counsel providing the opinion must explain
why it cannot give a
will opinion and describe the degree of uncertainty in the
opinion. Please refer to
Sections III.B and C of Staff Legal Bulletin 19.
Description of Satixfy Warrants, page 281
21. We note your disclosure on page 286. Please add a risk factor relating
to the exclusive
forum provision contained in the warrant agreement.
Satixfy Communications Ltd Financial Statements
Note 2 Significant Accounting Policies
A Basis of Preparation, page F-10
22. Please provide two years of audited financial data. Refer to the
guidance in section III
B.1.c of the Accessing the U.S. Capital Markets A Brief Overview
for Foreign Private
Issuers, which can be found at
https://www.sec.gov/divisions/corpfin/internatl/foreign-
private-issuers-overview.shtml#IIIB1c. Accordingly, please update your
financial
statements pursuant to Item 8.A.5 of Form 20-F.
Note 8 Investment in Jet-Talk, page F-25
23. We note that your company holds majority voting rights (51%) of
Jet-Talk. Please
explain in detail why equity accounting is appropriate and provide us
with your analysis
which supports your accounting treatment. Your response should include
the relevant
accounting guidance you relied upon, including your consideration of
paragraphs 5-7 of
IFRS 10 and the salient terms and conditions of the agreement which
support your
conclusion.
24. We note from your disclosures on page 218 that Jet-Talk is one of your
three largest
customers and accounted for xx and 68% of your revenues in the years
ended December
31, 2021 and 2020, respectively. Please explain why you believe it is
appropriate to
record the provision of development services to Jet-Talk as revenue
rather than as an
offset to research and development expenses on your statement of
operations. As part of
your response, please describe for us in detail the nature of the
development services
provided to Jet-Talk and whether you are entitled to or retain rights
to any intellectual
property arising from the development of the Aero/IFC satellite
communications terminal
for commercial aircraft contracts. Please include relevant
authoritative guidance that you
relied upon in determining your accounting treatment.
Audited Financial Statements of Endurance Acquisition Corp.
Note 7 - Warrant Liabilities, page F-57
25. We note from disclosures on page F-59 that Endurance Acquisition Corp.
accounted for
Yoav Leibovitch
FirstName LastNameYoavLtd.
Leibovitch
SatixFy Communications
Comapany
April NameSatixFy Communications Ltd.
29, 2022
April 529, 2022 Page 5
Page
FirstName LastName
its Public Warrants and Private Placement Warrants as liabilities in
accordance with the
guidance contained in ASC 815-40 because it does not control the
occurrence of events,
such as a tender offer or exchange that may trigger cash settlement of
the warrants where
not all of the shareholders also receive cash, the warrants do not
meet the criteria for
equity treatment thereunder, and as such, the warrants must be
recorded as derivative
liability. However, EDNCU's critical accounting policy for warrant
liability on page 214
states EDNCU Private Warrants are accounted for as warrant liabilities
due to certain
features contained in the warrant agreements that give rise to
liability treatment and
EDNCU Public Warrants are treated as equity as they do not meet the
definition of a
warrant liability. Please revise your disclosures in the filing, where
appropriate, to correct
the inconsistency.
Exhibits and Financial Statements Schedules, page II-1
26. We note that the Company has entered into a joint venture agreement
with ST Electronics
(Satcom & Sensor Systems) Pte Ltd and two development agreements with
Jet Talk
Limited. Please file all material agreements related to Jet Talk as
exhibits to your
registration statement.
27. Please clarify if you have an agreement with the European Space Agency
and, if so, file
the agreement as an exhibit to your registration statement.
General
28. On page 47, you state that you are exposed to supply chain risk in
light of the conflict
between Russia and Ukraine. Please disclose whether and how your
business segments,
products, lines of service, projects, or operations are materially
impacted by supply chain
disruptions, especially in light of the conflict between Russia and
Ukraine. For example,
discuss whether you have:
had to suspend the production, purchase, sale or maintenance of
certain items;
experienced higher costs due to constrained capacity or increased
commodity prices;
experienced surges or declines in consumer demand for which you
are unable to
adequately adjust your supply; or
been unable to supply products at competitive prices or at all due
to export
restrictions, sanctions, or the ongoing conflict.
Explain whether and how you have undertaken efforts to mitigate the
impact and where
possible quantify the impact to your business.
You may contact Andri Carpenter at 202-551-3645 or Jean Yu at
202-551-3305 if you
have questions regarding comments on the financial statements and related
matters. Please
contact Evan Ewing at 202-551-5920 or Asia Timmons-Pierce at 202-551-3754 with
any other
questions.
Yoav Leibovitch
SatixFy Communications Ltd.
April 29, 2022
Page 6
Sincerely,
FirstName LastNameYoav Leibovitch
Division of Corporation Finance
Comapany NameSatixFy Communications Ltd.
Office of Manufacturing
April 29, 2022 Page 6
cc: Brian Wolfe
FirstName LastName