United States securities and exchange commission logo
June 15, 2022
Alice Chang
Chief Executive Officer
Perfect Corp.
14F, No. 98 Minquan Road
Xindian District
New Taipei City 231
Taiwan
Re: Perfect Corp.
Amendment No. 1 to
Registration Statement on Form F-4
Filed May 27, 2022
File No. 333-263841
Dear Ms. Chang:
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 April
27, 2022 letter.
Amendment No. 1 to Form F-4
Cover Page
1. We note your response
to prior comments 2 and 3. Please revise to include the disclosure
responsive to those
comments at the forepart of the cover page. Disclose whether
Perfect's PRC
subsidiary has obtained and maintained all applicable licenses and
approvals from the
applicable regulatory authorities to provide its current services.
Additionally, state
that any action by the PRC government could significantly limit or
completely hinder the
parties' ability to consummate the Business Combination.
Alice Chang
FirstName LastNameAlice Chang
Perfect Corp.
Comapany
June NamePerfect Corp.
15, 2022
June 15,
Page 2 2022 Page 2
FirstName LastName
What positive and negative factors did Providents Board consider when
determining whether or
not to proceed with the Business Combination?, page 10
2. We note your disclosure here and elsewhere that in evaluating the
business combination,
Provident's board considered Perfect's CLTV to CAC ratio. Please
provide disclosure
explaining why this metric provides useful information to potential
investors about
Perfect's business. Identify all underlying estimates or assumptions
used in calculating the
metric, including total estimated contract revenue. Additionally,
because the metric
utilizes future projections, revise to address the significant
uncertainties with the accuracy
of this forward-looking information. Lastly, provide the basis for
your assertion that the
metric indicates attractive unit economics among SaaS companies. For
guidance, refer
to SEC Release No. 33-10751.
Question and Answers about the Proposed Transactions
What positive and negative factors....to proceed with the Business
Combination?, page 11
3. Revise your discussion of high revenue growth potential to include
updated financial
information for the year ended December 31, 2021. Further, revise to
remove your
statement that revenue is expected to grow at a CAGR of 32% between
2019 and 2021, as
it no longer seems current.
What equity stake will current Provident shareholders, the FPA Investors, the
PIPE Investors...,
page 16
4. Refer to prior comment 8. Please quantify the value of warrants, based
on recent trading
prices, that may be retained by redeeming stockholders assuming
maximum redemptions
and identify any material resulting risks.
Background of the Business Combination, page 128
5. We note your response to prior comment 17. Please revise to provide
additional details
regarding the the Initial Target and the decision not to pursue a
business combination.
Provide additional details and context regarding your disclosure that
"the Initial Target
was focusing on a strategic transaction, which had potential impact on
the timeline of its
preparation for and negotiation of the potential business
combination."
Reasons for the Approval of the Proposed Transactions, page 134
6. We note your disclosure that you expect the CAGR from 2021 to 2023 to
be 46%. Please
revise to discuss the assumptions underlying those projections and
provide
fulsome disclosure regarding the projected CAGR.
Unaudited Pro Forma Condensed Combined Financial Information
Note 4 - Adjustments to Unaudited Pro Forma Condensed Combined Financial
Information
Note (I), page 180
Alice Chang
FirstName LastNameAlice Chang
Perfect Corp.
Comapany
June NamePerfect Corp.
15, 2022
June 15,
Page 3 2022 Page 3
FirstName LastName
7. Your response to prior comment 19 indicates that you reflect the costs
incurred by
Provident in accumulated deficit since the transaction will be
accounted for as a
capital raise and therefore the costs of raising capital are charged
directly to equity. Since
Perfect Corp. is the issuer, please explain why Provident's costs are
not reflected in the
profit or loss for the year ended December 31, 2021. As part of your
response, provide us
with a breakdown of the $13.1 million in costs incurred by Provident
and clarify if any of
these costs were incurred in connection with the PIPE transaction. In
this regard, these
costs may be accounted for as an offset to equity in accordance with
SAB Topic 5A.
Note 5 - Pro forma Share and Earnings per share information, page 183
8. We note you are presenting a different pro forma net loss attributable
to shareholders on a
diluted basis compared to the pro forma net loss, for both scenarios.
Please revise to
disclose the nature and amount of these differences and why such
adjustments are
appropriate. Further, revise to disclose the adjustments to pro forma
weighted average
shares outstanding basic to arrive at the weighted average shares
outstanding diluted,
and explain why such adjustments are appropriate given the pro forma
net loss, for both
scenarios.
Perfect's Business
Product Pipeline
Non-fungible tokens (NFTs), page 222
9. We note your response to prior comment 22. Please revise your
disclosure to provide a
discussion of:
The specific blockchains on which your NFTs are offered, any
applicable network
transaction fees, the amount of any crypto assets currently held,
and how those assets
are stored;
The policies you have in place for determining whether the NFTs
offered on your
platform are securities;
the risks associated with increased regulatory actions as it
relates to crypto assets or
NFTs; and
Whether the platform permits users to send or receive crypto
assets other than NFTs
10. Please supplementally provide us with your detailed legal analysis as
to why your NFT
business does not or will not involve the offer and sale of securities
within the meaning of
Section 2(a)(1) of the Securities Act of 1933, the offer and sale of
which should be
registered under the Act. Your analysis should address the NFTs
themselves and the
platform through which the NFTs are being issued. See Gary Plastic
Packaging Corp. v.
Merrill Lynch, Pierce, Fenner & Smith, Inc., 756 F.2d 230 (2d Cir.
1985).
Management's Discussion and Analysis of Financial Condition and Results of
Operations
Key Factors Affecting Our Results of Operations
Our ability to monetize our services, page 236
Alice Chang
Perfect Corp.
June 15, 2022
Page 4
11. We note your response to prior comment 23 that the NDRR and retention
rate metrics are
for key customers, which accounted for approximately 63% of revenue in
2021. Tell us
and revise to disclose the type(s) of customers that contribute the
remaining 37% of
revenue and how or whether management monitors those results. Also,
you indicate that
these key customers accounted for 95% of the total revenue from brands
in 2021. Revise
to further to explain what "revenue from brands" means, disclose the
percentage of
revenue from brands to total revenue, and describe the types of
customers from which the
remaining revenue is derived.
Notes to the Consolidated Financial Statements
Note 6. Details of Significant Accounts
6(14) Revenue, page F-72
12. We note your revised disclosure in response to prior comment 34.
Please further revise to
disclose when you expect to recognize the transaction price allocated
to unsatisfied
contracts as of December 31, 2021, within the years 2022-2026, either
on a quantitative
basis or by using qualitative information. Refer to IFRS 15, paragraph
120.
You may contact Melissa Kindelan, Senior Staff Accountant, at (202)
551-3564 or
Christine Dietz, Senior Staff Accountant, at (202) 551-3408 if you have
questions regarding
comments on the financial statements and related matters. Please contact
Matthew Derby, Staff
Attorney, at (202) 551-3334 or Joshua Shainess, Legal Branch Chief, at (202)
551-7951 with any
other questions.
FirstName LastNameAlice Chang Sincerely,
Comapany NamePerfect Corp.
Division of
Corporation Finance
June 15, 2022 Page 4 Office of
Technology
FirstName LastName