United States securities and exchange commission logo
July 28, 2022
James Sullivan
Chief Financial Officer
Peraso Inc.
2309 Bering Drive
San Jose, CA 95131
Re: Peraso Inc.
Form 10-K for the
Fiscal Year ended December 31, 2021
Filed March 31,
2022
File No. 000-32929
Dear Mr. Sullivan:
We have limited our review of your filing to the financial
statements and related
disclosures 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 these comments within ten business days by
providing the requested
information or advise us as soon as possible when you will respond. If
you do not believe our
comments apply to your facts and circumstances, please tell us why in
your response.
After reviewing your
response to these comments, we may have additional comments.
Form 10-K for the Fiscal Year ended December 31, 2021
General
1. The comments in this
letter reference disclosures and accounting observed in your annual
report although also
apply to any corresponding matters in your subsequent interim
report. Please submit
the revisions that you propose to address the concerns outlined in
these comments in
amendments to the annual and subsequent interim reports.
Market for Registrants Common Equity, Related Stockholder Matters and
Issuer Purchases of
Equity Securities, page 26
2. Please revise your
filing to include the information prescribed by Item 701 of Regulation
S-K as to the preferred
securities issued in connection with your reverse merger.
James Sullivan
FirstName
Peraso Inc.LastNameJames Sullivan
Comapany
July NamePeraso Inc.
28, 2022
July 28,
Page 2 2022 Page 2
FirstName LastName
Management's Discussion and Analysis of Financial Condition and Results of
Operations
Overview, page 27
3. We note that your disclosures on pages 20 and 28 mention the
possibility that operations
of your key suppliers and manufacturing partners may be adversely
affected as a result of
the pandemic and of shortages in the global semiconductor business.
Please clarify
whether these concerns materially effect your outlook or business
goals, and disclose the
extent to which your results of operations and capital resources have
been impacted.
Please also discuss any efforts that you have undertaken to mitigate
these concerns and
any uncertainties arising from those efforts or which otherwise
prevail over your ability to
maintain or ensure product quality, reliability of product development
and order
fulfillment processes, or to obtain regulatory approvals.
Results of Operations, page 31
4. Please expand your disclosure to address any known trends, events or
uncertainties that
have had, or that are reasonably likely to have, a material impact on
your cash flows,
liquidity, capital resources, cash requirements, financial position,
or results of operations,
as may be attributable to the supply chain and inflation risks that
you mention on pages 19
and 20, including risks arising from your dependence on contract
manufacturers,
independent foundries, and testing and assembly vendors.
Please clarify the extent to which your revenues and cost of revenues
have been or are
expected to be impacted by supply chain disruption and inflation, and
discuss any plans
that you have to respond to or counter any adverse circumstances.
5. We note your disclosure indicating the increase in revenues is
attributable to an increase
in product shipments and that you have a similar explanation in your
subsequent interim
report though also associate the change to differences in the
availability of your memory
IC and mmWave module products, comparing one period to the other.
Please expand your discussion and analysis to address changes in
revenues with reference
to both quantities and prices of the various products sold to comply
with Item 303(b)(2) of
Regulation S-K. Please quantify and discuss the reasons for material
changes in the
volumes of product sales and changes in product pricing.
Controls and Procedures, page 35
6. We note that you evaluated the effectiveness of disclosure controls
and procedures and
internal control over financial reporting, and concluded that these
were both effective; and
that you reached a similar conclusion about disclosure controls and
procedures in your
subsequent interim report. Given the nature of concerns raised in the
other comments in
this letter, please revisit these assessments when formulating your
response.
James Sullivan
FirstName
Peraso Inc.LastNameJames Sullivan
Comapany
July NamePeraso Inc.
28, 2022
July 28,
Page 3 2022 Page 3
FirstName LastName
Financial Statements
Consolidated Statements of Operations, page 63
7. We note your disclosure on page 25 of your subsequent interim report
indicating that you
are reporting some amortization of your intangible assets as research
and development
expense in the Statements of Operations. We also see that you have
disclosures on pages
9, 29 and 70 of the annual report indicating that your intangible
assets include patents,
developed technology, and customer relationships.
Please expand your accounting policy disclosures regarding Cost of Net
Revenues and
Research and Development on pages 72 and 73 to describe the nature of
the intangible
assets that are subject to amortization and to clarify how you
differentiate between
intangible assets that are associated with customers or products sold,
from those that are
not, in determining an appropriate classification for amortization.
Tell us the extent to which amortization of your intangible assets has
been reported in
each of these line items for each period covered by your annual and
subsequent interim
reports, and if amortization relating to customer lists or products
sold has not been
reported as a component of Cost of Net Revenues, explain your
rationale and provide us
with your view on materiality along with any supporting analyses that
you prepared.
We generally believe that measures of gross profit should reflect all
costs that are
attributable to the generation of revenues to comply with GAAP.
Note 2 - Business Combination
Arrangement, page 74
8. Please expand your disclosures to more clearly identify and describe
the businesses of
both the accounting acquirer and the accounting acquiree, and to
describe the primary
reasons for the business combination to comply with FASB ASC
805-10-50.
Please also describe the inputs utilized in valuing the equity
consideration to include
any quoted market prices and dates of reference.
Securities Conversion, page 75
9. We understand that shareholders of Peraso Technologies Inc., prior to
the reverse merger
on December 17, 2021, arranged to receive 9,295,097 shares of a
subsidiary of MoSys,
Inc., named 2864555 Ontario Inc. (a/k/a/ Canco), and 3,558,151 common
shares
of MoSys, Inc. (subsequently renamed Peraso, Inc.), and that some of
these shares would
be placed in escrow generally for at least one year and possibly for
up to three years.
You indicate that shares of Canco may be exchanged for shares of
MoSys, Inc. and that
shares of Series A Special Voting Preferred Stock would be issued to
the former
shareholders of Peraso Technologies Inc. who have opted to receive the
Canco shares in
James Sullivan
Peraso Inc.
July 28, 2022
Page 4
order to convey voting and dividend rights equivalent to those that
would be held if the
recipients elected to exchange their Canco shares for your common
shares.
However, you do not report any outstanding preferred shares in your
Balance Sheet on
page 62, or in your Statements of Stockholders' Equity on page 64; and
your disclosure on
page 75 indicates that you are reporting the shares of Canco as if
they were shares of your
common stock, reasoning that they are similar in substance, possibly
when coupled
with the rights conveyed via the Series A preferred shares.
Based on these observations, unless you are able to identify
authoritative support for your
accounting presentation, it appears that you will need to revise your
financial statements
and related disclosures to reflect the actual number of common and
preferred shares that
were issued by the parent company in conjunction with the reverse
merger, including the
recasting of equity activity pursuant to FASB ASC 805-40-45-2(d). Your
revisions
should also serve to address the following points.
Clarify the manner by which the exchange rights of the Canco
shares are coupled
with the voting and dividend rights of the Series A preferred
shares.
Explain how conversion or exchange of the Canco shares would be
correlated with
any cancellation or relinquishment of Series A preferred shares.
Reveal the nature and extent of any assets and operations of
Canco, along with the
percentage of the minority ownership of Canco.
Measuring the Consideration Transferred, page 77
10. Please expand your disclosure concerning the acquired intangible
assets to provide the
information prescribed by FASB ASC 350-30-50-1 and 50-2.
In closing, 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 action by the staff.
You may contact Jenifer Gallagher, Staff Accountant at (202) 551-3706 or
Karl Hiller,
Branch Chief at (202) 551-3686 with any questions.
FirstName LastNameJames Sullivan Sincerely,
Comapany NamePeraso Inc.
Division of
Corporation Finance
July 28, 2022 Page 4 Office of Energy
& Transportation
FirstName LastName