United States securities and exchange commission logo
September 12, 2022
Ahmed Fattouh
Chairman and Chief Executive Officer
InterPrivate II Acquisition Corp.
1350 Avenue of the Americas, 2nd Floor
New York, New York 10019
Re: InterPrivate II
Acquisition Corp.
Amendment No. 1 to
Registration Statement on Form S-4
Filed August 12,
2022
File No. 333-266054
Dear Mr. Fattouh:
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
August 5, 2022 letter.
Amendment No. 1 to Registration Statement on Form S-4 filed August 12,
2022
Cover Page
1. We note your response
to comment 2 that the "parties have not yet determined the terms
of the re-allocation"
and that "the Company will provide the requested disclosure in a pre-
effective amendment to
the Amended Registration Statement." In connection therewith,
and in addition to
including a new question and answer on the allocations:
Please confirm
that you will provide the requested disclosure on the cover page, and
that of the
9,333,333 shares held in escrow and the 3,850,000 private warrants held
by the sponsor, you
will finalize and include the allocation terms, including the
amounts to be
issued and to whom, as well as the related mechanics and timing.
Ahmed Fattouh
FirstName
InterPrivateLastNameAhmed Fattouh
II Acquisition Corp.
Comapany 12,
September NameInterPrivate
2022 II Acquisition Corp.
September
Page 2 12, 2022 Page 2
FirstName LastName
In this regard, we also note that the merger agreement attached
as Annex A does not
appear to contractually provide for the re-allocation of the
sponsor's private warrants,
and Section 3.03 of the agreement indicates that the escrow share
allocation
mechanics and amounts have yet to be agreed upon by the parties.
Please tell us how
the parties plan to contractually finalize the escrow share
allocation terms and the
private warrants re-allocation terms, and confirm that you will
file any associated
agreements. Also tell us what consideration you gave to the
timing of the allocations,
as it appears that Section 3.03 contemplates up to an
eighteen-month period for the
parties to determine the escrow share allocation terms following
the closing of the
merger.
We note that the merger agreement discloses that certain of the
escrow shares will be
"set aside and allocated as agreed upon by Parent and the
Company, including for the
benefit of some or all of the Non-Redeeming Parent Stockholders."
When you
finalize your disclosure, please also clarify whether certain of
the escrow shares may
be allocated to the sponsor or EarlyBird Capital, each of whom it
appears could be
deemed non-redeeming stockholders.
Last, once the foregoing terms are finalized, please update
your discussion of the
applicable material tax consequences to also address the
consequences to
shareholders upon receiving such allocated shares, and address
such consequences in
the tax opinion from counsel to be filed as exhibit 8.1.
The Background of the Business Combination, page 154
2. We note your response to comment 14, as well as your amended
disclosure. Please revise
your discussion to discuss how your valuation was done. In this
regard, we note your
disclosure that "[t]he reduction in the valuation multiples of the
comparable companies
implied that a similar reduction would be demanded by public market
investors with
respect to Getaround." Such disclosure does not clarify whether you
utilized a multiple in
calculating the valuation, and while we note you discuss the
comparable companies
analysis and projections in your revised disclosure on page 161, such
disclosure does not
appear to indicate how the parties calculated the valuation (e.g.,
whether such projections
or analyses were utilized in connection with the valuation
methodology).
3. We note your disclosure that InterPrivate II reviewed a comparable
company analysis
(similar to what is discussed below under the section titled
"InterPrivate II s Board of
Directors Reasons for the Approval of the Business Combination
Valuation
Benchmarking")." In connection therewith, please:
Explain what you mean by "similar" and revise to clarify who
prepared such analysis
(e.g., if this was also Interprivate II s management). To the
extent that Interprivate II
reviewed different sets of comparable company analyses, please
revise to clarify and
Ahmed Fattouh
InterPrivate II Acquisition Corp.
September 12, 2022
Page 3
also include such additional analyses in the proxy
statement/prospectus.
Provide a more robust discussion of the valuation framework and
address the reasons
that the "comparable company analysis was focused largely on the
following
valuation framework: Enterprise Value to 2023 Estimated Revenue
multiple." In this
regard, it appears that this may be the "enterprise value /
estimated calendar year
2023 revenue" framework discussed on pages 174-5, which we note
appears to be
only one of four frameworks in the "Valuation Benchmarking"
disclosure.
Provide a more robust discussion of how the above-mentioned
framework "relied
upon the 2023 Estimated Net Revenues amount included" in your
discussion of
Getaround's unaudited prospective financial information. In this
regard, we note your
discussion of the "key elements of the prospective financial
information" does not
appear to include "estimated net revenues." Revise accordingly to
ensure consistency
throughout the proxy statement/prospectus.
4. We note your response to comment 15, as well as your amended
disclosure beginning on
page 159 that "LionTree assisted Interprivate II in its analysis of
the financial projections .
. . and with developing InterPrivate II s views on the potential
strengths and weaknesses
of different valuation frameworks that could be applied to companies
that may share
similar financial and growth characteristics with Getaround." We also
note your
discussion on page 161 of Interprivate II's review of such analyses
and certain
frameworks, which indicates that Interprivate II "focused largely" on
a single framework
over others. Please revise here to provide a more detailed discussion
of LionTree's role in
assisting Interprivate II in reviewing such valuation frameworks.
5. We note your response to comment 16, as well as your amended
disclosure on page 164
that the parties desired to retain broad flexibility to evaluate
and propose a variety of
potential future incentive structures and that they determined
that it would be beneficial
to defer adopting a specific approach. We note that the merger
agreement appears to
include a provision pertaining to the reallocation of the escrow
shares, but it does include
any provision or reference to the potential reallocation or forfeiture
of the sponsor s
warrants. In connection with the parties decision to defer adopting
a specific approach to
the incentive structures at signing, please provide a more robust
discussion of the decision
to agree to a merger agreement provision pertaining to the escrow
shares but not the
sponsor s private warrants.
6. We note your response to comment 17, as well as your amended disclosure.
Please
provide a more robust discussion of the process that led to the parties
deciding to allocate
a portion of the merger consideration to a PIPE protection amount,
including the rationale
FirstName LastNameAhmed Fattouh
therefor. In this regard, we note it appears it may have been possible
for the parties to
Comapany NameInterPrivate
preserve the possibilityIIofAcquisition Corp.actually allocating any
portion of the merger
a PIPE without
consideration
September to such
12, 2022 Page 3 potential PIPE.
FirstName LastName
Ahmed Fattouh
FirstName
InterPrivateLastNameAhmed Fattouh
II Acquisition Corp.
Comapany 12,
September NameInterPrivate
2022 II Acquisition Corp.
September
Page 4 12, 2022 Page 4
FirstName LastName
7. We note your disclosure on page 182 that "[i]n connection with
InterPrivate II s
evaluation of a potential business combination transaction with
Company B . . .
, InterPrivate II engaged Morgan Stanley pursuant to separate
agreements to serve as
InterPrivate II s financial advisor and co-placement agent." Please
discuss such
engagement here to provide shareholders with a complete picture of
Morgan Stanley's role
as an advisor to InterPrivate II in its search for a target company.
InterPrivate II's Board of Directors' Reasons for the Approval of the Business
Combination, page
168
8. We note your response to comment 18, as well as your amended
disclosure that
InterPrivate II's board reviewed a sensitivity analysis "given the
inherent limitations of the
prospective financial information of Getaround." In connection
therewith:
Please revise to highlight in this section that the assumptions
of the unaudited
prospective financial information "are no longer accurate," as
you disclose on page
176. In particular, please address this issue in your discussion
on pages 173-4, where
you state that "[t]his prospective financial information formed
the basis for
InterPrivate II's [comparable public company] analysis and are
subject to the
assumptions described in [such] section . . . ." In revising your
disclosure, please
clarify whether the assumptions were accurate at the time of the
board's approval.
The disclosure appears to indicate that the assumptions would not
be accurate, given
that they were prepared with an expectation of closing in the
second quarter of 2022,
the same quarter during which the board approved the transaction.
Your disclosure and response indicates that InterPrivate II's
board reviewed the
"sensitivity analysis demonstrating the impact of three different
Getaround business
performance scenarios" in its assessments of the aggregate
consideration. To the
extent that the board reviewed such analysis, please revise to
state as much in your
discussion of the aggregate consideration on page 169.
9. We note your disclosure that the sensitivity analysis "showed
different scenarios of the
future projections" and was based "on a range of estimated Getaround
revenues for
calendar year 2025 from the most conservative estimate of $602 million
to the most
optimistic estimate of $825 million." Please revise to clarify who
prepared the sensitivity
analysis, and as such analysis accounts for a range of estimate
revenue projections that
Interprivate II considered, please tell us whether multiple sets of
projections were
prepared and delivered to the Getaround board and Interprivate II. If
so, please include
these in the section entitled "Certain Unaudited Prospective Financial
Information of
Getaround."
10. We note that Getaround's estimated 2025 revenue, as disclosed on page
178, is $780.497
million, which is considerably closer to the more optimistic estimate
noted in the
sensitivity analysis. Please discuss here whether and how the
projections were considered
when selecting the conservative and optimistic estimates in this
analysis, and to the extent
Ahmed Fattouh
FirstName
InterPrivateLastNameAhmed Fattouh
II Acquisition Corp.
Comapany 12,
September NameInterPrivate
2022 II Acquisition Corp.
September
Page 5 12, 2022 Page 5
FirstName LastName
that the projections are deemed to be "optimistic," revise to state as
much in your
discussion on page 176.
Certain Unaudited Prospective Financial Information of Getaround, page 176
11. We note your response to comment 19, as well as your amended
disclosure that
management selected the "five-year period based on precedent
transaction disclosures,
publicly available information provided to Getaround by its financial
advisors prior to
their resignations, and Getaround management s desire to inform
potential investors of
Getaround s planned path to profitability . . . ." To provide
shareholders with additional
context, please provide a more specific basis for how and why
Getaround's management
selected a "five-year period" for its forecasts (e.g., elaborate on
the precedent transactions
and which industry they were in, or provide more disclosure regarding
the type and source
of publicly available information provided to Getaround). In
connection therewith, given
the high and sustained growth rate indicated by the projections,
please discuss the risks, if
any, that such projections could be unrealistic and as such could
potentially have resulted
in inflated valuation conclusions.
Certain Engagements in Connection with the Business Combination and Related
Transactions,
page 181
12. We note your response to comment 22 that "none of Morgan Stanley,
Goldman Sachs and
BofA Securities or their respective affiliates was involved in the
preparation of . . . the
disclosure regarding the projected financial information of Getaround:
(emphasis added).
Please clarify whether any of these advisors assisted in preparing or
reviewing the
material underlying the disclosure regarding projected financial
information (emphasis
added). In this regard, we note your disclosure on page 176 that the
Getaround s
management in-part "decided to provide projections over a five-year
period based on . . .
publicly available information provided to Getaround by its financial
advisors prior to
their resignations . . . ." To the extent that any of the financial
advisors did assist in
preparing such material, please state as much in the proxy
statement/prospectus.
13. We also note your response that "[a]s disclosed in the Amended
Registration Statement,
BofA Securities reviewed certain disclosure contained in the
Registration Statement."
Please direct us to the page number where such disclosure appears, or
revise the disclosure
to discuss the substance of your response to comment 22.
14. We note your response to comment 23, as well as your amended
disclosure that "[s]uch
actions indicate that neither of these former co-placement agents and
financial advisors
wants to be associated with the disclosure or the underlying business
analysis related to
the Business Combination." Please revise to also state that Goldman
Sachs and BofA
Securities' resignations indicate that they are not willing to have
the liability associated
with their work in this transaction.
15. We note your response to comment 26, as well as your amended
disclosure that each of
Goldman Sachs and BofA Securities "declined to provide the letter and
has not otherwise
Ahmed Fattouh
FirstName
InterPrivateLastNameAhmed Fattouh
II Acquisition Corp.
Comapany 12,
September NameInterPrivate
2022 II Acquisition Corp.
September
Page 6 12, 2022 Page 6
FirstName LastName
confirmed whether it agrees with the disclosure made in this proxy
statement/prospectus
relating to their respective terminations." Additionally, please
discuss whether the firms
discussed the reasons for their resignations and forfeiture of fees
with management.
16. We note your response to comment 28. Please disclose and quantify any
fees that would
have been due to Goldman Sachs and BofA Securities in connection with
their roles as
financial advisors. Please also quantify the "percentage of the gross
proceeds" that would
have been due in the event of a PIPE investment.
17. We note your response to comment 29, as well as your amended
disclosure that
"InterPrivate II did not engage Morgan Stanley as a financial advisor,
placement agent or
in any other capacity in connection with the Business Combination"
(emphasis added). In
connection therewith, please make the following revisions:
Revise to reconcile this with your discussion of the business
combination marketing
agreement, which indicates that InterPrivate II did engage Morgan
Stanley in an
advisory capacity in connection with the business combination. In
this regard, we
also note your disclosure that "the services to be provided by
each of Morgan
Stanley, Goldman Sachs and BofA Securities were complete or
substantially
complete at the time of the resignations," which appears to
indicate that Morgan
Stanley did perform certain agreed-upon services and that such
services were at least
substantially complete prior to Morgan Stanley's removal from the
business
combination marketing agreement on July 5, 2022.
Disclose the date upon which "InterPrivate II determined not to
engage Morgan
Stanley . . . to otherwise perform the services under the
business combination
marketing agreement in connection with the Business Combination
because Morgan
Stanley was engaged as a financial advisor to a competitor of
Getaround." In this
regard, it appears that such decision was made after March 9,
2021 but before May
11, 2022.
18. We note your response to comment 30, as well as your disclosure on
page 183 that "[t]he
resignations of Goldman Sachs and BofA Securities, including its
waiver of fees for
services that had already been rendered, is unusual and some investors
may find the
Business Combination less attractive as a result." Please also address
the unusual nature
of Morgan Stanley's resignation and waiver. Additionally, tell us
whether you are aware
of any disagreements with Morgan Stanley regarding the disclosure in
your registration
statement, and disclose whether Morgan Stanley provided you with any
reasons for the fee
waiver. If there was no dialogue and you did not seek out the reasons
why Morgan
Stanley was waiving deferred fees, despite already substantially
completing their services,
please indicate so in your registration statement. Last, please revise
the risk factor
disclosure on page 106 to explicitly clarify that Morgan Stanley has
performed
substantially all their obligations to obtain the fee and therefore is
gratuitously waiving the
right to be compensated, if true, as your disclosure on page 184
indicates that Morgan
Stanley at least substantially completed its required services.
Ahmed Fattouh
InterPrivate II Acquisition Corp.
September 12, 2022
Page 7
Material U.S. Federal Income Tax Considerations for Holders of Class A Stock,
page 211
19. We note your response to comment 33. Please provide disclosure as to
the tax consequences of the merger in this section and file an opinion
as an exhibit to the
registration statement. In this regard, we note that if the tax
consequences are material to
the transaction as a whole, which we believe to be the case with
respect to the merger,
then disclosure and an appropriate tax opinion are required with
respect to the transaction
as a whole. If there is uncertainty regarding the tax treatment of the
merger, counsel may
issue a "should" or "more likely than not" opinion to make clear that
the opinion is subject
to a degree of uncertainty, and explain why it cannot give a firm
opinion.
Information about Getaround, page 249
20. We note your response to comment 36, as well as your amended
disclosure that your
definition of "active cars" includes connected cars and that your
definition of "connected
cars" includes vehicles "regardless of whether they are shared on our
marketplace."
Please tell us why you include cars not shared in your marketplace as
"active cars" and/or
revise accordingly to reconcile with your statement that "Getaround is
a global
marketplace, with approximately 66,000 active cars." In this regard,
such disclosure
appears to indicate that there are 66,000 active cars in your
marketplace, but your
definition of active cars indicates that certain active cars may not
be shared on your
marketplace.
21. We note your response to comment 38 that "the majority of Getaround s
revenue comes
from hosts with more than one car listed, and not because of any
meaningful difference in
other characteristics or behaviors of Powerhosts relative to those of
regular hosts." Please
explain how the differences between your single-car hosts and Powerhosts
are not
meaningful, or alternatively revise your disclosure to highlight the
difference and include
a breakdown of such revenue to provide shareholders with additional
context regarding
your revenue model. In this regard, we note your press release, dated
March 5, 2021, in
which your Chief Operating Officer stated that you had "started to see
an increase in
Power Hosts with fleet sizes that have grown from an average of eight
cars last year to 12
cars this year, and even have Power Hosts with dozens of cars" (emphasis
added). Your
website also distinguishes between the characteristics of single-car
hosts, small-fleet
FirstName LastNameAhmed Fattouh
power hosts and large-fleet power hosts, and you state that that "[l]ike
the small-fleet
Comapany NameInterPrivate
owner, [the large-fleet II Acquisition
power host] is Corp.
likely a medium to large
company using car sharing
to increase a pre-existing
September 12, 2022 Page 7 fleet s income during idle hours."
FirstName LastName
Ahmed Fattouh
FirstName
InterPrivateLastNameAhmed Fattouh
II Acquisition Corp.
Comapany 12,
September NameInterPrivate
2022 II Acquisition Corp.
September
Page 8 12, 2022 Page 8
FirstName LastName
Getaround Management's Discussion and Analysis of Financial Condition and
Results of
Operations
Results of Operations
Comparison of the Years Ended December 31, 2021 and 2020
Total Revenues, page 296
22. We note your response and related revisions to comment 48 including
what appears to be
a hypothetical statement contemplating "same or higher number of
booked trips." Given
that your actual number of booked trips decreased both in the interim
period of 2022 and
the fiscal year 2021 compared to previous periods, please revise to
discuss the impact of
the decrease in booked trips for the periods presented. In addition,
we note that the
explanation for the service revenue increases for the 2022 interim
period and the fiscal
year 2021 is substantively the same despite the percentage of the
increase being materially
different from each other. Please revise to meaningfully explain the
fluctuations in the
results for each period. Finally, please tell us how you considered
other factors that may
contribute to fluctuations in results such as the number of
cities/countries
served, expansion of existing markets, partnerships with other
companies/distribution
channels, etc.
Non-GAAP Financial Measures
Trip Contribution Profit and Trip Contribution Margin, page 303
23. We note your response and related revisions to comment 46 indicating
that you view net
loss as the most directly comparable GAAP measure for reconciliation
of your non-GAAP
financial measures. Although we understand that you do not report
gross margin in your
financial statements, we believe that gross margin as defined in GAAP
represents the most
directly comparable GAAP financial measure that should be identified
and used in your
reconciliation to comply with the requirements of Item 10(e)(1)(i)(B)
of Regulation S-K.
Accordingly, please revise your presentation to reconcile your
non-GAAP financial
measures to a fully loaded gross margin as defined in GAAP. In
addition, revise to
disclose the fully loaded GAAP gross profit margin with equal or
greater prominence in
the fifth paragraph on page 250 where you disclose the trip
contribution margin.
Security Ownership of Certain Beneficial Owners and Management of InterPrivate
II, page 376
24. We note your response to comment 52, as well as your amended
disclosure in footnote (9)
that "[e]ach of the aforementioned entities and individuals disclaims
beneficial ownership
of the shares held of record by any other entity or individual
explicitly named in this
footnote except to the extent of such entity or individual s
pecuniary interest therein, if
any" (emphasis added). Please note that beneficial ownership is not
determined based on
pecuniary interest. Please revise to clarify here that the persons
listed are the beneficial
owners of the securities given their authority over the voting and/or
investment power
over such securities. Please refer to Instruction 2 to Item 403 of
Regulation S-K and Rule
13d-(3)(a) of the Exchange Act.
Ahmed Fattouh
FirstName
InterPrivateLastNameAhmed Fattouh
II Acquisition Corp.
Comapany 12,
September NameInterPrivate
2022 II Acquisition Corp.
September
Page 9 12, 2022 Page 9
FirstName LastName
Getaround, Inc.
Notes to Consolidated Financial Statements
General, page F-74
25. We note in your response to comment 56 that Getaround does not sell
the Connect IoT
device to the hosts. Please clarify that the device is sold by a third
party and therefore no
related fees are recognized. Additionally, please disclose the
information provided in
your response.
2. Summary of Significant Accounting Policies
Costs and Expenses, page F-80
26. We note your response and related revision to comment 55. Considering
your disclosures
throughout the document highlighting the importance and the reliance
on continued
innovation in your technology and marketplace including your
proprietary platform and
fourth generation hardware, and your disclosures regarding your
technology and product
development expenses which include prototypes, product testing and
testing equipment,
and compensation and related personnel costs associated with the
development of your
software, hardware, and user experience, please explain to us how
research and
development expenses incurred were not material.
27. We note your response to comment 60. It appears there are certain
costs in Operations and
Support Expenses, and Technology and Product Development Expenses that
relate
directly to a revenue stream and/or transactions between the hosts and
the guests, and to
maintenance of your platform - e.g. auto insurance, claims, customer
relationships,
and compensation and related personnel costs associated with the
maintenance of your
software, hardware, and user experience. Given the nature of these
expenses, please tell
us why these costs are not included in Cost of Revenue.
19. Related-Party Transactions, page F-117
28. We note your response and revisions to comment 66 and reissue our
comment in part.
Please revise to disclose all relevant terms and information related
to your stockholder
notes with your founders and board members in the Certain Getaround
Relationships and
Related Party Transaction section starting on page 315. In this
regard, relevant terms and
information related to 2018 stockholder notes appear to be missing.
Exhibit Index, page II-4
29. We note your response to comment 3, as well as your amended disclosure
that "the shares
of Class A Stock the Consenting Getaround Stockholders receive in the
Business
Combination will not be registered under the Securities Act and will
be subject to
restrictions on resale." We note that Exhibit 107 contemplates the
registration of all
"45,000,000 shares that may be issued as earnout consideration
following the Business
Combination." As it appears that such Consenting Getaround
Stockholders may receive
Ahmed Fattouh
InterPrivate II Acquisition Corp.
September 12, 2022
Page 10
such registered earnout shares, please revise the fee table or
alternatively provide us with
your analysis as to how such proposed registration is consistent with
the staff s views on
the registration of offers and sales where lock-up agreements are used,
pursuant to
Question 239.13 of the staffs Securities Act Sections Compliance and
Disclosure
Interpretations.
General
30. With a view toward disclosure, please tell us whether your sponsor is,
is controlled by, or
has substantial ties with a non-U.S. person. Please also tell us whether
anyone or any
entity associated with or otherwise involved in the transaction, such as
the target, is, is
controlled by, or has substantial ties with a non-U.S. person. If so,
also include risk factor
disclosure that addresses how this fact could impact your ability to
complete your initial
business combination. For instance, discuss the risk to investors that
you may not be able
to complete an initial business combination with a U.S. target company
should the
transaction be subject to review by a U.S. government entity, such as
the Committee on
Foreign Investment in the United States (CFIUS), or ultimately
prohibited. Further,
disclose that the time necessary for government review of the
transaction or a decision to
prohibit the transaction could prevent you from completing an initial
business
combination and require you to liquidate. Disclose the consequences of
liquidation to
investors, such as the losses of the investment opportunity in a target
company, any price
appreciation in the combined company, and the warrants, which would
expire worthless.
You may contact Stephen Kim at 202-551-3291 or Theresa Brillant at
202-551-3307 if
you have questions regarding comments on the financial statements and related
matters. Please
contact Brian Fetterolf at 202-551-6613 or Dietrich King at 202-551-8071 with
any other
questions.
Sincerely,
FirstName LastNameAhmed Fattouh
Division of
Corporation Finance
Comapany NameInterPrivate II Acquisition Corp.
Office of Trade &
Services
September 12, 2022 Page 10
cc: Laurie L. Green
FirstName LastName