United States securities and exchange commission logo
November 20, 2023
William J. Sandbrook
Co-Chief Executive Officer
Andretti Acquisition Corp.
7615 Zionsville Road
Indianapolis, Indiana 46268
Re: Andretti
Acquisition Corp.
Registration
Statement on Form S-4
Filed October 27,
2023
File No. 333-275207
Dear William J. Sandbrook:
We have reviewed your
registration statement and have the following comments.
Please respond to this letter by amending your registration
statement and providing the
requested information. If you do not believe a comment applies 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 this letter, we may have additional comments.
Registration Statement on Form S-4 Filed October 27, 2023
Cover Page
1. In light of the
unlikely possibility of no redemptions, balance your cover page disclosure
regarding ownership
levels in the Company by providing the equity stakes assuming
maximum redemptions.
2. Please revise your
disclosure on the cover page to disclose whether the approval of the
New York Stock Exchange
listing application is a condition to closing the Merger and
provide a
cross-reference to risk factor disclosure that addresses the risks involved if
the
application is not
approved.
William J. Sandbrook
FirstName LastNameWilliam
Andretti Acquisition Corp. J. Sandbrook
Comapany 20,
November NameAndretti
2023 Acquisition Corp.
November
Page 2 20, 2023 Page 2
FirstName LastName
Questions and Answers about the Merger and the Special Meeting
What are the Potential Impacts on the Proposed Transactions Resulting from
RBC's Waiver of
Deferred Fees?, page 11
3. In connection with RBC Capital Markets waiver of the deferred
underwriting
commissions that would otherwise be due to it upon the closing of the
business
combination, please provide the following disclosure:
Explain why the waiver was agreed to and clarify the SPAC s
current relationship
with RBC. Revise your pro forma financial information and relevant
disclosure
referring to the payment of deferred underwriting commissions;
Describe what relationship existed between RBC and the SPAC after
the close of the
IPO, including any financial or merger-related advisory services
conducted by RBC.
For example, clarify whether RBC had any role in the
identification or evaluation of
business combination targets; and
Disclose whether RBC provided you with any reasons for the fee
waiver. If there was
no dialogue and you did not seek out the reasons why RBC was
waiving deferred
fees, despite already completing their services, please indicate
so in your registration
statement. Further, revise the risk factor disclosure to
explicitly clarify that RBC has
performed all their obligations to obtain the fee and therefore is
gratuitously waiving
the right to be compensated.
Risk Factors, page 51
4. We note your disclosure that your warrant agreement has an exclusive
forum provision.
Please revise your risk factors to disclose that your warrant
agreement has an exclusive
forum provision and the related risks.
A limited number of customers have accounted for most of our revenue..., page
60
5. We note your disclosure that Zapata depends on a relatively small
number of customers.
To add context to this disclosure, please revise to disclose the
number of customers for
each period presented. Disclose the details of any material agreements
with your top
customers, if appropriate, and file the agreements as exhibits. Also,
disclose how you
define "enterprise customers" and disclose the number of enterprise
customers
versus government customers.
The pursuit of inorganic growth opportunities could result in harm to our
business..., page 65
6. We note that you may pursue growth opportunities by acquiring
complementary
businesses or other assets. Please expand the disclosure to address
whether you have any
negotiations in progress or have entered into any contracts for
acquisitions at the current
time.
William J. Sandbrook
FirstName LastNameWilliam
Andretti Acquisition Corp. J. Sandbrook
Comapany 20,
November NameAndretti
2023 Acquisition Corp.
November
Page 3 20, 2023 Page 3
FirstName LastName
In connection with the Merger, the Initial SPAC Shareholders and their
affiliates may elect...,
page 95
7. We note your disclosure that the Initial SPAC Shareholders or their
advisors or affiliates
may purchase SPAC Class A Common Stock in privately negotiated
transactions or in the
open market either prior to or following the consummation of the
Merger and that they
would be required to revoke any prior elections to redeem shares.
Please provide your
analysis on how such potential purchases would comply with Rule 14e-5.
Proposal No. 3 - The Merger Proposal, page 125
8. We note the organizational chart outlining your post-Merger corporate
structure. Please
revise to also provide an organizational chart outlining your
pre-Merger corporate
structure and illustrating the relationships of the various entities
discussed throughout the
registration statement.
Financing, page 137
9. We note your disclosure that Prior to the Closing, each of the SPAC
and Zapata intend to
solicit, negotiate and enter into committed equity facilities or other
subscription to shares
of New Company Common Stock that provides cash to the SPAC ( Equity
Financing )
and related agreements entered into, or to be entered into by the SPAC
relating to an
Equity Financing ( Financing Agreements ). We also note your
disclosure that Zapata
will need substantial additional funding to support its continuing
operations and pursue its
growth strategy. Please disclose whether the consummation of any
financing is a condition
of the Merger or otherwise necessary for the parties to complete the
Merger. Additionally,
with a view toward revised disclosure, please tell us how you intend
to make investors
aware of the terms of any financing.
Background to the Merger, page 151
10. Please highlight the relationship between Zapata and Andretti Global
prior to entering into
the Business Combination Agreement. Also expand your disclosure to
discuss the non-
redemption agreements and any other material agreements.
Certain Unaudited Projected Financial Information of Zapata, page 160
11. Please expand your disclosure of the material assumptions underlying
the financial
projections to include any limitations or other estimates. Also,
expand your disclosure to
provide additional detail and quantification of all of the material
assumptions used, how
they relate to the prospective financial information, and to discuss
the process undertaken
to formulate the projections and assumptions. For example, explain the
basis for
your revenue growth assumptions for fiscal years 2024 and 2025, and
explain how
your projections are representative of your current business
operations and future plans,
given that you generated only $5.166 million in revenue in the fiscal
year ended
William J. Sandbrook
Andretti Acquisition Corp.
November 20, 2023
Page 4
December 31, 2022 and project $5.850 million in fiscal year 2023.
Disclose whether you
believe your revenue projections are comparable to the actual
historical revenue growth
rates of publicly traded peer companies.
Material U.S. Federal Income Tax Considerations, page 192
12. We note that the registrant intends for the Domestication to qualify
as a reorganization
and that if the Domestication qualifies as a reorganization, U.S.
Holders would generally
not recognize any gain or loss as a result of the Domestication or
Merger. Please attribute
this representation of tax consequences to counsel and file a tax
opinion pursuant to Item
601(b)(8) of Regulation S-K or advise why the tax consequences are not
material to an
investor.
Unaudited Pro Forma Condensed Combined Financial Information
Note 2. Basis of Pro Forma Presentation, page 211
13. We note on page 212 that you state that you and Zapata have not had
any historical
relationship prior to the Merger. Refer to disclosure of agreements
between Zapata and
Andretti Autosport on pages F-75 and F-97 and disclosure of agreements
between Zapata
and Andretti Global on pages 283 and 285. Please revise the pro forma
financial
information to present the revenues and expenses between these
entities as related party
transactions on a pro forma basis since following the business
combination these entities
will be related parties.
Zapata's Management's Discussion and Analysis of Financial Condition and
Results of
Operations
Overview, page 248
14. Refer to the agreements you have with Andretti Global disclosed on
pages 243 and 283
and agreements with Andretti Autosport beginning in February 2022 on
pages F-75 and F-
97. Due to the materiality of the amounts involved, please expand MD&A
to include
disclosure of the amount of revenues and expenses between Andretti
Global, Andretti
Autosport and Zapata for each of the periods presented along with
disclosure of the end
date for these revenues and costs of December 31, 2024. Also, clarify
on page 254 that a
significant new customer in 2022 is Andretti Global or Andretti
Autosport, if applicable,
and expand the disclosure regarding the Sponsorship Agreement on page
259
accordingly. Also clarify the relationship between Andretti Global and
Andretti
Autosport.
Certain Relationships
FirstName and Related
LastNameWilliam Party Transactions, page 280
J. Sandbrook
Comapany
15. NameAndretti
Please Acquisition
revise to discuss Corp. that Mr. Andretti and Mr.
Sandbrook entered into
the agreements
with20,
November Zapata
2023toPage
provide
4 financing in the amounts of $1,000,000 and
$500,000 respectively.
FirstName LastName
William J. Sandbrook
FirstName LastNameWilliam
Andretti Acquisition Corp. J. Sandbrook
Comapany 20,
November NameAndretti
2023 Acquisition Corp.
November
Page 5 20, 2023 Page 5
FirstName LastName
Security Ownership of Certain Beneficial Owners and Management, page 305
16. Please revise to disclose the natural persons who hold voting and/or
dispositive power
over the shares held by each of the entities disclosed in the
beneficial ownership table.
Financial Statements - Andretti Acquisition Corp.
Note 9 - Subsequent Events, page F-44
17. Refer to your disclosure of the 1% U.S. federal excise tax in
connection with any
redemption of SPAC shares on page 94. With a view towards expanded
disclosure, please
tell us if the redemption of 15,105,199 shares of Class A common stock
subsequent to
June 30, 2023 is subject to the federal excise tax. If applicable,
give effect to this tax in
your pro forma financial statements.
Financial Statements - Zapata Computing, Inc.
Consolidated Statements of Operations, page F-48
18. Refer to your disclosure of customers and partners on page 243. We
note that one of your
top customers is Andretti Global. Please tell us the consideration you
gave to whether
Andretti Global is a related party to Zapata Computing, Inc. and
revise the disclosure in
your financial statements accordingly. If Andretti Global was not
considered to be a
related party prior to the business combination agreement with
Andretti Acquisition Corp.,
please provide detailed subsequent event disclosure for the related
party transactions with
Andretti Global.
Note 2. Summary of Significant Accounting Policies
Revenue Recognition, page F-56
19. Refer to your accounting policy for consulting services on page F-57.
We note that you
estimate total labor hours to satisfy the performance obligation. We
also note on page 64
that you enter into government contracts. Please expand the accounting
policy to clarify
whether any of your consulting service contracts are fixed fee in
nature and if so, please
include your accounting policy for loss contracts. Please expand the
disclosure of critical
accounting policies in MD&A on pages 260 and 261 accordingly.
General
20. 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, is,
is controlled by, or has
substantial ties with a non-U.S. person. If so, 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
William J. Sandbrook
Andretti Acquisition Corp.
November 20, 2023
Page 6
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.
21. We note your disclosure that the SPAC no longer needs to have net
tangible assets of at
least $5,000,001 prior to or upon consummation of the Merger. We note
that if the amount
in the trust falls below $5,000,001 as a result of redemptions, the
Company would likely
also no longer meet the NYSE listing standards. At that point it is
possible the
Company could become a penny stock. Please revise your risk factors to
clearly discuss
the impact that the trust falling below $5,000,001 could have upon
your listing on the
NYSE. Please provide clear disclosure that removal of this provision
may result in your
securities falling within the definition of penny stock, and clearly
discuss the risk to the
company and investors if your securities were to be considered penny
stock.
22. Please revise to disclose all possible sources and extent of dilution
that shareholders who
elect not to redeem their shares may experience in connection with the
business
combination. Provide disclosure of the impact of each significant
source of dilution,
including the amount of equity held by founders, convertible
securities, including warrants
retained by redeeming shareholders, at each of the redemption levels
detailed in your
sensitivity analysis, including any needed assumptions.
23. Revise your disclosure to show the potential impact of redemptions on
the per share value
FirstName LastNameWilliam J. Sandbrook
of the shares owned by non-redeeming shareholders by including a
sensitivity analysis
Comapany NameAndretti
showing a range of Acquisition
redemption Corp.
scenarios, including minimum, maximum
and interim
redemption levels.
November 20, 2023 Page 6
FirstName LastName
William J. Sandbrook
FirstName LastNameWilliam
Andretti Acquisition Corp. J. Sandbrook
Comapany 20,
November NameAndretti
2023 Acquisition Corp.
November
Page 7 20, 2023 Page 7
FirstName LastName
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.
Refer to Rules 460 and 461 regarding requests for acceleration. Please
allow adequate
time for us to review any amendment prior to the requested effective date of
the registration
statement.
Please contact Claire DeLabar at 202-551-3349 or Robert Littlepage at
202-551-3361 if
you have questions regarding comments on the financial statements and related
matters. Please
contact Alexandra Barone at 202-551-8816 or Matthew Crispino at 202-551-3456
with any other
questions.
Sincerely,
Division of
Corporation Finance
Office of Technology
cc: Raphael M. Russo