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United States securities and exchange commission logo
April 14, 2022
Ioannis Pipilis
Chief Executive Officer
SVF Investment Corp. 3
1 Circle Star Way
San Carlos CA, 94070
Re: SVF Investment
Corp. 3
Amendment No. 1 to
Registration Statement on Form S-4
Filed March 23,
2022
File No. 333-262529
Dear Mr. Pipilis:
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 March
3, 2022 letter.
Amendment No. 1 to Form S-4
Cover Page
1. We note your response
to prior comment 1. Please revise to identify the controlling
shareholders or group
with specificity.
Ioannis Pipilis
FirstName LastNameIoannis Pipilis
SVF Investment Corp. 3
Comapany
April NameSVF Investment Corp. 3
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April 214, 2022 Page 2
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Prospectus Summary
The Business Combination and the Merger Agreement, page 1
2. Revise to state that one of the primary reasons for using the Up-C
structure is to allow
the holders of New Symbotic Holdings Common Units to retain the tax
benefits of owning
interests in a pass-through entity while also being able to access
public markets. Highlight
that such benefits will accrue only to those holders and not the
public shareholders, and
address the conflicts of interest between certain parties as a result
of using this structure.
Transaction Summary, page 3
3. Disclosure on page 4 explains that following the Business Combination,
all investors other
than current Warehouse unitholders will hold their economic interests
through Symbotic
Inc. The diagram on page 3 showing the structure of the
Post-Combination Company
immediately following the closing of the Business Combination is
inconsistent with this
disclosure. Please revise the diagram and/or the narrative disclosure
for clarity.
4. Revise the diagram and accompanying narrative disclosure to reflect
both the economic
and voting power expected to be held by each group of securityholders.
Risk Factors
We depend heavily on principal customers, and therefore, our success is heavily
dependent...,
page 31
5. Please revise to further describe the restrictions placed by the
Master Automation
Agreement with Walmart on your ability to sell or license your
products and services to a
certain customer. Disclose whether you believe there is a material
impact to your business
as a result, and include the term of such restrictions. In your
response, please tell us the
name of such customer and explain further your reference to the
customers' affiliates or
dedicated service providers. In addition, revise to clarify what is
meant by Walmart's
board observation rights following the Business Combination and
explain the purpose of
such rights.
Unaudited Pro Forma Condensed Combined Financial Information, page 83
6. We note from your response to prior comment 22 that the reference to
"maximum
redemption" scenario here differs from similar references in the
forepart of the filing,
which assume all public shares are redeemed (net of 112,500 shares
purchased by SVF 3's
directors and officers). Please consider revising your reference to
maximum redemption
here so as to avoid any confusion with similar references elsewhere in
the filing.
Notes to Unaudited Pro Forma Condensed Combined Financial Information, page 94
7. Please refer to prior comment 23. Please confirm specifically if the
board of directors
determines the method of settlement when a unit is redeemed. If not,
clarify who does.
Tell us how you concluded that the requirement to seek approval by
majority shareholder
Ioannis Pipilis
FirstName LastNameIoannis Pipilis
SVF Investment Corp. 3
Comapany
April NameSVF Investment Corp. 3
14, 2022
April 314, 2022 Page 3
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FirstName LastName
vote, excluding any shares held by holders of New Symbotic Holdings
Common Units or
Affiliates, ensures that the issuer controls whether to settle unit
redemption requests in
cash or shares. In this regard, we note that the unitholders control
the majority voting and
appointment of directors of the Post-Combination Company and the
remaining
shareholders vote to approve the settlement method. Thus, it would
appear that control
over the settlement method is retained by both the unitholders and
shareholders of the
issuer and not the issuer itself. Lastly, to the extent units are
settled in cash, please clarify
whether payment will be from current cash or assets on hand at the
time or explain
whether the terms of the agreements specify the source of any cash
settlement.
Purchases of SVF 3 Shares, page 108
8. We note your disclosure that SVF 3 will file a Current Report on Form
8-K to disclose
arrangements entered into or significant purchases made by the
Sponsor, Warehouse
and/or their respective affiliates that would affect the vote on the
Business Combination
Proposal or the satisfaction of any closing conditions. Please confirm
that you intend to
provide investors with sufficient notice of any such arrangements in
advance of the
extraordinary general meeting. Additionally, revise to confirm that
any arrangements
entered into by SVF 3 (as opposed to just the Sponsor) will be subject
to such disclosure.
Finally, to the extent the parties are currently in discussions or are
considering
arrangements to protect certain investors against potential loss in
value of their shares,
provide detailed disclosure of the implications of such arrangements
to the public
shareholders.
Symbotic's Management Discussion and Analysis of Financial Condition and
Results of
Operations, page 187
9. You attribute the growth in systems revenue for each period presented
to the acceptance
of certain warehouse automation systems and the commencement of other
systems. As it
appears that the majority of your revenue growth is from one customer,
please revise to
indicate as such and include a discussion of the arrangement with such
customer and when
you anticipate delivery of the remaining deliverables. To the extent
you do not anticipate
that this revenue growth trend will continue or if you expect material
fluctuations in such
trend, please revise to discuss. Refer to Item 303(b) of Regulation
S-K.
10. You refer to the increase in headcount as a contributor to the
increase in various expense
line items. Please revise to disclose the specific changes in, and
additions to, headcount
that contributed to the increase in each expense.
Unaudited Prospective Financial Information of Symbotic, page 231
11. We note your response to prior comment 29. Please revise to quantify
each of the
listed operational assumptions. For example, quantify the amount of
revenue generating
system sales that is assumed will result from your ongoing discussions
with several new
prospective customers.
Ioannis Pipilis
SVF Investment Corp. 3
April 14, 2022
Page 4
12. We note that your March 10, 2022 Investor Presentation, attached as
Exhibit 99.1 to your
Form 425, contains financial projections that differ from those set
forth in the registration
statement. With a view toward revised disclosure, please tell us who
prepared these
financial projections, why they were prepared, and what consideration
was given to
disclosing these projections in the registration statement.
Material U.S. Federal Income Tax Consequences
Consequences of the Domestication to U.S. HoldersF Reorganization, page 274
13. Given tax counsel's opinion that the Domestication "should" qualify as
a tax-
free reorganization within the meaning of Section 368(a)(l)(F) of the
Code, please provide
supplemental disclosure describing the degree of uncertainty.
Additionally, expand your
risk factor disclosure on page 57 cautioning that the Domestication
"may result in adverse
tax consequences for holders of SVF 3 ordinary shares" to describe the
actual
consequences if the Domestication does not receive the intended tax
treatment.
Certain Relationships and Related Party Transactions, page 297
14. Please provide us with your legal analysis as to why Walmart, Inc. is
not a related party
and why corresponding disclosure under Item 404(a) is not required.
Your analysis
should address Walmart's current security holdings of Symbotic,
Walmart's
expected security ownership in the post-combination company, Walmart's
expected board
observation rights, and Symbotic's dependency on Walmart.
Unaudited Interim Financial Statements of Warehouse Technologies LLC and
Subsidiaries
Note 3. Revenue, page F-28
15. We note your response to prior comment 32. Please revise, here and on
page F-50, to
explain how the timing of satisfaction of your performance obligations
relates to the
typical timing of payment and the effect that those factors have on
the contract asset and
the contract liability balances. Refer to ASC 606-10-50-9.
16. We note your response and disclosure revisions to prior comment 36. It
is unclear how
disclosure that 92% of your revenue will be recognized over the next 8
years complies
with ASC 606-10-50-13. In this regard, you disclose in your revenue
forecasts that your
existing $5.4 billion backlog is non-changeable with scheduled orders.
As such, please
revise to quantify your remaining performance obligations using time
bands that are
more meaningful and appropriate to inform a reader of when you expect to
recognize
FirstName LastNameIoannis Pipilis
revenue for your remaining performance obligations. Also, please revise
to disclose, both
Comapany
here NameSVF
and on pageInvestment
180, that aCorp. 3
substantial majority of your remaining
performance
obligations
April 14, 2022 Pageconsist
4 primarily of one customer as stated in your
response.
FirstName LastName
Ioannis Pipilis
FirstName LastNameIoannis Pipilis
SVF Investment Corp. 3
Comapany
April NameSVF Investment Corp. 3
14, 2022
April 514, 2022 Page 5
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Audited Consolidated Financial Statements of Warehouse Technologies LLC and
Subsidiaries
Note 2. Summary of Significant Accounting Policies
Concentrations of Credit Risk and Significant Customers, page F-45
17. We note your response to prior comment 33. Please note that ASC
275-10-50-
18(a) requires disclosure of all concentrations relating to the volume
of business
transacted with a particular customer that meets the criteria of ASC
275-10-50-16.
Therefore, revise to provide disclosure of the concentration of
counterparties existing in
your accounts receivable separately for each customer. Also, if true,
revise to clarify that
the Company is not aware of any specific event or circumstance that
would result in a
material adverse impact to the results of operations as well as your
liquidity and financial
condition.
Revenue Recognition, page F-45
18. We note your response to prior comment 34 and the related disclosure
revisions. Please
address the following:
Tell us the amount or percentage of revenue from term based
licenses. Revise to
disclose the amount of revenue from term based licenses or state
that revenue from
such licenses is immaterial.
Disclosure on page 180 indicates that you charge an annual
software and support
subscription fee that is required to use the Symbotic system and
that your system
consists of three parts: the initial system, annual software
license subscription and
ongoing support services. Please revise to reconcile this
disclosure to the information
in your response and revised revenue policy disclosure.
On page 179, you disclose that you intend to expand your product
suite to increase
your potential value to existing customers and to attract new
customers. Please tell us
and revise to disclose whether these future products are included
in your support and
maintenance arrangements. If so, tell us how you considered the
impact of this
obligation on your allocation of transaction price and timing of
revenue recognition.
Disclose the typical term of the technical support, update and
upgrades agreement as
indicated in your response.
General
19. Please refer to prior comment 39. Please revise to also disclose the
exchange ratio of
Interim Symbotic Common Units to be issued in exchange for Warehouse
Units.
Ioannis Pipilis
FirstName LastNameIoannis Pipilis
SVF Investment Corp. 3
Comapany
April NameSVF Investment Corp. 3
14, 2022
April 614, 2022 Page 6
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FirstName LastName
You may contact Rebekah Lindsey, Senior Staff Accountant, at (202)
551-3303 or
Kathleen Collins, Accounting Branch Chief, at (202) 551-3499 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.
Sincerely,
Division of
Corporation Finance
Office of Technology