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United States securities and exchange commission logo
November 10, 2022
Mark Hanchett
Chief Executive Officer
Atlis Motor Vehicles Inc
1828 N Higley Rd., Suite 116
Mesa, Arizona 85205
Re: Atlis Motor
Vehicles Inc
Draft Registration
Statement on Form S-1
Submitted October
17, 2022
CIK No. 0001722969
Dear Mark Hanchett:
We have reviewed your draft 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 providing the requested
information and either submitting
an amended draft registration statement or publicly filing your
registration statement on
EDGAR. 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 the information you provide in response to these
comments and your
amended draft registration statement or filed registration statement, we
may have additional
comments.
Draft Registration Statement on Form S-1
Cover Page
1. We note the disclosure
that your offering of Class A common stock will be at an "assumed
public purchase price,"
which may be offered at a discount to the current market price of
your Class A common
stock and may not be indicative of the final offering price. To the
extent you are seeking
to conduct an at-the-market offering, please tell us how you meet
the requirements of
Rule 415(a)(4) and Rule 415(a)(1)(x). Otherwise, please revise to
state the price of the
securities to the public and indicate that the price will be fixed for the
duration of the
offering.
2. On page 69 you disclose
that you have agreed to issue warrants to the placement agents to
purchase shares of
common stock. Please provide disclosure on the cover page, prospectus
Mark Hanchett
FirstName
Atlis MotorLastNameMark
Vehicles Inc Hanchett
Comapany 10,
November NameAtlis
2022 Motor Vehicles Inc
November
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summary, risk factors and description of securities sections
describing the placement
agent warrants.
3. Please revise your cover page to disclose the total voting power of
the Class D shares
before and after the offering, assuming the sale of the maximum
offering amount.
Additionally, revise your prospectus summary to describe your capital
structure.
Market and Industry Data, page iii
4. We note your disclosure that you obtained the market and industry data
included in the
registration statement from independent industry sources as well as
from research reports
prepared for other purposes, and that you have not independently
verified the data
contained in those sources. This statement appears to imply a
disclaimer of responsibility
for this information in the registration statement. Please either
revise this section to
remove such implication or specifically state that you are liable for
all information in the
registration statement.
Summary of the Prospectus, page 1
5. Please revise your summary to present an objective description of the
challenges and/or
weakness of your business and operations. As an example only, you
highlight your
planned products and market opportunities without equally prominent
disclosure
regarding your weaknesses. We would expect to see prominent disclosure
regarding your
accumulated deficit of $184,913,059 accompanied by equally prominent
disclosure that
you have no viable plan of operation as of the date of the prospectus
to commence sales of
your products, which appear to be mostly aspirational.
6. Please provide prominent disclosure regarding your stock performance
and the volatility it
has experienced since becoming listed on the NASDAQ. It does not
appear as though
recent price movement bears any rational relation to company
performance and we would
expect to see disclosure that addresses, from management's
perspective, how your
investors should prepare for rapid and substantial price volatility
and any known factors
particular to your company and offering that may add to this risk.
Risk Factors, page 8
7. Please disclose whether you are subject to material cybersecurity
risks, including in your
supply chain based on third-party products, software or services used
in your products,
services or business and how a cybersecurity incident in your supply
chain could impact
your business. Discuss the measures you have taken to mitigate these
risks. Additionally,
please describe the extent and nature of the role of the board of
directors in overseeing
cybersecurity risks, including in connection with the company s
supply
chain/suppliers/service providers.
8. If material, please expand your discussion of interest rates to
specifically identify the
impact of rate increases on your operations and how your business has
been affected. For
Mark Hanchett
FirstName
Atlis MotorLastNameMark
Vehicles Inc Hanchett
Comapany 10,
November NameAtlis
2022 Motor Vehicles Inc
November
Page 3 10, 2022 Page 3
FirstName LastName
example, describe whether increased borrowing costs are expected to
impact your
business plan or your customers ability to purchase your products
in the future.
9. We note your disclosure indicating that inflation could impact your
results of operations.
Please provide risk factor disclosure if recent inflationary pressures
have materially
impacted your operations. In this regard, identify the types of
inflationary pressures you
are facing and how your business has been affected.
10. We note that the forum selection provision contained in Sections 9.1
and 9.2 of your
amended and restated bylaws. Please add a risk factor and revise the
description of
securities section to disclose your exclusive forum provisions. We
further note that the
forum selection provision contained in Section 9.2 of your amended and
restated bylaws
identifies the federal courts of the United States as the exclusive
forum for any Securities
Act claims. State that there is uncertainty as to whether a court
would enforce such
provision and that investors cannot waive compliance with the federal
securities laws and
the rules and regulations thereunder. In that regard, we note that
Section 22 of the
Securities Act creates concurrent jurisdiction for federal and state
courts over all suits
brought to enforce any duty or liability created by the Securities Act
or the rules and
regulations thereunder.
The dual class structure of our common stock has the effect of concentrating
voting power with
members of our management team..., page 21
11. Please revise to disclose that future issuances of Class D common
stock to management
may be dilutive to holders of Class A common stock.
Use of Proceeds, page 32
12. Expand your disclosures to briefly discuss how different funding
levels will impact your
business plan/operations and discuss your plan if substantially less
than the maximum
proceeds are obtained. Additionally, we note that you may use the
proceeds to build AMV
battery manufacturing capabilities. If any material amount of the
proceeds will be used to
acquire assets otherwise than in the ordinary course of your business,
such as the purchase
or lease of a manufacturing plant, describe briefly and state the cost
of the assets. Refer
to Item 504 of Regulation S-K.
Dilution, page 36
13. Please revise to provide dilution disclosures for varying levels of
proceeds that may be
raised in the offering.
Business, page 37
14. Please revise your disclosure to clearly state what stage of
development each of your
products is in, if such product is ready for production, if you have
started to produce that
product and whether or not you expect to rely on currently-unknown
advances in
Mark Hanchett
Atlis Motor Vehicles Inc
November 10, 2022
Page 4
technology to finish development of any products. For example, the
disclosure in this
section, when read with MD&A, makes it difficult to understand how far
from market
your AMV XT pickup truck is and whether your AMV Energy 30 pack and AV
Energy
Cell are, or are close to, ready for production. We further note your
disclosure on page
39 that you expect to build the first batteries for your customers in
the second half of
2022. Please disclose if you have started producing batteries and the
expected scale of
your first production.
15. We note your disclosure that you (i) are standing up battery pack
manufacturing in
parallel to battery cell manufacturing to meet current projected
customer demand where
customers have signed an LOIs and MOUs for 2022, (ii) have non-binding
reservations
for vehicles. Please elaborate on the quantity of expected customer
demand, your current
and near-term production capacity and the anticipated production
schedule for
your products. For example, please revise your disclosure of
"substantial interest" on page
39 to provide greater insight into expected consumer demand.
16. Please provide a materially complete discussion of Atlis Cloud
Services and what is
entailed with the development and implementation of your software and
cloud
technology. Describe the current status, how much research and
development the service
is undergoing, the entity that will host the technology and any other
information that is
necessary for readers to understand your operational plan for these
services in the next 6-
12 months.
17. Please revise your disclosure to fully describe your competitive
position with respect to
each of your products. For example, compare the specifications and
charging
capabilities of the company's battery technology with the technology
of its competitors.
Additionally, provide support for your statement that you are
developing superior battery
cell technology "with thermal and electrical performance that we
believe will be
unmatched." Update industry-related information as appropriate.
18. Please revise your disclosure on page 40 to disclose the material
terms of your agreement
with Australian Manufactured Vehicles and file the agreement pursuant
to Item
601(b)(10) of Regulation S-K.
19. Please revise to include sources and availability of raw materials.
Refer to Item
101(h)(4)(v) of Regulation S-K.
20. Please provide a discussion of your current intellectual property
rights, including the
duration of such rights. Refer to Item 101(h)(4)(vii) of Regulation
S-K.
21. We note your disclosure that "[a]s we progress, we may need to obtain
government
approval for meeting federal transportation safety guidelines." Please
revise to disclose the
FirstName LastNameMark Hanchett
effect of probable governmental regulations on the business and the
costs and effects of
Comapany NameAtlis
compliance withMotor Vehicles Inc
environmental laws. Refer to Item 101(h)(4)(ix) and
Item 101(h)(4)(xi)
of Regulation
November S-K.4
10, 2022 Page
FirstName LastName
Mark Hanchett
FirstName
Atlis MotorLastNameMark
Vehicles Inc Hanchett
Comapany 10,
November NameAtlis
2022 Motor Vehicles Inc
November
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Management's Discussion and Analysis of Financial Condition and Results of
Operations, page
43
22. We note that you intend to begin generating revenue in 2023. Please
disclose whether and
how your business segments, products, lines of service, projects, or
operations are, or you
expect to be, materially impacted by supply chain disruptions,
especially in light of
Russia s invasion of Ukraine. For example, discuss whether you have
or expect to:
suspend or delay the production, purchase, sale or maintenance of
certain items due
to a lack of raw materials, parts, or equipment; inventory
shortages; closed factories
reduced headcount; or delayed projects;
experience labor shortages that impact your business;
experience cybersecurity attacks in your supply chain;
experience higher costs due to constrained capacity or increased
commodity prices or
challenges sourcing materials (e.g., nickel, palladium, neon,
cobalt, iron, platinum or
other raw material sourced from Russia, Belarus, or Ukraine or
lithium, nickel,
manganese, beryllium, copper, gold or other raw material sourced
from Western
China);
be unable to supply products at competitive prices or at all due
to export
restrictions, sanctions, tariffs, trade barriers, or political or
trade tensions among
countries or the ongoing invasion; or
be exposed to supply chain risk in light of Russia s invasion of
Ukraine, the
effectiveness of the UFLPA and/or related geopolitical tension or
have sought to de-
globalize your supply chain.
Explain whether and how you have undertaken efforts to mitigate the
impact and where
possible quantify the impact to your business
23. Please revise to disclose the minimum period of time that you will be
able to conduct
planned operations using only currently available capital resources.
Refer to Item
303(b)(1) of Regulation S-K.
Management, page 50
24. We note that your amended and restated bylaws state that you have a
classified board.
Please revise to identify which class each director belongs to and
disclose when the
term of each class will expire.
Director Compensation, page 58
25. Please disclose the material terms of the company's director agreement
with
Ms. Nightengale.
Description of Securities, page 59
26. Please tell us where in your governing documents you are authorized to
issue 96,248,541
shares of capital stock, including 54,307,968 shares of Class A common
stock and
41,925,572 shares of Class D common stock. Further, tell us where the
rights of each of
Mark Hanchett
FirstName
Atlis MotorLastNameMark
Vehicles Inc Hanchett
Comapany 10,
November NameAtlis
2022 Motor Vehicles Inc
November
Page 6 10, 2022 Page 6
FirstName LastName
class of your common stock are set forth in your governing documents.
Revise this
section, as applicable, to provide the information required by Item
202 of Regulation S-K.
Certain Relationships and Related Party Transactions, page 63
27. Please revise this section to provide the information for the time
period set forth in Item
404(d) of Regulation S-K and the instructions thereto.
Plan of Distribution, page 69
28. Please clarify, by footnote or otherwise, that your tabular disclosure
under the subheading
"Placement Agent Fees, Commissions and Expenses" does not include the
placement
agent warrants that are deemed to be compensation under FINRA Rule
5110.
Recent Sales of Unregistered Securities, page II-1
29. We note that you cross reference to "Certain Relationships and Related
Party
Transactions," however, that section states that you have no
reportable transactions. Please
revise your disclosure to furnish the information required by Item 701
of Regulation S-K.
Signatures, page II-5
30. Revise your signature page to conform to the requirements of Form S-1.
Specifically, your
principal accounting officer or controller must sign the registration
statement in his or her
individual capacity. If someone has signed in more than one capacity,
indicate each
capacity in which he or she signed.
Exhibits
31. Please ensure each exhibit is in the proper text-searchable format.
See Rules 301 and 304
of Regulation S-T. Additionally, it appears you included your amended
and restated
bylaws twice in Exhibit 3.2. Please revise and refile.
32. Please file the (i) indemnification agreements, or a form of, between
the company and its
executive officers and/or directors and (ii) the non-employee director
agreements as
exhibits to the registration statement or tell us why you are not
required to do so.
33. We note your disclosure that none of your NEOs are have employment
agreements with
the company, however, we also note your disclosure that "[i]n 2021,
each Named
Executive Officer received a letter that superseded any prior offer
letter or compensation
arrangement with the Company." Please file these letters as exhibits
to the
registration statement or tell us why you are not required to do so.
General
34. Please supplementally provide us with copies of all written
communications, as defined in
Rule 405 under the Securities Act, that you, or anyone authorized to
do so on your behalf,
Mark Hanchett
Atlis Motor Vehicles Inc
November 10, 2022
Page 7
present to potential investors in reliance on Section 5(d) of the
Securities Act, whether or
not they retain copies of the communications. Please contact legal
staff associated with the
review of this filing to discuss how to submit the materials, if any,
to us for review.
You may contact Ernest Greene at 202-551-3733 or Kevin Woody at
202-551-3629 if
you have questions regarding comments on the financial statements and related
matters. Please
contact Evan Ewing at 202-551-5920 or Jay Ingram at 202-551-3397 with any other
questions.
FirstName LastNameMark Hanchett Sincerely,
Comapany NameAtlis Motor Vehicles Inc
Division of
Corporation Finance
November 10, 2022 Page 7 Office of
Manufacturing
FirstName LastName