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United States securities and exchange commission logo
October 20, 2022
Dr. Babak A. Taheri
Chief Executive Officer
Silvaco Group, Inc.
4701 Patrick Henry Drive, Building #23
Santa Clara, CA 95054
Re: Silvaco Group, Inc.
Draft Registration
Statement on Form S-1
Submitted September
23, 2022
CIK No. 0001943289
Dear Dr. Babak A. Taheri:
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 Submitted September 23, 2022
Cover Page
1. Please remove the
Filing Fee Table from the cover page and file it as an exhibit to this
registration statement.
Refer to Item 601(b)(107) of Regulation S-K.
Prospectus Summary
Overview, page 1
2. Please expand your
disclosure of your total addressable market opportunity for EDA
software to address any
assumptions and limitations associated with the calculation of
such specific market
opportunity.
Dr. Babak A. Taheri
Silvaco Group, Inc.
October 20, 2022
Page 2
Risk Factors
Our international sales constitute a substantial portion of our revenue and
could be negatively
affected..., page 19
3. You disclose that you have a wholly foreign-owned enterprise operating
in China as well
as employees and customers in China. Please expand your disclosure to
discuss the extent
of your operations in China, including quantifying the portion that
your enterprise in
China contributes to your operations and revenues. Also, discuss the
material risks
resulting from your China-based business operations.
Our operations could be disrupted by geopolitical conditions..., page 20
4. Please describe the extent and nature of the role of the board of
directors in overseeing
risks related to Russia s invasion of Ukraine. This could include
risks related to
cybersecurity, sanctions, employees based in affected regions, and
supply
chain/suppliers/service providers in affected regions as well as risks
connected with
ongoing or halted operations or investments in affected regions.
Management's Discussion and Analysis of Financial Condition and Results of
Operations
Impact of COVID-19, page 52
5. We note your general disclosures of the social and economic impacts
from COVID-
19 both here and on page 24. Please expand to discuss the specific
COVID-19 impact
you have experienced to your results of operations, financial
condition and relevant
metrics. Refer to CF Disclosure Guidance: Topic No. 9 and 9A for
additional guidance.
Key Factors Affecting our Results of Operations and Future Performance, page 53
6. Please disclose any known trends or uncertainties that have had or are
reasonably likely to
have a material impact on your cash flows, liquidity, capital
resources, cash requirements,
financial position, or results of operations arising from, related to,
or caused by the global
disruption from, Russia s invasion of Ukraine. Trends or
uncertainties may include
impairments of financial assets or long-lived assets; declines in the
value of inventory,
investments, or recoverability of deferred tax assets; the
collectability of consideration
related to contracts with customers; and modification of contracts
with customers. In this
regard, we note that your business is tied to the semiconductor
industry, which has been
adversely impacted by Russia s invasion of Ukraine.
Relationships with Key Customers, page 53
7. We note your disclosure here and on page 77 regarding the significance
of your
FirstName LastNameDr. Babak A. Taheri
relationships with key customers. Revise your disclosure here and in
your Business
Comapany NameSilvaco
section, Group,
as appropriate, to Inc.
provide the material terms of your
agreements with
your key customers,
October 20, 2022 Page 2 including whether you have written agreements
with these parties.
FirstName LastName
Dr. Babak A. Taheri
FirstName LastNameDr. Babak A. Taheri
Silvaco Group, Inc.
Comapany
October 20,NameSilvaco
2022 Group, Inc.
October
Page 3 20, 2022 Page 3
FirstName LastName
Shares Eligible for Future Sale
Lock-Up Agreements, page 110
8. Please revise to summarize the exceptions to the lock-up agreements
with your
officers, directors and existing stockholders.
Financial Statements
2. Summary of Significant Accounting Policies
Basis of Presentation and Consolidation, page F-8
9. We note the Company's seventeen subsidiaries "are all directly or
indirectly owned or
controlled by the Company." Disclose your accounting policies
concerning the
consolidation of subsidiaries that are controlled on a basis other
than ownership and
advise us. You should fully comply with the disclosure requirements of
ASC 810.
Revenue Recognition, page F-9
10. Please expand your revenue recognition policy note to fully address
your policies with
respect to custom development. Describe in this disclosure the custom
development
activities and the contractual terms under which you contract with
customers to provide
such services.
General
11. You refer to your prior operations in Russia and Ukraine. Please
describe the direct or
indirect impact of Russia s invasion of Ukraine on your business. In
addition, please also
consider any impact:
resulting from sanctions, limitations on obtaining relevant
government approvals,
currency exchange limitations, or export or capital controls,
including the impact of
any risks that may impede your ability to sell assets located in
Russia, Belarus, or
Ukraine, including due to sanctions affecting potential
purchasers;
resulting from the reaction of your investors, employees,
customers, and/or other
stakeholders to any action or inaction arising from or relating
to the invasion,
including the payment of taxes to the Russian Federation; and
that may result if Russia or another government nationalizes your
assets or operations
in Russia, Belarus, or Ukraine.
If the impact is not material, please explain why.
12. 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,
present to potential investors in reliance on Section 5(d) of the
Securities Act, whether or
not they retain copies of the communication.
Dr. Babak A. Taheri
FirstName LastNameDr. Babak A. Taheri
Silvaco Group, Inc.
Comapany
October 20,NameSilvaco
2022 Group, Inc.
October
Page 4 20, 2022 Page 4
FirstName LastName
You may contact Joseph Kempf, Senior Staff Accountant, at (202)
551-3352 or Robert
Littlepage, Accounting Branch Chief, at (202) 551-3361 if you have questions
regarding
comments on the financial statements and related matters. Please contact
Alexandra Barone,
Staff Attorney, at (202) 551-8816 or Matthew Crispino, Staff Attorney, at (202)
551-3456 with
any other questions.
Sincerely,
Division of
Corporation Finance
Office of Technology
cc: Gabriella Lombardi