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United States securities and exchange commission logo
June 1, 2021
Barry Engle
Chief Executive Officer
Lilium B.V.
505 Montgomery Street, Suite 1100
San Francisco, CA
Re: Lilium B.V.
Registration
Statement on Form F-4
Filed May 5, 2021
File No. 333-255800
Dear Ms. Engle:
We have reviewed your 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.
Form F-4 filed May 5, 2021
What interests do the Sponsor, Qell Initial Shareholders and Qell's
other current officers and
directors have in the Business Combination?, page 13
1. Please include the
aggregate market value of the Private Placement Warrants as of the
most practicable date.
2. Please disclose whether
there are any outstanding working capital loans.
Adverse publicity stemming from any incident involving, page 62
3. We note your disclosure
that your insurance may be inapplicable to cover any incident or
accident and that you
may have to bear substantial losses from an incident or accident.
Please disclose whether
your insurance covered the losses you sustained the fire in
Barry Engle
FirstName
Lilium B.V.LastNameBarry Engle
Comapany
June 1, 2021NameLilium B.V.
June 1,
Page 2 2021 Page 2
FirstName LastName
February 2020.
Background of the Business Combination, page 94
4. We note that you considered over 100 different potential business
combination
targets. Please substantially revise your disclosure to provide
additional detail, including
timing and how the discussions with other potential targets overlapped
with one another
and with Lilium. Please describe the potential terms discussed and the
progress of those
discussions. Also provide the dates of board meetings at which the
management team
communicated with the board, how many candidates they presented to the
board, what
recommendations they made, whether financial advisors were involved,
and further
information on the board s decision-making process.
5. Please revise your disclosure in this section to include negotiations
relating to material
terms of the transaction, including, but not limited to, structure,
consideration, proposals
and counter-proposals. In your revised disclosure, please explain the
reasons for the terms,
each party's position on the issues, and how you reached agreement on
the final terms.
6. We note your disclosure on page 99 that Qell and Lilium made
adjustments to Lilium s
financial projections to reflect the revised amount of PIPE proceeds.
Please disclose the
projections and assumptions.
7. Please identify the Strategic Advisor.
The Business Combination
Lilium Prospective Financial Information, page 105
8. Although you provide a table of selected prospective financial
measures for fiscal years
2024 through 2027, no similar detail is presented for fiscal years
2021 through 2023.
Please revise to include a uniform presentation for each fiscal year
or explain to us why
such information is impracticable and/or not useful to investors. If
prepared by
management, also include Lilium's net income (loss) projections for
each of the related
periods.
9. Please revise to disclose the extent to which your projected revenues
and production
volumes are subject to formal sales agreements. In addition, if a
material portion of your
projected financial measures are concentrated with an individual
customer(s), separately
quantify and discuss these concentrations.
10. We note your disclosure on page 107 that the financial projections
were based on
numerous variables, estimates, and assumptions. Please revise to
describe such variables,
estimates and assumptions with greater specificity and quantify where
practicable.
11. Refer to your statement that "Lilium undertakes no obligation to
update or otherwise
revise or reconcile the above the Lilium Projections to reflect
circumstances existing after
the date the Lilium Projections were generated or to reflect the
occurrence of future
events, even in the event that any or all of the assumptions
underlying such information
Barry Engle
FirstName
Lilium B.V.LastNameBarry Engle
Comapany
June 1, 2021NameLilium B.V.
June 1,
Page 3 2021 Page 3
FirstName LastName
are shown to be in error. Please tell us the basis for your
apparent belief that you can
limit your obligation to update your prospectus in this manner. In
particular, this assertion
does not appear consistent with the requirements of Item 408 of
Regulation C and your
proposed use of the prospectus over a period of time in connection
with a continuous
offering of shares pursuant to the exchange offer.
Material Tax Consequences, page 113
12. If counsel elects to file a short form tax opinion, both the opinion
and the information in
the joint proxy statement/prospectus must state clearly that the
discussion in the joint
proxy statement/prospectus constitutes counsel's opinion.
13. We note your disclosure that the Merger should constitute a
reorganization under Section
368(a)(1)(F) of the Code. Please have counsel explain why it cannot
give a will opinion
and to describe the degree of uncertainty in the opinion. Please also
include a risk factor
setting forth the risks of uncertain tax treatment to investors.
Unaudited Pro Forma Condensed Combined Financial Information
Notes to Unaudited Pro Forma Condensed Combined Financial Information, page 158
14. You disclose within your description of pro forma adjustment (D) that
22.6 million of
Qell transaction costs have been excluded from the pro forma statement
of operations.
Please reflect such expenses within the pro forma statement of
operations, similar to your
treatment of the Lilium transaction costs, or tell us why you believe
no adjustment is
necessary.
Business of Lilium and Certain Information About Lilium
Our Strategy, page 164
15. We note your discussions of "contribution margin" on pages 164-165 and
173. Please
revise your filing to specify how you define and calculate
contribution margin. A
discussion of the material expenses excluded from contribution margin
may also be useful
to investors. Also revise to indicate that contribution margin is not
a term defined under
IFRS and that your calculation of contribution margin may be different
than those used by
other registrants.
Safety and Performance, page 177
16. We note your disclosure that In February 2020 your prototype was
destroyed in a fire.
Please disclose whether the investigations related to the incident
have been complete and
results of such investigations. Pease also revise your risk factor
disclosures to state
whether there were any injuries, causalities or additional damages as
a result of the fire.
Lilium's Management's Discussion and Analysis of Financial Condition and
Results of
Operations
Critical Accounting Estimates
Barry Engle
FirstName
Lilium B.V.LastNameBarry Engle
Comapany
June 1, 2021NameLilium B.V.
June 1,
Page 4 2021 Page 4
FirstName LastName
Share-Based Compensation, page 193
17. We note your disclosure that the value of each share option was
determined to be the
value of the underlying common share less the exercise price since
"recent option
grants...have been deep in-the-money at their respective grant dates."
Please tell us in
sufficient detail how you determined intrinsic value represents an
appropriate fair value
measurement for your options under paragraph 17 of IFRS 2. Also
reconcile your
disclosure here to the disclosure on page F-50 discussing inputs to
the option pricing
"models used." If the intrinsic value valuation applies only to
"recent option grants," tell
us the number of options valued using intrinsic value, the total fair
value related to such
option issuances, and the periods over which the compensation will be
recognized. If
your intrinsic value disclosure applies to the valuation of
cash-settled options at fiscal
year-end, revise your disclosures to clarify, and explain how
intrinsic value represents an
appropriate fair value.
Audited Consolidated Financial Statements of Lilium GmbH
Notes to the Consolidated Financial Statements
20. Share-based Payments, page F-48
18. We note that the original terms of your share options allowed holders
to settle in cash or
shares only if an "exit event" occurs. We further note that the
options were modified in
November 2020 to give you the discretion to settle them in cash or
shares. Please address
the following comments related to your share options:
Considering the options appear to be cash-settleable only upon
a contingent event,
tell us how you determined that the shares qualified for
classification as cash-settled.
Cite the authoritative IFRS accounting guidance you relied upon,
such as IAS 37, in
determining whether to classify the options as cash-settled or
equity-settled.
In regards to the option modification, provide the disclosures
required by paragraph
47(c) of IFRS 2 in your next amendment. For the post-modification
options that
continue to be classified as cash-settled awards, also explain to
us in sufficient detail
why, consistent with your accounting policy disclosure on page
F-35, it appears they
have not been reclassified within equity considering you believe
the exit event is not
probable.
Exhibit 4.1, page II-1
19. We note that the form of warrant agreement filed as Exhibit 4.1
provides that any action,
proceeding, or claim arising out of or relating in any way to the
agreement shall be
brought and enforced in the courts of the State of New York or the
United States District
Court for the Southern District of New York, and that the company
irrevocably submits to
such jurisdiction, which jurisdiction shall be exclusive. We also note
that the parties
Barry Engle
Lilium B.V.
June 1, 2021
Page 5
waive any objection to such exclusive jurisdiction. If this
provision requires investors
in this offering to bring any such action, proceeding, or claim in the
courts of the State of
New York or the United States District Court for the Southern District
of New York,
please disclose such provision in your registration statement, and
disclose whether this
provision applies to actions arising under the Securities Act or
Exchange Act. If
the provision applies to actions arising under the Securities Act or
Exchange Act, please
also add related risk factor disclosure. If this provision does not
apply to actions arising
under the Securities Act or Exchange Act, please also ensure that the
provision in the
warrant agreement states this clearly.
General
20. Please revise your letter to Qell shareholders to state the equity and
voting interests of the
shareholders of Holdco after the business combination.
21. Please add a question and answer highlighting any material differences
in the rights of
security holders as result of the dual class structure. Please also
disclose the voting
percentages of the shareholders.
22. Please expand your cover page disclosure to briefly discuss the
contemplated dual-class
structure and the relative voting rights of Class A Shares and Class B
Shares. In addition,
please add risk factor disclosure to discuss whether your dual class
structure could inhibit
inclusion in certain stock market indices, and potential adverse
effects on your market price and liquidity.
23. Please disclose the intended use for the funds in the Trust and PIPE.
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.
You may contact Charles Eastman at 202-551-3794 or Andrew Blume at
202-551-3254 if
you have questions regarding comments on the financial statements and related
matters. Please
contact Asia Timmons-Pierce at 202-551-3754 or Jay Ingram at 202-551-3397 with
any other
questions.
FirstName LastNameBarry Engle Sincerely,
Comapany NameLilium B.V.
June 1, 2021 Page 5 Division of
Corporation Finance
FirstName LastName Office of
Manufacturing