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December 31, 2019
Ron Poliakine
Chief Executive Officer
Nano-X Imaging Ltd.
Communications Center
Neve Ilan, Israel 9085000
Re: Nano-X Imaging Ltd.
Draft Registration Statement on Form F-1
Submitted December 4, 2019
CIK No. 0001795251
Dear Mr. Poliakine:
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 F-1
Overview, page 1
1. Please revise paragraph four to briefly discuss the basis for the
statement that you will be
able to market and deploy the Nanox System broadly across the globe "at
a substantially
lower cost compared to currently available medical imaging systems, such
as computed
tomography."
2. Please revise the second to the last sentence in paragraph five to
indicate the basis for your
belief that neither your X-ray source nor the Nanox.Cloud will require
regulatory approval
or clearance as individual products marketed independently from the
Nanox.Arc. Please
also revise to address the apparent discrepancy between this statement
and your statement
Ron Poliakine
FirstName LastNameRon Poliakine
Nano-X Imaging Ltd.
Comapany31, 2019
December NameNano-X Imaging Ltd.
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in the first sentence that you expect to submit a 510(k) application
with respect to the
Nanox.Arc and Nanox.Cloud for medical device clearance with the FDA at
a future date.
3. Please also revise paragraph five to clarify, as you do at page 74,
that to date you have not
obtained FDA feedback regarding the regulatory pathway you expect to
pursue.
4. Please revise to make clear the basis for describing your system as
potentially "first-of-its-
kind" when you also state that you expect to make no new claims as to
the operation,
image quality or functionality of the Nanox.Arc compared to a
predicate device and you
have not yet produced a prototype of the Nanox.Arc nor a beta version
of the
Nanox.Cloud software.
Certain of our directors and/or officers may have interests that compete with
ours., page 23
5. Please revise, as appropriate, to discuss any mechanism in place to
resolve conflicts of
interest among the parties you have identified.
Use of Proceeds, page 53
6. Please revise paragraph two to indicate how much of the proceeds you
intend to allocate
to each use you have identified. Also, please clarify whether you
anticipate having
sufficient funds associated with obtaining regulatory clearance. If
not, please indicate the
source of any additional funds needed to do so.
7. We note disclosure at page 110 under "Asset Purchase by the Company
from Nanox
Gibraltar" that the consideration for assets transferred to the
company will occur, among
other events, upon "the closing of the first underwritten public
offering of the Company
pursuant to a registration statement under the Securities Act or the
Israeli Securities Law."
To the extent that proceeds from the offering will be used as
consideration for the assets
transferred, please revise to so indicate, including the amount to be
allocated.
Business, page 68
8. Please describe the material terms of your collaboration agreement
with Hadasit Medical
Research Services and Development Ltd., referenced in Note 10 on page
F-18, including a
description of each party's rights and obligations, a quantification
of any payment
obligations including milestones and range of royalty payments, the
contract term and any
termination provisions. Please also file the agreement as an exhibit
or provide us with an
analysis supporting a determination that you are not required to file
it as an exhibit.
Intellectual Property, page 77
9. Please revise to identify the other jurisdictions where you have nine
patents issued.
10. We note your reference to existing license agreements in sentence one
of the first full risk
factor on page 28, but see no further discussion of these agreements,
nor are they listed in
your exhibit index. Please revise or advise. Please also expand to
describe the terms of the
Ron Poliakine
Nano-X Imaging Ltd.
December 31, 2019
Page 3
right of first negotiation agreement with Fujifilm as noted on page 29
and file it as an
exhibit, or provide an analysis as to why you are not required to file
it.
Note 1. General, page F-8
11. We note that the asset purchase agreement excluded the shares of Nanox
Japan, Inc., a
wholly owned subsidiary of Nanox PLC (page 110) and you adjusted the
financial
statements to reflect only the net assets that were transferred in the
transaction. Since the
financial statements appear to include Nanox Japan, please explain to
us the interests in
Nanox Japan that were transferred under the asset purchase agreement
and are reflected in
the financial statements.
Note 2. Significant Accounting Policies, Functional Currency, page F-9
12. Please reconcile the disclosure on page 22 that a significant portion
of your operating
expenses, including personnel and facilities related expenses, are
incurred in NIS and Yen,
with your disclosure on page F-9 that a substantial portion of your
operational costs are
denominated in U.S. dollars. Tell us how you considered ASC 830-10-45
in determining
that your functional currency is the U.S. dollar.
Note 4. Related Party Liability, page F-13
13. Please show us how you calculated the amount of the related party
liability of $8,157,000.
Note 6. Shareholders' Equity, page F-13
14. Please tell us why you reflect the sale of 1,666,774 ordinary shares
during the year ended
December 31, 2018, for an aggregate amount of $3,684,000, as a
non-cash
financing activity in the statement of cash flows on page F-7.
15. We note that your pro forma presentations on pages 6, 8, 55, and 56
assume the issuance
of ordinary shares that will be issued upon the exercise of warrants
held by certain of your
shareholders immediately prior to the closing of the offering. Please
tell us where you
discuss these warrants in the financial statements and why you believe
the warrants will
be exercised prior to the closing.
Note 8. Related Parties, page F-16
16. In Note 8(d), you disclose that the related party receivable of
$1,694,000 includes funds
you received from Six-Eye from the sale of ordinary shares in 2018 less
amounts payable
FirstName LastNameRon Poliakine
under your consulting agreement. Please tell us why you reflect the
amounts net and
Comapany NameNano-X Imaging Ltd. services in the statements of operations.
Ensure that you
where you include the consulting
include all of the disclosures required by ASC 850-10-50-1 in the
financial statements.
December 31, 2019 Page 3
FirstName LastName
Ron Poliakine
FirstName LastNameRon Poliakine
Nano-X Imaging Ltd.
Comapany31, 2019
December NameNano-X Imaging Ltd.
December 31, 2019 Page 4
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FirstName LastName
General
17. 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 communications.
You may contact Li Xiao at 202-551-4391 or Kate Tillan at 202-551-3604
if you have
questions regarding comments on the financial statements and related matters.
Please contact
Paul Fischer at 202-551-3415 or Mary Beth Breslin at 202-551-3625 with any
other questions.
Sincerely,
Division of
Corporation Finance
Office of Life
Sciences
cc: Andrea Nicolas