WILLIAMS LAW GROUP, P.A.
2503 W. Gardner Ct.
Tampa FL 33611
Phone: 813-831-9348
Fax: 813-832-5284
e-mail: wmslaw@tampabay.rr.com
February 11, 2010
Ms. Stephani Bouvet
United States Securities and Exchange Commission
Division of Corporation Finance
100 F. St., N.E.
Washington, D.C. 20549-7010
Re: Hyperera, Inc.
Registration Statement on Form S-1
Amendment No. 1.
File No. 333-163035
Dear Ms. Bouvet:
We have filed on EDGAR the above Amendment No. 1 and the related response table which is attached to this letter.
Thank you for your consideration.
| | Sincerely, |
| | |
| | /s/ MICHAEL T. WILLIAMS, ESQ. |
| | |
| | Michael T. Williams, Esq. |
Comment Number | | Page[s] | | Explanation | |
| 1 . | | | | Language removed. Confirmed that all shares have been issued. | |
| 2 . | | | | Language concerning warrants removed. There are no warrants. | |
| 3 . | | | | Risk Factor concerning this potential conflict added. | |
| 4 . | | | | Risk revised to clarify no revenues as of September 30, 2010. | |
| 5 . | | | | Risk Factors separated and revised. | |
| 6 . | | | | Disclosure added to clarify only material relationship is with our attorney. | |
| 7 . | | | | Disclosure added to clarify that we conduct our business through our subsidiary in China and the we only intend to sell products of Beijing Chaoran. | |
| 8 . | | | | Extensive disclosure of regulatory environment in China added. | |
| 9 . | | | | Removed | |
| 10 . | | | | Updated as requested | |
| 11 . | | | | Updated as requested | |
| 12 . | | | | As there have been recent sales at $.20 per share we believe this comment is addressed. | |
| 13 . | | | | We have revised disclosure concerning this transaction as requested. | |
| 14 . | | | | Besides the distribution agreement. The purchase contracts Between Hyperera, Inc. and Beijing Chaoran are attached in exhibit. | |
| 15 . | | | | We have filed the distribution agreement revised to correct these scrivener errors. | |
| 16 . | | | | We have eliminated this undertaking. | |
| 17 . | | | | Auditor report revised as requested. | |
| 18-24 | | | | See Accounting Comment Response below | |
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| 25 . | | | | Updated | |
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Financial Statements
Independent Auditor’s Report on the Financial Statements
17. The auditor’s report was revised to add city and state where issued.
Note B- Significant Accounting Policies
Revenue Recognition, page F-10
| 18. | The revenue recognition will follow the guidance in SAB 104 and the arrangements contain a software element within the scope of SOP 97-2. See revised Revenue Recognition. |
| 19. | EITF 99-19: the analysis was disclosed and revised as follows: |
In accordance with paragraph 7-19 of EITF 99-19, "Reporting Revenues Gross as a Principal versus Net as an Agent", the Company will recognize revenues on a gross basis.EITF 99-19 discusses whether revenues and cost of goods sold to arrive at gross profit and their corresponding assets and liabilities should be recorded at gross or net.
The following indicators of gross revenue recognition are existed in the Company:
| | · | Acts as principal in the transaction. |
| | · | Has risk and rewards of ownership, such as general inventory risk, risk of loss for collection, delivery and returns, and |
| | · | Takes title to the products, |
| | · | The company can change the products or perform part of the service, and the Company is involved in the determination of products or service specifications, and the Company customizes the supplier’s software based on customer’s needs. |
All the indicators of net revenue reporting (EITF 99-19, paragraph 15-19) are not existed in the Company. The Company signed a distribution agreement on March 15, 2009 for 3 years with Beijing Chaoran Chuangshi Technology Co., Ltd (Beijing Chaoran) for the CIS software developed by Beijing Chaoran. According to the Agreement, the Company may exclusively sell the Chaoran developed CIS systems, but if Chaoran discontinue the supply of CIS, the Company can select other suppliers or other CIS developers to provide the similar products to the customers. Accordingly, an signed agreement will not affect the recognition of gross revenue reporting.
Note C – Related Party Transactions
Loans to Officers, page F-13
| 20. | The advanced $115,000 was to Mr. Zhiyong Li, Chairman and CEO of Hyperera, Inc. The loan was paid without interest charge in full on February 27, 2010. |
Note D – Shareholders’ Equity
Under the Company’s Articles of Incorporation dated February 19, 2008, the Company is authorized to issue 200,000,000 shares of capital stock with a par value of $0.001.
On Feburary19, 2008, the Company was incorporated in the State of Nevada.
On February 19, 2008, , the Company issued 20,000,000 shares to three founders of the Company, Zhiyong Li, Wei Wu, and Huitao Zhou at $0.001 per share or $ 20,000 for initial capital (stock subscription receivable). Detail as follow:
| Name | | Share QTY | | Purchase Date | | Amount ($0.001) Per Share | |
| Zhi Yong Li | | | 10,000,000 | | 2/19/2008 | | $ | 10,000 | |
| Wei Wu | | | 5,000,000 | | 2/19/2008 | | $ | 5,000 | |
| Hui Tao Zhou | | | 5,000,000 | | 2/19/2008 | | $ | 5,000 | |
| Total | | | 20,000,000 | | | | $ | 20,000 | |
On March 31, 2008, the Company issued total 5,200,000 shares to 52 shareholders at $0.03 per share or $156,000 for common stock (stock subscription receivable).
Detail list as follow:
| Name | | Share QTY | | Purchase Date | | Amount ($0.03) Per Share | |
| Lian Cheng Li | | | 100,000 | | 3/19/2008 | | $ | 3,000 | |
| Lian Rong Zhou | | | 100,000 | | 3/19/2008 | | $ | 3,000 | |
| Xiao Zhang | | | 100,000 | | 3/19/2008 | | $ | 3,000 | |
| Ya Jun Li | | | 100,000 | | 3/19/2008 | | $ | 3,000 | |
| Jia Bin Fu | | | 100,000 | | 3/19/2008 | | $ | 3,000 | |
| De Lu Zhang | | | 100,000 | | 3/19/2008 | | $ | 3,000 | |
| Gui Yun Tian | | | 100,000 | | 3/19/2008 | | $ | 3,000 | |
| Tong Xu | | | 100,000 | | 3/19/2008 | | $ | 3,000 | |
| Pei Ji Wu | | | 100,000 | | 3/19/2008 | | $ | 3,000 | |
| Lan Fen Wang | | | 100,000 | | 3/19/2008 | | $ | 3,000 | |
| Lin Hua Shang | | | 100,000 | | 3/19/2008 | | $ | 3,000 | |
| Jian Wu | | | 100,000 | | 3/19/2008 | | $ | 3,000 | |
| Quan Wu | | | 100,000 | | 3/19/2008 | | $ | 3,000 | |
| Qing Tian | | | 100,000 | | 3/19/2008 | | $ | 3,000 | |
| Shu Zhi Zhang | | | 100,000 | | 3/19/2008 | | $ | 3,000 | |
| Yu Fang Zhou | | | 100,000 | | 3/19/2008 | | $ | 3,000 | |
| Yue Hui Zhou | | | 100,000 | | 3/19/2008 | | $ | 3,000 | |
| Yue Ming Zhou | | | 100,000 | | 3/19/2008 | | $ | 3,000 | |
| Xiang You Kong | | | 100,000 | | 3/19/2008 | | $ | 3,000 | |
| Zhi Nan Zhou | | | 100,000 | | 3/19/2008 | | $ | 3,000 | |
| Jian Zhong Zhang | | | 100,000 | | 3/19/2008 | | $ | 3,000 | |
| Jian Guo Zhang | | | 100,000 | | 3/19/2008 | | $ | 3,000 | |
| Jian Wu Zhang | | | 100,000 | | 3/19/2008 | | $ | 3,000 | |
| Ling Fen Shang | | | 100,000 | | 3/19/2008 | | $ | 3,000 | |
| Wen Zhang | | | 100,000 | | 3/19/2008 | | $ | 3,000 | |
| Yan Yun Xi | | | 100,000 | | 3/20/2008 | | $ | 3,000 | |
| Ling Luan | | | 100,000 | | 3/20/2008 | | $ | 3,000 | |
| Qing Liang Chen | | | 100,000 | | 3/20/2008 | | $ | 3,000 | |
| Yan Mei Du | | | 100,000 | | 3/20/2008 | | $ | 3,000 | |
| Nan Su | | | 100,000 | | 3/20/2008 | | $ | 3,000 | |
| Qing Di | | | 100,000 | | 3/20/2008 | | $ | 3,000 | |
| Hong Tao Bai | | | 100,000 | | 3/20/2008 | | $ | 3,000 | |
| Meng Xia Zhuang | | | 100,000 | | 3/20/2008 | | $ | 3,000 | |
| Zhi Hui Zhang | | | 100,000 | | 3/20/2008 | | $ | 3,000 | |
| Shu Ting Zhang | | | 100,000 | | 3/20/2008 | | $ | 3,000 | |
| Wen Fang Dong | | | 100,000 | | 3/20/2008 | | $ | 3,000 | |
| Yan Hu | | | 100,000 | | 3/20/2008 | | $ | 3,000 | |
| Zhen Qin Wang | | | 100,000 | | 3/20/2008 | | $ | 3,000 | |
| Wei Lin | | | 100,000 | | 3/22/2008 | | $ | 3,000 | |
| Yi Xiong Wang | | | 100,000 | | 3/22/2008 | | $ | 3,000 | |
| Yang Yu | | | 100,000 | | 3/22/2008 | | $ | 3,000 | |
| Shu Jun Huang | | | 100,000 | | 3/22/2008 | | $ | 3,000 | |
| Zheng Jie Hua | | | 100,000 | | 3/22/2008 | | $ | 3,000 | |
| Ming Liu | | | 100,000 | | 3/22/2008 | | $ | 3,000 | |
| Li Wen Shi | | | 100,000 | | 3/22/2008 | | $ | 3,000 | |
| Zhong Huan Li | | | 100,000 | | 3/22/2008 | | $ | 3,000 | |
| Ji Xiang Liu | | | 100,000 | | 3/22/2008 | | $ | 3,000 | |
| Hou Qin Li | | | 100,000 | | 3/22/2008 | | $ | 3,000 | |
| Hao Chen Liu | | | 100,000 | | 3/22/2008 | | $ | 3,000 | |
| Da Liu | | | 100,000 | | 3/22/2008 | | $ | 3,000 | |
| Yu Ming Zhou | | | 100,000 | | 3/22/2008 | | $ | 3,000 | |
| Bao Shu Dai | | | 100,000 | | 3/22/2008 | | $ | 3,000 | |
| Total | | | 5,200,000 | | | | $ | 156,000 | |
On April 28, 2008, the Company issued additional 1,400,000 shares to 14 shareholders at $0.03 per share or $42,000 for common stock (stock subscription receivable). Detail as follow:
| Name | | Share QTY | | Purchase Date | | Amount ($0.03) Per Share | |
| Jun Liu | | | 100,000 | | 4/28/2008 | | $ | 3,000 | |
| Yu Yan Qin | | | 100,000 | | 4/28/2008 | | $ | 3,000 | |
| Lian Sheng Zhou | | | 100,000 | | 4/28/2008 | | $ | 3,000 | |
| Wen Hui Zhou | | | 100,000 | | 4/28/2008 | | $ | 3,000 | |
| Yong Heng Hao | | | 100,000 | | 4/28/2008 | | $ | 3,000 | |
| Mei Sheng | | | 100,000 | | 4/28/2008 | | $ | 3,000 | |
| Wen Luan Hu | | | 100,000 | | 4/28/2008 | | $ | 3,000 | |
| Guang Yue Shang | | | 100,000 | | 4/28/2008 | | $ | 3,000 | |
| Ke Yan Liu | | | 100,000 | | 4/28/2008 | | $ | 3,000 | |
| Li Fang Huang | | | 100,000 | | 4/28/2008 | | $ | 3,000 | |
| Hui Li | | | 100,000 | | 4/28/2008 | | $ | 3,000 | |
| Fu Jun Jia | | | 100,000 | | 4/28/2008 | | $ | 3,000 | |
| Yong Yu Liu | | | 100,000 | | 4/28/2008 | | $ | 3,000 | |
| Bao Yu Li | | | 100,000 | | 4/28/2008 | | $ | 3,000 | |
| Total | | | 1,400,000 | | | | $ | 42,000 | |
On July 20, 2008, additional 1,200,000 shares were issued to 7 shareholders at $ 0.03 per share, and the total proceeds of $36,000 were received. Detail as follow:
| Name | | Share QTY | | Purchase Date | | Amount ($0.03) Per Share | |
| Sen Chai | | | 100,000 | | 7/20/2008 | | $ | 3,000 | |
| Qian Sun | | | 100,000 | | 7/20/2008 | | $ | 3,000 | |
| Yun Sun | | | 100,000 | | 7/20/2008 | | $ | 3,000 | |
| Wan Ting Li | | | 100,000 | | 7/20/2008 | | $ | 3,000 | |
| Fu Xiang Tian | | | 200,000 | | 7/20/2008 | | $ | 6,000 | |
| Zeng Zhao | | | 300,000 | | 7/20/2008 | | $ | 9,000 | |
| Lie Rong Huang | | | 300,000 | | 7/20/2008 | | $ | 9,000 | |
| Total | | | 1,200,000 | | | | $ | 36,000 | |
On July 20, 2008, 139,000 shares were issued to Williams Law Group at $ 0.03 per share for the legal service value $4,170.
At December 15, 2009, additional 60,000 shares of common stocks were issued to 3 shareholders at $ 0.20 per share, and the total proceeds of $12,000 were received. The 3 new shareholders are independent and no-affiliated to Hyperera, Inc.
The price of common stocks issued to all shareholders were simple market approach, all the company information was disclosed to share subscribers and the price was mutually agreed and negotiated, then accepted by both the Company and common share subscribers.
Interim Financial Statements
Statement of Cash Flows, page F-20
On Feburary19, 2008, the Company was incorporated in the State of Nevada.
On February 19, 2008, , the Company issued 20,000,000 shares to three founders of the Company, Zhiyong Li, Wei Wu, and Huitao Zhou at $0.001 per share or $ 20,000 for initial capital (stock subscription receivable as of June 30, 2009).
On March 31, 2008, the Company issued total 5,200,000 shares to 52 shareholders at $0.03 per share or $156,000 for common stock (stock subscription receivable as of June 30, 2009).
On April 28, 2008, the Company issued additional 1,400,000 shares to 14 shareholders at $0.03 per share or $42,000 for common stock (stock subscription receivable as of June 30, 2009
The total stock subscription receivable of $218,000 was received on July, 2009. Therefore, as of December 31, 2008, there was no balance for stock subscription receivables and no amount would be shown on the Statement of Cash Flows as of December 31, 2008.
Note B-Significant Accounting Policies
Prepaid Expense to Supplier, page F-24
| 23. | Revised to disclose the prepaid of $207,998 to Beijing Chaoran, and the purchase contracts were attached. |
At November, 19, 2009, hardware sales revenue of $ 6,588 was recognized, and a cost of $ 5,968 was recorded too.
At December 28, 2009, hardware sales revenue of $ 59,430 was recognized, and a cost of $ 54,030 was incurred.
As of December, 31, 2009, a total revenue of $ 66,018 was earned; and the amount of $ 59,998 that prepaid to supplier on March, 2009 was become cost of good sold. Therefore, the total prepaid amount was reduce to $148,000.00
Prepaid to Supplier:
| 3/9/2009 | | Prepaid to Chaoran | | $ | 59,998 | |
| 3/18/2009 | | Prepaid to Chaoran | | $ | 148,000 | |
| 9/30/2009 | | Total | | $ | 207,998 | |
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| 11/19/2009 | | COGS | | $ | 5,968 | |
| 12/28/2009 | | COGS | | $ | 54,030 | |
| 12/31/2009 | | Total COGS | | $ | 59,998 | |
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| 12/31/2009 | | Total Prepaid to Supplier | | $ | 148,000 | |
| 25. | Prepaid of $207,998 was disclosed as related party transactions, and the related purchase contracts were attached as exhibit. |
General
