Global Cosmetics Inc.
Pavilion, 96 Kensington High Street, London, W8 4SG
Via EDGAR
October 11, 2016
Securities and Exchange Commission
Washington, DC 20548
Attention: Pam Long
| Re: | Global Cosmetics Inc. | |
| Registration Statement on Form S-1 | ||
| Filed May 2, 2016 | ||
| File No. 333-211050 |
Dear Ms. Long:
On October 11, 2016, Global Cosmetics Inc. (the “Company”) filed Amendment No. 2 (the “Amendment”) to the Company’s Registration Statement on Form S-1 filed with the Securities and Exchange Commission (the “Commission”) on May 2, 2016, (collectively, the “Registration Statement”).
The Amendment has been prepared in response to the comments of the staff (the “Staff”) delivered by way of its letter dated August 12, 2016 (the “Comment Letter”). Set forth below are the Company’s responses to the Staff’s comments, numbered in a manner to correspond to the order which the staff’s comments were delivered. For your convenience, we have included the original comments from the Comment Letter in their entirety:
General
1.Pleasestateon thecoverpagethatyouarenot ablankcheckcompanyand thatyouhave no intention to engagein a merger orotherbusiness combination.
Company Response:The Amendment has been revised to address this comment.
2.Wenoteyourresponse tocomment2 ofour letterdated May24, 2016,andwe reissue thecomment.In particular,wenote thattheoperationsyouciteasevidencethatyouare not a shellcompanyconsistofeither operationscarried onbyothercompanies, suchas thefactthatBel-Air Cosmetics’ productsgenerated $2.5 million andforwhichyou maintain adistribution license that hasas ofyetproducednorevenues, orarepreparatory orplanningactivitieswhich haveyetto produce anybusiness operations that aregreater than nominal. Accordingly, please reviseyour prospectus to disclose thatyouareashellcompanyand provideappropriate disclosureof the consequences,challenges and risksand the limitations imposed uponyourcompanybythat status. Refer to SecuritiesAct Rule 405andSECRelease33-8869(Dec. 6, 2007).
Company Response:The Amendment has been revised to address this comment.
TheOffering, page6
Useof Proceeds, page6
3. You have fundedyourhistorical operationsbyloans fromyour CEO, Mr.Ridding.We note thatyouretain discretion to useproceeds ofthis offeringasyou see fit,andyoumay use theproceeds in waysthat do notincreasethevalue ofthecompany.Pleasedisclose herewhetheryou willuseproceeds fromthis offeringtorepayloansfrom Mr. Riddingor paycompensation.
Company Response:The Amendment has been revised to address this comment.
RiskFactors, page8
4.Wenoteyourresponse tocomment7 ofour letterdated May24, 2016andyourrevisions toSecuritiesIssuedandto beIssued in TheOffering,andwereissueourcommentin part. Pleaseprovideappropriaterisk factor disclosure andrevise theDescription ofSecurities sectionaccordingly.
Company Response:The Amendment has been revised to address this comment.
5. On page12you deletedrisk factor“Our officersand directors willallocatesome portion oftheirtime to otherbusinesses….”Pleaseadviseus whyyouremoved this risk factorand whyyou believethereis no longer apotentialconflict of interestthatpresents a material risktoyour business andyourprospectiveinvestors, orreinsertthe risk factor.
Company Response:The Amendment has been revised to reinsert the risk factor.
Dilution, page21
6.Wenoteyourupdated scenario disclosures onpage22assuming a75%offering,a50% offeringanda25%offering.Based on ourrecalculations, itwouldappearthatthenet tangiblebookvaluesafter this offeringshould be$115,950 in a 75%offering, $55,950 in a50%offeringand($4,050) in a25%offeringbased on takingthenet proceeds disclosed on page21andaddingback the($54,050) nettangiblebook value as ofMarch 31, 2016.Please reviseoradvise.
Company Response:The Amendment has been revised to address this comment.
Description ofBusiness,page26
7.Inyourresponseto comment oneof our letterdated May24, 2016,you state thatyou have “[t]rademarks in place forAustralia,NewZealand,Europeand registrations in place in Mexicoand Canada.”Additionally,you updatedyour ProspectusSummaryto provide that“the licensor”hasgrantedyourcompany50%beneficial ownershipin thereferenced trademarkregistrations.Pleaseprovide theinformationrequiredby Item101(h)(4)(vii) ofRegulationS-K.
Company Response:The Amendment has been revised to address this comment and include additional exhibits.
8. Your enhanced disclosureprovides thatKeith McCulloch owns JJH.Please also disclose herethat Mr.McCulloch ownsBel-Air Cosmetics. You maystate that Mr.McCulloch ownsBel-Airas a subsidiaryunderJJH.
Company Response:The Amendment has been revised to address this comment.
9. Your enhanced disclosurestates thatyou do notintend to distribute cosmeticproducts otherthan 4U2-brandedproducts.Please also disclose that, per thelicensingagreement,youareprohibitedfromdistributingor handlinganyproductsthat could beconsidered directlycompetitive of4U2.
Company Response:The Amendment has been revised to address this comment.
GoingConcern, page35
10.Wenoteyourdisclosureon page5 thatyou havenoagreements, commitments or understandings with Mr.Riddingto provide additional loans toyourbusiness.Please reconcilethat disclosurewithyour statement herethatyour management(includingMr. Ridding) believesyou willbe able to operate forthe comingyearbasedpartiallyupon obtainingadditional loans from Mr. Ridding.
Company Response:The Amendment has been revised to address this comment.
BenjaminRidding-President,ChiefExecutiveOfficer,ChiefFinancial Officer,Secretary,Treasurerand aDirector,page36
11.Please fillin the date blanks of Mr. Ridding’semployment withSiT.
Company Response:The Amendment has been revised to address this comment.
12.We reissue comment 18ofour letter dated May24, 2016.Please elaborateonyour officers’and directors’ competingbusiness obligationsandanyimpact onyourproposed business.Wenote the risk factor onpage12.
Company Response:The Amendment has been revised to address this comment.
FinancialStatements, page31
13.Pleaseupdateyourlatestamendmenttoalsoinclude the report ofyour independent public accountingfirm thatisreferenced inthe consent on pageF-7.
Company Response:The Amendment includes the report.
14.Pleaseincludethecopyof the auditor’sconsent asanexhibitinyournext amendment. Refer toItem 601 ofRegulationS-K.
Company Response:The Amendment includes the consent.
Item 16. Exhibits, page41
15.Wenoteyourresponse tocomment 20 of ourletterdated May24, 2016,andreissuethecomment. Your registration statement continues to providethatyou outsourcesubstantial portions ofyouroperations to third-partyserviceproviders, suchas inthelast riskfactor on page16, to conductclinicaltrials, collection andanalysisof data,andmanufacturing.Pleasedescribethese agreementsandrelationshipsin detail andfile as exhibits contracts representingtheseagreements, orremove theimplication thatyou haveanyoperations.SeeItem 601(b0(10) ofRegulationS-K.Wenoteyourenhanced disclosure of third-partycontractorsrelatingtoyourwebsitedevelopment and the correspondingagreements filedas exhibits.
Company Response:The Amendment has been revised to address this comment.
16.Wenoteyourdisclosurethat alicensor hasgrantedyourcompany50%beneficial ownership in registered trademarks. Please fileasexhibits anycontractsrepresenting suchagreements.SeeItem 601(b)(10)of RegulationS-K.
Company Response:This contract was previously filed as Exhibit 10.3.
17.Inyourresponseto comment1 ofour letter datedMay24, 2016,you stateyou have placedan initial stock orderfornearly6,000 items of product.Pleasefileas exhibits anycontractsrepresentingsuch order.SeeItem 601(b)(10)of RegulationS-K.
Company Response:The purchase order has been included as an exhibit to the Amendment.
Legal Opinion
18.Wenoteyourresponse tocomment 22 of ourletterdated May24, 2016.Pleasehaveyourlegal counselremovethe implication that variousstate authoritiesandpublic officials providedadvicein determiningthesecurities registeredhereinare legallyissued, fullypaid and non-assessable.
Company Response:The legal opinion has been revised to address this comment.
In connection with the Company’s response to the United States Securities and Exchange Commission’s (the “Commission”) comments in a letter dated August 12, 2016, this correspondence shall serve as acknowledgment by the Company of the following:
| ■ | should the Commission or the staff, acting pursuant to delegated authority, declare the filing effective, it does not foreclose the Commission from taking any action with respect to the filing; | |
| ■ | the action of the Commission or the staff, acting pursuant to delegated authority, in declaring the filing effective, does not relieve the company from its full responsibility for the adequacy and accuracy of the disclosure in the filing; and | |
| ■ | the company may not assert staff comments and the declaration of effectiveness as a defense in any proceeding initiated by the Commission or any person under the federal securities laws of the United States. |
| Global Cosmetics Inc. | ||
| /s/ Benjamin Ridding | ||
| By: | Benjamin Ridding | |
| Chief Executive Officer | ||
