Mail Stop 4628
July 25, 2018
Jeffrey Mallmes
Chief Executive Officer
Quantum Energy, Inc.
218 N. Jefferson Street, Suite 400
Chicago, IL 60661
Re: Quantum Energy, Inc.
Registration Statement on Form S-1
Filed June 26, 2018
File No. 333-225892
Dear Mr. Mallmes:
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.
General
1. 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 communications.
2. Please disclose the price at which you will sell the shares in the
primary offering and the
proposed maximum offering size. Please also make corresponding updates
throughout
your prospectus, including the Use of Proceeds section at page 19.
3. Please update your financial statements and related disclosures to
comply with Rule 8-08
of Regulation S-X.
Jeffrey Mallmes
Quantum Energy, Inc.
July 25, 2018
Page 2
Information with Respect to the Company, page 25
Current & Planned Operations, page 26
4. We note your disclosure that, if the conditions of your letter of intent
with Inductance
Energy Corporation are satisfied, you will receive the necessary funds
to complete the
predevelopment work and purchase the land for the Stoughton Refinery.
This letter of
intent therefore appears material to you. Please file the letter of
intent or tell us why you
are not required to do so. Refer to Item 601(b)(10) of Regulation S-K.
Plan of Operation, page 30
5. Please disclose the status of discussions with the "provincial
government in
Sasketchewan regarding the development, construction and operations of
the Stoughton
Refinery," including the dates of your last contact. Please also
disclose if required
governmental approvals could slow down your expected "Duration" for each
stage of
Phase I and II as disclosed.
Directors, Executive Officers, Promoters, and Control Persons, page 34
6. We note the biography of Mr. Mallmes indicates that he does not have
experience in the
refining industry and owns other businesses. Please expand your risk
factor at page 8
entitled "We depend heavily on key personnel, and turnover of key senior
management
could harm our business" to include the risks associated with Mr.
Mallmes' lack of
industry experience, and his present involvement with other businesses.
As part of your
revised disclosure, please discuss and quantify the amount of time that
Mr. Mallmes will
dedicate to the company per week.
7. We note your July 13, 2018 press release available on your website that
indicates you
have appointed Richard K. Ethington and Pamela L. Bing as independent
directors and
members of your Audit Committee. Please revise to provide the
disclosures required by
Regulation S-K regarding these directors, including Item 401 of
Regulation S-K, or
advise.
Executive Compensation, page 37
8. Please disclose the compensation of all persons covered under Item
402(m)(2) of
Regulation S-K for each of your last two completed fiscal years. For
example, please
disclose the compensation of Jeffrey Mallmes, who appears to have become
your
principal executive officer in November 2017.
Jeffrey Mallmes
Quantum Energy, Inc.
July 25, 2018
Page 3
9. Please identify to the extent material any item included under All Other
Compensation.
In this regard, we note that all compensation paid to Stanley F. Wilson
is disclosed under
this column for fiscal year 2017. See Item 402(o)(7) of Regulation S-K.
Audited Financial Statements, page 46
Note 2 - Significant Accounting Policies, page F-7
Going Concern, page F-7
10. Within your going concern disclosure you refer to objectives that do not
correspond to
the plan of operations mentioned elsewhere in the filing. Please clarify
the extent and
nature of any plans that you have to overcome your financial
difficulties.
Note 10 Common Stock, page F-13
Common shares issued for cash, page F-14
11. We note that you have disclosures stating that you closed a private
placement of
securities on February 28, 2018 although you had not yet been paid for
the shares and did
not issue the shares until April 4, 2018. If these disclosures are
correct, it would appear
that reporting the issuance of the units in the financial statements
covering the fiscal year
ended February 28, 2018, as you have done, would be incorrect. Please
revise as
necessary to resolve this inconsistency.
Exhibit Index, page F-26
12. Please file the form of subscription agreement you plan to use for
purposes of offering
shares and the instrument that defines the rights of the common stock
being registered or
advise. Refer to Item 601(b)(4) of Regulation S-K.
13. We note that a legal opinion of Brunson Chandler & Jones, PLLC is filed
as Exhibit 5.1.
However, we note your disclosure at page 41 that Jerold N. Siegan will
issue the legal
opinion and that your exhibit index indicates you will file such opinion
as Exhibit 5.2.
Please revise to clarify counsel who will issue the legal opinion and
file such opinion.
We may have additional comments regarding the opinion following the
response.
14. Please obtain and file an updated consent from the auditors, one that
references the
correct registration statement number.
Signatures, page F-27
15. Please include signatures of at least a majority of the board of
directors. Refer to
Instruction 1 to Signatures of Form S-1.
Jeffrey Mallmes
Quantum Energy, Inc.
July 25, 2018
Page 4
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 Jenifer Gallagher, Staff Accountant, at (202) 551-3706
or Karl Hiller,
Accounting Branch Chief, at (202) 551-3686 if you have questions regarding
comments on the
financial statements and related matters. Please contact Lisa Krestynick, Staff
Attorney, at (202)
551-3056 or Kevin Dougherty, Staff Attorney, at (202) 551-3271 with any other
questions.
Sincerely,
/s/ John Reynolds
John Reynolds
Assistant Director
Office of Natural
Resources
cc: Jerold N. Siegan