November 16, 2018
Matthew Reid
Principal Executive Officer
APPlife Digital Solutions, Inc.
338 North Market Street, #161
San Jose, CA 95110
Re: APPlife Digital Solutions Inc
Registration Statement on Form S-1
Filed October 18, 2018
File No. 333-227878
Dear Mr. Reid:
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.
Registration Statement on Form S-1
Prospectus Cover, page 3
1. Please revise to disclose on the prospectus cover page that the selling
shareholders are
offering 3,611,552 shares in this offering. Clarify your statement on
page 12 that this is a
primary offering. Revise the cover page to also disclose a fixed price
at which the selling
securityholders will sell their shares until such time as the common
stock is listed on a
national securities exchange, or quoted on the OTC Bulletin Board, OTCQX
or OTCQB.
We note your reference to an offering price of $0.0875 per share of
common stock on
page 10.
Matthew Reid
FirstName LastNameMatthew Reid
APPlife Digital Solutions, Inc.
Comapany 16, 2018
November NameAPPlife Digital Solutions, Inc.
November 16, 2018 Page 2
Page 2
FirstName LastName
Management's Discussion and Analysis of Fiscal Condition and Results of
Operation
Investing Activities, page 18
2. Please discuss the obligations you have as the exclusive marketing and
development
partner for Smartrade. Please disclose any material risks or
challenges that may be posed
by your relationship with this platform. In this regard, it appears
that Smartrade is not
registered as a national securities exchange, alternative trading
system, or broker-dealer
under the Securities Exchange Act of 1934 but appears to be engaged in
the facilitation of
securities transactions in the United States.
Description of Business
Marketing Strategy, page 20
3. You disclose that you have "agreed to terms" with Lesly Bernard and
Natalia Bruschi
regarding your Drinx and Rooster apps, respectively. Please provide a
description of the
material terms of your agreement with each person to market your
product.
Directors, Executive Officers, Promoters and Control Persons, page 21
4. Please identify the companies at which Matthew Reid worked during the
past five years
and the dates of his employment at each company. See Item 401(e) of
Regulation S-K.
Recent Sales of Unregistered Securities, page 22
5. We note that Matthew Reid received 90,000,000 shares from the company
as
compensation for his services but that he currently owns 102,239,209
shares. Please
explain whether there were additional sales of unregistered securities
to Mr. Reid.
Notes the Consolidated Financial Statements
Note 2. Investment in Smartrade Exchange Services, Inc., page 37
6. We note that you entered into an agreement to purchase 21% of
Smartrade for $450,000 in
various tranches based on defined milestones and you agreed to
purchase an additional 3%
of the total common stock. We further note that you hold one of five
seats on the Board
of Directors and you are the exclusive marketing and development
partner for Smartrade.
These factors suggest that you have the ability to exercise
significant influence over
Smartrade. In this regard, tell us why this investment is being
accounted for as a cost
investment instead of applying the equity method. We refer you to ASC
323-10-15-3 and
6(a) & (b). In addition, if the investment is accounted for under the
equity method you are
required to provide the disclosures outlined in Rule 8-03(b)(3) of
Regulation S-X.
7. Please tell us how you considered Rule 8-04 of Regulation S-X in
evaluating whether you
are required to include audited consolidated financial statements of
Smartrade.
Matthew Reid
APPlife Digital Solutions, Inc.
November 16, 2018
Page 3
General
8. Please include a section to disclose your related party transactions.
In this regard, we note
that the company received loans from an officer to pay for operating
expenses and issued
stock to a family member of an officer in exchange for services. See
Item 404(d) of
Regulation S-K.
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 Morgan Youngwood, Staff Accountant, at (202) 551-3479 or
Stephen
Krikorian, Accounting Branch Chief, at (202) 551-3488 if you have questions
regarding
comments on the financial statements and related matters. Please contact
Michael Foland,
Attorney-Advisor, at (202) 551-6711 or Jan Woo, Legal Branch Chief, at (202)
551-3453 with
any other questions.
Sincerely,
FirstName LastNameMatthew Reid
Division of
Corporation Finance
Comapany NameAPPlife Digital Solutions, Inc.
Office of
Information Technologies
November 16, 2018 Page 3 and Services
FirstName LastName