United States securities and exchange commission logo
May 1, 2020
Elena Krioukova
Principal Executive Officer
Hygge Integrated Brands Corp.
1 Yonge Street, Unit 1801
Toronto, ON M5E 1W7
Re: Hygge Integrated
Brands Corp.
Registration
Statement on Form S-1
Filed April 8, 2020
File No. 333-237603
Dear Ms. Krioukova:
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 filed on April 8, 2020
The Offering, page 6
1. Your disclosure on page
6 indicates that shareholders will sell their shares at a price of
$0.025 per share and
that you intend to apply to the "OTC Pink Market." Reconcile this
disclosure with your
disclosure on: (1) the prospectus cover page that shareholders will
sell their shares at a
fixed price per share until your common stock is "listed on a national
securities exchange, or
quoted on the OTC Bulletin Board, OTCQX or OTCQB;" (2) page
6 that the offering is
being conducted on a self-underwritten, best efforts basis; (3) page 7
that shareholders will
sell their shares at a fixed price per share until your common stock
is "listed on a
national securities exchange, or quoted on the OTC Bulletin Board,
OTCQX or OTCQB and
thereafter at prevailing market prices or privately negotiated
prices;" and (4) page
37 that sales "may be at fixed prices, prevailing market prices at the
Elena Krioukova
Hygge Integrated Brands Corp.
May 1, 2020
Page 2
time of sale, at varying prices or at negotiated prices" on "OTC
Markets or any other stock
exchange, market or trading facility." Please note that the OTCQX and
OTCQB
marketplaces are considered existing markets for purposes of secondary
at the market
offerings, but that accommodation has not been extended to the OTC
Pink. Therefore, if
your securities are quoted only on the OTC Pink, sales must be made at
a fixed price for
the duration of the offering. Please revise accordingly.
There may be decreased spending on pets in a challenging economic climate, page
10
2. Clarify how "[y]our products command a price premium" given that it
appears you have
generated no revenue to date.
Our third-party contract manufacturers may breach our manufacturing agreements,
page 11
3. Please clarify whether you have agreements with the suppliers
mentioned in this risk
factor and on pages 24 and 29 and, if applicable, expand the
appropriate section to
disclose the material terms of the agreements. In addition, file as
exhibits the agreements.
Please also clarify who produces the dog beds referred to on page 29
and the nature of
your arrangement with them, if its a third party.
The Company is not required to prepare proxy or information statements, page 15
4. Please clarify why you believe you would not be subject to "going
private regulations"
because you would be subject to Section 15(d). Refer to Exchange Act
Rule 13e-
3(a)(3)(ii). Also, considering that you do not intend to register a
class of your securities
under Exchange Act Section 12, it appears you will also not be
eligible to list those
securities on a national securities exchange. Please revise your
disclosure to remove any
implication that you can list your securities on an exchange.
Holders, page 20
5. The disclosure in this section is missing. Please revise.
Management's Discussion and Analysis, page 23
6. Please tell us how your disclosure reflects the amount of funds needed
for compliance
with your obligations under the federal securities laws.
7. Please revise to clearly discuss the status of your operations and
manufacturing of your
products. In this regard, we note your disclosure in this section and
pages 5, 12 and 30
that you currently manufacture hypoallergenic pet shampoo and premium
dogbeds. You
also disclose on page 12 that you maintain an inventory of products and
accept payments
FirstName LastNameElena Krioukova
for purchases through your website. However, your disclosure on pages
23, 24 and F-5
Comapany NameHygge Integrated Brands Corp.
states that have not yet produced any products, your disclosure on page
F-10 indicates that
May 1,all of your inventory is raw materials and you have not yet generated any
revenue.
2020 Page 2
FirstName LastName
Elena Krioukova
FirstName LastNameElena Krioukova
Hygge Integrated Brands Corp.
Comapany NameHygge Integrated Brands Corp.
May 1, 2020
Page 3
May 1, 2020 Page 3
FirstName LastName
8. Please revise to briefly describe the capital necessary to generate
revenue from your
planned business and the amount of time your current funds to which
you have access will
enable you to conduct planned operations. In this regard, it is
unclear from your current
disclosure how your available capital has been sufficient for you or
third parties to
manufacture any products and otherwise operate your business. Please
also disclose the
basis for your statement that you expect to generate revenues in the
fourth quarter of 2020.
Plan of Operation, page 23
9. Your disclosure here regarding your "client base" and expanding your
product offerings
implies that you have actually sold your products, contrary to the
information in your
financial statements. Please revise or advise.
Description of our Business and Properties, page 29
10. Your disclosure does not mention whether you rent or own any property,
though you
indicate on page 23 that you manufacture dog beds in Canada and
indicate on page 26 that
you prepaid office rent. Clarify how you conduct the disclosed
operations without
property, or provide the disclosures required by Item 102 of
Regulation S-K.
11. Please provide the disclosure required by Item 101(h)(4)(viii) of
Regulation S-K.
12. Please disclose the development of your business since formation in
2018. For example,
summarize the specific steps taken in "the process of brand
development, product design
and establishing relationships with the third party pet grooming
products manufacturing,
designing and sourcing raw materials and establishing labor force for
production of the pet
beds," as disclosed on page 24, as well as the results achieved
through those efforts.
Anti-Takeover Provisions, page 40
13. In addition to addressing anti-takeover provisions under Nevada law,
please revise to
discuss provisions in Exhibits 3.1 and 3.2. We note, for example, the
number of shares
you are authorized to issue and two-thirds approval required to remove
directors.
Legal Matters, page 41
14. Please clarify the reference to proceedings against you "other than as
disclosed below."
There do not appear to be any disclosures below that address existing
or pending legal
proceedings.
Exhibits, page II-3
15. Please file as exhibits the agreements related to the loans from your
officer and director
mentioned on pages 28 and 36.
Elena Krioukova
FirstName LastNameElena Krioukova
Hygge Integrated Brands Corp.
Comapany NameHygge Integrated Brands Corp.
May 1, 2020
Page 4
May 1, 2020 Page 4
FirstName LastName
16. Please refer to Exhibit 5.1. The opinion counsel provides for this
offering should state
that the shares offered for resale are, not will be, legally issued,
fully paid and non-
assessable. Please file a revised opinion.
Signatures, page II-4
17. Please identify below the second paragraph of text required on the
Signatures page who
signed your document in the capacity of principal financial officer.
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 Ernest Greene at 202-551-3733 or John Cash, Accounting
Branch
Chief, at 202-551-3768 if you have questions regarding comments on the
financial statements
and related matters. Please contact Thomas Jones at 202-551-3602 or Geoffrey
Kruczek, Senior
Attorney, at 202-551-3641 with any other questions.
Sincerely,
Division of
Corporation Finance
Office of
Manufacturing
cc: Sharon D. Mitchell