United States securities and exchange commission logo
November 17, 2020
Ernest Hemple
Chief Executive Officer
Hoop Street Center I Corp
20715 S 184th Place
Queen Creek, AZ 85142
Re: Hoop Street Center
I Corp
Amendment No. 2 to
Offering Statement on Form 1-A
Filed November 6,
2020
File No. 024-11349
Dear Mr. Hemple:
We have reviewed your offering statement and amendments No. 1 and
No. 2 thereto 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 offering 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 offering statement and the
information you
provide in response to these comments, we may have additional comments.
Amendment No. 2 to Offering Statement on Form 1-A filed November 6, 2020
Part I
Item 1. Issuer Information, page 1
1. For this Item, you
disclose that there are no outstanding securities of the Company. For
Item 4 of Part I, you
disclose that there are 2,000,000 shares of preferred stock
outstanding, and for
Item 6 of Part I, you do not list any sales of unregistered securities in
the past year. You also
provide conflicting information about the number of outstanding
securities on pages 10
and 45 of the offering circular. Please amend Parts I and II of your
filing to reconcile
this disclosure and consistently disclose the number of your securities
currently outstanding.
Ernest Hemple
FirstName
Hoop StreetLastNameErnest
Center I Corp Hemple
Comapany 17,
November NameHoop
2020 Street Center I Corp
November
Page 2 17, 2020 Page 2
FirstName LastName
Item 4. Summary Information Regarding the Offering and Other Current or
Proposed Offerings,
page 1
2. Your disclosures that the securities are not being offered on a
delayed or continuous basis
pursuant to Rule 251(d)(3), and that the company is not conducting a
best efforts offering,
are inconsistent with your disclosures on pages 3 and 9 of the
offering circular. Please
amend your filing to reconcile this disclosure. In addition, please
disclose the anticipated
fees you expect to incur in connection with this offering that are
disclosed in the offering
circular, and include the names of the service providers. For example,
you disclose on
page 27 of the offering circular that "[t]he net proceeds from the
offering, assuming it is
fully subscribed, are expected to be approximately $49,750,000 after
the payment of
$250,000 as media partner fees, but before printing, mailing,
marketing, legal and
accounting costs, and other compliance and professional fees that may
be incurred."
Parts II and III
Perks, page 10
3. Your disclosure on page 9 indicates that an investor will receive
1,000 shares of preferred
stock for a $50,000 investment, while your disclosure on page 10
indicates that an
investor will receive 2,000 shares of preferred stock for a $50,000
investment. Please
clarify whether an investor will receive 1,000 shares or 2,000 shares
for a $50,000
investment, and the relevant other perks an investor will receive for
this investment
amount. If an investor will receive 2,000 shares for a $50,000
investment, please disclose
whether you intend to offer a discount on the price of preferred stock
as a perk, or
alternatively, reconcile this disclosure with the price of preferred
stock disclosed on the
cover of the offering circular. If you intend to offer a discount on
the price of preferred
stock as a perk, please clearly describe the discounted price per
share. Finally, please
amend your disclosure to clarify the circumstances under which you
will limit the capacity
or availability of the perks described in your offering circular, and
to clearly disclose that
the other perks described will be usable only when you commence
operations.
Dilution, page 24
4. Please provide the dilution disclosure required by Item 4 of Part II
of Form 1-A, or tell us
why this disclosure is not necessary.
Plan of Distribution, page 25
5. It appears from the description of your media partner on page 27 that
such partner may be
acting as a placement agent. In this regard, you describe your media
partner s activities as
marketing and lead generation in connection with this offering,
including
participat[ing] in trade shows, fairs, and other forums that give
an opportunity to
showcase the benefits of investing with [y]our brand. You also
disclose that you plan to
compensate the media partner at a rate of $50 per qualified lead, and
that media partner
fees in connection with this offering will be $250,000. Therefore,
please revise this
Ernest Hemple
Hoop Street Center I Corp
November 17, 2020
Page 3
section to include the required disclosure regarding the company s
use of a placement
agent. Please also revise Part I of Form 1-A and the cover of the
offering circular
accordingly. Alternatively, please tell us why you do not believe the
company s media
partner will act as a placement agent.
6. We note your disclosure that the offering is being conducted on a best
efforts basis, that
you will perform the administrative and technology-related functions
in connection with
this offering, and that you will engage a third-party to conduct due
diligence in relation to
each prospective investor. Please clarify who will be offering and
selling your interests in
this offering and disclose whether any persons affiliated with you are
relying upon
Rule 3a4-1 in connection with this offering.
Use of Proceeds, page 28
7. On page 38, you disclose the company s plan to begin repayment of
the operating
expenses incurred by Hoop Street, LLC at the commencement of the
offering. Please
revise your disclosure in the "Use of Proceeds" section to reflect
this and to include a
description of the terms of repayment. As a related matter, we note
your disclosure that
"[a] portion of the proceeds from this Offering may be used to
compensate or otherwise
make payments to officers or directors of the issuer." Please amend
the table in this
section to include the amount of proceeds you intend to use for
payments to officers or
directors, and the amount of proceeds you intend to use for repayment
of operating
expenses, under each scenario presented in the table.
Description of the Business
Receipt of Fees and Other Compensation by Hoop Street, LLC, and its Affiliates,
page 37
8. We note your disclosure that Hoop Street, LLC, and its affiliates
will receive substantial
fees from the Company, which fees will not be negotiated at arm s
length. Please clarify
whether these fees are in addition to the reimbursements described on
pages 33 and 46,
and the operating expenses described on page 38 of your filing. If so,
please disclose an
estimate of the amount of management fees you expect to pay to Hoop
Street, LLC and its
affiliates, to the extent currently known, and amend your "Interest of
Management and
Others in Certain Transactions" disclosure to provide the information
required by Item 13
of Form 1-A with respect to these management fees.
Management s Discussion and Analysis of Financial Condition and Results of
Operations
Plan of Operation, page 39
9. Please disclose whether and to what extent you expect the COVID-19
pandemic to affect
FirstName LastNameErnest Hemple
your plan of operations. See CF Disclosure Guidance: Topic Nos. 9 and
9A, available on
Comapany NameHoop
our public Street
website. Center
Please alsoI include
Corp appropriate risk factor
disclosure, as applicable,
about
November 17,the potential
2020 Page 3impact of the COVID-19 pandemic on your business or
future plans.
FirstName LastName
Ernest Hemple
FirstName
Hoop StreetLastNameErnest
Center I Corp Hemple
Comapany 17,
November NameHoop
2020 Street Center I Corp
November
Page 4 17, 2020 Page 4
FirstName LastName
Parent Company Holdings Transfer, page 45
10. You disclose that Hoop Street, LLC will have a right to sell 30% of
its common stock to
investors during or after the offering. However, it does not appear
from your offering
circular cover page or Item 4 of Part I of your offering statement
that you are seeking to
qualify a secondary component of your offering. We also note that the
size of your
offering would exceed the limit of $50,000,000 for a Tier 2 offering
under Regulation A if
this secondary sale is included. If you intend to include the
secondary sale in your
offering, please reduce the size of your primary offering and update
your disclosure
throughout Parts I, II and III to reflect the secondary sale. If you
do not intend to include
the secondary sale, please revise the disclosure in this section to
remove references to
secondary sales by Hoop Street, LLC. Refer to Securities Act Rule
251(a)(2), and Item
5(d) of Form 1-A.
Securities Being Offered, page 46
11. Please disclose the rights and preferences of the preferred stock
being offered and your
common stock, including, but not limited to, voting rights,
liquidation rights, conversion
rights, preemptive rights, and any redemption provisions. Refer to
Item 14 of Form 1-A.
In addition, you disclose that you do not intend to declare dividends
on the preferred stock
for the foreseeable future; however, the risk factor disclosure on
page 19 states that "[a]s
soon as the Company receives proceeds from this Offering, and it is
legally permissible,
the Company intends to pay dividends to investors," and suggests that
you will reserve a
portion of the offering proceeds to pay dividends. Please reconcile
this disclosure to
clearly state whether and to what extent you intend to declare
dividends. Please also revise
your "Use of Proceeds" section to include the estimated amount of
proceeds you expect to
reserve for dividends.
Financial Statements and Independent Auditor s Report, page 48
12. Please amend to provide audited financial statements and footnotes as
required by Part
F/S, paragraphs (c) and (b)(4), of Form 1-A. Please also update your
MD&A discussions
on page 37 pursuant to Item 9 of Part II of Form 1-A.
Signatures, page 52
13. In addition to the Chief Executive Officer s signature on behalf of
the company, as
currently provided, please also include the Chief Executive Officer
s signature in his
individual capacity as Chief Executive Officer. Please include
signatures for the Chief
Financial Officer and a majority of directors in their individual
capacities as officers
and/or directors, rather than signing on behalf of the company, as
currently provided. See
Instructions to Signatures to Form 1-A.
Ernest Hemple
FirstName
Hoop StreetLastNameErnest
Center I Corp Hemple
Comapany 17,
November NameHoop
2020 Street Center I Corp
November
Page 5 17, 2020 Page 5
FirstName LastName
Exhibits, page 54
14. Certain exhibits you have filed are inconsistent with the disclosure
about them in your
offering statement. For example, your bylaws do not include a
limitation on the liability
for directors and officers as you have described in the offering
statement and the form of
subscription agreement does not include a jury trial waiver as you
have described in you
risk factors. Please reconcile this disclosure.
15. We note that you have not included all required exhibits in your
Exhibit Index. Please
confirm that you will file a legal opinion, auditor s consent, and
any testing the waters
materials used pursuant to Rule 255. We also note that you have filed
a certificate of good
standing rather than the company's certificate of incorporation.
Please file the company's
current certificate of incorporation and any amendments thereto.
General
16. We note your disclosures on pages 25 and 26 that "[you] will initially
use [y]our existing
website (www.hoopstreet.com) to provide notification of the Offering,"
and that, to
subscribe to your offering, investors should go to www.hoopstreet.com,
and click on the
Invest Now button. The landing page for your website states:
"Invest $100,000 in Hoop
Street, then if Hoop Street grows to TopGolf s Pre-IPO $4B
valuation, then initial
$100,000 investment would be worth $40M*t," and provides a link to
Hoop Street
Entertainment Inc.'s private offering memorandum. Considering that
investors in your
offering are directed to your website for notice and to subscribe to
your offering, please
revise your website to clearly state whether you are referring to an
investment in your
company, or an investment in another Hoop Street entity, and tell us
how Hoop Street
Entertainment Inc. is related to you. If and when your website
solicits investments in your
1-A offering, please include the legends required by Rules 251(d) and
255 of Regulation
A, along with an active link to your offering circular. Finally,
please tell us why it is
appropriate to reference TopGolf when discussing returns related to an
investment in any
Hoop Street entity, considering that it does not appear that TopGolf
is related to you or
your parent, and does not appear that the information provided is
based on the historical
returns of you or your parent. Alternatively, please remove the
references to the TopGolf
valuation and potential returns from your website.
Ernest Hemple
FirstName
Hoop StreetLastNameErnest
Center I Corp Hemple
Comapany 17,
November NameHoop
2020 Street Center I Corp
November
Page 6 17, 2020 Page 6
FirstName LastName
You may contact Suying Li at 202-551-3335 or Lyn Shenk at 202-551-3380
if you have
questions regarding comments on the financial statements and related matters.
Please contact
Taylor Beech at 202-551-4515 or Katherine Bagley at 202-551-2545 with any other
questions.
Sincerely,
Division of
Corporation Finance
Office of Trade &
Services
cc: Adam Wardel