United States securities and exchange commission logo
April 16, 2021
Jeffrey Standen
Chief Executive Officer, Principal Executive Officer, and Director
Sino American Oil Company
2123 Pioneer Avenue
Cheyenne, WY 82001
Re: Sino American Oil
Company
Offering Statement
on Form 1-A
Filed March 22,
2021
File No. 024-11489
Dear Mr. Standen:
We have reviewed your offering 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 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.
Form 1-A filed March 22, 2021
Summary
The Company, page 1
1. The disclosure on page
1 states that the Company plans to grow shareholder value
through securing oil
and natural gas reserves and negotiating oil and natural
gas exploration,
development and production deals within the United States of America
and Canada. However,
disclose elsewhere on page 18 states that the Company is
engaged in the
assessment, acquisition, exploration and development materials and
properties in
Australia, Asia, and South America. Please expand or revise your disclose
to resolve the apparent
inconsistency or tell us why a revision is not needed.
Jeffrey Standen
FirstName LastNameJeffrey
Sino American Oil CompanyStanden
Comapany
April NameSino American Oil Company
16, 2021
April 216, 2021 Page 2
Page
FirstName LastName
The Company, page 1
2. Please revise your disclosure here and elsewhere to clarify your
current business activities
and how you intend to generate revenue from your current operations
and any anticipated
business activities. For example, you disclose on page 19 that the
Company has been
"focused on oil extraction, selling of oil and gas, and also finding
unusable land projects
and making them useful for vegetation production...[and] focused on
capped wells and
possible tanker storage systems." To the extent you are not engaged in
a particular line of
business, please eliminate any inferences to such business and
operations. In this regard,
we note you have included risk factors pertaining to nutritional
supplemental products.
The Offering, page 13
3. Please clarify whether there is a selling shareholder component to
this offering. In this
regard, we note your disclosure here that you will not receive any
proceeds from the sale
of common stock by the selling shareholder.
Use of Proceeds, page 13
4. We note the total of use of proceeds in the table if maximum amount
raised in the offering
does not equal $50,000,000. Please revise or advise. In addition,
please expand your
disclosures to present use of proceeds based on the sale of 75%, 50%
and 25% of the
shares offered for sale in this offering.
5. We note from the Offering Section that you will use net proceeds for,
among others,
project build out of the resort. Please revise your Use of
Proceeds section to quantify
the amount of the proceeds to be used for the project build out of
the resort and describe
it in a footnote. In addition, please explain "working capital for the
Nutritional
Supplements Product lines" disclosed here and provide a footnote to
describe what other
expenses are considered under contingency.
6. We note your disclosure that "[a]s of December 31, 2020, the Company
owed its officers
$384,000 in unpaid wages." Please revise your offering circular to
state whether or not
the proceeds will be used to compensate or otherwise make payments to
officers or
directors of the issuer. Refer to Instruction 2 to Item 6 of Part II
of Form 1-A.
Determination of Offering Price, page 15
7. Expand your disclosure to describe the recent price volatility in the
price of your common
stock quoted on the OTC Pink and its impact on your determination of
the offering price.
Dilution, page 15
8. We note your disclosure net tangible and intangible book value as of
December 31, 2020
was $1,661,845 is not consistent with the balance sheet as of December
31, 2020
presented on page F-10. Please revise or advise.
Jeffrey Standen
FirstName LastNameJeffrey
Sino American Oil CompanyStanden
Comapany
April NameSino American Oil Company
16, 2021
April 316, 2021 Page 3
Page
FirstName LastName
9. Your disclosures in the third paragraph are not consistent with such
disclosures in the
table of Capitalization and Dilution of Offering on page 16. If the
maximum 20,000,000
new shares of Common Stock are sold in this offering at the public
offering price of $2.50
per share, after deducting approximately $50,000 in offering expenses,
it appears to us pro
forma as adjusted net tangible book value would be $49,517,732 or
$0.23 per share and
consequently, dilution to new investors would be $2.27 per share.
Please revise or advise.
10. Please revise your dilution table to include pro forma net tangible
book value after the
offering and related dilution per share to new investors, under each
of the scenarios,
assuming the sale of 75%, 50% and 25% of the shares offered for sale
in this offering.
11. We note you provide tables assuming the sale of, respectively, 100%,
75%, 50% and 25%
of the shares offered for sale in this offering. Please explain to us
why the number of
shares held by existing stockholders have been reduced to 100,000,000
shares and basis
for number of shares sold to new investors presented here, under each
of the scenarios
assuming 75%, 50% and 25% of shares are sold. In addition, tell us why
you used $0.20
per share paid by investors in this Offering and how you determined an
average price of
$0.174 per share paid by existing stockholders. Revise your
disclosures as appropriate.
Management's Discussion and Analysis and Results of Operations
Company's Plan of Operation, page 19
12. Your disclosure indicates that Kinghorn Resources Ltd. has identified
numerous
properties that are available for acquisition. Expand the disclosure
to describe the nature
of the business relationship that exists between Sino American Oil
Company and
Kinghorn Resources Ltd.
13. Your disclosure also indicates that numerous other similar type
properties, as compared to
the Kaybob South Field and the Grand Prairie area assets, are
available for acquisition.
Please expand the disclosure to identify the criteria used by Sino
American and Kinghorn
in identifying potential oil and gas properties for acquisition.
14. Please expand your discussion of the acquisition of oil and gas
interests in the Kaybob
South and the Grand Prairie area to clarify if you are acquiring
working interests in these
assets. If true, please clarify the proportion of the 8/8ths or 100%
working interest that
you will acquire and if such interests include interests in developed
leases that have
existing producing wells and related production equipment as well as
interests in
additional undeveloped leases.
Jeffrey Standen
FirstName LastNameJeffrey
Sino American Oil CompanyStanden
Comapany
April NameSino American Oil Company
16, 2021
April 416, 2021 Page 4
Page
FirstName LastName
Summary of Key Milestones and Timelines to Achieve Estimated Production and
Deliverables,
page 20
15. Please expand your disclosure to clarify that the summary of key
milestones, including
key dates, activities and related capital expenditures, relate to the
successful acquisition of
oil and gas interests in the Kaybob South Field and the Grand Prairie
area assets,
respectively.
Our Business, page 21
16. Please disclose details regarding the cease trade order issued by the
Supreme Court of
British Columbia and include corresponding disclosure in your summary
section and a
related risk factor.
Executive Officers and Directors, page 23
17. You state that Mr. Standen has been providing "consulting services to
industry through
KingHorn Resources Ltd." Revise to clarify Mr. Standen's biographical
description and
disclose any potential conflicts of interest. It appears that Mr.
Standen is also currently
the President of KingHorn Resources.
Signatures, page 35
18. Please note that the offering statement must be signed by the issuer,
principal executive
officer, principal financial officer, principal accounting officer,
and a majority of the
members of its board of directors. Accordingly, in addition to Mr.
Standen signing in his
capacity as a director, please revise his title to reflect his
signature as an officer. Refer to
the Signatures section of Form 1-A.
Financial Statements, page 37
19. We note your disclosure on page 19 that you have "plans to enter a
Letter of Intent to
Purchase Oil and Gas Reserves and resources in the Kaybob South Grand
Prairie
areas" and also note related information on page 20. Accordingly,
please revise to include
audited financial statements of businesses to be acquired or probable
of acquisition and
pro forma financial Information as required by Part F/S (b)(7)(iii),
(iv) and (c)(1)(ii) of
Form 1-A or demonstrate to us why they are not required.
Note 2 - Summary of Significant Policies, page F-14
20. Please provide a statement that in the opinion of management all
adjustments necessary in
order to make the interim financial statements not misleading have
been included. Refer
to Part F/S (b)(5)(iii) of Form 1-A.
Jeffrey Standen
Sino American Oil Company
April 16, 2021
Page 5
Exhibits
21. Your legal opinion does not express an opinion on the law of any state
other than Nevada
despite your status as a Wyoming corporation. Please submit a revised
legal opinion to
address this issue. We note your certificate of incorporation filed as
Exhibit 2A with your
offering statement.
General
22. We note that your common stock is quoted on the OTC Pink. Please
describe the limited
trading and recent price volatility in your stock and briefly disclose
any known risks of
investing in your stock under these circumstances. Add, for comparison
purposes,
disclosure of the market price of your common stock prior to the recent
price volatility in
your stock. For example, disclose the price at which your stock was
trading before
February, 2021.
We will consider qualifying your offering statement at your request. If
a participant in
your offering is required to clear its compensation arrangements with FINRA,
please have
FINRA advise us that it has no objections to the compensation arrangements
prior to
qualification.
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. We also remind you that, following qualification of your
Form 1-A, Rule 257
of Regulation A requires you to file periodic and current reports, including a
Form 1-K which
will be due within 120 calendar days after the end of the fiscal year covered
by the report.
For questions regarding comments on engineering matters, you may contact
John
Hodgin, Petroleum Engineer, at (202) 551-3699. You may contact Steve Lo, Staff
Accountant, at
(202) 551-3394 or Raj Rajan, Staff Accountant, at (202) 551-3388 if you have
questions
regarding comments on the financial statements and related matters. Please
contact Anuja A.
Majmudar, Attorney-Adviser, at (202) 551-3844 or, in her absence, Loan Lauren
Nguyen, Legal
Branch Chief, at (202) 551-3642 with any other questions.
Sincerely,
FirstName LastNameJeffrey Standen
Division of
Corporation Finance
Comapany NameSino American Oil Company
Office of Energy &
Transportation
April 16, 2021 Page 5
cc: Matthew McMurdo, Esq.
FirstName LastName