United States securities and exchange commission logo
May 12, 2021
Umesh Patel
Chief Executive Officer
Fuse Group Holding Inc.
805 W. Duarte Rd., Suite 102
Arcadia, CA 91007
Re: Fuse Group Holding
Inc.
Form 10-K for the
Fiscal Year ended September 30, 2020
Filed December 16,
2020
Response Dated
March 19, 2021
File No. 333-202948
Dear Mr. Patel:
We have reviewed your March 19, 2021 response to our comment
letter 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 these comments within ten business days by
providing the requested
information or advise us as soon as possible when you will respond. If
you do not believe our
comments apply to your facts and circumstances, please tell us why in
your response.
After reviewing your response to these comments, we may have
additional
comments. Unless we note otherwise, our references to prior comments are
to comments in our
March 10, 2021 letter.
Form 10-K for the Fiscal Year ended September 30, 2020
Notes to Consolidated Financial Statements
Note 5 - Prepaid Expenses, page F-13
1. We have read your
response to prior comment one, concerning your various disclosures
explaining that you
have entered into an agreement to acquire Portafolio en Investigacion
Ambiental S.A. de C.V.
( Portafolio ), including five mines in Mexico, in exchange for
14,285,715 shares of
your common stock. However, in your response you indicate that
Portafolio does not own
any mines but rather has only five concessions to explore for
minerals. You state
that the areas have not been explored and have no actual operations
and that Portafolio
does not own any facilities and equipment....
Umesh Patel
FirstName
Fuse GroupLastNameUmesh Patel
Holding Inc.
Comapany
May NameFuse Group Holding Inc.
12, 2021
May 12,
Page 2 2021 Page 2
FirstName LastName
We believe that you should promptly expand upon your earlier
disclosures to clarify each
of the points outlined above. You should also emphasize that you have
no basis to form
an expectation of there being any concentration of specific minerals
on the properties, or
of being able to obtain the surface rights and permits that would be
necessary to extract
minerals from the areas covered by the concessions, if any are ever
found.
2. We note your response to prior comment two, regarding the Form 8-K
that you filed on
February 16, 2021, stating We believe the current report and
exhibit are fully factual and
reliable in connection with the terms of the transaction, including
the identities of the
parties and the specific properties being acquired....
However, certain representations and warranties indicate that a
business with mining
operations had been established. For example, Section 2.1(a) states
that Portfolio ...has
the right to conduct its business as currently conducted, and
explains that you were
provided access to contracts for the purchase of the Company s
output, while Section
2.1(m) states that Portfolio holds all permits, licenses and
authorizations necessary to the
conduct of its business, including without limitation, its mining
operations.
We understand from your response that there is no business, no mining
operations, no
contracts for the sale of output, and no permits or licenses to
conduct mining operations
other than the concessions to explore; please clarify these points in
your amendments.
3. In your response to prior comment one, regarding the status of your
agreement to acquire
Portfolio, you state we have issued the shares but have not
delivered them to the selling
shareholders and you indicate that various steps are incomplete.
Please revise your
disclosure to clarify the status, including a description of the
uncertainties pertaining to
the timeframe for completion, your current expectation for the closing
date, and the
reasons you would describe the shares as issued but not delivered.
If you retain the shares and have not completed the transaction, it is
unclear what basis
you would have in GAAP for recognizing the asset "prepayment for
acquisition of mining
rights" in your March 31, 2021 interim report. Please identify the
specific authoritative
accounting guidance that you have relied upon in preparing this
report.
4. We have read your response to prior comment three, regarding your
agreement to acquire
E-Mo Biotech Holding, Inc. ( E-Mo ), and the Form 8-K that you
filed on March 17,
2021, with the Share Exchange Agreement. You disclose that the
purchase price of $100
million will be paid with shares of common stock, and indicate that a
change in control is
expected to occur when the shares are issued in April 2021; although
you have not
reported this event or indicated how you would be accounting for the
transaction.
In the Form 8-K that you filed on February 11, 2021, you stated
E-Mo is involved in
biology research and development including vaccines, immunological
treatment,
diagnostic product development and similar treatments against the
Severe Acute
Respiratory Syndrome Coronavirus 2 ( SARS-co-V2 ) and relevant
diseases.
Umesh Patel
Fuse Group Holding Inc.
May 12, 2021
Page 3
However, in Sections 4.14 and 5.8 of the Share Exchange Agreement,
there is only a
general indication of assets, referencing the Poliomyelitis Virus
Vaccine for Prevention
of COVID-19 ( Vaccine ) and related FDA application, test, trials,
data and permits,
patents and patent applications for such Vaccine. Provide us with a
summary of the
business and activities conducted by E-Mo over the last three years,
including a list of all
vaccines, treatments, and diagnostic products developed by E-Mo, and
details of the
specific advances related to its COVID-19 vaccine, including the dates
of research and
development and of any meaningful progress, to include testing,
clinical trials, permit and
patent applications and grants, and correspondence with the FDA.
Please amend your filings to clarify the extent to which E-Mo has
engaged and advanced
in all of these areas, including the extent of revenues and earnings;
the products and
services it provides and their relative significance; and with regard
to its efforts to create
a COVID-19 vaccine, the stage of its research and development,
including the timeline
and steps that would be required to assess viability, obtain
regulatory approvals, and
market such a product; and explain how you view this prospect in light
of the competing
vaccines that are already available and identify any material
uncertainties.
5. Tell us how you determined that E-Mo would be properly valued at $100
million, describe
the particular steps and timeline for completing this transaction, and
the date you will be
filing the financial statements of this entity. Provide us with the
documentation underlying
your valuation, including analyses and details of its financial
results, a listing of the
specific assets and liabilities to be acquired, and a summary of any
material contracts.
Indicate how you plan to account for the transaction and explain your
rationale, with
reference to the specific authoritative guidance and any corresponding
facts.
You may contact Joseph Klinko at (202) 551-3824 or Mark Wojciechowski at
(202) 551-
3759 with any questions..
FirstName LastNameUmesh Patel Sincerely,
Comapany NameFuse Group Holding Inc.
Division of
Corporation Finance
May 12, 2021 Page 3 Office of
Energy & Transportation
FirstName LastName