KOLASCO CORP.
1005-63 CALLOWHILL DR.
TORONTO, ON, M9R 3L6
CANADA
May 23, 2012
United States
Securities and Exchange Commission
Washington, DC 20549
Re: Kolasco Corp.'s - Registration Statement on Form S-1
Amendment No. 1
Filing No. 333-180459
Dear: Celeste M. Murphy
In response to your letter dated April 23, 2012 which included comments
regarding our registration statement, we have prepared the following responses:
GENERAL
COMMENT: 1
WE NOTE THAT YOU ARE A DEVELOPMENT STAGE COMPANY WITH NOMINAL OPERATIONS. AS A
RESULT, THE COMPANY IS CONSIDERED A SHELL COMPANY UNDER RULE 405 OF THE
SECURITIES ACT AND RULE 12B-2 OF THE EXCHANGE ACT. IN ADDITION, THE SHARES BEING
REGISTERED FOR RESALE CONSTITUTES 100% OF THE COMPANY'S SHARES NOT HELD BY YOUR
SOLE OFFICER AND DIRECTOR, AND WERE ISSUED TO YOUR SELLING SHAREHOLDERS
RECENTLY. AS A RESULT, THE OFFERING IS AN INDIRECT PRIMARY OFFERING.
REVISE YOUR PROSPECTUS COVER PAGE TO IDENTIFY THE COMPANY AS A SHELL COMPANY.
IDENTIFY ALL THE SELLING SHAREHOLDERS AS UNDERWRITERS (NOT "MAY BE DEEMED
UNDERWRITERS") AND FIX THE SALES PRICE TO THE PUBLIC FOR THE DURATION OF THE
OFFERING. IN ADDITION, MAKE CONFORMING CHANGES THROUGHOUT THE PROSPECTUS (E.G.
PLAN OF DISTRIBUTION).
RESPONSE: The Registrant does not believe that it is a "shell company" as
described under Rule 405 of Regulation C under the Securities Act of 1933, as
amended. Rule 405 of Regulation C defines a "shell company" as a registrant that
has: (1) no or nominal operations; and (2) either (i) no or nominal assets;
assets consisting solely of cash and cash equivalents; or (iii) assets
consisting of any amount of cash and cash equivalents and nominal other assets.
Specifically, the Registrant does not believe that it can be classified as
having "no or nominal operations". From inception, the Registrant's management
has devoted a significant amount of time to the development of the Registrant's
business. In furtherance of the Registrant's planned business, the Registrant's
management investigated the market demand for translation and interpretation
services, raised seed capital, developed its business plan, purchased a
translation program, registered a domain name for our new website, completed a
translation project for our first client, and executed a contract for
translation services with Apikosmetic Ltd. The Registrant does not believe that
such activities and the various other activities it has undertaken in the
furtherance of its planned business that it can be classified as having "no or
nominal operations".
In response to the question re: the indirect primary offering, the registrant
respectfully submits that the resale offerings of shares of its common stock
included in the Registration Statement are appropriately characterized as
transactions eligible to be made under Rule 415(a)(1)(i) of Regulation C, and
are not primary offerings of the shares to the public.
Rule 415(a)(1)(i) provides that "[s]ecurities may be registered for an offering
to be made on a continuous or delayed basis in the future, [p]rovided, [t]hat .
.. . [t]he registration statement pertains only to . . . [s]ecurities which are
to be offered or sold solely by or on behalf of a person or persons other than
the registrant, a subsidiary of the registrant or a person of which the
registrant is a subsidiary." The shares of the company's common stock included
in the Registration Statement are being offered or sold solely by shareholders
of the company, not by the company, a subsidiary of the company, or a person of
which the company is a subsidiary. Moreover, the company will receive none of
the proceeds from the sale of any such shares of common stock.
Furthermore, below is an analysis of: who receives the proceeds of an offering,
the consideration of "Length of Time the Selling Shareholders Have Held the
Shares; Relationship of the Selling Shareholders to the Issuer; Circumstances
Under Which the Selling Shareholders Received the Shares; Whether Sellers are
tin the Business of Underwriting Securities; Amount of Shares Involved; and
Whether Under All the Circumstances It Appears that the Sellers are Acting as a
Conduit for the Issuer. The analysis below confirms that the resale offerings of
shares of its common stock constitute genuine secondary offerings and not
primary offerings, for the following reasons:
Length of Time the Selling Shareholders Have Held the Shares. As of the filing
of this registration statement, all of the outstanding shares sold pursuant to
the Registration Statement will have been held by the selling shareholders for
at least five months since the original purchase of such shares from the
company, placing the full risk of investing in such shares on the investors over
a quite substantial period of time.
Relationship of the Selling Shareholders to the Issuer. The company has no
commitment, agreement, arrangement or understanding with any selling shareholder
regarding a distribution of the shares of common stock included in the
Registration Statement, and those selling shareholders who sell shares pursuant
thereto will do so without collecting a fee, commission or other payment from
the company.
Circumstances Under Which the Selling Shareholders Received the Shares. All of
the outstanding shares of common stock included in the Registration Statement
were purchased from the company for cash in the private placements. Each of the
investors in the private placement represented at the time of purchase that the
investor was acquiring the outstanding shares included in the Registration
Statement for investment purposes and not with a view to distribution.
Whether Sellers are in the Business of Underwriting Securities. None of the
selling shareholders: 1) has had a material relationship with us other than as a
shareholder at any time within the past three years; 2) has ever been one of our
officers or directors; 3) is a broker-dealer; or a broker-dealer's affiliate.
All selling shareholders have advised the company that they purchased the
relevant shares of common stock in the ordinary course of business or for
investment purposes and not with intent to distribute such shares in violation
of the Securities Act.
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Amount of Shares Involved. The company does not believe that the amount of
common stock being registered alone warrants recharacterizing valid secondary
offerings as primary offerings. The amount of shares being offered is only one
of several factors to be considered in evaluating whether, under "all the
circumstances," a purported secondary offering is instead a primary offering.
Securities Act Rules CDI Question 612.09. Other facts discussed in this letter,
such as various investors'represented investment intent, circumstances under
which the selling shareholders received the shares, the selling shareholders'
holding periods, and the relationship of the selling shareholders to the
company, support the appropriate characterization of the offerings as secondary
in nature.
Whether Under All the Circumstances It Appears That the Sellers Are Acting as a
Conduit for the Issuer. The company respectfully submits that the selling
shareholders should in no manner be deemed to be acting as its conduit in a
distribution of common stock. The company has no commitment, agreement,
arrangement or understanding with any selling shareholder regarding a
distribution of shares of common stock included in the Registration Statement,
nor will the company receive any proceeds from the resale of such shares. To the
knowledge of the company, none of the selling shareholders has any agreement or
understanding as to the sale of any shares of common stock included in the
Registration Statement, nor, to the knowledge of the Company, do such
shareholders have an obligation to sell such shares. As of the date of this
registration statement, all of such shares will have been acquired from the
company more than 5 months ago. All of the outstanding shares included in the
Registration Statement were purchased for full consideration, unconditionally
and irrevocably, at the time of their issuance, placing the full risk of
investing in such shares on the investors over a substantial period of time. The
company respectfully submits that given the totality of these facts, the selling
shareholders are not acting as conduits for the company and therefore the resale
offerings of shares of the company's common stock constitute genuine secondary
offerings and not primary offerings.
COMMENT: 2
PLEASE UPDATE THE FINANCIAL INFORMATION INCLUDED IN YOUR FILING IN ACCORDANCE
WITH THE REQUIREMENTS OF RULE 8-08 OF REGULATION S-X.
RESPONSE: We have updated the financial information.
COMMENT: 3
WE NOTE THAT THROUGHOUT YOUR DISCLOSURE YOU REFER TO YOUR SOLE OFFICER AND
DIRECTOR BOTH AS "MR." AND "MS." MYKOLA OGIR. PLEASE REVISE FOR CONSISTENCY
THROUGHOUT THE REGISTRATION STATEMENT.
Response: We have revised for consistency.
OUR BUSINESS, PAGE 3
COMMENT: 4
YOU STATE IN THE FIRST PARAGRAPH, AND ELSEWHERE IN YOUR FILING, THAT YOU HAVE NO
REVENUES OR OPERATIONS, HOWEVER YOU APPEAR TO HAVE RECOGNIZED $800 IN REVENUES
AND $1,334 IN OPERATING EXPENSES DURING THE PERIOD FROM DECEMBER 1, 2010 TO
NOVEMBER 30, 2011.
PLEASE REVISE THROUGHOUT YOUR FILING OR ADVISE US.
RESPONSE: We have revised on Page 3 and throughout the filing to disclose
revenue of $800.
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DESCRIPTION OF BUSINESS, PAGE 14
COMMENT: 5
AT THE BOTTOM OF PAGE 14 YOU STATE THAT IF YOU ARE PRESENTED WITH A JOB OUTSIDE
OF YOUR LANGUAGE EXPERTISE YOU WILL OUTSOURCE IT TO OTHER TRANSLATION EXPERTS.
PLEASE REVISE YOUR DISCLOSURE TO DISCUSS WHETHER YOU HAVE EXISTING
RELATIONSHIPS, WRITTEN AGREEMENTS OR OTHERWISE ESTABLISHED CONNECTIONS WITH
OTHER TRANSLATION EXPERTS.
RESPONSE: We revised to disclose that we do not have existing relationships or
written agreements with such translation experts.
TRANSLATION, PAGE 15
COMMENT: 6
YOU STATE THAT YOUR DIRECTOR, MR. OGIR, WILL COMPLETE ALL HUMAN TRANSLATION FOR
THE COMPANY INITIALLY. HOWEVER, WE NOTE THAT YOU ARE CURRENTLY OFFERING
TRANSLATION IN FOUR LANGUAGES AND THAT MR. OGIR HAS NO FORMAL TRAINING IN
LANGUAGE TRANSLATION. ADDITIONALLY, ON PAGE 5 YOU STATE THAT HE WILL ONLY BE
DEVOTING 20 - 25% OF HIS TIME TO THE COMPANY AND ONLY WHEN CONVENIENT TO HIM.
PLEASE RECONCILE, EXPLAINING THE TIME MR. OGIR PLANS TO DEVOTE TO THE COMPANY.
ALTERNATIVELY, REVISE YOUR RISK FACTOR SECTION TO PROVIDE THESE FACTS TOGETHER
UNDER A SINGLE RISK FACTOR.
RESPONSE: We have added disclosure that Mr. Ogir has agreed to devote more of
his time to our business matters when it will be required--when our operations
expand.
We have also indicated that Mr. Ogir is Ukrainian and Russian native speaker and
holds Bachelor's and Master's degrees in foreign languages. In 1977 he graduated
from permanent guide-interpreters courses under the Council Of Ministers of the
USSR on Spanish and English Programs. In 1981 he graduated from People's
University of Technical Progress in Kiev, Ukraine. Faculty: Scientific and
Technical Translation. Department: English, Spanish, Russian and Ukrainian
Translation.
COMMENT: 7
WE NOTE THAT YOU WILL USE MT PROMT SYSTEM 9.0 SOFTWARE TO ASSIST WITH
TRANSLATIONS.
REVISE THIS SECTION TO DISCUSS WHETHER YOU CURRENTLY HOLD A LICENSE TO INSTALL
AND USE THIS SOFTWARE OR HAVE OTHERWISE PURCHASED THIS SOFTWARE. IF YOU HAVE NOT
YET PURCHASED THE SOFTWARE, PROVIDE CONTEXT BY OUTLINING THE FUTURE OR EXPECTED
COSTS INVOLVED.
RESPONSE: We have disclosed that we purchased MT PROMPT SYSTEM 9.0 from PROMT
(www.promt.com), a provider of automated translation software with offices in
US, Germany, and Russia.
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2-WAY EMAIL TRANSLATION, PAGE 16
COMMENT: 8
HERE, AND IN THE PARAGRAPHS IMMEDIATELY PRIOR AND AFTER, YOU DISCUSS THE PURPOSE
OF "GISTED" EMAIL TRANSLATION FOR BUSINESSES AND EMAILS TO AND FROM "OVERSEAS
CORRESPONDENTS" AS WELL AS PROVIDING ON-SITE INTERPRETATION SERVICES FOR
BUSINESS NEGOTIATIONS, FOR EXAMPLE. HOWEVER, WE NOTE THAT ELSEWHERE IN YOUR
DISCLOSURE YOU DISCUSS YOUR PRIMARY TARGET CUSTOMERS AS INTERNATIONAL STUDENTS.
PLEASE EXPLAIN EXPANDING YOUR DISCUSSION AS APPROPRIATE.
Response: We have removed our erroneous disclosure regarding our primary target
customers as international students.
MARKETING OUR SERVICES, PAGE 16
COMMENT: 9
YOU STATE THAT YOU PLAN TO "CONCLUDE" REFERRAL AGREEMENTS WITH VARIOUS TOURIST
ORGANIZATION AND TRAVEL AGENCIES IN THE NEXT YEAR. PLEASE REVISE YOUR DISCLOSURE
TO EXPLAIN THE MEANING OF "CONCLUDE." FOR EXAMPLE, DISCUSS WHETHER YOU HAVE
ENTERED NEGOTIATIONS, EXECUTED WRITTEN AGREEMENTS OR SOME OTHER LEVEL OF
SECURING THESE RELATIONSHIPS. PLEASE FILE ANY MATERIAL CONTRACTS. REFER TO ITEM
601(B)(10) OF REGULATION S-K.
RESPONSE: We have disclosed that we have not entered in negotiations, executed
written agreements, and have not secured these relationships.
Thank you.
Sincerely,
/s/ Mykola Ogir
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MYKOLA OGIR
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