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¶ – Release Delayed ·As Of Filer Filing For·On·As Docs:Size Issuer Filing Agent 5/08/23 Inno Holdings Inc. DRSLTR¶ 12/12/23 1:54K EdgarAgents LLC/FA |
Document/Exhibit Description Pages Size
1: DRSLTR Comment-Response or Draft-Registration-Statement HTML 45K
Letter to the SEC
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NORTH AMERICA SOUTH AMERICA EUROPE ASIA
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800 Capitol St., Suite 2400 Houston, TX 77002-2925 T +1 (713) 651-2600 F +1 (713) 651-2700 |
mike blankenship
Managing Partner
1.713.651.2678
SiSi Cheng
Kevin Woody
Thomas Jones
Jay Ingram
Division of Corporation Finance
Office of Manufacturing
United States Securities and Exchange Commission
100 F Street, NE
Washington, D.C. 20549
| Re: | INNO HOLDINGS INC. Amendment No. 1 to Draft Registration Statement on Form S-1 Submitted February 9, 2023 CIK No. 0001961847 |
Ladies and Gentlemen:
On behalf of our client, INNO HOLDINGS INC. (the “Company”), we are writing to submit the Company’s response to the comments of the Staff of the Division of Corporation Finance (the “Staff”) of the Securities and Exchange Commission (the “Commission”) delivered on March 8, 2023, with respect to the above referenced filing.
We have set forth below the comments in the Staff’s letter, in bold, and the Company’s responses thereto.
Reference is made to the Registration Statement on Form S-1 (the “Registration Statement”) filed by the Company on May 8, 2023.
Amendment No. 1 to Draft Registration Statement on Form S-1 submitted February 9, 2023 Market Data, page 2
| 1. | The disclosure in the second through sixth sentences in this section appears to imply a disclaimer of responsibility for this information in the registration statement. Please either revise this section to remove such implication or specifically state that you are responsible for all information in the registration statement. |
Response: The Company acknowledges the Staff’s comment and advises the Staff that it has revised the disclosure on page 2 of the Registration Statement to address the Staff’s comment.
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May 8, 2023 |
| Page 2 |
| 2. | We note the disclosure in this section that “To our knowledge, certain third-party industry data that includes projections for future periods does not take into account the effects of the worldwide coronavirus pandemic. Accordingly, those third-party projections may be overstated and should not be given undue weight.” Please clearly disclose which data “includes projections for future periods does not take into account the effects of the worldwide coronavirus pandemic.” |
Response: The Company acknowledges the Staff’s comment and advises the Staff that it has revised the disclosure on page [2] of the Registration Statement to address the Staff’s comment.
| 3. | Please tell us whether you commissioned any of the third-party data presented in your document and, if so, please file the consent as an exhibit. |
Response: In response to the Staff’s comment, the Company respectfully notes that it did not commission any of the third-party data contained in the Registration Statement and accordingly does not believe any third-party consents are required.
Mobile Factory, Off-site Equipment Rental, Sales, Service, and Support, page 8
| 4. | Please ensure that the information in the illustrations on pages 9 and 10 is legible. |
Response: The Company acknowledges the Staff’s comment and advises the Staff that it has revised the image on page [9] of the Registration Statement to address the Staff’s comment.
Summary Risk Factors, page 13
| 5. | Please include a bullet point to highlight the risk factor on pages 29-30 that the company may experience extreme stock price volatility unrelated to the company’s actual or expected operating performance, financial condition or prospects, making it difficult for prospective investors to assess the rapidly changing value of the company’s common stock. |
Response: The Company acknowledges the Staff’s comment and advises the Staff that it has revised the disclosure on page [14] of the Registration Statement to address the Staff’s comment.
Capitalization, page 38
| 6. | Please revise your capitalization table to include both short and long term debt balances. |
Response: The Company acknowledges the Staff’s comment and advises the Staff that it has revised the table on page [38] of the Registration Statement to address the Staff’s comment.
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May 8, 2023 |
| Page 3 |
Management’s Discussion and Analysis of Financial Condition and Results of Operations Revenues, page 41
| 7. | Please revise to quantify the impacts of changes in price and volume on your revenues and discuss the underlying business reasons for these changes. |
Response: The Company acknowledges the Staff’s comment and advises the Staff that it has revised the disclosure on page 42 of the Registration Statement to address the Staff’s comment.
Liquidity and Capital Resources
Cash Flows, page 44
| 8. | Please provide a more robust analysis of the changes in net cash used in operating activities. Your analysis should quantify all factors that affected operating cash and address the material drivers underlying those factors. Refer to Section IV.B of SEC Release 33-8350. |
Response: The Company acknowledges the Staff’s comment and advises the Staff that it has revised the analysis on page 47 of the Registration Statement to address the Staff’s comment.
Business, page 51
| 9. | Please disclose, if applicable, the material terms of your written agreements with the customer that that accounted for 15% and the three customers that accounted for 91% of the company’s total revenues for the fiscal years ended September 30, 2022 and September 30, 2021, respectively. In this regard, we note your disclosure in Note 13 on page F-20. Also, tell us why you have not filed any of the agreements as exhibits. |
Response: The Company acknowledges the Staff’s comment and advises the Staff that it has revised the disclosure on page 63 of the Registration Statement to address the Staff’s comment. The Company’s written agreements with these customers generally terminate upon completion of the project. The agreements with each of these customers were made in the ordinary course of business and the projects have been completed. Therefore, the written agreements have terminated.
| 10. | Please disclose, if applicable, the material terms of your written agreements with the suppliers that accounted for 75% and 70% of the company’s total purchases for the fiscal years ended September 30, 2022 and September 30, 2021, respectively. In this regard, we note your disclosure in Note 13 on page F-20. Also, tell us why you have not filed any of the agreements as exhibits. |
Response: The Company acknowledges the Staff’s comment and advises the Staff that it has revised the disclosure on page 63 of the Registration Statement to address the Staff’s comment. The Company currently does not currently have written agreements with any suppliers. All of the Company’s raw materials purchases are made by individual invoices.
Executive and Director Compensation, page 79
| 11. | Please finalize all information within brackets in this section and throughout the registration statement. |
Response: The Company acknowledges the Staff’s comment and advises the Staff that it has revised the disclosure on page 82 and 83 of the Registration Statement to address the Staff’s comment.
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May 8, 2023 |
| Page 4 |
Lock-up Agreements, page 95
| 12. | Please disclose the “certain other exceptions” mentioned in the first paragraph of this section. |
Response: The Company acknowledges the Staff’s comment and advises the Staff that it has revised the disclosure on page 98 of the Registration Statement to address the Staff’s comment.
Notes to Consolidated Financial Statements
Note 2 - Basis of Presentation and Summary of Significant Accounting Policies
Subsequent Events, page F-13
| 13. | Please revise to disclose the actual date through which subsequent events have been evaluated. Refer to ASC 855-10-50-1. |
Response: The Company acknowledges the Staff’s comment and advises the Staff that it has revised the disclosure on page F-32 of the Registration Statement to address the Staff’s comment.
Note 13 - Concentration of Risk, page F-20
| 14. | Please revise to separately disclose the total revenue from each customer that accounted for more than 10% of your revenue for each period presented pursuant to ASC 280-10-50-42. In this regard, we note your disclosure that three customers accounted for 91% of your total revenue for the year ended September 30, 2021. |
Response: The Company acknowledges the Staff’s comment and advises the Staff that it has revised the disclosure on page F-39 of the Registration Statement to address the Staff’s comment.
Exhibits
| 15. | Please ensure that you file as separate exhibits the consents of the board members. |
Response: The Company acknowledges the Staff’s comment and advises the Staff that it has revised the exhibit table of the Registration Statement to address the Staff’s comment.
General
| 16. | If your operations have experienced or are experiencing inflationary pressures or rising costs, please expand to identify the principal factors contributing to the inflationary pressures the company has experienced and clarify the resulting impact to the company. Please also revise to identify actions planned or taken, if any, to mitigate inflationary pressures. |
Response: The Company acknowledges the Staff’s comment and advises the Staff that it has revised the disclosure on page 44 of the Registration Statement to address the Staff’s comment.
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May 8, 2023 |
| Page 5 |
| 17. | Please disclose whether and how your business segments, products, lines of service, projects, or operations are materially impacted by supply chain disruptions, especially in light of Russia’s invasion of Ukraine. For example, discuss whether you have or expect to: |
| ● | suspend the production, purchase, sale or maintenance of certain items due to a lack of raw materials, parts, or equipment; inventory shortages; closed factories or stores; reduced headcount; or delayed projects; |
| ● | experience labor shortages that impact your business; |
| ● | experience cybersecurity attacks in your supply chain; |
| ● | experience higher costs due to constrained capacity or increased commodity prices or challenges sourcing materials (e.g., nickel, palladium, neon, cobalt, iron, platinum or other raw material sourced from Russia, Belarus, or Ukraine); |
| ● | experience surges or declines in consumer demand for which you are unable to adequately adjust your supply; |
| ● | be unable to supply products at competitive prices or at all due to export restrictions, sanctions, tariffs, trade barriers, or political or trade tensions among countries or the ongoing invasion; or be exposed to supply chain risk in light of Russia’s invasion of Ukraine and/or related geopolitical tension or have sought, made or announced plans to “de-globalize” your supply chain. |
| ● | Explain whether and how you have undertaken efforts to mitigate the impact and where possible quantify the impact to your business. |
Response: The Company acknowledges the Staff’s comment and advises the Staff that it has revised the disclosures on pages 24 and 45 of the Registration Statement to address the Staff’s comment.
| 18. | Please disclose whether you are subject to material cybersecurity risks in your supply chain based on third-party products, software, or services used in your products, services, or business and how a cybersecurity incident in your supply chain could impact your business. Discuss the measures you have taken to mitigate these risks. To the extent material, disclose any new or heightened risk of potential cyberattacks by state actors or others since Russia’s invasion of Ukraine and whether you have taken actions to mitigate such potential risks. |
Response: The Company acknowledges the Staff’s comment and advises the Staff that it has revised the disclosures on pages 26 and 45 of the Registration Statement to address the Staff’s comment.
| 19. | Please describe the extent and nature of the role of the board of directors in overseeing cybersecurity risks, including in connection with the company’s supply chain/suppliers/service providers. |
Response: The Company acknowledges the Staff’s comment and advises the Staff that it has revised the image on page 79 of the Registration Statement to address the Staff’s comment.
| 20. | Please discuss whether supply chain disruptions materially affect your outlook or business goals. Specify whether these challenges have materially impacted your results of operations or capital resources and quantify, to the extent possible, how your sales, profits, and/or liquidity have been impacted. Also discuss known trends or uncertainties resulting from mitigation efforts undertaken, if any. Explain whether any mitigation efforts introduce new material risks, including those related to product quality, reliability, or regulatory approval of products. |
Response: The Company acknowledges the Staff’s comment and advises the Staff that it has revised the disclosure on pages 44-46 of the Registration Statement to address the Staff’s comment.
| 21. | Please discuss whether recent increased cases of COVID-19 and/or shutdowns related to additional or increased outbreaks have had a material impact on your operations, supply chain, liquidity or capital resources. |
Response: The Company acknowledges the Staff’s comment and advises the Staff that it has revised the disclosure on page 46 of the Registration Statement to address the Staff’s comment.
* * * * * * *
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May 8, 2023 |
| Page 6 |
If you have any questions, please feel free to contact me at (713) 651-2678. Thank you for your cooperation and prompt attention to this matter.
| Sincerely, | |
| /s/ Michael Blankenship | |
| Michael Blankenship |
| cc: | Dekui Liu, Chief Executive Officer, INNO HOLDINGS INC. |
| This ‘DRSLTR’ Filing | Date | Other Filings | ||
|---|---|---|---|---|
 | ||||
| Filed on: | 5/8/23 | DRS/A | ||
| 3/8/23 | ||||
| 2/9/23 | DRS/A | |||
| 9/30/22 | ||||
| 9/30/21 | ||||
| List all Filings | ||||