United States securities and exchange commission logo
March 30, 2022
Kermit Harris
President and Director
Astra Energy, Inc.
9565 Waples Street, Suite 200
San Diego, CA 92121
Re: Astra Energy, Inc.
Registration
Statement on Form S-1
Filed March 3, 2022
File No. 333-263256
Dear Mr. Harris:
We have reviewed your registration 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 registration
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 registration statement and
the information you
provide in response to these comments, we may have additional comments.
Registration Statement on Form S-1 Filed March 3, 2022
Cover Page
1. Please revise your
prospectus cover page to clarify the securities to be covered by this
registration statement,
and ensure that such disclosure is consistent with your fee table.
For example, you
disclose on the cover page that you are offering units, but it does not
appear that you have
included the units and each component of the units in the fee table.
As another example,
your cover page disclosure references the sale of 53,781,000 shares
of your common stock.
Please revise your cover page to clarify the securities being
offered in the primary
offering and the securities being offered in the resale offering. In
addition, clarify the
offering price of the securities to be offered in the primary offering.
In that regard, it
appears that you are offering units but your disclosure references an
offering price per
share.
Kermit Harris
FirstName LastNameKermit Harris
Astra Energy, Inc.
Comapany
March NameAstra Energy, Inc.
30, 2022
March2 30, 2022 Page 2
Page
FirstName LastName
2. We note your disclosure that your common stock is currently quoted on
the OTC Bulletin
Board. However, we also note your disclosure that your common stock is
quoted on the
OTC Pink market. Please revise your disclosure throughout your filing
to clarify the
current quotation of your common stock. In addition, we note your
disclosure that the
selling stockholders will sell their shares at various market prices
for the duration of the
offering. If your common stock is only quoted on the OTC Pink market,
please note that
the OTC Pink market is not an established public trading market into
which selling
stockholders may offer and sell shares at other than a fixed price.
Accordingly, please
revise your cover page disclosure, and make corresponding changes
elsewhere in the
prospectus, to disclose a fixed price at which the selling
stockholders will offer and sell
shares until your shares are listed on a national securities exchange
or quoted
on OTCQX or OTCQB, at which time they may be sold at prevailing market
prices or in
privately negotiated transactions. Refer to Item 501(b)(3) of
Regulation S-K.
Prospectus Summary, page 4
3. We note the disclosure in Note 3 on page 44 that the company has an
accumulated deficit
of $30,362,882 as of November 30, 2021 and has no current revenue
generating
operations. We also note the statement that these factors raise
substantial doubt about the
company s ability to continue as a going concern, as well as your
disclosure on page 12
that you expect to incur substantial expenses and generate continued
operating losses until
you generate revenues sufficient to meet your obligations. Please
disclose such
information in your prospectus summary, and include related risk
factor disclosure.
Summary of the Offering, page 5
4. You disclose that there will be 55,455,540 shares of common stock
outstanding after this
offering. However, it appears you will have 50,455,540 common shares
outstanding after
the offering, based on your proposed issuance of 5,000,000 units
consisting of one share
of common stock and one warrant. Please revise as appropriate.
5. Please also disclose the number of warrants outstanding before and
after the offering.
Risk Factors, page 6
6. Please revise to clarify how the risks described under the headings
"We face intense
competition" and "Delays in product development schedules may
adversely affect our
revenues" relate to your business.
Management's Discussion and Analysis of Financial Condition and Results of
Operations
Critical Accounting Policies, page 10
7. You disclose on page 11, under Net income (loss) per common share,
that The rights of
conversion on the outstanding issued shares of Series B, Series C and
Series D preferred
Kermit Harris
FirstName LastNameKermit Harris
Astra Energy, Inc.
Comapany
March NameAstra Energy, Inc.
30, 2022
March3 30, 2022 Page 3
Page
FirstName LastName
stock have expired. This disclosure is inconsistent with your
disclosures in Note 5
Preferred Stock to your annual and unaudited interim financial
statements on page 45 and
55, and with your disclosures about the Series D preferred stock under
Description of
Securities, Preferred Stock, on page 28. Please revise as appropriate.
Business, page 17
8. Please disclose your total number of employees and the number of
full-time employees.
See Item 101(h)(4)(xii) of Regulation S-K.
Description of Our Business, page 17
9. We note your disclosure that on November 5, 2021, Astra Energy Africa
was issued an
Investment License by the Uganda Investment Authority. Please revise
to disclose the
scope of such license and any material terms. We also note your
disclosure that on
January 12, 2022, you have entered into an agreement with Green
Hygienics Holdings
Inc. to supply and install an electricity generating system in
Southern California, and note
your disclosure that the project is scheduled for completion in 2022.
Please disclose all
material terms of such agreement, and file the agreement as an
exhibit. See Item
601(b)(10) of Regulation S-K.
10. We note your disclosure that Astra Energy is advancing a waste
to energy project on the
island of Zanzibar to convert 15 tons of municipal solid waste per
hour into 10MW/hour
of electric power. Please revise to clarify the status of this
project.
Use of Proceeds, page 20
11. We note your disclosure regarding your use of proceeds for
engineering, property leases
and equipment and installation. If known, please revise to disclose
the project or projects
on which you intend to use such proceeds. In addition, provide a brief
outline of any
program of construction or addition of equipment. If any material
amounts of other funds
are necessary to accomplish the specified purposes for which the
proceeds are to be
obtained, state the amounts of such other funds needed for each such
specified purpose
and the sources thereof. Refer to Item 504 of Regulation S-K.
Dilution, page 21
12. Your dilution calculations show the Decrease in Investment to New
Shareholders as
zero percent under each of your offering scenarios. However, the
dilution to new
investors is the difference between the offering price per share paid
by the new investors
and your net tangible book value per share after the offering which is
greater than zero
percent under each of your offering scenarios. Please revise and
provide us with your
dilution computations.
Plan of Distribution, page 26
13. We note your disclosure that an investor in the offering by the
company must execute and
Kermit Harris
FirstName LastNameKermit Harris
Astra Energy, Inc.
Comapany
March NameAstra Energy, Inc.
30, 2022
March4 30, 2022 Page 4
Page
FirstName LastName
deliver a subscription agreement, and we note that you have filed a
form of subscription
agreement as Exhibit 99.1. However, the terms set forth in such form
of subscription
agreement do not appear to be consistent with the terms of the
offering described in the
prospectus. For example, the form of subscription agreement
contemplates a
warrant exercise period of the earlier of two years from the date of
issuance, or within 30
days after the Company stock closes at or above $1.00 for five
consecutive trading days.
As another example, the form of subscription agreement states that the
warrant and
underlying shares of common stock have not been registered under the
Securities Act.
Similarly, the form of warrant filed as Exhibit 99.2 does not appear
to reflect the terms of
the warrants to be offered as described in your prospectus. Please
advise.
Directors, Executive Officers and Corporate Governance, page 31
14. For each director and executive officer, please disclose such person's
principal
occupations and employment during the past five years, and the name
and principal
business of any corporation or other organization in which such
occupations and
employment were carried on. Refer to Item 401(e) of Regulation S-K.
Financial Statements for the Years Ended August 31, 2021 and 2020
Note 2 - Summary of Significant Accounting Policies
Stock-based Compensation, page 43
15. You disclose that you account for equity-based transactions with
nonemployees under the
provisions of ASC Topic 505-50. However, ASC Topic 505-50 was
superseded by
Accounting Standards Update No. 2018-07, Compensation Stock
Compensation (Topic
718) which was effective for fiscal years beginning after December 15,
2018. Please
revise your accounting and disclosures for equity-based transactions
with nonemployees
to comply with the guidance in ASC Topic 718.
Note 3 - Going Concern, page 44
16. Please revise to disclose management s plans intended to mitigate
the conditions or events
that raise substantial doubt about your ability to continue as a going
concern as required
by ASC 205-40. This comment also applies to your unaudited interim
financial
statements.
Note 4 - Common Stock, page 44
17. The sum of the number of shares and the dollar amounts reflected in
Note 4 for common
shares issued for cash issued and for services do not agree with the
related amounts
presented in your Statements of Stockholders Equity. Please revise
as appropriate.
18. Revise to clarify whether the 600,000 shares associated with the Stock
Subscription
Receivable and Common Stock To Be Issued are included in the number of
shares issued
and outstanding in your Statement of Stockholders Equity. Please
also disclose amounts
related to collections of the Subscription Receivable and related
issuances (or release) of
Kermit Harris
FirstName LastNameKermit Harris
Astra Energy, Inc.
Comapany
March NameAstra Energy, Inc.
30, 2022
March5 30, 2022 Page 5
Page
FirstName LastName
Common Stock To Be Issued during the year ended August 31, 2021 and
the unaudited
interim period ended November 30, 2021.
Note 5 - Preferred Stock, page 45
19. In your Form 8-K/A filed February 3, 2020 you disclose the
cancellation of 8,000 shares
of Series A Preferred Stock effective January 19, 2022. Disclose the
reason for the
cancellation and how you accounted for the cancellation.
20. You disclose that the Series D Preferred Stock has a liquidation
preference of 120% of its
stated value. Revise to provide the disclosures required by ASC
505-10-50.
Note 6 - Related Party Transactions, page 45
21. The sum of the number of shares and the sum of the dollar amounts
reflected in Note 6 for
common shares issued to related parties for services do not agree with
the related amounts
presented in your Statements of Stockholders Equity. Please revise
as appropriate.
22. Provide an explanatory footnote for the 3,000,000 common shares
cancelled which
includes when the shares were issued, the consideration originally
received for such shares
and the reason such shares were cancelled.
23. You disclose that on February 1, 2021 you executed a service agreement
with a term of
1.5 years with Mr. Claycamp under which he will receive 3,000,000
shares of common
stock over the term of the agreement. Your disclosures do not agree
with the terms of the
agreement with Mr. Claycamp filed as Exhibit 10.10 to the Form S-1.
Please revise as
appropriate.
Financial Statements for the Three Months Ended November 30, 2021 and 2020
Note 8 - Subsequent Events, page 56
24. You disclose that subsequent to November 30, 2021 you issued 1,100,000
shares of
common stock for services and 275,000 shares for cash. However, in
your disclosures
under Recent Sales of Unregistered Securities on page 57, you disclose
230,000 common
shares issued for cash from December 1, 2021 to February 25, 2022.
Please revise your
disclosures as appropriate to correct this apparent discrepancy.
Signatures, page 66
25. In your next amendment, please include all signatures required by Form
S-1, including the
signature on behalf of the registrant. Refer to Instruction 1 to
Signatures on Form S-1.
Exhibits
26. Please file as an exhibit a list of all subsidiaries. See Item
601(b)(21) of Regulation S-K.
In addition, please file an executed version of the convertible
debenture filed as Exhibit
10.12. For example, we note that you have not provided the name of the
holder.
Kermit Harris
Astra Energy, Inc.
March 30, 2022
Page 6
27. Please obtain and file a legality opinion that covers the legality of
each of the securities to
be offered under this registration statement. In that regard, we note
that the legality
opinion filed as Exhibit 5.1 does not address the legality of the
warrants. We also note the
statement in the opinion that the opinion is limited to the Federal laws
of the United
States. Please ensure that the legality opinion addresses the legality of
the securities under
the relevant state laws. For example, we note your disclosure that the
registrant is
incorporated in Nevada. For guidance, please refer to Staff Legal
Bulletin No. 19.
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.
Refer to Rules 460 and 461 regarding requests for acceleration. Please
allow adequate
time for us to review any amendment prior to the requested effective date of
the registration
statement.
You may contact Sondra Snyder, Staff Accountant, at (202) 551-3332 or
Gus Rodriguez,
Accounting Branch Chief, at (202) 551-3752 if you have questions regarding
comments on the
financial statements and related matters. Please contact Cheryl Brown, Law
Clerk, at (202) 551-
3905 or Laura Nicholson, Special Counsel, at (202) 551-3584 with any other
questions.
Sincerely,
FirstName LastNameKermit Harris
Division of
Corporation Finance
Comapany NameAstra Energy, Inc.
Office of Energy &
Transportation
March 30, 2022 Page 6
cc: Carl P. Ranno, Esq.
FirstName LastName