SEC Company Response from Ilustrato Pictures International Inc. (ILUS) (CIK 0001496383) (ILUS) — Dec 14, 2010
Ilustrato Pictures International Inc. (ILUS) (CIK 0001496383)
Date: Dec. 14, 2010 · CIK: 0001496383 · Accession: 0001380389-10-000083
AI Filing Summary & Sentiment
Reasoning
File numbers found in text: 333-168136
Referenced dates: September 27, 2010
Letter
UNITED STATES Securities and Exchange Commission Division of Corporate Finance Superior Venture Corporation Registration Statement on Form S-1 Filed July 16, 2010 File No. 333-168136
Dear Mr. Reynolds:
Superior Venture Corporation submits this letter to you in response to your letter of October 25, 2010, which letter sets forth comments of the Staff of the Securities and Exchange Commission regarding the above referenced filing. This letter sets forth our responses to the Staff’s comments. For your convenience, we have recited the Staff’s comments in italicized, bold type and have followed each comment with our response. We also have appended to the end of this letter a redline version of Amendment No. 3 to our registration statement on Form S-1.
COMMENT:
Form S-/A, filed October 25, 2010
Summary
1.
We partially reissue comment one of our letter dated September 27, 2010. Please reconcile the disclosure that you plan to offer two varietals during the next 12 months and that you plan to offer two varietals during the next six months following the closing of the offering with the disclosure in the milestones discussion, which indicates that you will not receive your first cases of production run until seven to nine months following the closing of the offering..
RESPONSE:
We acknowledge the Staff’s comment and confirm that the Company has reconciled and clarified our disclosure throughout the Form S-1/A as follows: “Superior Venture plans to offer two wine varietals approximately seven to nine months following the closing of the public offering and plans to add two more varieties within the next 24 months. Upon receiving our first shipment during the seven to nine month timeframe; we hope to start generating revenue approximately thirty days following the initial delivery”. The Company has revised section “Summary” sub-section “General Information about the Company,” section “Description of Our Business” sub-section “Business Overview,” sub-section “Product Development,” and sub-section 12 Month Growth Strategy and Milestones,” section “Plan of Operation” sub-section “Proposed Milestones to Implement Business Operations.”
COMMENT:
Risk Factors
2.
We reissue comment three of our letter dated September 27, 2010. Please add a separate risk factor discussing the going concern raised by the independent public accountant. You have currently added a risk factor subheading.
RESPONSE:
We acknowledge the Staff’s comment and the Company responds by stating that it has added a separate risk factor subheading for the paragraph discussing the going concern raised by the independent public accountant. The revised section appears in the “Risk Factors” in the Form S-1/A filing as written below.
RISKS RELATED TO OUR FINANCIAL CONDITION AND CAPITAL REQUIREMENTS
AUDITOR’S GOING CONCERN
As shown in the financial statements accompanying this prospectus, Superior Venture Corporation has had no revenues to date and has incurred only losses since its inception. The Company has had no operations and has been issued a “going concern” opinion from our accountants, based upon the Company’s reliance upon the sale of our common stock as the sole source of funds for our future operations.
COMMENT:
Description of Our Business
3.
We reissue comment five of our letter dated September 27, 2010. Please reconcile the disclosure in the summary and in the business overview that your business plan is to “produce” and sell wine varietals with the disclosure on page 19 where you refer to growers and wineries that you have identified that you hope will produce your wine. It appears that you will not “produce” the wine varietals yourself..
RESPONSE:
We acknowledge the Staff’s comment and confirm that we revised the S-1/A filing and removed the word “produce” where it implies that we will produce the wine varietals ourselves. We revised section “Summary” sub-section “General Information about the Company”, section “Description of Our Business” sub-section “Business Overview” and sub-section “Product Development” to reflect the revisions.
COMMENT:
4.
We note the disclosure that you have identified a winery that you plan on working with to hand craft your wines. Please disclose whether you have had any discussions or negotiations with the winery.
RESPONSE:
We acknowledge the Staff’s comment and confirm that the Company has disclosed the following statements in section “Description of Our Business” sub-section “Business Overview” where the first paragraph includes the wording as follows: “The Company does not have any agreements and it has not had any discussions with specific growers and wineries. However, the Company has identified a winery that we plan to work with to hand-craft our wines
COMMENT:
5.
We partially reissue comment six of our letter dated September 27, 2010. Please provide a more detailed discussion of your proposed products.
RESPONSE:
We acknowledge the Staff’s comment and confirm that we revised the S-1/A filing in the “Description of Our Business” section where we provided a more detailed discussion of our proposed products. The revised “Description of Our Business” section appears in the S-1/A as written below.
Business Overview
Superior Venture Corporation is a Nevada Corporation with a principal business objective of selling wine varietals. Superior Venture plans to offer two wine varietals approximately seven to nine months following the closing of the public offering and plans to add two more varieties within the next 24 months. Upon receiving our first shipment during the seven to nine month timeframe; we hope to start generating revenue approximately thirty days following the initial delivery. The Company does not have any agreements and it has not had any discussions with specific growers and wineries. However, the Company has identified a winery that we plan to work with to hand-craft our wines. First, we choose the varietal, and the fruit the vineyard came from. Second, we work with the winery on creating our proprietary blend. Our proprietary blend will consist of 75% of select varietal and the remaining 25% can be selected from barrel inventory. Initially we plan to offer two varietal such as a Chardonnay and a Merlot. We chose these as our initial wines because the vast majority of all wines sold in the United States are table wines. “Chardonnay is the world’s most popular white wine grape, with over 300,000 acres planted, 100,000 in California alone” (source: DrinkWine.com – http://www.drinkwine.com/wine_guide/varietals/chardonnay.html). We chose a Merlot as our second wine because it’s softness on the pallet has made it an “introducing” wine for new red-wine drinkers. Once the exact varietal has been determined, the wines are bottled, corked and labeled to our specifications.
COMMENT:
Industry Analysis
6.
We reissue comment seven of our letter dated September 27, 2010. Please revise the citation you provide here and elsewhere as appropriate, as there continues to be a typographical error. In addition, the article cited was from March 2008. Please provide clear disclosure as to the date of the information and explain why such statistical information remains appropriate given the passage of time. Please further revise to clarify whether the citations you provide pertain to all industry statements included. If they do not, please provide source(s) of such information. As a non-exclusive example, we note the statement that in 1980 there were 900 wineries in America, in 2000 there were 2,100 wineries and now there are over 6,100 wineries. This would also include statistical information found throughout the business section. Lastly, please provide us supplementally with a copy of each source of information cited throughout the prospectus, as previously requested.
RESPONSE:
We acknowledge the Staff’s comment and confirm that the Company has revised the “Industrial Analysis” section to reflect the most current statistical information available and we provided additional detail to where the reader may reference the sources. In addition we have provided supplemental copies of each source of information cited throughout the prospectus. The revised “Industrial Analysis” section appears in the S-1/A as written below.
Industry Analysis
Wine consumption in the United States reached an all time high of 767 million gallons in 2009 (source: http://www.wineinstitute.org/resources/statistics - under statistics please click on click “Wine consumption in the U.S.). This volume of consumption equates to 2.5 gallons of wine per capita consumption and would be higher if based on legal drinking age population. This is an increase from 568 million gallons consumed in the year 2000 and equates to 2.01 gallons of wine per capita consumption (source: http://www.wineinstitute.org/resources/statistics - under statistics please click on click “Wine consumption in the U.S.). In addition, “The number of wineries in the United States increased by 122 over last year to reach a total of 6,223 (as of November 2009), according to the Wine Business Monthly proprietary database (source: http://www.winebusiness.com/wbm/?go=getArticle&dataId=72744 – enter article number 72744 in keyword search box) . “In 2009, the number of bonded U.S. wineries saw the same net percentage increase (6 percent) as in 2008, a considerable slow-down from previous years of rapid growth: 10 percent in 2007 and 15 percent in 2006 (source: http://www.winebusiness.com/wbm/?go=getArticle&dataId=72744 – enter article number 72744 in keyword search box).
The increased popularity of wine is also due to ongoing studies linking moderate consumption of wine to decreased risk of heart disease, cancer, and stroke. In addition, the antioxidants found in red wine appear to be
one of protection and prevention of disease. Despite a difficult economy, this type of news fares well for the industry as a whole because any correlation that a consumer product has with a person's well being tends to transcend itself to the bottom line. With increased industry awareness and mainstreaming of the product comes additional outlets where wine can be purchased. In addition to the increase of Internet and mail order purchases boosted by the abovementioned law changes, the industry has also benefited from the sale of wine at relatively inexpensive price points in retailer establishments such as grocery stores and Wal-Mart.
Champagne & sparkling wine continued to gain market share within the last decade. Within this timeframe, imports are increasing at a faster pace than their domestic counterparts which is a similar trend in the table wine market. The increased use of sparkling wine as an ingredient in cocktails along with its year round popularity is fueling the growth in the category.
COMMENT:
Marketing, page 21
7.
We reissue comment eight of our letter September 27, 2010. Please revise to clarify whether the citation you provide pertains to all statistical and factual information included in your Target Market Segmentation section. If this is not the case, please provide the source(s) for such statements. As a non-exclusive example, we note the Gallup poll that named wine over beer as America’s most popular alcoholic beverage. Furthermore, please revise your citation to more clearly disclose where to find the information. We note in particular the reference to Adams Handbook. In addition, we note that the website provided for the citation to American Generations takes the reader to an archive page rather than an article.
RESPONSE:
We acknowledge the Staff’s comment and confirm that the Company has rewrote the “Marketing” section to included source references for all the citations. In addition, we have provided additional instructions to aid the reader to access the referenced source information written in the “Target Market Segmentation” section. The “Marketing” section appears in the Form S-1/A as written below.
Marketing
This section details our sales and marketing strategies.
Our initial target market is an end consumer that has disposable income and college educated. Initial due diligence reveled that these ideal customers are more likely to be wine-educated, enjoy dining out, and regularly entertain friends or business associates. In the last decade, wine has enjoyed an increasingly positive image from consumers and media outlets. The May 2005 Supreme Court ruling in favor of interstate wine sales was a boon to thousands of American wineries. In addition, the decision had a favorable impact on public opinion and awareness of wine. In a Gallup poll taken several weeks after the ruling, consumers named wine over beer in 2005 as America’s most popular alcoholic beverage (http://www.gallup.com/poll/141656/drinking-rate-edges-slightly-year-high.aspx). Beer has since regained the top spot for preferred alcoholic beverage, but wine ranks as the preferred beverage among women and drinkers 55 and older clearly choose wine as their preferred beverage (http://www.gallup.com/poll/141656/drinking-rate-edges-slightly-year-high.aspx). The strong growth coincided with an increasing adult population and more specifically a significant increase in the age 50 and up population. Based on our due diligence and the statistical data; Superior Venture intends to target this segment. Additionally, there is a relatively new trend that overall, the wine market is getting younger, and this segment is largely overlooked by most of our competitors.
COMMENT:
8.
We reissue comment nine of our letter dated September 27, 2010. We continue to note the reference to “variety of target market specific marketing strategies” in the summary section. Please discuss in greater detail this strategy, including how your marketing strategy is different from the competition, or remove these statements as they would appear promotional in nature.
RESPONSE:
We acknowledge the Staff’s comment and confirm that the Company removed statements that appear promotional in nature specifically referencing “a variety of target market specific strategies” in the summary section.
COMMENT:
Management’s Discussion and Analysis
9.
Please disclose the cash balance as of the most recent practicable date. In addition, we note disclosure in the last risk factor that you plan on paying the $5,500 cost of registration from cash on hand. We note that the cash on hand was not sufficient to cover this cost. Please add disclosure and explain how you plan to pay the registration costs and other costs that occur until the potentially nine months that the offering will continue.
RESPONSE:
We acknowledge the Staff’s comment and confirm that the Company has added a disclosure to explain how they plan to pay the registration costs and other costs that occur. The statement appears in the section “Management’s Discussion and Analysis” as follows: “If we experience a shortfall in operating capital prior to funding from the proceeds of this offering, our director has verbally agreed to advance the company funds to complete the registration costs and other costs that occur until the potentially nine months that the offering will continue.” In addition, the Company confirms that it has disclosed the cash balance as of the most recent practicable accounting period available.
COMMENT:
Directors, Executive Officers, Promoters and Control Persons, page 40
10.
We reissue comment 12 of our letter dated September 27, 2010. Please revise your disclosure to specifically address the specific experience, qualifications, attributes, or skills that led to the conclusion that Mr. Moore should serve as a director of the company. See Item 401(e
Show Raw Text
CORRESP 1 filename1.htm UNITED STATES Superior Venture Corporation 1937 E. Mineral Avenue Centennial, Colorado 80122 December 14, 2010 Mr. John Reynolds Assistant Director Securities and Exchange Commission Division of Corporate Finance 100 F Street NE Washington, D.C. 20549 RE: Superior Venture Corporation Registration Statement on Form S-1 Filed July 16, 2010 File No. 333-168136 Dear Mr. Reynolds: Superior Venture Corporation submits this letter to you in response to your letter of October 25, 2010, which letter sets forth comments of the Staff of the Securities and Exchange Commission regarding the above referenced filing. This letter sets forth our responses to the Staff’s comments. For your convenience, we have recited the Staff’s comments in italicized, bold type and have followed each comment with our response. We also have appended to the end of this letter a redline version of Amendment No. 3 to our registration statement on Form S-1. COMMENT: Form S-/A, filed October 25, 2010 Summary 1. We partially reissue comment one of our letter dated September 27, 2010. Please reconcile the disclosure that you plan to offer two varietals during the next 12 months and that you plan to offer two varietals during the next six months following the closing of the offering with the disclosure in the milestones discussion, which indicates that you will not receive your first cases of production run until seven to nine months following the closing of the offering.. RESPONSE: We acknowledge the Staff’s comment and confirm that the Company has reconciled and clarified our disclosure throughout the Form S-1/A as follows: “Superior Venture plans to offer two wine varietals approximately seven to nine months following the closing of the public offering and plans to add two more varieties within the next 24 months. Upon receiving our first shipment during the seven to nine month timeframe; we hope to start generating revenue approximately thirty days following the initial delivery”. The Company has revised section “Summary” sub-section “General Information about the Company,” section “Description of Our Business” sub-section “Business Overview,” sub-section “Product Development,” and sub-section 12 Month Growth Strategy and Milestones,” section “Plan of Operation” sub-section “Proposed Milestones to Implement Business Operations.” COMMENT: Risk Factors 2. We reissue comment three of our letter dated September 27, 2010. Please add a separate risk factor discussing the going concern raised by the independent public accountant. You have currently added a risk factor subheading. RESPONSE: We acknowledge the Staff’s comment and the Company responds by stating that it has added a separate risk factor subheading for the paragraph discussing the going concern raised by the independent public accountant. The revised section appears in the “Risk Factors” in the Form S-1/A filing as written below. RISKS RELATED TO OUR FINANCIAL CONDITION AND CAPITAL REQUIREMENTS AUDITOR’S GOING CONCERN As shown in the financial statements accompanying this prospectus, Superior Venture Corporation has had no revenues to date and has incurred only losses since its inception. The Company has had no operations and has been issued a “going concern” opinion from our accountants, based upon the Company’s reliance upon the sale of our common stock as the sole source of funds for our future operations. COMMENT: Description of Our Business 3. We reissue comment five of our letter dated September 27, 2010. Please reconcile the disclosure in the summary and in the business overview that your business plan is to “produce” and sell wine varietals with the disclosure on page 19 where you refer to growers and wineries that you have identified that you hope will produce your wine. It appears that you will not “produce” the wine varietals yourself.. RESPONSE: We acknowledge the Staff’s comment and confirm that we revised the S-1/A filing and removed the word “produce” where it implies that we will produce the wine varietals ourselves. We revised section “Summary” sub-section “General Information about the Company”, section “Description of Our Business” sub-section “Business Overview” and sub-section “Product Development” to reflect the revisions. COMMENT: 4. We note the disclosure that you have identified a winery that you plan on working with to hand craft your wines. Please disclose whether you have had any discussions or negotiations with the winery. RESPONSE: We acknowledge the Staff’s comment and confirm that the Company has disclosed the following statements in section “Description of Our Business” sub-section “Business Overview” where the first paragraph includes the wording as follows: “The Company does not have any agreements and it has not had any discussions with specific growers and wineries. However, the Company has identified a winery that we plan to work with to hand-craft our wines COMMENT: 5. We partially reissue comment six of our letter dated September 27, 2010. Please provide a more detailed discussion of your proposed products. RESPONSE: We acknowledge the Staff’s comment and confirm that we revised the S-1/A filing in the “Description of Our Business” section where we provided a more detailed discussion of our proposed products. The revised “Description of Our Business” section appears in the S-1/A as written below. Business Overview Superior Venture Corporation is a Nevada Corporation with a principal business objective of selling wine varietals. Superior Venture plans to offer two wine varietals approximately seven to nine months following the closing of the public offering and plans to add two more varieties within the next 24 months. Upon receiving our first shipment during the seven to nine month timeframe; we hope to start generating revenue approximately thirty days following the initial delivery. The Company does not have any agreements and it has not had any discussions with specific growers and wineries. However, the Company has identified a winery that we plan to work with to hand-craft our wines. First, we choose the varietal, and the fruit the vineyard came from. Second, we work with the winery on creating our proprietary blend. Our proprietary blend will consist of 75% of select varietal and the remaining 25% can be selected from barrel inventory. Initially we plan to offer two varietal such as a Chardonnay and a Merlot. We chose these as our initial wines because the vast majority of all wines sold in the United States are table wines. “Chardonnay is the world’s most popular white wine grape, with over 300,000 acres planted, 100,000 in California alone” (source: DrinkWine.com – http://www.drinkwine.com/wine_guide/varietals/chardonnay.html). We chose a Merlot as our second wine because it’s softness on the pallet has made it an “introducing” wine for new red-wine drinkers. Once the exact varietal has been determined, the wines are bottled, corked and labeled to our specifications. COMMENT: Industry Analysis 6. We reissue comment seven of our letter dated September 27, 2010. Please revise the citation you provide here and elsewhere as appropriate, as there continues to be a typographical error. In addition, the article cited was from March 2008. Please provide clear disclosure as to the date of the information and explain why such statistical information remains appropriate given the passage of time. Please further revise to clarify whether the citations you provide pertain to all industry statements included. If they do not, please provide source(s) of such information. As a non-exclusive example, we note the statement that in 1980 there were 900 wineries in America, in 2000 there were 2,100 wineries and now there are over 6,100 wineries. This would also include statistical information found throughout the business section. Lastly, please provide us supplementally with a copy of each source of information cited throughout the prospectus, as previously requested. RESPONSE: We acknowledge the Staff’s comment and confirm that the Company has revised the “Industrial Analysis” section to reflect the most current statistical information available and we provided additional detail to where the reader may reference the sources. In addition we have provided supplemental copies of each source of information cited throughout the prospectus. The revised “Industrial Analysis” section appears in the S-1/A as written below. Industry Analysis Wine consumption in the United States reached an all time high of 767 million gallons in 2009 (source: http://www.wineinstitute.org/resources/statistics - under statistics please click on click “Wine consumption in the U.S.). This volume of consumption equates to 2.5 gallons of wine per capita consumption and would be higher if based on legal drinking age population. This is an increase from 568 million gallons consumed in the year 2000 and equates to 2.01 gallons of wine per capita consumption (source: http://www.wineinstitute.org/resources/statistics - under statistics please click on click “Wine consumption in the U.S.). In addition, “The number of wineries in the United States increased by 122 over last year to reach a total of 6,223 (as of November 2009), according to the Wine Business Monthly proprietary database (source: http://www.winebusiness.com/wbm/?go=getArticle&dataId=72744 – enter article number 72744 in keyword search box) . “In 2009, the number of bonded U.S. wineries saw the same net percentage increase (6 percent) as in 2008, a considerable slow-down from previous years of rapid growth: 10 percent in 2007 and 15 percent in 2006 (source: http://www.winebusiness.com/wbm/?go=getArticle&dataId=72744 – enter article number 72744 in keyword search box). The increased popularity of wine is also due to ongoing studies linking moderate consumption of wine to decreased risk of heart disease, cancer, and stroke. In addition, the antioxidants found in red wine appear to be one of protection and prevention of disease. Despite a difficult economy, this type of news fares well for the industry as a whole because any correlation that a consumer product has with a person's well being tends to transcend itself to the bottom line. With increased industry awareness and mainstreaming of the product comes additional outlets where wine can be purchased. In addition to the increase of Internet and mail order purchases boosted by the abovementioned law changes, the industry has also benefited from the sale of wine at relatively inexpensive price points in retailer establishments such as grocery stores and Wal-Mart. Champagne & sparkling wine continued to gain market share within the last decade. Within this timeframe, imports are increasing at a faster pace than their domestic counterparts which is a similar trend in the table wine market. The increased use of sparkling wine as an ingredient in cocktails along with its year round popularity is fueling the growth in the category. COMMENT: Marketing, page 21 7. We reissue comment eight of our letter September 27, 2010. Please revise to clarify whether the citation you provide pertains to all statistical and factual information included in your Target Market Segmentation section. If this is not the case, please provide the source(s) for such statements. As a non-exclusive example, we note the Gallup poll that named wine over beer as America’s most popular alcoholic beverage. Furthermore, please revise your citation to more clearly disclose where to find the information. We note in particular the reference to Adams Handbook. In addition, we note that the website provided for the citation to American Generations takes the reader to an archive page rather than an article. RESPONSE: We acknowledge the Staff’s comment and confirm that the Company has rewrote the “Marketing” section to included source references for all the citations. In addition, we have provided additional instructions to aid the reader to access the referenced source information written in the “Target Market Segmentation” section. The “Marketing” section appears in the Form S-1/A as written below. Marketing This section details our sales and marketing strategies. Our initial target market is an end consumer that has disposable income and college educated. Initial due diligence reveled that these ideal customers are more likely to be wine-educated, enjoy dining out, and regularly entertain friends or business associates. In the last decade, wine has enjoyed an increasingly positive image from consumers and media outlets. The May 2005 Supreme Court ruling in favor of interstate wine sales was a boon to thousands of American wineries. In addition, the decision had a favorable impact on public opinion and awareness of wine. In a Gallup poll taken several weeks after the ruling, consumers named wine over beer in 2005 as America’s most popular alcoholic beverage (http://www.gallup.com/poll/141656/drinking-rate-edges-slightly-year-high.aspx). Beer has since regained the top spot for preferred alcoholic beverage, but wine ranks as the preferred beverage among women and drinkers 55 and older clearly choose wine as their preferred beverage (http://www.gallup.com/poll/141656/drinking-rate-edges-slightly-year-high.aspx). The strong growth coincided with an increasing adult population and more specifically a significant increase in the age 50 and up population. Based on our due diligence and the statistical data; Superior Venture intends to target this segment. Additionally, there is a relatively new trend that overall, the wine market is getting younger, and this segment is largely overlooked by most of our competitors. COMMENT: 8. We reissue comment nine of our letter dated September 27, 2010. We continue to note the reference to “variety of target market specific marketing strategies” in the summary section. Please discuss in greater detail this strategy, including how your marketing strategy is different from the competition, or remove these statements as they would appear promotional in nature. RESPONSE: We acknowledge the Staff’s comment and confirm that the Company removed statements that appear promotional in nature specifically referencing “a variety of target market specific strategies” in the summary section. COMMENT: Management’s Discussion and Analysis 9. Please disclose the cash balance as of the most recent practicable date. In addition, we note disclosure in the last risk factor that you plan on paying the $5,500 cost of registration from cash on hand. We note that the cash on hand was not sufficient to cover this cost. Please add disclosure and explain how you plan to pay the registration costs and other costs that occur until the potentially nine months that the offering will continue. RESPONSE: We acknowledge the Staff’s comment and confirm that the Company has added a disclosure to explain how they plan to pay the registration costs and other costs that occur. The statement appears in the section “Management’s Discussion and Analysis” as follows: “If we experience a shortfall in operating capital prior to funding from the proceeds of this offering, our director has verbally agreed to advance the company funds to complete the registration costs and other costs that occur until the potentially nine months that the offering will continue.” In addition, the Company confirms that it has disclosed the cash balance as of the most recent practicable accounting period available. COMMENT: Directors, Executive Officers, Promoters and Control Persons, page 40 10. We reissue comment 12 of our letter dated September 27, 2010. Please revise your disclosure to specifically address the specific experience, qualifications, attributes, or skills that led to the conclusion that Mr. Moore should serve as a director of the company. See Item 401(e