Attached files
| file | filename |
|---|---|
| EX-3.1 - EXHIBIT31 - DREWRYS BREWING CO | exhibit31.htm |
| EX-5.1 - EXHIBIT51 - DREWRYS BREWING CO | exhibit51.htm |
| EX-3.2 - EXHIBIT32 - DREWRYS BREWING CO | exhibit32.htm |
| EX-4.1 - EXHIBIT41 - DREWRYS BREWING CO | exhibit41.htm |
| EX-99.1 - EXHIBIT991 - DREWRYS BREWING CO | exhibit991.htm |
| EX-14.1 - EXHIBIT141 - DREWRYS BREWING CO | exhibit141.htm |
| EX-23.1 - EXHIBIT231 - DREWRYS BREWING CO | exhibit231.htm |
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM S-1
REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933
Drewrys Brewing Company
(Exact name of registrant as specified in its charter)
Nevada
(State or other jurisdiction of incorporation or organization)
2082
(Primary Standard Industrial Classification Code Number)
27-2153794
(I.R.S. Employer Identification Number)
Francis Manzo
5402 Brittany Drive, McHenry, IL 60050
815-575-4815
(Address, including zip code, and telephone number, including
area code, of registrant's principal executive offices)
As soon as practicable after the effective date of this registration statement
(Approximate date of commencement of proposed sale to the public)
This is the initial public offering of the Company's common stock. There is no minimum amount of shares that must be sold in the offering, the net proceeds from this offering may be $(8,000) to $292,000 after expenses.
If any of the securities being registered on this Form are to be offered on a delayed or continuous basis pursuant to Rule 415 under the Securities Act of 1933 check the following box: x
If this Form is filed to register additional securities for an offering pursuant to Rule 462(b) under the Securities Act, please check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. o
If this Form is a post-effective amendment filed pursuant to Rule 462(c) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. o
If this Form is a post-effective amendment filed pursuant to Rule 462(d) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. o
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting Company. See the definitions of "large accelerated filer," "accelerated filer" and "smaller reporting Company" in Rule 12b-2 of the Exchange Act. (Check one)
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Large accelerated filer o
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Accelerated filer o
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Non-accelerated filer o
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Smaller reporting Company x
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(Do not check if a smaller reporting Company)
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CALCULATION OF REGISTRATION FEE
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Title of Each
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Proposed
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Proposed
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Class of
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Amount
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Maximum
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Maximum
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Amount of
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Securities to
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to be
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Offering Price
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Aggregate
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Registration
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be Registered
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Registered
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Per Unit(1)
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Offering Price
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Fee(2)
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Common Stock by Company
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3,000,000
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$0.10
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$300,000
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$34.83
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(1) The offering price has been arbitrarily determined by the Company and bears no relationship to assets, earnings, or any other valuation criteria. No assurance can be given that the shares offered hereby will have a market value or that they may be sold at this, or at any price.
(2) Estimated solely for the purpose of calculating the registration fee based on Rule 457(o).
The registrant hereby amends this registration statement on such date or dates as may be necessary to delay its effective date until the Registrant shall file a further amendment which specifically states that this Registration Statement shall thereafter become effective in accordance with Section 8(a) of the Securities Act of 1933 or until the registration statement shall become effective on such date as the Commission, acting pursuant to said Section 8(a), may determine.
There is no minimum amount of shares that must be sold in the offering. If we do not sell any shares, the Company will lose $8,000 in expenses. If the Company sells all the shares, the Company will net $292,000 after expenses. If the Company sells only 50% of the shares (1,500,000 shares), the net proceeds will be $142,000.
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Drewrys Brewing Company
3,000,000 SHARES OF COMMON STOCK
This registration statement constitutes the initial public offering of Drewrys Brewing Company’s common stock. Drewrys Brewing Company (“Drewrys”) is registering 3,000,000 shares of common stock at an offering price of $0.10 per share for a total amount of $300,000. The Company will sell the securities in $100 increments. There are no underwriters or broker dealers involved with the offering.
The Company is not a blank check company and we have no plans or intentions to be acquired or merge with an operating company. We also have no plans to change our management nor enter into change of control or similar transaction. In addition, Mr. Francis Manzo, our sole shareholder, has no plans to enter into a change of control or similar transaction or to change management.
The Company's sole officer and director, Mr. Francis Manzo, will be responsible for marketing and selling these securities. The Company will offer the securities on a “best efforts basis” and there will be no minimum amount required to close the transaction. If all the shares are not sold, there is the possibility that the amount raised may be minimal and might not even cover the costs of the offering which the Company estimates at $8,000. The offering price of $0.10 per share may not reflect the market price of the shares after the offering. The proceeds from the sale of the securities will be placed directly into the Company's account and there will not be an escrow account. All proceeds from the sale of the securities are non-refundable, except as may be required by applicable laws. The Company will pay all expenses incurred in this offering. There has been no public trading market for the common stock of Drewrys Brewing Company.
The offering will be closed at the earlier of 90 days after the registration statement becomes effective or all of the shares are sold in the offering.
THIS INVESTMENT INVOLVES A HIGH DEGREE OF RISK. YOU SHOULD PURCHASE SHARES ONLY IF YOU CAN AFFORD A COMPLETE LOSS. SEE "RISK FACTORS" BEGINNING ON PAGE 5.
Neither the Securities and Exchange Commission nor any state securities commission has approved or disapproved of these securities or passed upon the adequacy or accuracy of the prospectus. Any representation to the contrary is a criminal offense.
The information in this prospectus is not complete and may be changed. We may not sell these securities until the registration statement filed with the Securities and Exchange Commission is effective. This prospectus is not an offer to sell these securities and is not soliciting an offer to buy these securities in any state where the offer or sale is not permitted.
The date of this prospectus is April ____, 2011
TABLE OF CONTENTS
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Page No.
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PART I
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5
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| LIQUIDITY AND CAPITAL RESOURCES | 26 |
| MANAGEMENT | 27 |
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34
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PART II
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II-1
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II-2
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II-3
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II-3
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II-4
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II-6
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SUMMARY OF OUR OFFERING
Drewrys Brewing Company has 9,000,000 shares of common stock issued and outstanding and is registering an additional 3,000,000 shares of common stock for offering to the public. The company plans to sell all 3,000,000 shares of common stock after this registration becomes effective. The price at which the company offers these shares is fixed at $0.10 per share for the duration of the offering.
Drewrys Brewing Company will receive all proceeds from the sale of the common stock.
3,000,000 shares of common stock are offered by the company.
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Offering price per share by the company
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The price, if and when the company sells the shares of common stock, is set at $0.10.
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Number of shares outstanding before the offering of common shares
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9,000,000 common shares are currently issued and outstanding.
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Number of shares outstanding after the offering of common shares
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12,000,000 common shares will be issued and outstanding after this offering is completed if all shares are sold. If the offering is not fully subscribed, less than 12,000,000 will be outstanding after the offering. For example, if the Company sells 50% of the total offering of 3,000,000 shares of common stock, the Company will have issued and outstanding 10,500,000 shares of its common stock after the offering.
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The minimum number of shares to be sold in this offering
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None.
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Market for the common shares
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There is no public market for the common shares. The shares are being offered at $0.10 per share. Drewrys may not be able to meet the requirement for a public listing or quotation of its common stock. Further, even if Drewrys’ common stock is quoted or granted listing, a market for the common shares may not develop. If a market develops, the price of the shares in the market may not be greater than or equal to the price in this offering.
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Use of proceeds
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The Company intends to use the proceeds of this offering to further the business and marketing plan, and for other general corporate and working capital purposes. The expenses of this offering, including the preparation of this prospectus and the filing of this registration statement, estimated at $8,000, are being paid for by Drewrys. The net proceeds will be the gross proceeds from the offering less the expenses of $8,000. Therefore, if the all shares are sold in the offering, the net proceeds will be $292,000 ($30,000 Gross proceeds - $8,000 expenses). If only 50% of the shares are
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sold, the net proceeds will be $142,000 ($150,000 gross - $8,000 of expenses). The proceeds will be used first for essential business operations (ex. SEC filings, audit, etc.) and the remaining portion will be used to further the development of the business and marketing plan. None of the proceeds will be used for product development.
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Termination of the offering
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The offering will conclude at the earlier of when all 3,000,000 shares of common stock have been sold, or 120 days after this registration statement is declared effective by the Securities and Exchange Commission.
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Terms of the offering
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The Company's President, Chief Executive Officer, Sole Member of the Board of Directors Chief Financial Officer Principal Accounting Officer Secretary will sell the common stock upon effectiveness of this registration statement.
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Risk Factors
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You should read the "Risk Factors" section beginning on page 5 and consider these factors carefully before deciding to invest in shares of our common stock.
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You should rely only upon the information contained in this prospectus. Drewrys has not authorized anyone to provide you with information different from that which is contained in this prospectus. Drewrys is offering to sell shares of common stock and seeking offers to buy shares of common stock only in jurisdictions where offers and sales are permitted. The information contained in this prospectus is accurate only as of the date of this prospectus, regardless of the time of delivery of this prospectus, or of any sale of the common stock.
This summary provides an overview of selected information contained in this prospectus. It does not contain all the information that you should consider before making a decision to purchase the shares offered by Drewrys. You should very carefully and thoroughly read the more detailed information in this prospectus and review our financial statements.
SUMMARY INFORMATION ABOUT DREWRYS
Drewrys plans to create and market a line of low priced beers under the Drewrys trademark and craft beers under the Holihan brand name. Depending upon the success of the Drewrys and Holihan brands, eventually other brand names would be created. Drewrys' first product will be a Drewrys branded beer. The name DREWRYS was granted trademark status by the United States Patent and Trademark Office on August 10th, 2010. Drewrys was a beer brand with a heritage dating back to 1878 that was distributed in the Great Lakes region of the United States and disappeared from production in the 1990’s. The Company holds a trademark for the name HOLIHAN and was granted trademark status by the United States Patent and Trademark Office on September 7th, 2010. The Company also holds a trademark for CANADIAN ACE that was issued by the State of Illinois on March 6h, 2006. Ownership of all of these trademarks was transferred to the Company from the previous owner, Francis Manzo, the President of the Company.
Drewrys's plan is to sell to distributors only, targeting select distributors that specialize in lower priced and craft beers which is a growing category. The Company has identified four segments in the retail industry: Warehouse Club store, grocery chain-retailers, liquor and beer stores and convenience store retailers.
As of the date of this prospectus, we have not generated any revenue from our business operations.
The Company's business and marketing plans have not been completed and are subject to change.
The Company's auditors have raise substantial doubt as to the Company's ability to continue as a going concern.
Our business and registered office is located at the residence of Mr. Francis Manzo located at 5402 Brittany Drive, McHenry, IL 60050. Our contact number is 815-575-4815.
As of December 31, 2010, Drewrys had $100 of cash on hand in the corporate bank account. The Company currently has incurred liabilities of $6,950 as of December 31, 2010. The Company anticipates incurring costs associated with this offering totaling approximately $8,000.
The following financial information summarizes the more complete historical financial information found in the audited financial statements of the Company filed with this prospectus.
SUMMARY FINANCIAL DATA
The following summary financial data should be read together with our financial statements and the related notes and "Management's Discussion and Analysis or Plan of Operation" appearing elsewhere in this prospectus. The summary financial data is not intended to replace our financial statements and the related notes. Our historical results are not necessarily indication of the results to be
expected for any future period.
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BALANCE SHEET
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AS OF
DECEMBER 31, 2010
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Total Assets
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$ | 1,160 | ||
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Total Liabilities
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$ | 6,950 | ||
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Shareholder's Equity/(Deficit)
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$ | (5,790 | ) | |
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YEAR ENDED
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INCEPTION TO
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OPERATING DATA
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DECEMBER 31, 2010
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DECEMBER 31, 2010
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Revenue
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$ | 0 | $ | 0 | ||||
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Net Loss
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$ | 8,399 | $ | 8,399 | ||||
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Net Loss Per Share *
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$ | . 0.001 | $ | 0.001 | ||||
* Diluted loss per share is identical to basic loss per share as the Company has no potentially dilutive securities outstanding.
As indicated in the financial statements accompanying this prospectus, Drewrys has had no revenue to date and has incurred only losses since inception. The Company has had no operations and has been issued a "going concern" opinion from their auditors, based upon the Company's reliance upon the sale of our common stock as the sole source of funds for our future operations.
The company does not own any real estate or other properties. The company's office is located at 5402 Brittany Drive, McHenry, Illinois 60050. The business office is located at the residence of Francis Manzo, the CEO, of the company at no charge.
Please consider the following risk factors and other information in this prospectus relating to our business and prospects before deciding to invest in our common stock.
This offering and any investment in our common stock involves a high degree of risk. You should carefully consider the risks described below and all of the information contained in this prospectus before deciding whether to purchase our common stock. If any of the following risks actually occur, our business, financial condition and results of operations could be harmed.
The Company considers the following to be the material risks for an investor regarding this offering. Drewrys should be viewed as a high-risk investment and speculative in nature. An investment in our common stock may result in a complete loss of your entire investment. Please consider the following risk factors before deciding to invest in our common stock.
RISKS RELATED TO OUR FINANCIAL CONDITION AND CAPITAL REQUIREMENTS
AUDITOR'S GOING CONCERN
THERE IS SUBSTANTIAL UNCERTAINTY ABOUT THE ABILITY OF DREWRYS BREWING COMPANY TO CONTINUE ITS OPERATIONS AS A GOING CONCERN
In their audit report for the period ending December 31, 2010 and dated March 29, 2011; our auditors have expressed an opinion that substantial doubt exists as to whether we can continue as an ongoing business. Because our sole officer may be unwilling or unable to loan or advance any additional capital to Drewrys Brewing Company, we believe that if we do not raise additional capital within 12 months of the effective date of this registration statement, we may be required to suspend or cease the development of our business and marketing plans. Due to the fact that there is no minimum investment and no refunds on sold shares, you may be investing in a Company that will not have the funds necessary to develop its business strategies. As such we may have to cease operations and you could lose your entire investment. See the December 31, 2010 Audited Financial Statements - Auditors Report". Because the Company has been issued an opinion by its auditors that substantial doubt exists as to whether it can continue as a going concern it may be more difficult to attract investors.
SINCE DREWRYS ANTICIPATES OPERATING EXPENSES WILL INCREASE PRIOR TO GENERATING A PRODUCT FOR SALE, IT MAY NEVER ACHIEVE PROFITABILITY AND IF THE COMPANY CAN NOT ACHIEVE PROFITABILITY OR RAISE ADDITIONAL CAPITAL, IT MAY FAIL RESULTING IN A COMPLETE LOSS OF YOUR INVESTMENT
The Company must complete the business and marketing plans before any product and packaging development can start. Over the next twelve months, the Company anticipates increasing its operating expenses and will need $50,000 to complete the business and marketing plan and to fund initial basic operations of the Company.
There is no history upon which to base any assumption as to the likelihood that the Company will be successful in creating a product. We cannot provide investors with any assurance that if we create a craft beer product, that we will be successful in attracting customers and have the ability to generate any revenue. If we are unable to address these risks, there is a high probability that our business can fail, which will result in the loss of your entire investment.
OUR BUSINESS WILL FAIL IF WE DO NOT OBTAIN ADEQUATE FINANCING, RESULTING IN THE COMPLETE LOSS OF YOUR INVESTMENT
We will require additional financing to sustain our business operations. Over the next 12 months, we anticipate needing at least $25,000 to complete the marketing and business plan and other operating expenses. Currently, we do not have any arrangements for financing and can provide no assurances to investors that we will be able to obtain any when required. If we don't raise additional capital, our business will fail.
OUR LACK OF AN OPERATING HISTORY GIVES NO ASSURANCE THAT OUR FUTURE OPERATIONS WILL RESULT IN ANY REVENUES, WHICH COULD RESULT IN THE SUSPENSION OR TERMINATION OF OUR OPERATIONS AND INVESTORS MAY LOOSE THEIR ENTIRE INVESTMENT
We were incorporated in Nevada on October 11, 2010 and subsequently acquired the registered trademarks to the names DREWRYS, HOLIHAN and CANADIAN ACE from the President and Founder of the Company, Francis Manzo. Ownership was transferred by a ‘Bill of Sale’ Document on October 15, 2010. We have not created or sold any beer product which is required to generate revenue. We are an early entry stage company in a very competitive market. We have no operating history upon which an evaluation of our future success or failure can be made.
Based upon current plans, we expect to incur operating losses in future periods because we will be incurring expenses and not generating revenues because we don't have a product. If and when we have a product, we cannot guarantee that we will be successful in generating revenues in the future. Failure to generate revenues will cause us to go out of business and you will lose your entire investment.
SOURCE OF BEER FOR OUR BRANDS
To manufacture beer for us, we need to work with contract brewers to brew beer for us in the types and styles we plan to market. We may not be able to come to an agreement with a contract brewer to brew for us due to costs, production runs, time required to brew beer and have available for us when we have a order to deliver. Contract brewers may also have requirements and that we may be too small for them to work with us.
OUR OPERATING RESULTS MAY PROVE UNPREDICTABLE WHICH MAY IMPACT THE COMPANY AND THE VALUE OF THE INVESTMENT
Our operating results are likely to fluctuate significantly in the future due to a variety of factors, many of which we have no control over. Currently, we don't have a product or prototype. Factors that may cause our operating results to fluctuate significantly include: our inability to generate enough working capital from future equity sales, our ability to hire key personnel to help launch our product, our inability to source a contract brewer to manufacture and package our lower-priced and craft beer product, and Mr. Manzo's time allocation to drive the business. If and when we are able to create a craft beer product, the risk factors include: the level of acceptance by the beer distributors and wholesalers retail market for our craft beer products; competitive landscape with other product suppliers, pricing, fluctuations in the demand for our product, and capital expenditures relating to expansion of our future business, operations and infrastructure and general economic conditions. If realized, any of these risks could have a materially adverse effect on our business, financial condition and operating results.
THE COMPANY'S SOLE OFFICER AND DIRECTOR MAY NOT BE IN A POSITION TO DEVOTE A MAJORITY OF HIS TIME TO THE COMPANY, WHICH MAY RESULT IN PERIODIC INTERRUPTIONS AND EVEN BUSINESS FAILURE.
Mr. Manzo, our sole officer and director, has other business interests and currently devotes approximately 20 to 25 hours per week to our operations. If Mr. Manzo is not able to devote sufficient time to run the Company, this may result in periodic interruptions in developing our business. Such delays could have a significantly negative effect on the success of the business.
THE CEO MAY LEAVE THE COMPANY WHICH COULD ADVERSELY AFFECT THE ABILITY OF THE COMPANY TO CONTINUE OPERATIONS. IF THE COMPANY CEASES OPERATIONS, YOU WILL LOSE YOUR INVESTMENT
Because the Company is entirely dependent on the efforts of its CEO, sole officer and director, his departure or the loss of other key personnel in the future could have a materially adverse effect on the business. His expertise in the consumer products and beverage industry as well as his marketing expertise is critical to the success of the business. The loss of this resource would have a significant impact on our business.
The Company does not maintain key person life insurance on its sole officer and director. The loss of his services will materially impact the business and we might have to cease operations if a replacement cannot be found on a timely basis.
IF THE COMPANY CEASES OPERATIONS, IT IS HIGHLY LIKELY THAT THERE WILL NOT BE SUFFICIENT ASSETS TO SELL AND RETURN THAT CAPITAL TO INVESTORS. UNDER THESE CIRCUMSTANCES, YOU WILL LOSE YOUR INVESTMENT.
In the event of the dissolution of the Company, the proceeds realized from the liquidation of its assets, if any, will be used primarily to pay the claims of the Company's creditors, if any, before there can be any distribution to the shareholders. In that case, the ability of purchasers of the offered shares to recover all or any portion of the purchase price for the offered shares will depend on the amount of funds realized, if any, after the settlement of claims.
RISKS RELATED TO THE COMPANY'S MARKET AND STRATEGY
IF, AFTER DEMONSTRATING PRODUCTION OF A CRAFT BEER, WE ARE UNABLE TO ESTABLISH RELATIONSHIPS WITH DISTRIBUTION PARTNERS AND/OR CUSTOMERS, THE BUSINESS WILL FAIL.
Because there may be a substantial delay between the completion of this offering and the execution of the business plan, our expenses may be increased and it may take us longer to generate revenues. We have no way to predict when we will begin delivering our products. In addition, it takes time, money, and resources to build relationships with distributor customers, contract brewers, and supplier partners. If these efforts are unsuccessful or take longer than anticipated, the Company may run out of capital and the business will fail.
WE MAY BE UNABLE TO GAIN ANY SIGNIFICANT MARKET ACCEPTANCE FOR OUR PRODUCTS OR ESTABLISH A SIGNIFICANT MARKET PRESENCE WITH THE RETAILERS AND CONSUMERS. IF WE CAN NOT GAIN MARKET ACCEPTANCE, WE WILL NOT BE ABLE TO GENERATE REVENUE AND OUR BUSINESS WILL FAIL.
The Company's growth strategy is substantially dependent upon its ability to market its future products successfully to beer distributors and wholesalers and retailers who sell beer. However, it may be very difficult to achieve significant acceptance and product appeal, competition, and other factors outside of the Company's control. Such acceptance, if achieved, may not be sustained for any significant period of neither time nor build to an acceptable volume that is sufficient to maintain our business. In addition, there is no guarantee that any acceptance by customers will remain. Failure of the Company's products to achieve or sustain market acceptance could have a materially adverse effect on our business, financial conditions and the results of our operations.
OBTAINING CONTRACTS TO SELL PRODUCTS WITH RETAILERS CARRYING BEER IS VERY DIFFICULT AND TIME CONSUMING. WITHOUT THESE TYPES OF CONTRACTS, THE COMPANY WILL NOT BE ABLE TO SELL ITS PRODUCTS AND ITS BUSINESS WILL FAIL.
In the beer and liquor section in retail locations, shelf space is very expensive and difficult to obtain. Since we are a small early stage company, it will be very time consuming and expensive to obtain the types of contracts which are required to sell our products. If we are not able to secure these contracts, we will not be able to sell our product and our business will fail.
THE DISTRIBUTORS GENERALLY SELL PRODUCTS IN HIGH VOLUMES BUT HAVE VERY LOW MARGINS. WE MUST BE ABLE TO OPERATE OUR BUSINESS TO SUPPLY THESE DISTRIBUTOR PARTNERS WITH PRODUCT VOLUMES THAT FIT WITH THEIR BUSINESS. IF WE ARE NOT ABLE TO SERVICE THESE DISTRIBUTOR PARTNERS AND MATCH THEIR VOLUME REQUIREMENTS, WE WILL LOSE THEM AS DISTRIBUTOR PARTNERS, OUR REVENUES WILL FALL, AND WE MIGHT HAVE TO CEASE OPERATION WHICH COULD RESULT IN A LOSS OF YOUR INVESTMENT.
The Company expects to sell products through a small number of liquor and beer wholesalers and distributors who in turn sell to the retailer for consumer purchase. These retailers will require that we accommodate certain volume requirements to remain on their shelves, and if we cannot accommodate those volume requirements, they might choose to discontinue selling our products. If we lose a distribution partner, our revenues will be materially impacted and we might have to cease operations. If these circumstances occur, investors will lose their investment.
THE COMPANY ANTICIPATES THAT ESTABLISHING AND MAINTAINING A CUSTOMER BASE IN THE MIDWEST AND EASTERN REGIONS OF THE COUNTRY. THIS MAY BE DIFFICULT TO ACHIEVE ESPECIALLY SINCE CONSUMERS ARE ALWAYS COST CONSCIENCE. IF WE CAN NOT ATTRACT A CUSTOMER BASE, WE FACE A HIGH RISK OF BUSINESS FAILURE WHICH WOULD RESULT IN THE LOSS OF YOUR INVESTMENT.
The Company expects that attracting, building and managing a retail customer base through the efforts of the independent distributor is very difficult to accomplish in the beer retailer market space. Customers are very cost sensitive and will switch to any other product based on cost or taste. We plan to provide a product that is great tasting and economical. Accordingly, when we are ready, if we cannot build a consistent customer base, our future sales and operating results will be negatively impacted and our business could fail.
RISKS RELATED TO INVESTING IN OUR BUSINESS
IF THE COMPANY ENCOUNTERS ADDITIONAL EXPENSES OR CHARGES AND CAN NOT RESOLVE THEM AT ACCEPTABLE COSTS, THE COMPANY WILL RUN OUT OF CAPITAL AND MAY CAUSE US TO CEASE OPERATIONS.
Because we are a small business, with limited assets, we are not in a position to assume unanticipated costs and expenses. If we encounter these type of circumstances and do not have the financial resources to fix them, we may have to suspend operations or cease operations entirely which could result in a total loss of your investment.
THE COMPANY MAY RETAIN INDEPENDENT RESOURCES OR CONSULTANTS TO HELP GROW THE BUSINESS. IF THESE RESOURCES DO NOT PERFORM, THE COMPANY MAY HAVE TO CEASE OPERATIONS AND YOU MAY LOSE YOUR INVESTMENT.
The company's management may retain independent contractors to provide services to the company. Those independent individuals and organizations have no fiduciary duty to the shareholders of the company and may not perform as expected.
THE BEER MARKET IS A MATURE MARKET WITH AGGRESSIVE COMPETITION ON PRICING, SERVICES AND SUPPORT. FAILURE TO PROVIDE ATTRACTIVE MARGINS AND ADEQUATE SERVICES AND SUPPORT TO DISTRIBUTORS AND RETAILERS WILL RESULT IN DECREASED REVENUES. WITHOUT REVENUES OUR BUSINESS WILL FAIL.
The Company believes the beer market is very competitive and aggressive on pricing, service, and support. Competitors may enter this sector with superior products, services, financial resources, conditions and/or benefits. This would infringe on our ability to attract customers, lengthen our sales cycle, increase marketing costs, which in turn will have an adverse effect upon our business and the results of our operations.
COMPETITION MAY DECREASE OUR FUTURE ABILITY TO GAIN CUSTOMERS AND MARKET SHARE.
Several of our competitors have substantially more capital, longer operating histories, greater brand recognition, larger distributors and customer bases than we do. The competitors include Anheuser-Busch InBev, The Molson/Coor’s joint venture, Pabst Brewing, Samuel Adams Brewing, Heineken, Goose Island Brewing, and numerous other import and craft brewers. The brewery we select to act as a co-packer and brewer for our products will also be considered a competitor.
These competitors may also adopt more aggressive pricing policies and establish more comprehensive marketing and advertising campaigns than we can. Our competitors may develop product offerings that we do not offer or that are more sophisticated or more cost effective. For these and other reasons, our competitors' products may achieve greater acceptance in the marketplace, limiting our ability to attract customers. Our failure to adequately address these factors could harm our business and operating results.
RISKS RELATED TO THIS OFFERING
BECAUSE THERE IS NO PUBLIC TRADING MARKET FOR OUR COMMON STOCK, YOU MAY NOT BE ABLE TO RESELL YOUR STOCK AND NOT BE ABLE TO TURN YOUR INVESTMENT INTO CASH
There is currently no public trading market for Drewrys' common stock. Therefore, there is no central place, such as a stock exchange or electronic trading system, to resell your shares. If you do want to resell your shares, you will have to locate a buyer and negotiate your own sale.
INVESTING IN OUR COMPANY WILL RESULT IN AN IMMEDIATE LOSS BECAUSE BUYERS WILL PAY MORE FOR OUR COMMON STOCK THAN THE PRO RATA PORTION OF THE ASSETS ARE WORTH
The Company has only been recently formed and has only a limited operating history and no earnings, therefore, the price of the offered shares is not based on any data. The offering price and other terms and conditions regarding the Company's shares have been arbitrarily determined and do not bear any relationship to assets, earnings, book value or any other objective criteria of value. No investment banker, appraiser or other independent third party has been consulted concerning the offering price for the shares or the fairness of the offering price used for the shares.
The offering price of $0.10 per common share as determined herein is substantially higher than the net tangible book value per share of the Company's common stock. Drewrys' assets do not substantiate a share price of $0.10.
This premium in share price applies to the terms of this offering and does not attempt to reflect any forward looking share price subsequent to the Company obtaining a listing on any exchange, or becoming quoted on the OTC Bulletin Board.
THERE IS NO MINIMUM AMOUNT REQUIRED TO BE RAISED IN THIS OFFERING, AND IF WE CANNOT GENERATE SUFFICIENT FUNDS FROM THIS OFFERING, THE BUSINESS WILL FAIL.
There is not a minimum amount of shares that need to be sold in this Offering for the Company to access the funds. Therefore, the proceeds of this Offering will be immediately available for use by us and we don't have to wait until a minimum number of Shares have been sold to keep the proceeds from any sales. We cannot assure you that subscriptions for the entire Offering will be obtained. We have the right to terminate the offering of the Shares at any time, regardless of the number of Shares we have sold since there is no minimum subscription requirement. Our ability to meet our financial obligations, cash needs, and to achieve our objectives, could be adversely affected if the entire offering of shares is not fully subscribed for.
BECAUSE THE COMPANY HAS 75,000,000 AUTHORIZED SHARES, MANAGEMENT COULD ISSUE ADDITIONAL SHARES, DILUTING THE CURRENT SHAREHOLDERS' EQUITY
The Company has 75,000,000 authorized shares, of which only 9,000,000 are currently issued and outstanding and an up to a maximum amount of 12,000,000 will be issued and outstanding after this offering terminates if the full offering is subscribed. The Company's management may, without the consent of the existing shareholders, issue substantially more shares, causing a large dilution in the equity position of the Company's current shareholders.
Additionally, large share issuances would generally have a negative impact on the Company's share price. It is possible that, due to additional share issuance, you could lose a substantial amount, or all, of your investment.
INVESTING IN THE COMPANY IS HIGHLY SPECULATIVE AND COULD RESULT IN THE ENTIRE LOSS OF YOUR INVESTMENT
Purchasing the offered shares is highly speculative and involves significant risk. The offered shares should not be purchased by any person who cannot afford to lose their entire investment. The business and marketing plan of the Company is not completed, and it is possible that we may be unable to finish it. The Company's shareholders may be unable to realize a substantial or any return on their purchase of the offered shares and may lose their entire investment. For this reason, each prospective purchaser of the offered shares should read this prospectus and all of its exhibits carefully and consult with their attorney, business and/or investment advisor.
AS WE DO NOT HAVE AN ESCROW OR TRUST ACCOUNT WITH SUBSCRIPTIONS FOR INVESTORS, IF WE FILE FOR OR ARE FORCED INTO BANKRUPTCY PROTECTION, THEY WILL LOSE THE ENTIRE INVESTMENT
Invested funds for this offering will not be placed in an escrow or trust account and if we file for bankruptcy protection or a petition for involuntary bankruptcy is filed by creditors against us, your funds will become part of the bankruptcy estate and administered according to the bankruptcy laws. As such, you will lose your investment and your funds will be used to pay creditors.
THE COMPANY DOES NOT ANTICIPATE PAYING DIVIDENDS IN THE FORESEEABLE FUTURE, SO THE ONLY WAY IN WHICH YOU CAN MAKE A GAIN ON ANY INVESTMENT IN THIS COMPANY IS TO SELL THE STOCK IF AND ONLY IF A MARKET DEVELOPS.
We do not anticipate paying dividends on our common stock in the foreseeable future, but plan rather to retain earnings, if any, for the operation growth and expansion of our business. Therefore, the only way to liquidate your investment is to sell your stock.
IN THE EVENT THAT THE COMPANY'S SHARES ARE TRADED, THEY MAY TRADE UNDER $5.00 PER SHARE AND THUS WILL BE A PENNY STOCK. TRADING IN PENNY STOCKS HAS MANY RESTRICTIONS AND THESE RESTRICTIONS COULD ADVERSELY AFFECT THE PRICE AND LIQUIDITY OF THE COMPANY'S SHARES CREATING A POTENTIAL LOSS OF INVESTMENT
In the event that our shares become publicly traded, and our stock trades below $5.00 per share, our stock would be known as a "penny stock", which is subject to various regulations involving disclosures to be given to you prior to the purchase of any penny stock. The U.S. Securities and Exchange Commission (the "SEC") has adopted regulations which generally define a "penny stock" to be any equity security that has a market price of less than $5.00 per share, subject to certain exceptions. Depending on market fluctuations, our common stock could be considered to be a "penny stock". A penny stock is subject to rules that impose additional sales practice requirements on broker/dealers who sell these securities to persons other than established customers and accredited investors. For transactions covered by these rules, the broker/dealer must make a special suitability determination for the purchase of these securities. In addition, he must receive the purchaser's written consent to the transaction prior to the purchase. He must also provide certain written disclosures to the purchaser. Consequently, the "penny stock" rules may restrict the ability of broker/dealers to sell our securities, and may negatively affect the ability of holders of shares of our common stock to resell their shares. These disclosures require you to acknowledge that you understand the risks associated with buying penny stocks and that you can afford the loss of your entire investment. Penny stocks are low priced securities that do not have a very high trading volume. Consequently, the price of the stock is often volatile and you may not be able to buy or sell the stock when you want to.
BLUE SKY LAWS MAY LIMIT YOUR ABILITY TO SELL YOUR SHARES. IF THE STATE LAWS ARE NOT FOLLOWED, YOU WILL NOT BE ABLE TO SELL YOUR SHARES AND YOU MAY LOSE YOUR INVESTMENT
State Blue Sky laws may limit resale of the Shares. The holders of our shares of common stock and persons who desire to purchase them in any trading market that might develop in the future should be aware that there may be significant state law restrictions upon the ability of investors to resell our shares.
Accordingly, even if we are successful in having the Shares listed for trading on the Over-The-Counter Bulletin Board (the “OTCBB"), investors should consider any secondary market for the Company's securities to be limited.
SINCE OUR SOLE OFFICER AND DIRECTOR CURRENTLY OWNS 100% OF THE OUTSTANDING COMMON STOCK, INVESTORS MAY FEEL THAT HIS DECISIONS ARE CONTRARY TO THEIR INTERESTS
The Company's sole officer and director, Mr. Francis Manzo, owns 100% of the outstanding shares and will own no less than 75% after this offering is completed. For example, if 50% of the offering is sold, Mr. Manzo will still own 85.7% of the shares issued and outstanding. As a result, he will maintain control of the Company and be able to choose all of our directors. His interests may differ from those of other stockholders. Factors that could cause his interests to differ from the other stockholders include the impact of corporate transactions on the timing of business operations and his ability to continue to manage the business given the amount of time he is able to devote to the Company.
FORWARD-LOOKING STATEMENTS
This prospectus contains certain forward-looking statements regarding management's plans and objectives for future operations, including plans and objectives relating to our planned entry into our service business. The forward-looking statements and associated risks set forth in this prospectus include or relate to, among other things, (a) our projected profitability, (b) our growth strategies, (c) anticipated trends in our industry, (d) our ability to obtain and retain sufficient capital for future operations, and (e) our anticipated needs for working capital. These statements may be found under "Management's Discussion and Analysis or Plan of Operation" and "Description of Business," as well as in this prospectus generally. Actual events or results may differ materially from those discussed in these forward-looking statements as a result of various factors, including, without limitation, the risks outlined under "Risk Factors" and matters described in this prospectus generally. In light of these risks and uncertainties, the forward-looking statements contained in this prospectus may not in fact occur.
The forward-looking statements herein are based on current expectations that involve a number of risks and uncertainties. Such forward-looking statements are based on the assumptions that we will be able to continue our business strategies on a timely basis, that we will attract customers, that there will be no materially adverse competitive conditions under which our business operates, that our sole officer and director will remain employed as such, and that our forecasts accurately anticipate market demand. The foregoing assumptions are based on judgments with respect to, among other things, future economic, competitive and market conditions, and future business decisions, all of which are difficult or impossible to predict accurately and many of which are beyond our control. Accordingly, although we believe that the assumptions underlying the forward-looking statements are reasonable, any such assumption could prove to be inaccurate and therefore there can be no assurance that the results contemplated in forward-looking statements will be realized. In addition, as disclosed elsewhere in this "Risk Factors" section of this prospectus, there are a number of other risks inherent in our business and operations, which could cause our operating results to vary markedly and adversely from prior results or the results contemplated by the forward-looking statements. Increases in the cost of our services, or in our general or administrative expenses, or the occurrence of extraordinary events, could cause actual results to vary materially from the results contemplated by these forward-looking statements.
Management decisions, including budgeting, are subjective in many respects and subject to periodic revisions in order to reflect actual business conditions and developments. The impact of such conditions and developments could lead us to alter our marketing, capital investment or other expenditures and may adversely affect the results of our operations. In light of the significant uncertainties inherent in the forward-looking information included in this prospectus, the inclusion of such information should not be regarded as a representation by us or any other person that our objectives or plans will be achieved.
Our offering is being made on a self-underwritten basis: no minimum number of shares must be sold in order for the offering to proceed. The offering price per share is $0.10. The following table sets forth the potential net proceeds and the uses of proceeds assuming the sale of 25%, 50%, 75% and 100%, respectively, of the securities offered for sale by the Company.
|
IF 25% OF
|
IF 50% OF
|
IF 75% OF
|
IF 100% OF
|
||||
|
SHARES SOLD
|
SHARES SOLD
|
SHARES SOLD
|
SHARES SOLD
|
||||
|
NET PROCEEDS FROM THIS OFFERING
|
$67,000
|
$142,000
|
$217,000
|
$292,000
|
Our offering is being made on a self-underwritten basis: no minimum number of shares must be sold in order for the offering to proceed. The offering price per share is $0.10. The net proceeds in the table above assume $8,000 in costs associated with this offering.
The funds raised through this offering will first be used to cover mandatory operating expenses over the next year such as public company requirements with audit, SEC filings, and reporting. We anticipate these costs to be approximately $7,000-8,000 which are expected to last until the end of the Company's fiscal year. The balance of the funds raised will be used to complete the business and marketing plan, and the packaging designs.
The business and marketing and packaging design plan must be completed before any product distribution agreement starts. We plan to raise a subsequent round of capital after this offering and will use those proceeds to implement the business plan. We anticipate the implementation will cost approximately $25,000. The additional capital will be allocated toward product development, marketing, and the remaining toward contract brewing. The costs associated with this plan include hiring brewing industry consultants), costing $10,000 and the balance of $282,000 for product marketing, finished goods inventory and general working capital purposes. These resources will create the marketing and product strategy, manufacturing strategy, business operations, and develop a financial plan that estimates the cost to design, manufacture and bring the first beer product to market in order to start generating revenues. These resources will estimate these costs based on their experience. There can be no assurances by the Company that these strategies and estimates will not change in the future. The Company will not use any of the offering proceeds for product development.
The following table sets forth the use of the proceeds from this offering:
|
If Maximum Amount Sold
|
If Less Than
|
The Maximum
|
Amount Sold
|
||||
|
100%
|
75%
|
50%
|
25%
|
||||
|
Net Proceeds*
|
$292,000
|
$217,000
|
$142,000
|
$67,000
|
|||
|
Business Planning and Strategy
|
25,000
|
25,000
|
25,000
|
25,000
|
|||
|
New Product Development and Design
|
10,000
|
10,000
|
10,000
|
10,000
|
|||
|
Raw Materials and Packaging
|
50,000
|
50,000
|
50,000
|
20,000
|
|||
|
Marketing and Selling
|
100,000
|
75,000
|
50,000
|
12,000
|
|||
|
Finished Goods Inventory
|
100,000
|
50,000
|
0
|
0
|
|||
|
Working Capital
|
7,000
|
7,000
|
7,000
|
0
|
|||
|
Total Use of Net Proceeds
|
$292,000
|
$217,000
|
$142,000
|
$67,000
|
* Assumes offering costs of $8,000
Should the Company raise less than the maximum amount, the Company may be forced to extend or file additional offerings to conduct normal business operation in order to achieve its proposed business plan. Because actual beer brewing production will be done by third parties, the amount of capital required to have a finished product ready for the market is substantially reduced. The majority of proceeds will be used for marketing the product to the wholesalers and distributors that will contact the retail stores, restaurants and taverns/bars in the trade area the Company has targeted. These marketing dollars will be for such items as drinking glasses and coasters, neon signs, cardboard signs, billboards, pictures of the Company’s products on delivery trucks, advertisements in retailers sales sheets and promotions, and other beer related merchandise.
The Company, in the normal course of business, may become aware of possible acquisition candidates of business entities or trademarks. The Company could use part of the proceeds from this offering to acquire such assets providing the transaction benefited the Company in its efforts to expand the number of beer brands and types offered. The Company may also use its stock for such transactions. It is the Company intention to use limited leverage to acquire any businesses or trademark. In the current economic environment, bank financings are not available, so all transactions will likely be for cash and stock.
The Company may form or acquire additional trademarks and brands, and may acquire smaller business entities with trademarks and business platforms that will be able to maximize full the Company’s trademarks’ potential. We believe we will be able to meet these costs through use of funds in our treasury, through deferral of fees by certain service providers and additional amounts, as necessary, to be loaned to or invested in us by our stockholders, management or other investors.
The Company may consider acquisitions of business entities in related fields. Such a company may be in need of additional funds for expansion into new products or markets, is seeking to develop a new product or service, or is an established business which may be experiencing financial or operating difficulties and is in need of additional capital. In the alternative, a business combination with such a company may involve the acquisition of or merger with the company which may require additional capital.
Any target business that is selected may be a financially unstable company or an entity in its early stages of development or growth, including entities without established records of sales or earnings. In that event, we will be subject to numerous risks inherent in the business and operations of financially unstable and early stage or potential emerging growth companies. In addition, we may effect a business combination with an entity in an industry characterized by a high level of risk, and, although our management will endeavor to evaluate the risks inherent in a particular target business, there can be no assurance that we will properly ascertain or assess all significant risks.
In addition, the increase in equity capital will provide a greater interest in the public market for the Common Stock and to facilitate future acquisitions of complimentary business by offering the Company’s stock for such acquisitions and mergers.
The funds raised through this offering will first be used to cover mandatory operating expenses over the next year such as public company requirements with audit, SEC filings, and reporting. We anticipate these costs to be approximately $7,000-8,000 which are expected to last until the end of the Company's fiscal year. The balance of the funds raised will be used to complete the business and marketing plan, and the packaging designs.
The business and marketing and packaging design plan must be completed before any product distribution agreement starts. We plan to raise a subsequent round of capital after this offering and will use those proceeds to implement the business plan. We anticipate the implementation will cost approximately $25,000. The additional capital will be allocated toward product development, marketing, and the remaining toward contract brewing. The costs associated with this plan include hiring brewing industry consultants), costing $10,000 and the balance of $285,000 for product marketing and general working capital purposes. These resources will create the marketing and product strategy, manufacturing strategy, business operations, and develop a financial plan that estimates the cost to design, manufacture and bring the first beer product to market in order to start generating revenues. These resources will estimate these costs based on their experience. There can be no assurances by the Company that these strategies and estimates will not change in the future. The Company will not use any of the offering proceeds for product development.
DETERMINATION OF OFFERING PRICE
As there is no established public market for our shares, the offering price and other terms and conditions relative to our shares have been arbitrarily determined by Drewrys and do not bear any relationship to assets, earnings, book value, or any other objective criteria of value. In addition, no investment banker, appraiser, or other independent third party has been consulted concerning the offering price for the shares or the fairness of the offering price used for the shares.
The price of the current offering is fixed at $0.10 per share. This price is significantly greater than the price paid by the company's sole officer and director for common equity since the company's inception on October 11, 2010. The company's sole officer and director paid $0.001 per share at par value, a difference of $0.099 per share lower than the share price in this offering.
DILUTION OF THE PRICE YOU PAY FOR YOUR SHARES
Dilution represents the difference between the offering price and the net tangible book value per share immediately after completion of this offering. Net tangible book value is the amount that results from subtracting total liabilities and intangible assets from total assets. Dilution arises mainly as a result of our arbitrary determination of the offering price of the shares being offered. Dilution of the value of the shares you purchase is also a result of the lower book value of the shares held by our existing stockholders. The following tables compare the differences of your investment in our shares with the investment of our existing stockholders.
EXISTING SHAREHOLDER PER SHARE DATA IF ALL OF THE SHARES ARE SOLD
|
Price per share
|
$ | 0.10 | ||
|
Net tangible book value per share before offering
|
$ | 0.0006 | ||
|
Potential gain to existing shareholders
|
$ | 0.0909 | ||
|
Net tangible book value per share after offering ..
|
$ | 0.025 | ||
|
Increase to present stockholders in net tangible book value per share after offering
|
$ | 0.0909 | ||
|
Capital contributions
|
$ | 9,000 | ||
|
Number of shares outstanding before the offering
|
9,000,000 | |||
|
Number of shares after offering held by existing stockholders
|
9,000,000 | |||
|
Percentage of ownership after offering
|
75 | % |
PURCHASERS PER SHARE DATA AND OWNERSHIP OF SHARES IN THIS OFFERING IF ALL SHARES SOLD
|
Price per share
|
$ | 0.10 | ||
|
Dilution per share
|
$ | 0.075 | ||
|
Net Capital contributions
|
$ | 300,000 | ||
|
Percentage of capital contributions (gross)
|
77 | % | ||
|
Number of shares after offering held by public investors
|
3,000,000 | |||
|
Percentage of ownership after offering
|
25 | % |
THE OFFERING BY THE COMPANY
Drewrys is registering 3,000,000 shares of its common stock for offer and sale.
There is currently no active trading market for our common stock, and such a market may not develop or be sustained. After we become effective with the SEC, we plan to develop a trading market. In order to do so, we have to retain an authorized OTC Bulletin Board market maker. The market maker will file Form 211 with FINRA (Financial Industry Regulatory Authority). Once we are approved with FINRA, our stock will be quoted on the OTCBB or OTC Market Group’s system.
There can be no assurances that we will be able to retain an authorized OTC BB market maker and furthermore, there are no assurances that we will be approved by FINRA. At the date hereof, we are not aware that any market maker has any such intention.
All of the shares registered herein will become effective for sale to investors.
The company will not offer the shares through a broker-dealer or anyone affiliated with a broker-dealer.
NOTE: As of the date of this prospectus, our sole officer and director, Mr. Francis Manzo, owns 9,000,000 common shares, which are subject to Rule 144 restrictions. There is currently one (1) shareholder of our common stock.
The company is hereby registering 3,000,000 common shares. The price per share is $0.10.
In the event the company receives payment for the sale of their shares, Drewrys will receive all of the proceeds from such sales. Drewrys is bearing all expenses in connection with the registration of the shares of the company.
We are offering the shares on a "self-underwritten" basis directly through Mr. Manzo, our sole executive officer and director, who will not receive any commissions or other remuneration of any kind for selling shares in this offering, except for the reimbursement of actual out-of-pocket expenses incurred in connection with the sale of the common stock. The offering will conclude at the earlier of when all 3,000,000 shares of common stock have been sold or 120 days after this registration statement becomes effective with the Securities and Exchange Commission.
This offering is a self-underwritten offering, which means that it does not involve the participation of an underwriter to market, distribute or sell the shares offered under this prospectus. We will sell shares on a continuous basis. We reasonably expect the amount of securities registered pursuant to this offering to be offered and sold within 120 days from this initial effective date of this registration.
In connection with his selling efforts in the offering, Mr. Manzo will not register as broker-dealer pursuant to Section 15 of the Exchange Act, but rather will rely upon the "safe harbor" provisions of Rule 3a4-1 under the Exchange Act. Generally speaking, Rule 3a4-1 provides an exemption from the broker-dealer registration requirements of the Exchange Act for persons associated with an issuer that participate in an offering of the issuer's securities. Francis Manzo is not subject to any statutory disqualification, as that term is defined in Section 3(a)(39) of the Exchange Act. Francis Manzo will not be compensated in connection with his participation in the offering by the payment of commissions or other remuneration based either directly or indirectly on transactions in our securities. Mr. Manzo is not and has not been within the past 12 months, a broker or dealer, and is not within the past 12 months, an associated person of a broker or dealer. At the end of the offering, Mr. Manzo will continue to primarily perform substantial duties for us or on our behalf otherwise than in connection with transactions in securities. Mr. Manzo has not participated in selling an offering of securities for any issuer more than once every 12 months other than in reliance on Exchange Act Rule 3a4-1(a)(4)(i) or (iii).
9,000,000 common shares are issued and outstanding as of the date of this prospectus. The company is registering an additional 3,000,000 shares of its common stock for possible resale at the price of $0.10 per share.
Drewrys will receive all proceeds from the sale of its shares. The price per share is $0.10. However, Drewrys common stock may never be quoted on the OTC Bulletin Board or listed on any exchange.
The company's shares may be sold to purchasers from time to time directly by, and subject to, the discretion of the company. Further, the company will not offer their shares for sale through underwriters, dealers, or agents or anyone who may receive compensation in the form of underwriting discounts, concessions or commissions from the company and/or the purchasers of the shares for whom they may act as agents. The shares sold by the company may be sold occasionally in one or more transactions at a fixed price of $0.10 per share.
The shares may not be offered or sold in certain jurisdictions unless they are registered or otherwise comply with the applicable securities laws of such jurisdictions by exemption, qualification or otherwise. We intend to sell the shares only in the states in which this offering has been qualified or an exemption from the registration requirements is available, and purchases of shares may be made only in those states.
In addition and without limiting the foregoing, the company will be subject to applicable provisions, rules and regulations under the Exchange Act with regard to security transactions during the period of time when this Registration Statement is effective.
Drewrys will pay all expenses incidental to the registration of the shares (including registration pursuant to the securities laws of certain states).
We are not a party to any material legal proceedings and to our knowledge; no such proceedings are threatened or contemplated by any party.
BUSINESS
The following summary is qualified in its entirety and should be read in conjunction with the more detailed information and Financial Statements and the Notes thereto appearing elsewhere in this Registration Statement.
Company Summary
Drewrys Brewing Company ("Drewrys" or the "Company") is a beer marketing company intending to develop products and sell them to beer distributors and wholesalers who will in turn sell the products to retailers for sales to consumers. The Company is based in McHenry, Illinois. The Company was started by Francis Manzo and incorporated in Nevada on October 11, 2010. Drewrys's operations are located in a home office.
Drewrys was a beer brewed in the Midwest with a heritage dating back to 1878 and was distributed in Indiana, Illinois, Iowa, Michigan, Ohio, and Wisconsin. In the early 1960’s it was the 15th largest brewery at that time, and publicly traded. Eventual brewery mergers and the competitive nature of the beer industry saw the brand decline in volume until it was eliminated from the retail space by the late 1990’s.
Drewrys Brewing Company, Inc. is developing beers for the domestic beer market The Company will brew under the trade names DREWRYS, HOLIHAN and CANADIAN ACE. DREWRYS is targeted for the domestic budget or low-priced beer market. HOLIHAN is targeted for the "craft beer" segment and is a full-flavored beer brewed in the traditional style. The CANADIAN ACE brand will be developed to a malt beverage with a light taste of Canadian whisky in the brew. The Company's objective is to provide excellent tasting beers for the market segment that it would target.
Drewrys will compete in the domestic budget and craft beer segment of the US market. The domestic craft beer segment has grown at a rate of approximately 40% per year for several years while overall domestic beer market sales have been relatively flat. Many industry analysts believe that the craft beer segment will grow from 5% of the total domestic beer market in 2010 to 10% by the year 2020. With the economy in distress, budget beers have shown increases in sales compared to premium and other beer segments.
Management believes that following the successful completion of its initial public offering, the continued growth in the domestic craft beer segment gave rise to a qualitative shift in the public's awareness of craft beers, and that this shift now gives the Company an opportunity to enter new markets at a time when many consumers are discovering craft brews for the first time.
Accordingly, Drewrys plans to call for accelerated introduction of additional bottled brands and draft beer into new regional markets, and greatly increase total availability of its products. Drewrys Brewing intends to continue to compete primarily on the basis of product quality and image. The Company’s marketing plan emphasizes introducing the budget brand, DREWRYS in 12 and 24oz. cans in either thirty (30) can multipacks and the craft beer brand, HOLIHAN in 12 oz. twenty-four (24) packs using high quality graphics and packaging.
The larger size can and multipacks will use the phrase “The Big D” which was used by the previous brand as a marketing piece on promotional literature and packaging.
The Company will contract with existing brewers to brew the DREWRYS and HOLIHAN brands. The Company believes that there are numerous contract brewers available to brew for the Company. Some contract brewers are already in the craft beer segment, and product development is available through these craft brewers.
Reliance on Domestic Low-Priced and Craft Beer Segment Growth Rate
The domestic craft beer segment of the highly competitive U.S. beer market has been characterized by more than ten years of steady growth. The growth rate may vary from region to region, and there is no assurance that the rate of growth will continue. If the growth rate were to not continue, the Company might face increased competition and might incur greater expenses and reduced gross margins that could have a material adverse impact on its business, financial condition, and results of operations. See "Business - Industry Overview - Domestic Craft Beer Segment."
Geographic Concentration
The previous distribution area for the Drewrys brand was historically concentrated in the Midwest. Holihan’s previous area distribution was located in the New England states. Management believes that regional identification will assist the Company in establishing the popularity of its Drewrys and Holihan brands in the Midwest and Atlantic Coast regions.
There is no assurance that the Company’s Drewrys and Holihan brands will be as widely accepted or that consumers in new geographic markets will be receptive to the Company’s products. Management believes that Midwest and Atlantic Coast is likely to continue to be the largest market for its brands, and that regional identification may assist the Company’s competitors in other regions. Penetrating other regional markets is an important element of the Company's expansion plan, and failure to accomplish this objective will hinder the success of the expansion plan and could have a material adverse impact on the Company's business, financial condition, and results of operations. See "Business – Regional Expansion."
Reliance on Distributors
Drewrys Brewing will rely exclusively on independent distributors for its wholesale sales. The distributors that the Company relies upon may also market competing imported and domestic craft beers. Although by law distributors are independent of any brewer, a distributor can be controlled if it relies on one or two large brewers who account for the majority of its sales. The Company has no formal written distribution agreements with any distributors at this time. Most distribution agreements may be terminated by either party with 30-day written notice. The laws of some states, however, may restrict the
Company’s ability to terminate its agreements with distributors in those states. Inability to terminate a distributor who is performing poorly could have a material adverse effect on the Company's business, financial condition, and results of operations. A down-turn in the performance of a single distributor can also have a material adverse impact on the Company’s business, financial condition, and results of operations. See "Business -- Product Distribution."
Competition
Certain competitors in the domestic craft beer segment have large advertising budgets, substantial financial resources, and/or access to the distribution networks of major national and international brewers. Several of Drewrys’ primary competitors are expanding or have recently expanded their production capacity. The amount of supermarket shelf space that can be devoted to any class of products is limited. Well-financed competitors could hinder distribution of the Company's products and have a material adverse effect on the Company's business, financial condition, and results of operations. See "Business - Industry Overview - Domestic Craft Beer Segment."
Possible Increases in Excise Taxes
Alcoholic beverages are subject to substantial federal and state excise taxes. The federal rate of taxation increases from $7.00 per barrel (“bbl.”) to $18.00 per bbl. for annual production in excess of 60,000 bbl. Alcoholic beverages has in recent years have been targets of attempts to increase so-called “sin taxes." If excise taxes are increased, the Company would have to raise prices to maintain profit margins. Historically, price increases due to additional excise taxes have not reduced unit sales, but past experience does not necessarily indicate future effects, and the actual effect is likely to depend on the amount of the increase, general economic conditions, and other factors. The occurrence of significant tax increases could have a material adverse impact on the Company's business, financial condition, and results of operations.
Industry Overview
Domestic Beer Market.
A barrel equals approximately 13.78 cases or 331 twelve ounce bottles; 177 million bbl. is therefore the approximate equivalent of 58.5 billion 12 oz. bottles of beer.
The U.S. beer market may be divided into five segments:
|
Suggested
|
||||||
|
Segment
|
Est. Market
|
Retail
|
||||
|
Segment
|
Share
|
Top Brands
|
Price *
|
|||
|
Low-Priced
|
60.0%
|
Busch, Milwaukee's Best, Old Milwaukee, Keystone
|
$2.99
|
|||
|
Premium
|
31.4%
|
Budweiser, Miller Lite, Bud Light, Coors Light
|
$3.99
|
|||
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Super-Premium
|
1.2%
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Michelob, Lowenbrau
|
$4.69
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|||
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European Import
|
5.5%
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Heineken, Guinness, Bass
|
$6.99
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|||
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Domestic Craft
|
1.9%
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Samuel Adams, Pete's, Sierra Nevada
|
$5.99 to $6.99
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* Prices are for 6-pack cans or bottles
Domestic Craft Beer Segment. While overall beer sales have been basically flat for several years, domestic craft beer sales have increased at a rate of approximately 40% per year for several years. Many industry analysts predict that craft beer sales will continue to increase.
Craft beers are characterized by their full-flavor and are usually produced along traditional European brewing styles. The majority of craft beers are ales, although some are malt lagers. Wheat beers and fruit flavored ales and lagers have enjoyed recent popularity among craft beer consumers.
Competition
The craft beer category consists of:
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·
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Contract brews -- any style brew produced by one brewer for sale under the label of someone else who does not have a brewery or whose brewery does not have sufficient capacity.
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·
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Regional craft brews -- “hand-crafted” brews, primarily ales, sold under the label of the brewery that produced it.
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·
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Microbrews -- “hand-crafted” brews, primarily ales, sold under the label of the brewery that produced it, if the capacity of the brewery does not exceed 15,000 bbl. per year.
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·
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Large brewer craft-style brews -- a brand brewed by a national brewer which may only imitate the style of a craft beer. These craft-style brews are often sold under the label of a brewery that does not exist or the label of a brewpub with no bottling capacity. The term "phantom brewery" is sometimes used to describe such brands.
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·
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Brewpub brews -- "hand-crafted" brews produced for sale and consumption at the brewery, this is normally connected with a restaurant/saloon. Brewpub brews are not normally sold for off-site consumption in significant quantities.
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Drewrys will compete against all of the above brewers primarily on the basis of price product quality and image.
Patents and Trademarks
The Company has federal trademark registrations of the DREWRYS word mark (Reg. No. 3,831,617), and HOLIHAN word mark (Reg. No.3,846,803). The CANADIAN ACE trademark is registered with the State of Illinois (Reg. No. 095680)
Government Regulation
A federal permit from the Bureau of Alcohol, Tobacco, and firearms ("BATF") allows the Company to distribute and import fermented malt beverages. To keep these licenses and permits in force, the Company must pay annual fees and submit timely production reports and excise tax returns. Prompt notice of any changes in the operations, ownership, or company structure must also be made to these regulatory agencies. BATF must also approve all product labels, which must include an alcohol use warning. These agencies require that individuals owning equity securities in aggregate of 10% or more in the Company be investigated as to their suitability.
Taxation of alcohol has increased significantly in recent years. Currently, the Federal tax rate is $7.00 per bbl. for up to 60,000 bbl. per year and $18.00 per bbl. for over 60,000 bbl.
Mission
Drewrys will strive for quality in its’ budget and craft beer products for consumers. The Company plans on creating a suite of craft and non-craft type beer products for the consumer.
Products
Drewrys plans to create a quality brewed beer for beer drinkers that seek a full body taste at a reasonable price. The Company’s first product will be a Drewrys budget or low-priced beer. Other products in the Company's plans include beers under the Holihan trade name and others that may be further developed.
Market Analysis Summary
Drewrys believes the great potential to distribute the product to the consumer is with beer distributors who are well established and trusted with select retailers. The craft and budget beer categories is growing nationally when compares to beers in other subset categories such as import, premium, non-alcoholic, and other malt brewer beverages. Re-introducing the names “DREWRYS” into the Midwest region and “HOLIHAN” in the Atlantic and New England regions could be a benefit in attracting consumers that might remember the name.
Marketing
We plan to evaluate a variety of marketing methods, including in store displays, billboards, newspaper, trade shows, and truck signs to reach potential customers.
Competition and Buying Patterns
The Company plans to be competitive in our market by making sure our product is good tasting and provides value to the consumer. A reasonable price at the store is critical in attracting a consumer to initially buy the product initially. In addition, Drewrys plans to create other lower-priced, craft and non-craft beer brands. According to the Company's research, it is the Company's believes that there are other long established and no longer produced brand names available in which to trademark various different types and classes of beers.
Strategy and Implementation Summary
Drewrys believes that in order to market to the beer distributor wholesaler, and then to the retailer, the Company will need to start in one geographical area. Since the Company is based in Illinois, the Company would target the beer distributors/wholesalers within the Midwestern and Eastern part of the United States which include all the states in the New England region, New York, Pennsylvania, Ohio Michigan, Indiana and Illinois. The Company will work indirectly with the retailer to understand their in-store marketing techniques and promotions. The Company anticipates that they will work with the local in-store employees to provide these promotions to their customers. The beer distributors wholesalers will be critical in reaching the retailers to sell our product to the consumers.
Competitive Positioning
The Company plans to be competitive in our market by making sure our product is good tasting and provides value to the consumer A reasonable price at the store is critical in attracting a consumer to initially buy the product initially. In addition, Drewrys plans to create other lower-priced, craft and non-craft beer brands. According to the Company's research, it is the Company's believes that there are other long established and no longer produced brand names available in which to trademark various different types and classed of beers.
MANAGEMENT'S DISCUSSION AND ANALYSIS OR PLAN OF OPERATION
This section of the prospectus includes a number of forward-looking statements that reflect our current views with respect to future events and financial performance. Forward-looking statements are often identified by words like: "believe", "expect", "estimate", "anticipate", "intend", "project" and similar expressions, or words which, by their nature, refer to future events. You should not place undue certainty on these forward-looking statements, which apply only as of the date of this prospectus. These forward-looking statements are subject to certain risks and uncertainties that could cause actual results to differ materially from historical results or our predictions.
Drewrys plans to create and market a line of craft beer items. We have not yet generated or realized any revenues from business operations. From inception to December 31, 2010, the company's business operations have primarily been focused on developing our business plan and market research.
LIMITED OPERATING HISTORY; NEED FOR ADDITIONAL CAPITAL
THERE IS NO HISTORICAL FINANCIAL INFORMATION ABOUT US UPON WHICH TO BASE AN EVALUATION OF OUR PERFORMANCE. DREWRYS BREWING COMPANY WAS INCORPORATED IN THE STATE OF NEVADA ON OCTOBER 11, 2010; WE ARE A DEVELOPMENT STAGE COMPANY THE COMPANY WILL DESIGN, DEVELOP, AND MARKET A LINE SPECIALTY CRAFT BEERS FOR THE CONSUMERS MARKET. WE HAVE NOT GENERATED ANY REVENUES FROM OUR OPERATIONS. WE CANNOT GUARANTEE WE WILL BE SUCCESSFUL IN OUR BUSINESS OPERATIONS. OUR BUSINESS IS SUBJECT TO RISKS INHERENT IN THE ESTABLISHMENT OF A NEW BUSINESS ENTERPRISE, INCLUDING THE FINANCIAL RISKS ASSOCIATED WITH THE LIMITED CAPITAL RESOURCES CURRENTLY AVAILABLE TO US FOR THE IMPLEMENTATION OF OUR BUSINESS STRATEGIES (SEE "RISK FACTORS"). TO BECOME VIABLE AND COMPETITIVE, WE MUST DEVELOP AND COMPLETE THE BUSINESS AND MARKETING PLAN, EXECUTE THE PLAN AND ESTABLISH SALES VIA THE BEER DISTRIBUTOR AND WHOLESALER NETWORK WHO IN TURN SELLS TO RETAILERS TO REACH THE CONSUMERS. OUR AUDITORS HAVE EXPRESSED AN OPINION THAT SUBSTANTIAL DOUBT EXISTS AS TO WHETHER WE CAN CONTINUE AS AN ONGOING BUSINESS.
Over the 12 month period starting upon the effective date of this registration statement, the Company anticipates needing $25,000 of capital in order to complete the Business and Marketing Plan and to commence product manufacture and purchase of supplies and packaging. The Company believes this event is the most critical to our success. The Company estimates that it will take up to six months after this registration statement becomes effective and the costs will be similar to this offering, however, the Company is uncertain on the timeframe for raising the additional capital necessary to complete its business and marketing plan.
There are two major parts to the business and marketing plan, the product development strategy and marketing strategy. We plan on using consultants and contract brewers to develop both strategies, estimated to be completed in two months, and will cost approximately $10,000. The product development strategy costs consist of two resources, one product design and the other a manufacturing expert. The marketing strategy will require one resource.
The Company will not commence any product development and prototypes until the business and marketing plans are completed.
After the business and marketing plans are completed, Company intends to hire independent consultants, and contractors to develop the product prototypes. The Company believes finding experienced consultants in the beer and beverage industry is critical to ensure the success of the Company's development plans. The Company expects to complete the product development within four (4) months from this offering.
Drewrys has incurred a loss of $8,399 for the period from October 11, 2010 (inception) through December 31, 2010. The Company has not generated any revenue from business operations. All proceeds currently held by the company are the result of the sale of common stock to its officer. The Company does not have any contractual arrangement with our CEO, Mr. Francis Manzo, to fund the Company on an on-going basis for either operating capital or a loan. The CEO may elect to fund the Company as he initially did; however, there are no assurances that he will continue to do so in the future.
The Company incurred operating expenses for the period ending December 31, 2010 of $8,399. It is anticipated that future expenses of $100 for general administrative costs will be incurred for the cost of the registration of this S-1 filing. Since inception, the majority of the company's time has been spent on developing its business plan and conducting industry research, and preparing for a primary financial offering. The loss incurred over the period from inception October 11, 2010 to December 31, 2010 was $8,399.
LIQUIDITY AND CAPITAL RESOURCES
As of the date of this registration statement, we have yet to generate any revenues from our business operations. For the period ended December 31, 2010, Drewrys Brewing Company issued 9,000,000 shares of common stock to our sole officer and director for subscriptions receivable and cash proceeds of $9,000 at $0.001 per share.
We anticipate needing a $25,000 in order to complete our business and marketing plan over the next twelve (12) months and to identify the necessary resources to implement our plan. In addition, the subsequent offering will allow us to complete the product design, prototype, and to bring the product to market in order to generate revenues. At this time, we cannot estimate the financial resources required for the product development, prototype and bring the product to market to generate revenues. We expect that after the business and marketing plan is completed, we will know the financial resources which will be required to bring the product to market and start generating revenues.
Again, the Company believes this event of raising additional capital is critical to implement our plan. The costs associated with this plan include hiring three consultants (1 for product design, 1 marketing, and 1 manufacturing resources), each costing $10,000 and the balance of $7,000 for general working capital purposes. These resources will create the marketing and product strategy, contract manufacturing strategy, business operations, and develop a financial plan that estimates the cost to design, manufacture and bring the first lower-priced beer product, Drewrys, to market in order to start generating revenues. The working capital expenses are estimated as follows: $8,000 for public company costs that include ‘Edgarization’ fees for SEC filings, $5,000 for legal, $3,000 for accounting, $1,000 for travel, $500 for telephone and internet, and $100 for office supplies. Currently, the Company believes these figures are accurate based on current economic conditions, unemployment numbers, and the recent positive growth trends in the home building and improvement industry. However, the available cash is not sufficient to allow us to commence full execution of our business plan.
Based on our success of raising additional capital over the next twelve (12) months, which is the Company's greatest uncertainty and therefore top priority, we anticipate employing various consultants and contractors to commence the development strategy for the product prototypes. Until the Business and Marketing plan are completed, we are not able to quantify with any certainty any planned capital expenditures beyond the business and marketing plan. Currently, the only planned capital expenditures are the public company operating costs. As of December 31, 2010, the Company has no firm commitments for any capital expenditures.
Our business will require additional capital resources that may be funded through the issuance of common stock or of notes payable or other debt arrangements. The Company will explore all financing possibilities and alternatives. Despite our current financial status we believe that we may be able to issue notes payable or debt instruments in order to further develop our Business and Marketing Plan. We anticipate that receipt of such financing may require granting a security interest in the Company, and are willing to grant such interest to secure the necessary funding. This security interest would be UCC1 lien on all of the Company's assets. Any security interest would take preference over equity in a liquidation.
Through inception October 11, 2010 through December 31, 2010 we have not incurred any expenses relating to production. As of December 31, 2010 our current cash reflects less than three (3) months of operation.
To date, we have managed to keep our monthly cash flow requirement low for two reasons. First, our sole officer has agreed not to draw a salary until the Company has raised $500,000 of cash in either equity or debt for working capital or has at least $500,000 in revenues. Second, we have been able to keep our operating expenses to a minimum by operating in space owned by our sole officer and are only paying the direct expenses associated with our business operations.
We believe managing costs is very important to our success, especially under the current economic times.
Given our low monthly cash flow requirement and the compensation arrangement with our sole officer, management believes that, while our auditors have expressed substantial doubt about our ability to continue as a going concern, and assuming that we do not commence our anticipated operations until sufficient financial resources are available, we believe we will be able to meet our obligations for at least the next twelve months.
In the early stages of our company, we will need cash for completing the business and marketing plans. We anticipate that during the first year, in order to develop our business plan to any meaningful degree, we would need to spend a minimum of $25,000 on such endeavors. After this offering, we will seek additional financing through means such as equity offerings, borrowings from institutions and/or private individuals. We estimate the costs with additional equity offerings will be similar to this offering, however we are uncertain as to the costs with loans because we have not entered into any of those types of arrangements. Even if we sell all shares offered through this registration statement, we expect that we will seek additional financing in the future.
However, we may not be able to obtain additional capital or generate sufficient revenues to fund our operations. If we are unsuccessful at raising sufficient funds, for whatever reason, to fund our operations, we may be forced to seek a buyer for our business or another entity with which we could create a joint venture. If all of these alternatives fail, we expect that we will be required to seek protection from creditors under applicable bankruptcy laws.
The Company has not entered into any contractual obligations or commitment agreements.
MANAGEMENT
OFFICER AND DIRECTOR
Our sole officer and director will serve until his successor is elected and qualified. Our officer is elected by the board of directors to a term of one (1) year and serves until his successor is duly elected and qualified, or until he is removed from office. The board of directors has no nominating, auditing or compensation committees.
The name, address, age and position of our President, Secretary, Treasurer, Principal Executive Officer, Principal Financial Officer, and sole member of the Board of Directors is set forth below:
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Name and Address
|
Age
|
Position(s)
|
||
|
Francis Manzo
5402 Brittany Drive
McHenry IL 60050
|
55
|
President, Secretary, Treasurer, Principal
Executive Officer, Principal Financial Officer,
and sole member of the Board of Directors
|
The person named above has held his offices/positions since the inception of our company and is expected to hold his offices/positions until the next annual meeting of our stockholders.
COMMITTEES OF THE BOARD OF DIRECTORS
Our Board of Directors has not established any committees, including an Audit Committee, a Compensation Committee, a Nominating Committee or any committee performing a similar function. The functions of those committees are being undertaken by the entire board as a whole. Because we do not have any independent directors, our Board of Directors believes that the establishment of committees of the Board would not provide any benefits to our company and could be considered more form than substance.
We do not have a policy regarding the consideration of any director candidates which may be recommended by our stockholders, including the minimum qualifications for director candidates, nor has our Board of Directors established a process for identifying and evaluating director nominees. We have not adopted a policy regarding the handling of any potential recommendation of director candidates by our stockholders, including the procedures to be followed. Our Board has not considered or adopted any of these policies as we have never received a recommendation from any stockholder for any candidate to serve on our Board of Directors. Given our relative size and lack of directors and officers insurance coverage, we do not anticipate that any of our stockholders will make such a recommendation in the near future. While there have been no nominations of additional directors proposed, in the event such a proposal is made, all members of our Board will participate in the consideration of director nominees.
When we are able to expand our Board of Directors to include one or more independent directors, we intend to establish an Audit Committee of our Board of Directors.
WE DO NOT HAVE ANY INDEPENDENT DIRECTORS AND WE HAVE NOT VOLUNTARILY IMPLEMENTED VARIOUS CORPORATE GOVERNANCE MEASURES, IN THE ABSENCE OF WHICH, STOCKHOLDERS MAY HAVE MORE LIMITED PROTECTIONS AGAINST INTERESTED DIRECTOR TRANSACTIONS, CONFLICTS OF INTEREST AND SIMILAR MATTERS.
Federal legislation has resulted in the adoption of various corporate governance measures designed to promote the integrity of the corporate management and the securities markets. Some of these measures have been adopted in response to legal requirements. Others have been adopted by companies in response to the requirements of national securities exchanges, such as the NYSE or The NASDAQ Stock Market, on which their securities are listed. Among the corporate governance measures that are required under the rules of national securities exchanges are those that address board of directors' independence, audit committee oversight, and the adoption of a code of ethics. Our Board of Directors is comprised of one individual who is also our executive officer. Our executive officer makes decisions on all significant corporate matters such as the approval of terms of the compensation of our executive officer and the oversight of the accounting functions.
Although we have adopted a Code of Ethics and Business Conduct, we have not yet adopted any of these other corporate governance measures and, since our securities are not yet listed on a national securities exchange, we are not required to do so. We have not adopted corporate governance measures such as an audit or other independent committees of our board of directors as we presently do not have any independent directors. If we expand our board membership in future periods to include additional independent directors, we may seek to establish an audit and other committees of our board of directors. It is possible that if our Board of Directors included independent directors and if we were to adopt some or all of these corporate governance measures, stockholders would benefit from somewhat greater assurances that internal corporate decisions were being made by disinterested directors and that policies had been implemented to define responsible conduct. For example, in the absence of audit, nominating and compensation committees comprised of at least a majority of independent directors, decisions concerning matters such as compensation packages to our senior officer and recommendations for director nominees may be made by a majority of directors who have an interest in the outcome of the matters being decided. Prospective investors should bear in mind our current lack of corporate governance measures in formulating their investment decisions.
CODE OF BUSINESS CONDUCT AND ETHICS
In February 2010 we adopted a Code of Ethics and Business Conduct which is applicable to our future employees and which also includes a Code of Ethics for our President, Secretary, Treasurer, Principal Executive Officer, Principal Financial Officer, and sole member of the Board of Directors and persons performing similar functions. A code of ethics is a written standard designed to deter wrongdoing and to promote
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·
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honest and ethical conduct,
|
|
·
|
full, fair, accurate, timely and understandable disclosure in regulatory filings and public statements,
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|
·
|
compliance with applicable laws, rules and regulations,
|
|
·
|
the prompt reporting violation of the code, and
|
|
·
|
accountability for adherence to the code.
|
A copy of our Code of Business Conduct and Ethics has been filed with the Securities and Exchange Commission as an exhibit to this Form S-1 filing. Any person desiring a copy of the Code of Business Conduct and Ethics, can obtain one by going to www.sec.gov and looking at the attachments to this Form S-1.
BACKGROUND OF OFFICER AND DIRECTOR
Mr. Francis Manzo, President, Chief Executive Officer, Sole Member of the Board of Directors Chief Financial Officer Principal Accounting Officer Secretary
FRANCIS MANZO. Mr. Manzo, our President, Secretary and sole-director is currently president of Metrecal Nutrition, Inc., a position he has held since 2010, the Managing Principal of Appletree Capital Ltd., a position he has held since 2005, and President of Metrecal Nutrition, Inc., a position he has held since April 2010. Appletree Capital Ltd. is a private investment and business consulting firm based in Mc Henry, Illinois. From 1985 to 2010 Mr. Manzo was President of Byers Food Company which marketed consumer foods. From 1998 to 2005, Mr. Manzo was President of High-Low Foods, Inc. operating a retail grocery business in Northern Illinois. Mr. Manzo was President of QVP Brands, Inc. a soap and detergents marketer. Mr. Manzo assisted in the formation of various business entities. Mr. Manzo received a B.S. degree in Business Administration from Lewis University.
CERTAIN TRANSACTIONS AND RELATED TRANSACTIONS
The Company issued 9,000,000 shares of its common stock, in restricted form, to its sole officer and director, Francis Manzo, in exchange for the payment of the Company’s expenses valued at $9,000.00.
EXECUTIVE COMPENSATION
Francis Manzo will not be taking any compensation until the Company has raised $500,000 of cash in either equity or debt for working capital or has at least $500,000 in revenues. The Company has no formal employment agreement with Mr. Manzo and the loss of his services would seriously harm the company and its proposed operations.
SUMMARY OF COMPENSATION
We did not pay any salaries in 2010. We do not anticipate beginning to pay salaries until we have adequate funds to do so. There are no stock option plans, retirement, pension, or profit sharing plans for the benefit of any officer or director other than as described herein.
SUMMARY COMPENSATION TABLE
The following table provides certain summary information concerning cash and certain other compensation we paid to our Chief Executive Officer for the fiscal year ending October 31, 2010.
|
Non-
|
||||||||
|
Non-Equity
|
Qualified
|
|||||||
|
Incentive
|
Deferred
|
|||||||
|
Stock
|
Option
|
Plan
|
Compensation
|
All Other
|
||||
|
Name &
|
Fiscal
|
Salary
|
Bonus
|
Award(s)
|
Award(s)
|
Earnings
|
Compensation
|
Total
|
|
Principal Position
|
Year
|
($)
|
($)
|
($)
|
($)
|
($)
|
($)
|
($)
|
|
Francis Manzo
Chief Executive Officer
|
2010
|
0
|
-
|
-
|
-
|
-
|
-
|
0
|
DIRECTOR COMPENSATION
Mr. Manzo, the sole member of our Board of Directors, is also our sole executive officer. We do not pay fees to any director, however we will reimburse any director for out-of-pocket expenses incurred with board meetings.
LONG-TERM INCENTIVE PLAN AWARDS
We do not have any long-term incentive plans including options and SARs that provide compensation intended to serve as incentive for performance.
EMPLOYMENT AGREEMENTS
At this time, Drewrys has not entered into any employment agreement with our sole officer and director.
The following table sets forth, as of the date of this prospectus, the total number of shares owned beneficially by our sole officer and director, and key employees, individually and as a group, and the present owners of 5% or more of our total outstanding shares.
The stockholder listed below has direct ownership of his shares and possesses sole voting and dispositive power with respect to the shares.
|
Number of
|
Percentage
|
||
|
Title of Class
|
Name
|
Shares Owned
|
of Shares(1)
|
|
Shares of Common Stock
|
Francis Manzo (2)
5402 Brittany Drive
McHenry, IL 60050
|
9,000,000
|
100%
|
__________________
(1) Based on 9,000,000 shares outstanding as of October 31, 2010.
(2) The person named above may be deemed to be a "parent" and "promoter" of our company, within the meaning of such terms under the Securities Act of 1933, Mr. Manzo is the only "parent" and "promoter" of the company.
For the period ended October 31, 2010, a total of 9,000,000 shares of common stock were issued to our sole officer and director, all of which are restricted securities, as defined in Rule 144 of the Rules and Regulations of the SEC promulgated under the Securities Act. Under Rule 144, the shares can be publicly sold, subject to volume restrictions and restrictions on the manner of sale, commencing one year after their acquisition. Under Rule 144, a shareholder can sell up to 1% of total outstanding shares every three months in brokers' transactions. Shares purchased in this offering, which will be immediately resalable, and sales of all of our other shares after applicable restrictions expire, could have a depressive effect on the market price, if any, of our common stock and the shares we are offering.
Our sole officer and director will continue to own the majority of our common stock after the offering, regardless of the number of shares sold. Since he will continue control our company after the offering, investors in this offering will be unable to change the course of our operations. Thus, the shares we are offering lack the value normally attributable to voting rights. This could result in a reduction in value of the shares you own because of their ineffective voting power. None of our common stock is subject to outstanding options, warrants, or securities convertible into common stock.
The company is hereby registering 3,000,000 of its common shares, in addition to the 9,000,000 shares currently issued and outstanding. The price per share is $0.10 (please see "Plan of Distribution" below).
The 9,000,000 shares currently issued and outstanding were acquired by our sole officer and director for the period ended, October 31, 2010. We issued a total of 9,000,000 common shares for consideration of $9,000, which was accounted for as a purchase of common stock.
DESCRIPTION OF SECURITIES
In the event the company receives payment for the sale of their shares, Drewrys will receive all of the proceeds from such sales. Drewrys is bearing all expenses in connection with the registration of the shares of the Company.
COMMON STOCK
The authorized common stock is seventy-five million (75,000,000) shares with a par value of $.001 for an aggregate par value of seventy-five thousand dollars ($75,000).
Common Stock has the following rights:
* have equal ratable rights to dividends from funds legally available if and when declared by our Board of Directors;
* are entitled to share ratably in all of our assets available for distribution to holders of common stock upon liquidation, dissolution or winding up of our affairs;
* do not have preemptive, subscription or conversion rights and there are no redemption or sinking fund provisions or rights;
* and are entitled to one non-cumulative vote per share on all matters on which stockholders may vote.
We refer you to the Bylaws of our Articles of Incorporation and the applicable statutes of the State of Nevada for a more complete description of the rights and liabilities of holders of our common stock securities.
NON-CUMULATIVE VOTING
Holders of shares of our common stock do not have cumulative voting rights, which means that the holders of more than 50% of the outstanding shares, voting for the election of directors, can elect all of the directors to be elected, if they so choose, and, in that event, the holders of the remaining shares will not be able to elect any of our directors. After this offering is completed, and assuming all 3,000,000 shares being offered are sold, present stockholders will own approximately 75% of our outstanding shares.
CASH DIVIDENDS
As of the date of this prospectus, we have not declared or paid any cash dividends to stockholders. The declaration of any future cash dividend will be at the discretion of our Board of Directors and will depend upon our earnings, if any, our capital requirements and financial position, our general economic conditions, and other pertinent conditions. It is our present intention not to pay any cash dividends in the foreseeable future, but rather to reinvest earnings, if any, in our business operations.
REPORTING
After we complete this offering, we will not be required to furnish you with an annual report. Further, we will not voluntarily send you an annual report. We will be required to file reports with the SEC under section 15(d) of the Securities Act. The reports will be filed electronically. The reports we will be required to file are Forms 10-K, 10-Q, and 8-K. You may read copies of any materials we file with the SEC at the SEC's Public Reference Room at 100 F Street, N.E., Washington, D.C. 20549. You may obtain information on the operation of the Public Reference Room by calling the SEC at 1-800-SEC-0330. The SEC also maintains an Internet site that will contain copies of the reports we file electronically. The address for the Internet site is www.sec.gov.
STOCK TRANSFER AGENT
We have not engaged the services of a transfer agent at this time. However, within the next twelve months we anticipate doing so. Until such a time a transfer agent is retained, Drewrys will act as its own transfer agent.
STOCK OPTION PLAN
The Board of Directors of Drewrys has not adopted a stock option plan ("Stock Option Plan"). The company has no plans to adopt a stock option plan but may choose to do so in the future. If such a plan is adopted, this plan may be administered by the board or a committee appointed by the board (the "Committee"). The committee would have the power to modify, extend or renew outstanding options and to authorize the grant of new options in substitution therefore, provided that any such action may not, without the written consent of the optionee, impair any rights under any option previously granted. Drewrys may develop an incentive based stock option plan for its officer and director and may reserve up to 10% of its outstanding shares of common stock for that purpose.
The validity of the securities offered by this prospectus will be passed upon for us by McDowell Odom LLP.
EXPERTS
Our financial statements have been audited for the period ending December 31, 2010 by Lake & Associates CPA's, LLC, as set forth in their report included in this prospectus. Their report is given upon their authority as experts in accounting and auditing.
Drewrys Brewing Company
(A Development Stage Company)
Index to Financial Statements
From October 11, 2010 (Inception) through December 31, 2010
INDEX TO FINANCIAL STATEMENTS
REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
To the Board of Directors and
Stockholders of Drewrys Brewing Company
We have audited the accompanying balance sheet of Drewrys Brewing Company (a development stage enterprise) (the “Company”) as of December 31, 2010 and the related statements of operations, stockholders’ equity/(deficit), and cash flows for the period from October 11, 2010 (inception) through December 31, 2010. These financial statements are the responsibility of the company’s management. Our responsibility is to express an opinion on these financial statements based on our audits.
We conducted our audits in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. The Company is not required to have, nor were we engaged to perform, an audit of its internal control over financial reporting. Our audit included consideration of internal control over financial reporting as a basis for designing audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the Company’s internal control over financial reporting. Accordingly, we express no such opinion. An audit also includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements, assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audits provide a reasonable basis for our opinion.
In our opinion, the financial statements referred to above present fairly, in all material respects, the financial position of Drewrys Brewing Company (a Nevada corporation) as of December 31, 2010 and the results of its operations and its cash flows for the period October 11, 2010 (inception) through December 31, 2010, in conformity with accounting principles generally accepted in the United States of America.
The accompanying financial statements have been prepared assuming that the Company will continue as a going concern. As discussed further in Notes 1 and 6, the Company has been in the development stage since its inception (October 11, 2010) and continues to incur significant losses. The Company's viability is dependent upon its ability to obtain future financing and the success of its future operations. These factors raise substantial doubt as to the Company's ability to continue as a going concern. Management's plan in regard to these matters is also described in Note 6. The financial statements do not include any adjustments that might result from the outcome of this uncertainty.
/s/ Lake & Associates CPA’s LLC
Lake & Associates CPA’s LLC
Schaumburg, Illinois
March 29, 2011
1905 Wright Boulevard
Schaumburg, IL 60193
Phone: 847-524-0800
Fax: 847-524-1655
|
DREWRYS BREWING COMPANY
|
||||
|
(A DEVELOPMENT STAGE COMPANY)
|
||||
|
DECEMBER 31, 2010
|
||||
|
ASSETS
|
||||
|
As of
|
||||
|
December 31, 2010
|
||||
|
CURRENT ASSETS:
|
||||
|
Cash and equivalents
|
$ | 100 | ||
|
Total Current Assets
|
100 | |||
|
OTHER ASSETS:
|
||||
|
Trademarks
|
560 | |||
|
Label Designs
|
500 | |||
|
Total Other Assets
|
1,060 | |||
|
Total Assets
|
$ | 1,160 | ||
|
LIABILITIES AND STOCKHOLDERS' EQUITY (DEFICIENCY)
|
||||
|
CURRENT LIABILITIES:
|
||||
|
Accounts payable and accrued liabilities
|
$ | 6,950 | ||
|
Total Liabilities
|
6,950 | |||
|
STOCKHOLDERS' EQUITY (DEFICIT):
|
||||
|
Common stock , par value $.001; 75,000,000 shares authorized;
|
||||
|
9,000,000 shares issued as of October 31, 2010
|
$ | 9,000 | ||
|
Subscription receivable
|
(6,450 | ) | ||
|
Additional paid in capital
|
59 | |||
|
Deficit accumulated during the development stage
|
(8,399 | ) | ||
|
Total Stockholders' Equity/(Deficit)
|
(5,790 | ) | ||
|
Total Liabilities and Stockholders' Equity/(Deficit)
|
$ | 1,160 | ||
The accompanying notes are an integral part of these statements.
|
DREWRYS BREWING COMPANY
|
||||
|
(A DEVELOPMENT STAGE COMPANY)
|
||||
|
STATEMENTS OF OPERATIONS
|
||||
|
For the period from Inception to December 31, 2010
|
||||
|
For the period
|
||||
|
from Inception
|
||||
|
(October 11, 2010)
|
||||
|
to December 31, 2010
|
||||
|
REVENUES
|
$ | - | ||
|
EXPENSES
|
||||
|
General and Administrative
|
399 | |||
|
Professional Fees
|
8,000 | |||
|
Total Operating Expenses
|
8,399 | |||
|
Income (Loss) Before Income Taxes
|
(8,399 | ) | ||
|
Provision for Income Taxes
|
- | |||
|
Net (loss)
|
$ | (8,399 | ) | |
|
Basic and diluted net loss per common share
|
** | |||
|
Weighted average number of common shares outstanding
|
9,000,000 | |||
|
** Less than $.01
|
||||
The accompanying notes are an integral part of these statements.
|
DREWRYS BREWING COMPANY
|
||||||||||||||||||||||||
|
(A DEVELOPMENT STAGE COMPANY)
|
||||||||||||||||||||||||
|
STATEMENT OF STOCKHOLDERS' EQUITY/(DEFICIT)
|
||||||||||||||||||||||||
|
For the period from Inception to December 31, 2010
|
||||||||||||||||||||||||
|
Additional
|
Accumulated
|
Total
|
||||||||||||||||||||||
| Common Stock |
Subscription
|
Paid in
|
(Deficit) During
|
Stockholders'
|
||||||||||||||||||||
|
Par Value of $0.001
|
Shares
|
Amount
|
Receivable
|
Capital
|
Development Stage
|
Equity/(Deficit)
|
||||||||||||||||||
|
Inception - October 11, 2010
|
- | $ | - | $ | - | $ | - | $ | - | |||||||||||||||
|
Common shares issued to founder for
|
||||||||||||||||||||||||
|
subscription agreement on October 11, 2010
|
9,000,000 | 9,000 | (9,000 | ) | - | - | - | |||||||||||||||||
|
Capital contribution
|
- | - | - | 59 | - | 59 | ||||||||||||||||||
|
Payments on subscription receivable
|
- | - | 2,550 | - | - | 2,550 | ||||||||||||||||||
|
Loss for the period from inception on October 11,
|
||||||||||||||||||||||||
|
2010 to December 31, 2010
|
- | - | - | - | (8,399 | ) | (8,399 | ) | ||||||||||||||||
|
Balance at December 31, 2010
|
9,000,000 | $ | 9,000 | $ | (6,450 | ) | $ | 59 | $ | (8,399 | ) | $ | (5,790 | ) | ||||||||||
The accompanying notes are an integral part of these statements.
|
DREWRYS BREWING COMPANY
|
||||
|
(A DEVELOPMENT STAGE COMPANY)
|
||||
|
STATEMENTS OF CASH FLOWS
|
||||
|
For the period from Inception to December 31, 2010
|
||||
|
For the period
|
||||
|
from Inception
|
||||
|
(October 11, 2010)
|
||||
|
to December 31, 2010
|
||||
|
OPERATING ACTIVITIES:
|
||||
|
Net loss
|
$ | (8,399 | ) | |
|
Adjustments to reconcile net loss to net cash used in operating activities:
|
||||
|
Changes in operating assets and liabilities:
|
||||
|
(Increase)/decrease in other assets
|
(1,060 | ) | ||
|
Increase/(decrease) in accounts payable
|
6,950 | |||
|
Net cash used in operating activities
|
(2,509 | ) | ||
|
FINANCING ACTIVITIES:
|
||||
|
Payments on subscription agreement
|
2,550 | |||
|
Capital contribution
|
59 | |||
|
Net cash provided by (used in) financing activities
|
2,609 | |||
|
NET INCREASE IN CASH
|
100 | |||
|
CASH BEGINNING BALANCE
|
- | |||
|
CASH ENDING BALANCE
|
$ | 100 | ||
|
SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION:
|
||||
|
Taxes paid
|
$ | - | ||
|
Interest paid
|
$ | - | ||
|
NONCASH TRANSACTIONS AFFECTING OPERATING,
|
||||
|
INVESTING, AND FINANCING ACTIVITIES:
|
||||
|
Issuance of common stock for subscription agreement
|
$ | 9,000 | ||
The accompanying notes are an integral part of these statements.
Drewrys Brewing Company
(A Development Stage Company)
NOTES TO FINANCIAL STATEMENTS
(DECEMBER 31, 2010)
NOTE 1. GENERAL ORGANIZATION AND BUSINESS
Drewrys Brewing Company is a development stage company, incorporated in the State of Nevada on, October 11, 2010, to develop and market a line of low-priced and craft beers. The intent is to provide consumers with malt beverages that appeal to their price point.
Drewrys‘ plan is to sell wholesale only, targeting select regional wholesalers and distributors in the Midwest and Atlantic/New England regions.
Through December 31, 2010 the Company was in the development stage and has not carried on any significant operations and has generated minimal revenues. The Company had incurred a loss due to professional fees accrued since inception. The accompanying financial statements have been prepared assuming that the Company will continue as a going concern. These matters, among others, raise substantial doubt about the ability of the Company to continue as a going concern. These financial statements do not include any adjustments to the amounts and classification of assets and liabilities that may be necessary should the Company be unable to continue as a going concern.
NOTE 2. SUMMARY OF SIGNIFICANT ACCOUNTING PRACTICES
Accounting Basis
The Company is currently a development stage enterprise reporting under the provisions of Accounting Standards Codification ("ASC") 915 "Development Stage Entities". These financial statements are prepared on the accrual basis of accounting in conformity with accounting principles generally accepted in the United States of America.
Cash and Cash Equivalents
For the purpose of the financial statements cash equivalents include all highly liquid investments with maturity of three months or less.
Drewrys Brewing Company
(A Development Stage Company)
NOTES TO FINANCIAL STATEMENTS
(DECEMBER 31, 2010)
(continued)
Earnings (Loss) per Share
The basic earnings (loss) per share are calculated by dividing the Company's net income available to common shareholders by the weighted average number of common shares outstanding during the year. The diluted earnings (loss) per share are calculated by dividing the Company's net income (loss) available to common shareholders by the diluted weighted average number of shares outstanding during the year. The diluted weighted average number of shares outstanding is the basic weighted number of shares adjusted as of the first of the year for any potentially dilutive debt or equity. There are no diluted shares outstanding for any periods reported.
Dividends
The Company has not adopted any policy regarding payment of dividends. No dividends have been paid during the periods shown, and none are contemplated in the near future.
Income Taxes
The Company adopted FASB ASC 740, Income Taxes, at its inception. Under ASC 740, deferred tax assets and liabilities are recognized for the future tax consequences attributable to differences between the financial statements carrying amounts of existing assets and liabilities and their respective tax bases. Deferred tax assets, including tax loss and credit carry forwards, and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. The effect on deferred tax assets and liabilities of a change in tax rates are recognized in income in the period that includes the enactment date. Deferred income tax expense represents the change during the period in the deferred tax assets and deferred tax liabilities. The components of the deferred tax assets and liabilities are individually classified as current and non-current based on their characteristics. Deferred tax assets are reduced by a valuation allowance when, in the opinion of management, it is more likely than not that some portion or all of the deferred tax assets will not be realized. No deferred tax assets or liabilities were recognized as of December 31, 2010.
Professional Fees
The Company will expense professional fees as incurred. The professional fees for the period ending December 31, 2010 was $8,000.00.
Use of Estimates
The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenue and expenses during the reporting period. Actual results could differ from those estimates.
Drewrys Brewing Company
(A Development Stage Company)
NOTES TO FINANCIAL STATEMENTS
(DECEMBER 31, 2010)
(continued)
Revenue and Cost Recognition
The Company has no current source of revenue; therefore the Company has not yet adopted any policy regarding the recognition of revenue or cost.
Property
The company does not own any real estate or other properties. The company's office is located 5402 Brittany Drive, McHenry Illinois 60050. Our contact number is 815- 575-4815. The business office is located at the home of Francis Manzo, the CEO of the company at no charge to the company.
Recently Issued Accounting Pronouncements
The Company has adopted all recently issued accounting pronouncements. The adoption of the accounting pronouncements, including those not yet effective, is not anticipated to have a material effect on the financial position or results of operations of the Company.
Intangible Assets
The Company evaluates the recoverability of identifiable intangible assets whenever events or changes in circumstances indicate that an intangible asset’s carrying amount may not be recoverable. There was no impairment loss for the period from October 11, 2010 (inception) to December 31, 2010.
Fair value of Financial Instruments
The Company considers that the carrying amount of financial instruments, including accounts payable, approximate fair value because of the short maturity of these instruments.
Related Parties
Related parties, which can be a corporation, individual, investor or another entity are considered to be related if the party has the ability, directly or indirectly, to control the other party or exercise significant influence over the Company in making financial and operation decisions. Companies are also considered to be related if they are subject to common control or common significant influence. The Company has these relationships.
Subsequent Events
We evaluated subsequent events through the date and time our financial statements were issued.
Drewrys Brewing Company
(A Development Stage Company)
NOTES TO FINANCIAL STATEMENTS
(DECEMBER 31, 2010)
(continued)
NOTE 3. INCOME TAXES
The Company provides for income taxes under ASC Topic 740 which requires the use of an asset and liability approach in accounting for income taxes. Deferred tax assets and liabilities are recorded based on the differences between the financial statement and tax bases of assets and liabilities and the tax rates in effect currently.
ASC Topic 740 requires the reduction of deferred tax assets by a valuation allowance if, based on the weight of available evidence, it is more likely than not that some or all of the deferred tax assets will not be realized. In the Company's opinion, it is uncertain whether they will generate sufficient taxable income in the future to fully utilize the net deferred tax asset. Details for
the period ending December 31, 2010:
|
Income tax expense (asset) at statutory rate
|
$ | (2,856 | ) | |
|
Valuation allowance
|
2,856 | |||
|
Income tax expense per books
|
$ | 0 | ||
|
Net deferred tax asset consists of the following components:
|
||||
|
NOL Carryover
|
$ | 8,399 | ||
|
Valuation allowance
|
(8,399 | ) | ||
|
Net deferred tax asset
|
$ | 0 |
The Company has filed no income tax returns since inception.
At December 31, 2010, the Company had estimated net loss carry forwards of approximately $8,400 which expire through its tax year ending 2030. Utilization of these net operating loss carry forwards may be limited in accordance with IRCD Section 3.82 in the event of certain shifts in ownership.
NOTE 4. STOCKHOLDERS' EQUITY
Common Stock
There are 75,000,000 Common Shares at $0.001 par value authorized with 9,000,000 Issued and Outstanding as of December 31, 2010. These shares were issued to the sole officer and director of the Company.
NOTE 5. RELATED PARTY TRANSACTIONS
The officer and director of the Company are involved in other business activities and may, in the future, become involved in other business opportunities that become available. They may face a conflict in selecting between the Company and other business interests. The Company has not formulated a policy for the resolution of such conflicts.
Drewrys Brewing Company
(A Development Stage Company)
NOTES TO FINANCIAL STATEMENTS
(DECEMBER 31, 2010)
(continued)
NOTE 6. GOING CONCERN
The accompanying financial statements have been prepared assuming that the Company will continue as a going concern. For the period October 11, 2010 through December 31, 2010 the Company has had a net loss of $8,399 to date due to professional and other fees paid. As of December 31, 2010, the Company has not emerged from the development stage. In view of these matters, recoverability of any asset amounts shown in the accompanying financial statements is dependent upon the Company's ability to begin operations and to achieve a level of profitability. Since inception, the Company has financed its activities principally from the sale of equity securities. The Company intends on financing its future development activities and its working capital needs largely from loans and the sale of public equity securities with some additional funding from other traditional financing sources, including term notes, until such time that funds provided by operations are sufficient to fund working capital requirements.
NOTE 7. TRADEMARKS AND LABEL DESIGNS
The Company owns trademarks and label designs for its’ various brands of beer. These costs provide future benefit to the Company and are considered to have an infinite life at this time. The life of these assets will be re-evaluated when they are placed into service.
PART II. INFORMATION NOT REQUIRED IN THE PROSPECTUS
OTHER EXPENSES OF ISSUANCE AND DISTRIBUTION
The registrant will pay for all expenses incurred by this offering. Whether or not all of the offered shares are sold, these expenses are estimated as follows:
|
SEC Filing Fee and Printing
|
$ | 100 | * | |
|
Legal Services
|
5,000 | |||
|
Accounting and Audit
|
3,000 | |||
|
Transfer Agent
|
500 | * | ||
|
TOTAL
|
$ | 8,600 |
* estimate
To the fullest extent permitted by the Nevada Business Corporation Act, the Corporation shall indemnify, or advance expenses to, any person made, or threatened to be made, a party to any action, suit or proceeding by reason of the fact that such person (i) is or was a director of the Corporation; (ii) is or was serving at the request of the Corporation as a director of another corporation, provided that such person is or was at the time a director of the Corporation; or (iv)is or was serving at the request of the Corporation as an officer of another Corporation, provided that such person is or was at the time a director of the corporation or a director of such other corporation, serving at the request of the Corporation. Unless otherwise expressly prohibited by the Nevada Business Corporation Act, and except as otherwise provided in the previous sentence, the Board of Directors of the Corporation shall have the sole and exclusive discretion, on such terms and conditions as it shall determine, to indemnify, or advance expenses to, any person made, or threatened to be made, a party to any action, suit, or proceeding by reason of the fact such person is or was an officer, employee or agent of the Corporation as an officer, employee or agent of another corporation, partnership, joint venture, trust or other enterprise.
Our bylaws provide for the indemnification of our directors and officers to the fullest extent permitted by the Nevada Business Corporation Act. We are not, however, required to indemnify any director or officer in connection with any (a) willful misconduct or (b) a conscious disregard for the best interests of the corporation in a proceeding by or in the right of the corporation to procure a judgment in its favor or in a proceeding by or in the right of a shareholder toward or on behalf of us in the performance of his or his duties as a director or officer. We are required to advance, prior to the final disposition of any proceeding, promptly on request, all expenses incurred by any director or officer in connection with that proceeding on receipt of any undertaking by or on behalf of that director or officer to repay those amounts if it should be determined ultimately that he or she is not entitled to be indemnified under our bylaws or otherwise.
We have been advised that, in the opinion of the SEC, any indemnification for liabilities arising under the Securities Act of 1933 is against public policy, as expressed in the Securities Act, and is, therefore, unenforceable.
RECENT SALES OF UNREGISTERED SECURITIES
(a) Prior sales of common shares
Drewrys Brewing Company is authorized to issue up to 75,000,000 shares of common stock with a par value of $0.001. For the period ended December 31, 2010, we had issued 9,000,000 common shares to our sole officer and director for a total consideration of $9,000. The issuance of the shares was made to the sole officer and director of the Company and an individual who is a sophisticated and accredited investor, therefore, the issuance was exempt from registration of the Securities Act of 1933 by reason of Section 4 (2) of that Act.
Drewrys Brewing Company is not listed for trading on any securities exchange in the United States, and there has been no active market in the United States or elsewhere for the common shares.
During the past year, Drewrys Brewing Company has sold the following securities which were not registered under the Securities Act of 1933, as amended:
For the period ended December 31, 2010, Drewrys Brewing Company issued 9,000,000 shares of common stock to the sole officer and director for cash proceeds of $2,550 at 0.001 per share and subscription receivable of $6,450.
EXHIBITS AND FINANCIAL STATEMENT SCHEDULES.
The following exhibits are filed as part of this registration statement, pursuant to Item 601 of Regulation K. All exhibits have been previously filed unless otherwise noted.
|
EXHIBIT NO.
|
DOCUMENT DESCRIPTION
|
|
|
3.1
|
||
|
3.2
|
||
|
4.1
|
||
|
5.1
|
||
|
14.1
|
||
|
23.1
|
||
|
23.2
|
Consent of Counsel (included in Exhibit 5.1).*
|
|
|
99.1
|
_________________
* Filed herewith
(B) DESCRIPTION OF EXHIBITS
|
EXHIBIT 3.1
|
Articles of Incorporation of Drewrys Brewing Company
|
|
EXHIBIT 3.2
|
Bylaws of Drewrys Brewing Company
|
|
EXHIBIT 4.1
|
Specimen Stock Certificate of Drewrys Brewing Company
|
|
EXHIBIT 5.1
|
Opinion of Counsel.
|
|
EXHIBIT 14.1
|
Code of Business Conduct and Ethics.
|
|
EXHIBIT 23.1
|
Consent of Accountants
|
|
EXHIBIT 23.2
|
Consent of Counsel (included in Exhibit 5.1)
|
|
EXHIBIT 99.1
|
Subscription Documents and Procedure of Drewrys Brewing Company
|
UNDERTAKINGS
The undersigned registrant hereby undertakes:
|
1.
|
To file, during any period in which offers or sales are being made, a post-effective amendment to this registration statement:
|
|
|
i.
|
To include any prospectus required by Section 10(a)(3) of the Securities Act of 1933;
|
|
|
ii.
|
To reflect in the prospectus any facts or events arising after the effective date of the registration statement (or the most recent post-effective amendment thereof) which, individually or in the aggregate, represent a fundamental change in the information set forth in the registration statement. Notwithstanding the foregoing, increase or decrease in the volume of securities offered (if the total dollar value of securities offered would not exceed that which was registered) and any deviation from the low or high end of the estimated maximum offering range may be reflected in the form of prospectus filed with the Commission pursuant to Rule 424(b) if, in the aggregate, the changes in volume and price represent no more than 20% change in the maximum aggregate offering price set forth in the "Calculation of Registration Fee" table in the effective registration statement.
|
|
|
iii.
|
To include any material information with respect to the plan of distribution not previously disclosed in the registration statement or any material change to such information in the registration statement.
|
|
2.
|
That, for the purpose of determining any liability under the Securities Act of 1933, each such post-effective amendment shall be deemed to be a new registration statement relating to the securities offered therein, and the offering of such securities at that time shall be deemed to be the initial bona fide offering thereof.
|
|
3.
|
To remove from registration by means of a post-effective amendment any of the securities being registered that remain unsold at the termination of the offering.
|
4. That, for the purpose of determining liability under the Securities Act of 1933 to any purchaser:
|
|
i.
|
If the registrant is subject to Rule 430C, each prospectus filed pursuant to Rule 424(b) as part of a registration statement relating to an offering, other than registration statements relying on Rule 430B or other than prospectuses filed in reliance on Rule 430A, shall be deemed to be part of and included in the registration statement as of the date it is first used after effectiveness. Provided, however, that no statement made in a registration statement or prospectus that is part of the registration statement or made in a document incorporated or deemed incorporated by reference into the registration statement or prospectus that is part of the registration statement will, as to a purchaser with a time of contract of sale prior to such first use, supersede or modify any statement that was made in the registration statement or prospectus that was part of the registration statement or made in any such document immediately prior to such date of first use.
|
|
5.
|
That, for the purpose of determining liability of the registrant under the Securities Act of 1933 to any purchaser in the initial distribution of the securities: The undersigned registrant undertakes that in a primary offering of securities of the undersigned registrant pursuant to this registration statement, regardless of the underwriting method used to sell the securities to the purchaser, if the securities are offered or sold to such purchaser by means of any of the following communications, the undersigned registrant will be a seller to the purchaser and will be considered to offer or sell such securities to such purchaser:
|
|
|
i.
|
Any preliminary prospectus or prospectus of the undersigned registrant relating to the offering required to be filed pursuant to Rule 424;
|
|
|
ii.
|
Any free writing prospectus relating to the offering prepared by or on behalf of the undersigned registrant or used or referred to by the undersigned registrant;
|
|
|
iii.
|
The portion of any other free writing prospectus relating to the containing material information about the undersigned registrant or its securities provided by or on behalf of the undersigned registrant; and
|
|
|
iv.
|
Any other communication that is an offer in the offering made by the undersigned registrant to the purchaser.
|
Insofar as indemnification for liabilities arising under the Securities Act of 1933, may be permitted to directors, officers and controlling persons of the registrant pursuant to the foregoing provisions, or otherwise, the registrant has been advised that in the opinion of the Securities and Exchange Commission such indemnification is against public policy as expressed in the Act and is, therefore, unenforceable. In the event that a claim for indemnification against such liabilities (other than the payment by the registrant of expenses incurred or paid by a director, officer or controlling person of the registrant in the successful defense of any action, suit or proceeding) is asserted by such director, officer or controlling person in connection with the securities being registered, the registrant will, unless in the opinion of its counsel the matter has been settled by controlling precedent, submit to a court of appropriate jurisdiction the question whether such indemnification by it is against public policy as expressed in the Act and will be governed by the final adjudication of such issue.
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the registrant certifies that it has reasonable grounds to believe that it meets all of the requirements of filing on this Form S-1. Furthermore, the registrant has authorized this registration statement and has duly caused this Form S-1 registration statement to be signed on its behalf by the undersigned, thereunto duly authorized, in McHenry, IL 60050, on this 11th day of April, 2011.
Drewrys Brewing Company
/s/ Francis Manzo
Francis Manzo
President, Chief Executive Officer,
Sole Member of the Board of Directors
Chief Financial Officer
Principal Accounting Officer
Secretary
POWER OF ATTORNEY
Know all men by these present, that each person whose signature appears below constitutes and appoints Francis Manzo, as agent, with full power of substitution, for his and in his name, place and stead, in any and all capacities, to sign any and all amendments, including post-effective amendments, to this registration statement, and to file the same, therewith, with the Securities and Exchange Commission, and to make any and all state securities law filings, granting unto said attorney-in-fact and agent, full power and authority to do and perform each and every act and thing requisite or necessary to be done in about the premises, as fully to all intents and purposes as he might or could do in person, hereby ratifying the confirming all that said attorney-in-fact and agent, or any substitute or substitutes, may lawfully do or cause to be done by virtue hereof. Pursuant to the requirements of the Securities Act of 1933, this Form S-1 registration statement has been signed by the following persons in the capacities and on the dates indicated:
|
/s/ Francis Manzo
|
Dated: April 11, 2011
|
|
Francis Manzo
|
|
|
President, Chief Executive Officer,
Sole Member of the Board of Directors
|
|
|
Chief Financial Officer
|
|
|
Principal Accounting Officer
|
|
|
Secretary
|
II - 6