SEC Company Response from TRADEQUEST INTERNATIONAL INC (CIK 0000029322) — Sep 28, 2005
TRADEQUEST INTERNATIONAL INC (CIK 0000029322)
Date: Sept. 28, 2005 · CIK: 0000029322 · Accession: 0001289623-05-000138
AI Filing Summary & Sentiment
Referenced dates: September 27, 2005
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CORRESP
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filename1.htm
sec response letter
E-Mail: mindeglia@spectrumlawgroup.com
File
No.: 10064.02
September
28, 2005
VIA
EDGAR AND FACSIMILE ONLY
FAX
No.: (202) 772-9210
Securities
and Exchange Commission
Division
of Corporation Finance
450
5th
Street, N.W.
Washington,
D.C. 20459
Mail
Stop
0304
Re: Tradequest
International, Inc.
Form
10-KSB for Fiscal Year Ended December 31, 2004
SEC
File
No. 0-27609
Ladies
and Gentlemen:
On
behalf
of our client, Tradequest International, Inc., a Nevada corporation
(“Tradequest”), set forth below are Tradequest’s responses to the comments of
the staff delivered by way of its letter dated September 27, 2005, numbered
in a
manner to correspond to the order to which the staff’s comments were
delivered.
Form
10-KSB for Fiscal Year Ended December 31, 2004
Note
5
- Change of Ownership, page 13
1. At
the
time of the issuance of the 40,278,490 shares of common stock to Loyola Holdings
and Margot Hutchinson, the board of directors of Tradequest consisted of
Randall
K. Read, Karleen Reed, and Ashley Jorgenson, none of whom are currently
affiliated with Tradequest. However, current management is informed and believes
that the directors of Tradequest at the time of the transaction were looking
to
raise sufficient capital to satisfy Tradequest’s outstanding liabilities at that
time, including amounts owed to Mr. Read. Further, current management is
informed and believes that the directors of Tradequest at the time of the
transaction were seeking to sell off control of Tradequest.
The
directors that which approved the transaction in question had negotiated
at
arms-length with Loyola Holdings and Margot Hutchinson for the issuance and
acquisition of the 40,278,490 shares, and the most that Loyola Holdings and
Ms.
Hutchinson were willing to pay for the shares was $0.003 per share. Current
management is informed and believes that the prior directors determined that
$0.003 per share was fair value for the shares and considered the following
factors in making such a determination:
·
At
the time of the transaction, Tradequest had essentially no
assets;
·
At
the time of the transaction, Tradequest had no
operations;
·
At
the time of the transaction, Tradequest had a significant working
capital
deficit and stockholder’s deficit;
and
·
For
the periods preceding the transaction, Tradequest had essentially
no
revenues.
On
August
31, 2004, Tradequest’s common stock was quoted at $0.18 per share; however,
according to the published reports available on BigCharts.com, the stock
only
traded 1,200 shares on that day, for a total dollar volume of $216.00. Further,
according to BigCharts.com, less than 50,000 shares of Tradequest’s common stock
had traded in the entire month of August.
Current
management is informed and believes that, based on the arms-length negotiations
between Tradequest and the purchasers, the financial condition of Tradequest,
and the thinly-traded nature of Tradequest’s common stock, the board of
directors of Tradequest determined in good faith that the fair market value
of
shares of the common stock on the date of the transaction in question was
$0.003
per share.
2. At
the
time of the transaction in question, the major shareholder of Loyola Holdings
was not an officer of Tradequest; accordingly, Tradequest did not consider
SFAS
No. 123 to be applicable to the issuance of shares to Loyola
Holdings.
3. Other
than her status as a holder of greater than 10% of the common stock of
Tradequest from August 2004 to January 2005, Margot Hutchinson has never
been a
related party of Tradequest. Further, Margot Hutchinson is not a related
party
to either Loyola Holdings or Lalita Janke. Finally, Ms. Hutchinson has never
provided any services to Tradequest.
Item
12. Certain Relationships and Related Transactions
4. Tradequest
accounted for the issuance of 4,305,556 shares of common stock to Randall
K.
Read pursuant to the Release and Indemnity Agreement by crediting Stockholder’s
Equity in the amount of $11,840 and debiting General, and Administrative
Expense
in the amount of $11,840, pursuant to SFAS 123. The value per share was
determined at fair value as set forth in Response to Comment #1
above.
5. Tradequest
has no obligation to pay the Text Retrieval Systems, Inc. royalty. The rights
to
the royalty income were assigned directly to Mr. Read, and any payments on
the
royalty are made by Text Retrieval Systems, Inc. directly to Mr. Read. Since
the
assignment of this royalty, no amounts have been paid to or are owed to Mr.
Read
by Tradequest.
Text
Retrieval Systems is formerly a subsidiary of Tradequest. According to filings
previously made with the SEC, Tradequest spun Text Retrieval Systems off
in
1998. There is currently no relationship between Text Retreival Systems and
Tradequest at this time.
On
behalf
of Tradequest, please be advised that Tradequest has endeavored to respond
fully
to each of the staff’s comments. We acknowledge and understand that any comment
from the staff regarding these issues would not be binding and would not
commit
the staff in any manner. Further, Tradequest acknowledges the
following:
·
It
is responsible for the adequacy and accuracy of the disclosure
in its
filings;
·
Staff
comments or changes to disclosure in response to staff comments
do not
foreclose the Commission from taking any action with respect to
the
filings; and
·
Tradequest
may not assert staff comments as a defense in any proceeding initiated
by
the Commission or any person under the federal securities laws
of the
United States.
Please
advise us as soon as possible if the staff has any further comments relating
to
either of the above-referenced filing. You can contact the undersigned at
(949)
851-4300. Thank you in advance for your courtesy and cooperation.
Very
truly yours,
Spectrum
Law Group, LLP
/S/
Marc
A. Indeglia
Marc
A.
Indeglia
MAI:wfr
cc: Tradequest
International, Inc.