SecProbe.io

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Mail Stop 3561

      December 15, 2005

Mr. Patrick Soon-Hock Lim
Chairman and Chief Executive Officer
Secured Digital Applications, Inc.
11, Jalan 51A/223
46100 Petaling Jaya
Selangor, Malaysia

	RE:	Secured Digital Applications, Inc.
		Form 10-KSB for Fiscal Year Ended December 31, 2005
		Filed April 15, 2005

Form 10-QSB for Fiscal Quarters Ended March 31, 2005, June 30,
2005
and September 30, 2005
		File No. 000-25658

Dear Mr. Lim:

      We have reviewed your supplemental response letter dated
November 25, 2005 as well as the above referenced filings and have
the following comments.  As noted in our comment letter dated
November 4, 2005, we have limited our review to your financial
statements and related disclosures and will make no further review
of
your documents.  As such, all persons who are responsible for the
adequacy and accuracy of the disclosure are urged to be certain
that
they have included all information required pursuant to the
Securities Exchange Act of 1934.

Form 10-KSB for Fiscal Year Ended December 31, 2004

Note 12: Convertible Term Notes, page F-28
1. We note your response to comment 1.  According to paragraph 4
of
EITF 00-19, in order for your convertible debt to be considered
conventional, the holder may only realize the value of the
conversion
option by exercising the option and receiving the entire proceeds
in
a fixed number of shares or the equivalent amount of cash, at the
discretion of the issuer.  Based on our review of your agreements,
your convertible debt fails this test on several levels, as
follows:
* According to paragraph 3.4(c) of your Secured Convertible Term
Note
agreement, the conversion price is immediately reset if you issue
common stock, or securities convertible into common stock, for
consideration, or with a conversion price, less than the
conversion
price of your note.  Therefore the conversion price on your note
is
not fixed.

* Your provision that the holder has the option of converting into
shares provided that your shares have a VWAP of 110% above the
exercise price for the ten trading days immediately preceding the
due
date creates a situation where the value of the shares issued
would
exceed the cash settlement by at least 10%.  Therefore, conversion
of
the debt into shares would not result in an equivalent amount of
cash.

* Finally, principal and interest payments on your debt can be
paid
in cash or in common stock, subject to certain conditions, at the
option of the holder, not the issuer.

Because your debt is not conventional convertible, you must
continue
your analysis under paragraphs 12-32 of EITF 00-19 to evaluate
whether your conversion feature is an equity instrument and
thereby
excluded from the scope of SFAS 133.  Based on paragraph 16 of
EITF
00-19, you would ignore the uneconomic settlement alternative of
not
issuing registered shares and paying the penalty and only consider
the option of issuing registered shares to settle this feature.
Based on paragraph 14, issuing registered shares is outside of
your
control. As a result, we believe that the conversion feature on
your
convertible term note would not qualify for equity classification
and
therefore would not be excluded from the scope of SFAS 133.
Because
your conversion feature is considered an embedded derivative under
SFAS 133, it must be separated from the debt host and accounted
for
at fair value.  Please revise your financial statements to
classify
the conversion feature on your convertible debt as a derivative
liability with changes in fair value recorded in earnings for the
appropriate periods and reverse any beneficial conversion features
recognized in association with this conversion feature under
EITF`s
98-5 and 00-27.
Note 13: Shareholders` Equity, page F-29

2. We note your response to comment 2.  We believe that because of
the nature of the cumulative preferred dividends on your
convertible
preferred stock, the economic characteristics of your preferred
stock
are more akin to debt.  Secondly, your preferred stock shares some
of
the same relevant provisions as your convertible debt discussed in
comment 1 above and is therefore not conventional convertible.
Just
as for your convertible debt you must therefore consider whether,
if
freestanding, the conversion feature would be classified as equity
based on analysis of paragraphs 12-32 of EITF 00-19 in order to
determine whether the feature is within the scope of SFAS 133 and
needs to be bifurcated and fair valued.

We believe the "liquidated damages" associated with the
registration
requirement on the shares underlying the conversion option are too
significant to be considered compensation for the difference
between
the value of registered and unregistered shares and are therefore,
in
substance, a penalty.  Issuance of unregistered shares and payment
of
this penalty would be considered an uneconomic settlement
alternative
to settlement in registered shares.  Paragraph 16 of EITF 00-19
requires that you disregard this uneconomic alternative and assume
settlement in registered shares, which is outside of your control.
Based on these facts, we believe that the conversion feature on
the
convertible preferred stock issued to Laurus, similar to the
conversion feature on the convertible note, is an embedded
derivative
that must be separated from the host contract and accounted for at
fair value under SFAS 133.  Please revise your financial
statements
to classify the conversion feature on your convertible preferred
stock as a derivative liability with changes in fair value
recorded
in earnings for the appropriate periods.

Preferred Stock of a Subsidiary, page F-29

3. We note your response to comment 3.  The conditions on the
issuance of your Series A convertible preferred shares that
resulted
in the redemption of the shares being outside of your control do
not
appear to have been met or removed until November 15, 2004.
Additionally, even after potential for redemption is removed, it
appears to us that you should classify the preferred stock issued
by
your subsidiary as minority interest instead of equity.  Please
revise your financial statements to appropriately classify the
proceeds of this issuance outside of permanent equity.

4. We note your response to comment 4.  Refer to our discussion in
comment 2 above as your warrants carry certain provisions similar
to
those of the conversion feature on your preferred shares.  Please
revise your financial statements to classify the warrants as a
liability with changes in fair value recorded in earnings for the
appropriate periods.

*    *    *    *

      Please respond to these comments within 10 business days or
tell us when you will provide us with a response.  Please furnish
a
letter that keys your responses to our comments and provides any
requested supplemental information.  Please file your response
letter
on EDGAR. Please understand that we may have additional comments
after reviewing your amendment and responses to our comments.

      You may contact Kenya Wright Gumbs, Staff Accountant, at
(202)
551-3373 or Carlos Pacho, Senior Assistant Chief Accountant, at
(202)
551-3835 if you have questions regarding comments on the financial
statements and related matters.  Please contact me at (202) 551-
3810
with any other questions.

								Sincerely,

								Larry M. Spirgel
								Assistant Director

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Patrick Soon-Hock Lim
Secured Digital Applications, Inc.
December 15, 2005
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