SEC Company Response from AMERICAN SOUTHWEST HOLDINGS INC (CIK 0001001516) — Oct 19, 2005
AMERICAN SOUTHWEST HOLDINGS INC (CIK 0001001516)
Date: Oct. 19, 2005 · CIK: 0001001516 · Accession: 0001076542-05-000253
AI Filing Summary & Sentiment
File numbers found in text: 000-27947
Referenced dates: September 26, 2005
Letter
VIA EDGAR AND FEDERAL EXPRESS Securities and Exchange Commission Division of Corporation Finance Mr. David R. Humphrey Re: American Southwest Holdings, Inc. Form 10-KSB for the Year Ended December 31, 2004 File 000-27947
Dear Mr. Humphrey:
On behalf of American Southwest Holdings, Inc. (the “Company”), set forth below are the Company’s responses to the Staff’s comment letter dated September 26, 2005, with respect to the above-referenced periodic reports of the Company. We have reproduced the Staff’s comments and have followed each comment with the Company’s response. References in this letter to “we,”“our” or “us” mean the Company or its advisors, as the context may require.
Form 10-KSB for the Fiscal Year Ended December 31, 2004
Item 7 - Financial Statements
Note 1 - Significant Accounting Policies and Use of Estimates
Goodwill - Mining Rights, page F-13
Comment
1.
We note your response to our prior comment #2. However, please note that footnote 4 within paragraph 9 of SFAS 141 refers to EITF 98-3, which provides guidance in determining whether a nonmonetary transaction represents the purchase of an asset or the acquisition of a business. Accordingly, we reissue our prior comment.
Response
The financial statements have been revised to report the transaction as an asset purchase. See Appendix 1.
Securities and Exchange Commission
Division of Corporation Finance
Re: American Southwest Holdings, Inc.
October 19, 2005
Page
Comment
2.
If you determine that your acquisition of Metal Sands Limited ("MSL") represents the purchase of an asset (i.e. mineral rights), please revise all related disclosures accordingly. Also, the parenthetical reference in Note 7 related to the issuance of approximately 33,000,000 shares in connection with the acquisition of MSL should refer to Note 8, not Note 7.
Response
The financial statements have been revised to report the transaction as an asset purchase. See Appendix 1.
Note 8 - Acquisition of Metal Sands Limited, page F-21
Comment
3.
We note your response to our prior comments #3 and #4. However, in light of the absence of an active trading market for your common stock, as well as the absence of a valuation of the mining rights at the date of acquisition, we believe you do not have a sufficient basis for valuing the shares issued at $.04 per share. Therefore, based on the guidance in SAB 48, we believe you should record the mineral rights acquired at the transferor's historical cost. By reference to the financial statements of MSL, which were included in your December 15, 2004 Form 8-K, it appears that the historical cost of the mining rights is nominal. However, we would not object if you recorded the approximately 33,000,000 shares issued at their par value of $.001 per share (i.e. approximately $33,000.)
Response
The financial statements have been revised to report a value of $33,100 for the 33,100,000 shares of common stock issued. See Appendix 1.
Comment
4.
Costs related to your purchase of mining rights, such as the issuance of warrants valued at $300,000 for facilitation of the MSL transaction, should be expensed. Please revise your financial statements and related disclosure accordingly.
Securities and Exchange Commission
Division of Corporation Finance
Re: American Southwest Holdings, Inc.
October 19, 2005
Page
Response
The financial statements have been revised to expense the $300,000 facilitation fee for the MSL transaction. See Apendix 1.
General
Comment
5.
We note that you have not filed your Form 10-QSB for the quarterly period ended June 30, 2005 or a corresponding NT 10-QSB in relation to your delayed filing. Please tell us, in your response, the reason for the delay and file the required reports as soon as possible.
Response
The Company was waiting for the resolution of the above comments prior to filing the Form 10-QSB for the period ended June 30, 2005. The Company plans on filing the report within 10 days of notice that the Staff has no further comments.
We hope that the information contained in this letter satisfactorily addresses the comments by the Staff. If you have no further comments, these changes will be made in a Form 10-KSB amendment and corresponding changes in a Form 10-QSB amendment in a few days. Please direct any questions, requests for additional documentation or comments to the undersigned by telephone at (480) 443-9657, or by facsimile at (480) 443-1908.
Very
truly yours,
Michael
K. Hair, P.C.
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CORRESP
1
filename1.htm
Unassociated Document
Michael
K. Hair, P.C.
Attorney
at Law
7407
E. Ironwood Court
Scottsdale,
Arizona 85258
Telephone:
(480) 443-9657
October
19, 2005
VIA
EDGAR AND FEDERAL EXPRESS
Securities
and Exchange Commission
Division
of Corporation Finance
100
F
Street, N.E.
Washington
DC, 20549
Attn.:
Mr.
David R. Humphrey
Re:
American
Southwest Holdings, Inc.
Form
10-KSB for the Year Ended December 31, 2004
File
000-27947
Dear
Mr.
Humphrey:
On
behalf
of American Southwest Holdings, Inc. (the “Company”), set forth below are the
Company’s responses to the Staff’s comment letter dated September 26, 2005, with
respect to the above-referenced periodic reports of the Company. We have
reproduced the Staff’s comments and have followed each comment with the
Company’s response. References in this letter to “we,”“our” or “us” mean the
Company or its advisors, as the context may require.
Form
10-KSB for the Fiscal Year Ended December 31, 2004
Item
7 - Financial Statements
Note
1 - Significant Accounting Policies and Use of
Estimates
Goodwill
- Mining Rights, page F-13
Comment
1.
We
note your response to our prior comment #2. However, please
note
that footnote 4 within paragraph 9 of SFAS 141 refers to EITF 98-3,
which
provides guidance in determining whether a nonmonetary transaction
represents the purchase of an asset or the acquisition of a
business. Accordingly, we reissue our prior
comment.
Response
The financial statements have been revised to report
the
transaction as an asset purchase. See Appendix 1.
Securities
and Exchange Commission
Division
of Corporation Finance
Re:
American Southwest Holdings, Inc.
October
19, 2005
Page
2
Comment
2.
If
you determine that your acquisition of Metal Sands Limited ("MSL")
represents the purchase of an asset (i.e. mineral rights), please
revise
all related disclosures accordingly. Also, the parenthetical
reference in Note 7 related to the issuance of approximately
33,000,000
shares in connection with the acquisition of MSL should refer
to Note 8,
not Note 7.
Response
The financial statements have been revised to report
the
transaction as an asset purchase. See Appendix 1.
Note
8 - Acquisition of Metal Sands Limited, page F-21
Comment
3.
We
note your response to our prior comments #3 and #4. However,
in
light of the absence of an active trading market for your common
stock, as
well as the absence of a valuation of the mining rights at the
date of
acquisition, we believe you do not have a sufficient basis for
valuing the
shares issued at $.04 per share. Therefore, based on the
guidance in
SAB 48, we believe you should record the mineral rights acquired
at the
transferor's historical cost. By reference to the financial
statements of MSL, which were included in your December 15, 2004
Form 8-K,
it appears that the historical cost of the mining rights is nominal.
However, we would not object if you recorded the approximately
33,000,000
shares issued at their par value of $.001 per share (i.e. approximately
$33,000.)
Response
The financial statements have been revised to report
a value
of $33,100 for the 33,100,000 shares of common stock issued. See
Appendix
1.
Comment
4.
Costs
related to your purchase of mining rights, such as the issuance
of
warrants valued at $300,000 for facilitation of the MSL transaction,
should be expensed. Please revise your financial
statements and
related disclosure
accordingly.
Securities
and Exchange Commission
Division
of Corporation Finance
Re:
American Southwest Holdings, Inc.
October
19, 2005
Page
3
Response
The
financial statements have been revised to expense the $300,000 facilitation
fee
for the MSL transaction. See Apendix 1.
General
Comment
5.
We
note that you have not filed your Form
10-QSB for the quarterly period ended June 30, 2005 or a corresponding
NT
10-QSB in relation to your delayed filing. Please tell
us, in your
response, the reason for the delay and file the required reports
as soon
as possible.
Response
The
Company was waiting for the resolution of the
above comments prior to filing the Form 10-QSB for the period
ended June 30,
2005. The Company plans on filing the report within
10 days of notice that
the Staff has no further comments.
We
hope that
the information contained in this letter satisfactorily addresses
the comments
by the Staff. If you have no further comments, these
changes will be made
in a Form 10-KSB amendment and corresponding changes in a Form
10-QSB amendment
in a few days. Please
direct any questions, requests for additional documentation
or comments to the
undersigned by telephone at (480) 443-9657, or by facsimile
at (480)
443-1908.
Very
truly yours,
Michael
K. Hair, P.C.
By:
/s/
Michael K. Hair
Michael
K. Hair,
President
cc:
Alan
Doyle, American Southwest Holdings, Inc.
Debby
Tutrone, Semple & Cooper, LLP
Appendix
1
Report
of Independent Certified Public
Accountant
To
the
Board of Directors and Audit Committee
American
Southwest Holdings Inc.
I
have
audited the accompanying balance sheet of American Southwest
Holdings
Inc.,
(formerly Namibian Copper Mines, Inc.) (a Development Stage
Company) as of
December
31, 2003, and 2002 and the related statements of operations,
stockholders'
equity (deficit), and cash flows for the years 2003, 2002 and
2001 and the
period
from October 10, 1989 (inception) to December 31, 2003. These
financial
statements
are the responsibility of the Company's management. My responsibility
is
to
express an opinion on these financial statements based on my
audit.
I
conducted my audit in accordance with auditing standards generally
accepted in
the
United States of America. Those standards require that I plan
and perform
the
audit
to obtain reasonable assurance about whether the financial
statements
are
free
of material misstatement. An audit includes examining, on a
test basis,
evidence
supporting the amounts and disclosures in the financial statements.
An
audit
also includes assessing the accounting principles used and
significant
estimates
made by management, as well as evaluating the overall financial
statement
presentation. I believe that my audit provides a reasonable
basis for
my
opinion.
In
my
opinion, the financial statements referred to above present
fairly, in all
material
respects, financial position of American Southwest Holdings,
Inc. as of
December
31, 2003, and 2002 and the related statements of operations,
stockholders'
equity, and cash flows for the years 2003, 2002 and 2001 and
the period
from October 10, 1989 (inception) to December 31, 2003 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 in the notes
to the financial
statements, the Company has no established source of revenue
and no operations.
This raises substantial doubt about the Company's ability to
continue
as a going concern. The financial statements do not include
any adjustments
that might result from this uncertainty.
/s/
Shelley International CPA
January
25, 2004
Mesa
Arizona
F-3
AMERICAN
SOUTHWEST HOLDINGS,
INC.
(An
Exploration Stage Company)
Consolidated
Balance Sheets
December
31,
2004
2003
ASSETS
Cash
& cash equivalents
$
205,493
$
4,579
Receivables
3,065
—
Total
current assets
208,558
4,579
Property
and equipment, net
4,202
—
Mining
rights
228,099
—
Total
assets
$
440,859
$
4,579
LIABILITIES
AND SHAREHOLDERS' EQUITY
Accounts
payable and accrued liabilities
$
147,937
$
122,581
Due
to related parties
334,714
—
Loans
payable to related parties
41,495
36,980
Total
current liabilities
524,146
159,561
Common
stock
$.001
par value, 100,000,000 shares authorized, 82,150,806
and 28,163,950 shares
issued and outstanding at December 31, 2004 and
2003,
respectively
82,151
28,164
Paid
in capital
13,234,217
12,464,174
Common
stock subscribed
67,095
—
Deficit
accumulated during development stage
(13,460,872
)
(12,647,320
)
Foreign
currency translation adjustment (Note 1)
(5,878
)
—
Total
shareholders' deficit
(83,287
)
(154,982
)
Total
liabilities and shareholders' equity
$
440,859