SEC Company Response from ENCORE CLEAN ENERGY, INC (CIK 0001036588) — Jun 24, 2005
ENCORE CLEAN ENERGY, INC (CIK 0001036588)
Date: June 24, 2005 · CIK: 0001036588 · Accession: 0001062993-05-001446
AI Filing Summary & Sentiment
File numbers found in text: 000-26047
Referenced dates: June 20, 2005
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Filed by Automated Filing Services Inc. (604) 609-0244 - Encore Clean Energy Inc - Letter
O’Neill Law Group
PLLC
435 Martin Street, Suite 1010
Blaine, WA 98230
Stephen F.X. O’Neill*
Christian I. Cu**
Telephone:
360-332-3300
Facsimile:
360-332-2291
E-mail:
cic@stockslaw.com
File # 4329
June 23, 2005
VIA EDGAR &
FACSMILE - 202-772-9209
THE UNITED STATES SECURITIES
AND EXCHANGE COMMISSION
Division of Corporation Finance
100 F Street, N.E.
Mail Stop 4561
Washington, DC 20549
Attention: Robert F. Telewicz,
Jr., Staff Accountant
Dear Sirs:
RE:
ENCORE CLEAN ENERGY, INC. (the “Company”)
-
SEC File Number 000-26047
-
Item 4.02 Form 8-K filed May 16, 2005
We write on behalf of Encore Clean Energy, Inc. (the “Company”) in
response to your comment letter dated June 20, 2005 regarding the Company’s
above-referenced Form 8-K filing (the “Comment Letter”).
Our responses herein are based on the factual information
provided to us by the Company. Paragraph numbering used for each response corresponds
to the numbering used in the Comment Letter. Capitalized terms used herein and
not defined, have the same meanings given such terms in the Form 8-K.
FORM 8-K
1.
PLEASE TELL US IF YOUR
CERTIFYING OFFICERS HAVE RECONSIDERED THE EFFECT ON THE ADEQUACY OF
YOUR DISCLOSURE CONTROLS AND PROCEDURES AS OF THE END OF THE PERIOD COVERED
BY YOUR FORMS 10-Q FOR THE PERIODS ENDED MARCH 31, 2004, JUNE
30, 2004 AND SEPTEMBER 30, 2004 IN LIGHT OF THE MATERIAL
ERROR YOU HAVE DISCLOSED. ADDITIONALLY, TELL US WHAT EFFECT THE
ERROR HAD ON YOUR CURRENT EVALUATION OF DISCLOSURE CONTROLS AND
PROCEDURES AS OF YOUR FISCAL YEAR END DECEMBER 31, 2004.
In response to this comment, the Company
has informed us that Daniel Hunter, the Company’s certifying officer,
performed a review of the Company’s disclosure controls and procedures
in place during the interim periods ended March 31, 2004, June 30, 2004
and September 30, 2004 and the year ended December 31, 2004 and is satisfied
that such controls and procedures were adequate to ensure that the information
required to be disclosed in the Company’s reports under the Securities
Exchange Act of 1934 (the “Exchange Act”) were recorded, processed,
summarized and reported within the periods specified in the SEC’s
rules and forms. Further, Mr. Hunter is satisfied that the error leading
to the restatement of the financial statements for the periods described
above is not indicative of any systemic deficiencies in the Company’s
disclosure controls and procedures and that such errors are not likely
to be repeated in the future.
VANCOUVER
OFFICE:
O’Neill Law
Corporation
Suite 1880, 1055 West Georgia Street, Box 11122, Vancouver, British Columbia,
Canada V6E 3P3
Tel: (604) 687-5792 / Fax: (604) 687-6650
*Washington and British Columbia Bars; ** Nevada, Washington
and British Columbia Bars
O’Neill Law Group PLLC
2
United States Securities and Exchange
Commission
Attention: Mr. Robert Telewicz
The Company’s previously issued
financial statements for the periods set out above mistakenly failed to
account for the royalty advances/consulting fees payable to Robert D.
Hunt pursuant to the Exclusive License Agreement between Cryotherm, Inc.
and Mr. Hunt (the “Hunt License Agreement”). The Hunt License
Agreement was assumed by the Company upon completion of the acquisition
of and merger with Cryotherm in 2003. The Company believes that the failure
to account for the royalty advances/consulting fees is a result of a mistake
made when consolidating the books and accounts of the Company with Cryotherm
upon completion of the merger. An accrual for the royalty advances/consulting
fees payable to Mr. Hunt under the Hunt License Agreement was never recorded
in Cryotherm’s financial records. As a result, when merging the
financial records of Cryotherm with the Company’s, the Company’s
financial personnel failed to realize the omission and thus failed to
record the accrual as well. Furthermore, the Company’s auditors
also did not recognize the omission and thus did not advise the Company
of such. As the Company was not aware that the omission had been made,
it mistakenly failed to record the accrual in its interim financial statements
for the periods ended March 31, 2004, June 30, 2004 and September 30,
2004. Upon reviewing the convertible note issued to Mr. Hunt effective
January 14, 2005 in payment of the amounts owing under the Hunt License
Agreement, the Company realized the omission had been made and restated
its financial statements for those interim periods and for the year ended
December 31, 2003 in order to correct the error.
At all times, the Company’s executive
officers and financial personnel were aware of the Hunt License Agreement,
and a copy was attached as an exhibit to the Company’s Annual Report
on Form 10-KSB for the year ended December 31, 2003. In addition, the
Company made full disclosure of the amounts payable under the Hunt License
Agreement in that Annual Report.
As the error leading to the restatement
of the Company’s financial statements stemmed from an error made
in the financial records of Cryotherm and from the consolidation of those
records with the records of the Company upon completion of the merger,
Mr. Hunter is satisfied that similar errors are unlikely to be repeated
in the future.
A statement from the Company, as requested in the Comment Letter,
is attached.
If you have any questions or require any additional information or documents, please telephone the undersigned at (604) 687-5792.
Yours truly,
“Christian I. Cu”
CHRISTIAN I. CU
CIC/clk
Enclosure
cc: Encore Clean Energy, Inc.
Attn: Mr. Daniel B. Hunter,
President
ACKNOWLEDGEMENT OF ENCORE CLEAN ENERGY, INC.
Encore Clean Energy, Inc. (the “Company”), hereby acknowledges
that:
the Company is responsible for the adequacy and accuracy of the disclosures
made in its filings;
United States Securities and Exchange Commission (the
“Commission”) staff comments or changes to our disclosure made
in response to Commission staff comments do not foreclose the Commission
from taking any action with respect to the Company’s filings; and
the Company may not assert Commission staff comments as
a defense in any proceeding initiated by the Commission or any person under
the federal securities laws of the United States.
Dated the 23rd day of June, 2005.
ENCORE CLEAN ENERGY, INC.
Per:
/s/ Daniel B. Hunter
Daniel B. Hunter
Chief Executive Officer, Chief Financial Officer
and President