SEC Company Response from LEGEND INTERNATIONAL HOLDINGS INC (CIK 0001132143) — Nov 7, 2005
LEGEND INTERNATIONAL HOLDINGS INC (CIK 0001132143)
Date: Nov. 7, 2005 · CIK: 0001132143 · Accession: 0001157523-05-009797
AI Filing Summary & Sentiment
File numbers found in text: 000-32551
Referenced dates: July 28, 2005
Letter
------------------------------------ Level 8, 580 St Kilda Road, Melbourne Victoria 3004, Australia PO Box 6315, St Kilda Road Central Melbourne, Victoria 8008, Australia Telephone: +61 3 8532 2866 Facsimile: +61 3 8532 2805 Email: Igdi@axisc.com.au 20 October 2005 Securities and Exchange Commission 100F Street NE Washington D.C. 20549-4561 USA Attention: Mr J Forglione Staff Accountant Division of Corporation Finance
Dear Sir
Legend International Holdings, Inc Form 10-KSB for the year ended December 31, 2004 Filed March 31, 2005 File No. 000-32551
We refer to your letter dated July 28, 2005 and apologize for the delay in responding.
1. We have considered paragraphs 277 and 284 - 285 of SFAS 123 further.
Firstly, we would like to set out Legend's history which we believe is important to this discussion. As disclosed in our 2004 Form 10-KSB, Legend was incorporated in the State of Delaware on January 5, 2001, to engage in the business of selling compatible inkjet cartridges and refill kits on the Internet. In March 2003, management of the Company decided to engage in the business of building and acquiring controlling or other interests in one or more companies engaged in the contract sales and distribution of specialty medical products, and raise additional capital for this purpose. Neither business was successful and operations of both were eventually discontinued. During fiscal 2004, management of the Company developed a plan of operations to acquire income-producing real property. The Company did not acquire any properties pursuant to such plan.
Following the change of management in November 2004, the Company has developed a new plan of operations for fiscal 2005, which is to engage in mineral exploration and development activities. Legend's current business plan calls for the identification of mineral properties, in South America and other parts of the world, where it can obtain secure title to exploration, development and mining interests. Our preference is to identify large gold deposits with low operating costs. We are prepared to consider the exploration, development and mining of profitable base metal interests.
To date, we have not identified any such mineral properties.
<PAGE>
It is our view, that whilst it is the intention of Legend to enter into the mineral exploration industry, at December 31, 2004, it had not identified any mineral properties, as detailed in our Form 10-KSB. In addition, it had abandoned any historical activities. Accordingly, it is our belief that to consider the historical volatility of similar entities following a comparable period in their lives in the mineral exploration industry is not correct as the Company had not commenced activities in that industry. Equally, to compare historical volatility to comparable companies in which the Company formally operated is also incorrect as the Company is no longer in that industry. We believe that the Company, at December 31, 2004 had no real industry classification. It had an intent to move into the mineral exploration industry which occurred post December 31, 2004.
Finally, after management performed the Black Scholes computation and came to a value of the options, management considered the value of the benefits passing to the corporation and the value of the options granted and believed the value was reasonable.
2. Attached is the historical volatility for the period November 6, 2003 to November 12, 2004.
If you require any further information, please do not hesitate to contact me.
/S/ PETER LEE ---------------------------------- PETER LEE Chief Financial Office & Secretary
<PAGE>
ERI's Black-Scholes Calculator -------------------------------------------------------------------------------- INPUT DATA
Stock Asset Price: .05 US$ Example: "42.00"
Option Strike Price: .05 US$ Example: "42.00"
Maturity (Time Until Expiration): 5 Years Example: "1.5"
Risk-Free Interest Rate: .05155 Annual% Example: ".05" (for 5%)
Volatility: .167 Annual% Example: ".20" (for 20%)
CALCULATE CLEAR FIELDS --------------------------------------------------------------------------------
OPTIONS (FAIR VALUE)
European Call: 0.0137 US$
European Put: 0.0024 US$ --------------------------------------------------------------------------------
Provided by ERI Economic Research Institute -- Your research outsource for salary survey, cost of living and executive data.
To learn more about how to use the Black-Scholes method to place a value on stock options, please see ERI's free online course #22 - Black Scholes Valuations.
<PAGE>
LEGEND INT HLD'S INC
Date Open Close Close/Open Natural Logarithun of open/close 12-Nov-04 0.05 0.05 0 0 11-Nov-04 0.05 0.05 0 0 10-Nov-04 0.06 0.06 0 0 9-Nov-04 0.06 0.06 0 0 8-Nov-04 0.06 0.06 0 0 5-Nov-04 0.06 0.06 0 0 4-Nov-04 0.06 0.06 0 0 3-Nov-04 0.06 0.06 0 0 2-Nov-04 0.06 0.06 0 0 1-Nov-04 0.06 0.06 0 0 29-Oct-04 0.05 0.05 0 0 28-Oct-04 0.05 0.05 0 0 27-Oct-04 0.05 0.05 0 0 26-Oct-04 0.05 0.05 0 0 25-Oct-04 0.05 0.05 0 0 22-Oct-04 0.05 0.05 0 0 21-Oct-04 0.05 0.05 0 0 20-Oct-04 0.05 0.05 0 0 19-Oct-04 0.05 0.05 0 0 18-Oct-04 0.05 0.05 0 0 15-Oct-04 0.05 0.05 0 0 14-Oct-04 0.05 0.05 0 0 13-Oct-04 0.05 0.05 0 0 12-Oct-04 0.05 0.05 0 0 11-Oct-04 0.05 0.05 0 0 8-Oct-04 0.05 0.05 0 0 7-Oct-04 0.05 0.05 0 0 6-Oct-04 0.05 0.05 0 0 5-Oct-04 0.05 0.05 0 0 4-Oct-04 0.05 0.05 0 0 1-Oct-04 0.05 0.05 0 0 30-Sep-04 0.05 0.05 0 0 29-Sep-04 0.05 0.05 0 0 28-Sep-04 0.05 0.05 0 0 27-Sep-04 0.05 0.05 0 0 24-Sep-04 0.05 0.05 0 0 23-Sep-04 0.05 0.05 0 0 22-Sep-04 0.05 0.05 0 0 21-Sep-04 0.05 0.05 0 0 20-Sep-04 0.02 0.02 0 0 17-Sep-04 0.02 0.02 0 0 16-Sep-04 0.02 0.02 0 0 15-Sep-04 0.02 0.02 0 0 14-Sep-04 0.02 0.02 0 0 13-Sep-04 0.02 0.02 0 0 10-Sep-04 0.02 0.02 0 0 9-Sep-04 0.02 0.02 0 0 8-Sep-04 0.02 0.02 0 0 7-Sep-04 0.02 0.02 0 0 6-Sep-04 0.02 0.02 0 0 3-Sep-04 0.02 0.02 0 0 2-Sep-04 0.02 0.02 0 0 1-Sep-04 0.02 0.02 0 0 31-Aug-04 0.02 0.02 0 0 30-Aug-04 0.02 0.02 0 0 27-Aug-04 0.02 0.02 0 0 26-Aug-04 0.03 0.02 0 0 25-Aug-04 0.03 0.03 0 0 24-Aug-04 0.03 0.03 0 0 23-Aug-04 0.03 0.03 0 0 20-Aug-04 0.03 0.03 0 0 19-Aug-04 0.03 0.03 0 0 18-Aug-04 0.03 0.03 0 0 17-Aug-04 0.03 0.03 0 0 16-Aug-04 0.03 0.03 0 0 13-Aug-04 0.03 0.03 0 0 12-Aug-04 0.03 0.03 0 0 11-Aug-04 0.03 0.03 0 0 10-Aug-04 0.03 0.03 0 0 9-Aug-04 0.04 0.04 0 0 6-Aug-04 0.04 0.04 0 0 5-Aug-04 0.04 0.04 0 0 4-Aug-04 0.04 0.04 0 0 3-Aug-04 0.04 0.04 0 0 2-Aug-04 0.06 0.04 1.5 0.08804563 30-J u 1-04 0.04 0.04 0 0 29-Jul-04 0.04 0.04 0 0 28-Jul-04 0.04 0.04 0 0 27-Jul-04 0.04 0.04 0 0 26-Jul-04 0.04 0.04 0 0 23-Jul-04 0.04 0.04 0 0 22-Jul-04 0.04 0.04 0 0 21-Jul-04 0.04 0.04 0 0 20-Jul-04 0.04 0.04 0 0 19-Jul-04 0.04 0.04 0 0 16-Jul-04 0.04 0.04 0 0 15-Jul-04 0.04 0.04 0 0 14-J u 1-04 0.04 0.04 0 0 13-Jul-04 0.04 0.04 0 0 12-Jul-04 0.04 0.04 0 0 9-Jul-04 0.04 0.04 0 0 8-J u 1-04 0.04 0.04 0 0 7-Jul-04 0.04 0.04 0 0 6-Jul-04 0.04 0.04 0 0 2-Jul-04 0.04 0.04 0 0 1-Jul-04 0.04 0.04 0 0 30-Jun-04 0.05 0.04 1.25 0.048455007 29-Jun-04 0.05 0.05 0 0 28-Jun-04 0.05 0.05 0 0 25-Jun-04 0.05 0.05 0 0 24-Jun-04 0.05 0.05 0 0 23-Jun-04 0.05 0.05 0 0 22-Jun-04 0.05 0.05 0 0 21-Jun-04 0.05 0.05 0 0 18-Jun-04 0.05 0.05 0 0 17-Jun-04 0.05 0.05 0 0 16-Jun-04 0.05 0.05 0 0 15-Jun-04 0.05 0.05 0 0 14-Jun-04 0.05 0.05 0 0 10-Jun-04 0.05 0.05 0 0 9-Jun-04 0.05 0.05 0 0 8-Jun-04 0.05 0.05 0 0 7-Jun-04 0.06 0.06 0 0 4-Jun-04 0.06 0.06 0 0 3-Jun-04 0.08 0.06 1.333333333 0.062469368 2-Jun-04 0.09 0.09 0 0 1-Jun-04 0.13 0.1 1.3 0.056971676 28-May-04 0.17 0.17 0 0 27-May-04 0.17 0.17 0 0 26-May-04 0.17 0.17 0 0 25-May-04 0.17 0.17 0 0 24-May-04 0.17 0.17 0 0 21-May-04 0.17 0.17 0 0 20-May-04 0.17 0.17 0 0 19-May-04 0.14 0.17 0.823529412 -0.042160443 18-May-04 0.13 0.13 0 0 17-May-04 0.13 0.13 0 0 14-May-04 0.13 0.13 0 0 13-May-04 0.13 0.13 0 0 12-May-04 0.2 0.2 0 0 11-May-04 0.2 0.2 0 0 10-May-04 0.24 0.2 1.2 0.039590623 7-May-04 0.18 0.18 0 0 6-May-04 0.18 0.18 0 0 5-May-04 0.18 0.18 0 0 4-May-04 0.18 0.18 0 0 3-May-04 0.18 0.18 0 0 30-Apr-04 0.18 0.18 0 0 29-Apr-04 0.18 0.18 0 0 28-Apr-04 0.18 0.18 0 0 27-Apr-04 0.18 0.18 0 0 26-Apr-04 0.18 0.18 0 0 23-Apr-04 0.18 0.18 0 0 22-Apr-04 0.18 0.18 0 0 21-Apr-04 0.18 0.18 0 0
Show Raw Text
<DOCUMENT>
<TYPE>CORRESP
<SEQUENCE>1
<FILENAME>filename1.txt
<TEXT>
LEGEND Legend International Holdings, Inc.
INTERNATIONAL HOLDINGS INC. A Delaware Corporation
------------------------------------
Level 8, 580 St Kilda Road,
Melbourne Victoria 3004, Australia
PO Box 6315, St Kilda Road Central
Melbourne, Victoria 8008, Australia
Telephone: +61 3 8532 2866
Facsimile: +61 3 8532 2805
Email: Igdi@axisc.com.au
20 October 2005
Securities and Exchange Commission 100F Street NE
Washington D.C. 20549-4561
USA
Attention: Mr J Forglione
Staff Accountant
Division of Corporation Finance
Dear Sir
Legend International Holdings, Inc
Form 10-KSB for the year ended December 31, 2004
Filed March 31, 2005
File No. 000-32551
We refer to your letter dated July 28, 2005 and apologize for the delay in
responding.
1. We have considered paragraphs 277 and 284 - 285 of SFAS 123 further.
Firstly, we would like to set out Legend's history which we believe is
important to this discussion. As disclosed in our 2004 Form 10-KSB, Legend
was incorporated in the State of Delaware on January 5, 2001, to engage in
the business of selling compatible inkjet cartridges and refill kits on the
Internet. In March 2003, management of the Company decided to engage in the
business of building and acquiring controlling or other interests in one or
more companies engaged in the contract sales and distribution of specialty
medical products, and raise additional capital for this purpose. Neither
business was successful and operations of both were eventually
discontinued. During fiscal 2004, management of the Company developed a
plan of operations to acquire income-producing real property. The Company
did not acquire any properties pursuant to such plan.
Following the change of management in November 2004, the Company has
developed a new plan of operations for fiscal 2005, which is to engage in
mineral exploration and development activities. Legend's current business
plan calls for the identification of mineral properties, in South America
and other parts of the world, where it can obtain secure title to
exploration, development and mining interests. Our preference is to
identify large gold deposits with low operating costs. We are prepared to
consider the exploration, development and mining of profitable base metal
interests.
To date, we have not identified any such mineral properties.
<PAGE>
It is our view, that whilst it is the intention of Legend to enter into the
mineral exploration industry, at December 31, 2004, it had not identified
any mineral properties, as detailed in our Form 10-KSB. In addition, it had
abandoned any historical activities. Accordingly, it is our belief that to
consider the historical volatility of similar entities following a
comparable period in their lives in the mineral exploration industry is not
correct as the Company had not commenced activities in that industry.
Equally, to compare historical volatility to comparable companies in which
the Company formally operated is also incorrect as the Company is no longer
in that industry. We believe that the Company, at December 31, 2004 had no
real industry classification. It had an intent to move into the mineral
exploration industry which occurred post December 31, 2004.
Finally, after management performed the Black Scholes computation and came
to a value of the options, management considered the value of the benefits
passing to the corporation and the value of the options granted and
believed the value was reasonable.
2. Attached is the historical volatility for the period November 6, 2003 to
November 12, 2004.
If you require any further information, please do not hesitate to contact
me.
/S/ PETER LEE
----------------------------------
PETER LEE
Chief Financial Office & Secretary
<PAGE>
ERI's Black-Scholes Calculator
--------------------------------------------------------------------------------
INPUT DATA
Stock Asset Price: .05 US$ Example: "42.00"
Option Strike Price: .05 US$ Example: "42.00"
Maturity
(Time Until Expiration): 5 Years Example: "1.5"
Risk-Free Interest Rate: .05155 Annual% Example: ".05" (for 5%)
Volatility: .167 Annual% Example: ".20" (for 20%)
CALCULATE CLEAR FIELDS
--------------------------------------------------------------------------------
OPTIONS (FAIR VALUE)
European Call: 0.0137 US$
European Put: 0.0024 US$
--------------------------------------------------------------------------------
Provided by ERI Economic Research Institute -- Your research outsource for
salary survey, cost of living and executive data.
To learn more about how to use the Black-Scholes method to place a value on
stock options, please see ERI's free online course #22 - Black Scholes
Valuations.
<PAGE>
LEGEND INT HLD'S INC
Date Open Close Close/Open Natural Logarithun
of open/close
12-Nov-04 0.05 0.05 0 0
11-Nov-04 0.05 0.05 0 0
10-Nov-04 0.06 0.06 0 0
9-Nov-04 0.06 0.06 0 0
8-Nov-04 0.06 0.06 0 0
5-Nov-04 0.06 0.06 0 0
4-Nov-04 0.06 0.06 0 0
3-Nov-04 0.06 0.06 0 0
2-Nov-04 0.06 0.06 0 0
1-Nov-04 0.06 0.06 0 0
29-Oct-04 0.05 0.05 0 0
28-Oct-04 0.05 0.05 0 0
27-Oct-04 0.05 0.05 0 0
26-Oct-04 0.05 0.05 0 0
25-Oct-04 0.05 0.05 0 0
22-Oct-04 0.05 0.05 0 0
21-Oct-04 0.05 0.05 0 0
20-Oct-04 0.05 0.05 0 0
19-Oct-04 0.05 0.05 0 0
18-Oct-04 0.05 0.05 0 0
15-Oct-04 0.05 0.05 0 0
14-Oct-04 0.05 0.05 0 0
13-Oct-04 0.05 0.05 0 0
12-Oct-04 0.05 0.05 0 0
11-Oct-04 0.05 0.05 0 0
8-Oct-04 0.05 0.05 0 0
7-Oct-04 0.05 0.05 0 0
6-Oct-04 0.05 0.05 0 0
5-Oct-04 0.05 0.05 0 0
4-Oct-04 0.05 0.05 0 0
1-Oct-04 0.05 0.05 0 0
30-Sep-04 0.05 0.05 0 0
29-Sep-04 0.05 0.05 0 0
28-Sep-04 0.05 0.05 0 0
27-Sep-04 0.05 0.05 0 0
24-Sep-04 0.05 0.05 0 0
23-Sep-04 0.05 0.05 0 0
22-Sep-04 0.05 0.05 0 0
21-Sep-04 0.05 0.05 0 0
20-Sep-04 0.02 0.02 0 0
17-Sep-04 0.02 0.02 0 0
16-Sep-04 0.02 0.02 0 0
15-Sep-04 0.02 0.02 0 0
14-Sep-04 0.02 0.02 0 0
13-Sep-04 0.02 0.02 0 0
10-Sep-04 0.02 0.02 0 0
9-Sep-04 0.02 0.02 0 0
8-Sep-04 0.02 0.02 0 0
7-Sep-04 0.02 0.02 0 0
6-Sep-04 0.02 0.02 0 0
3-Sep-04 0.02 0.02 0 0
2-Sep-04 0.02 0.02 0 0
1-Sep-04 0.02 0.02 0 0
31-Aug-04 0.02 0.02 0 0
30-Aug-04 0.02 0.02 0 0
27-Aug-04 0.02 0.02 0 0
26-Aug-04 0.03 0.02 0 0
25-Aug-04 0.03 0.03 0 0
24-Aug-04 0.03 0.03 0 0
23-Aug-04 0.03 0.03 0 0
20-Aug-04 0.03 0.03 0 0
19-Aug-04 0.03 0.03 0 0
18-Aug-04 0.03 0.03 0 0
17-Aug-04 0.03 0.03 0 0
16-Aug-04 0.03 0.03 0 0
13-Aug-04 0.03 0.03 0 0
12-Aug-04 0.03 0.03 0 0
11-Aug-04 0.03 0.03 0 0
10-Aug-04 0.03 0.03 0 0
9-Aug-04 0.04 0.04 0 0
6-Aug-04 0.04 0.04 0 0
5-Aug-04 0.04 0.04 0 0
4-Aug-04 0.04 0.04 0 0
3-Aug-04 0.04 0.04 0 0
2-Aug-04 0.06 0.04 1.5 0.08804563
30-J u 1-04 0.04 0.04 0 0
29-Jul-04 0.04 0.04 0 0
28-Jul-04 0.04 0.04 0 0
27-Jul-04 0.04 0.04 0 0
26-Jul-04 0.04 0.04 0 0
23-Jul-04 0.04 0.04 0 0
22-Jul-04 0.04 0.04 0 0
21-Jul-04 0.04 0.04 0 0
20-Jul-04 0.04 0.04 0 0
19-Jul-04 0.04 0.04 0 0
16-Jul-04 0.04 0.04 0 0
15-Jul-04 0.04 0.04 0 0
14-J u 1-04 0.04 0.04 0 0
13-Jul-04 0.04 0.04 0 0
12-Jul-04 0.04 0.04 0 0
9-Jul-04 0.04 0.04 0 0
8-J u 1-04 0.04 0.04 0 0
7-Jul-04 0.04 0.04 0 0
6-Jul-04 0.04 0.04 0 0
2-Jul-04 0.04 0.04 0 0
1-Jul-04 0.04 0.04 0 0
30-Jun-04 0.05 0.04 1.25 0.048455007
29-Jun-04 0.05 0.05 0 0
28-Jun-04 0.05 0.05 0 0
25-Jun-04 0.05 0.05 0 0
24-Jun-04 0.05 0.05 0 0
23-Jun-04 0.05 0.05 0 0
22-Jun-04 0.05 0.05 0 0
21-Jun-04 0.05 0.05 0 0
18-Jun-04 0.05 0.05 0 0
17-Jun-04 0.05 0.05 0 0
16-Jun-04 0.05 0.05 0 0
15-Jun-04 0.05 0.05 0 0
14-Jun-04 0.05 0.05 0 0
10-Jun-04 0.05 0.05 0 0
9-Jun-04 0.05 0.05 0 0
8-Jun-04 0.05 0.05 0 0
7-Jun-04 0.06 0.06 0 0
4-Jun-04 0.06 0.06 0 0
3-Jun-04 0.08 0.06 1.333333333 0.062469368
2-Jun-04 0.09 0.09 0 0
1-Jun-04 0.13 0.1 1.3 0.056971676
28-May-04 0.17 0.17 0 0
27-May-04 0.17 0.17 0 0
26-May-04 0.17 0.17 0 0
25-May-04 0.17 0.17 0 0
24-May-04 0.17 0.17 0 0
21-May-04 0.17 0.17 0 0
20-May-04 0.17 0.17 0 0
19-May-04 0.14 0.17 0.823529412 -0.042160443
18-May-04 0.13 0.13 0 0
17-May-04 0.13 0.13 0 0
14-May-04 0.13 0.13 0 0
13-May-04 0.13 0.13 0 0
12-May-04 0.2 0.2 0 0
11-May-04 0.2 0.2 0 0
10-May-04 0.24 0.2 1.2 0.039590623
7-May-04 0.18 0.18 0 0
6-May-04 0.18 0.18 0 0
5-May-04 0.18 0.18 0 0
4-May-04 0.18 0.18 0 0
3-May-04 0.18 0.18 0 0
30-Apr-04 0.18 0.18 0 0
29-Apr-04 0.18 0.18 0 0
28-Apr-04 0.18 0.18 0 0
27-Apr-04 0.18 0.18 0 0
26-Apr-04 0.18 0.18 0 0
23-Apr-04 0.18 0.18 0 0
22-Apr-04 0.18 0.18 0 0
21-Apr-04 0.18 0.18 0 0