SecProbe.io

CORRESP
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filename1.htm

Christopher E. Howard

One Monument Square

Portland, ME
04101

207-791-1335 voice

207-791-1350 fax

choward@pierceatwood.com

pierceatwood.com

August 11,
2005

Mr. Jeffrey Riedler

Assistant Director

Division of Corporation
Finance

Securities and Exchange
Commission

450 Fifth Street, N.W.

Washington, D.C. 20549

Re:          Advanced
Cell Technology, Inc. – SEC File No. 0-50295

Dear Mr. Riedler:

We are counsel to
Advanced Cell Technology, Inc., a Nevada corporation (the “Company”),
formerly known as A.C.T. Holdings, Inc.
This letter is being submitted to you in response to comments contained
in your letter of July 28, 2005, relating to the following Company filings
with the Securities and Exchange Commission (the “Commission”):  (1) Form 10-KSB filed January 31,
2005; (2) Form 8-K filed February 4, 2005; (3) Form 8-K/A
filed April 18, 2005; and (4) Form 10-QSB filed May 23,
2005.  These comments, and the responses
on behalf of the Company to these comments, are set forth below.  For your reference, we have attached copies
of our proposed amended filings on Form 10-KSB/A and Form 10-QSB/A
marked to show changes in response to your letters of June 30, 2005 and July 28,
2005.

1.             Form 10-QSB
— Our Intellectual Property, page 40

Comment 1:

“We note your response to comment
10.  Please include a summarized version
of this information in your amended filing so that investors know the basis for
your belief that your ‘intellectual property collectively represents one of the
strongest portfolios in the field.’”

Response to Comment 1

As requested, the Company
will include a summarized version of comment 10 in Item 5 of our Quarterly
Report on Form 10-QSB/A for the period ended March 31, 2005 (“Form 10-QSB/A”),
page 36.

Comment
2:

“We
note your response to comment 11.  Since
investors generally do not receive copies of correspondences from SEC staff
reviews, please revise the proposed disclosure so it does not reference the
comment numbers.  Upon deleting the
comment numbers, it will be necessary to expand the disclosure so that it
continues adequately to cover the information previously conveyed by the cross
references to comment numbers.”

Response to Comment 2

As requested, the Company
will include the expanded disclosure explaining the consequences of a patent’s
expiration in Item 5 to our Form 10-QSB/A, page 41, without
reference to comment numbers.

Notes to Consolidated Financial Statements

2.             Significant
Accounting Policies; Revenue Recognition, page 9

Comment
3:

“We
have read your response to comments 5 and 6.
You state in your response to comment 5 that you amortize the deferred
amounts over the estimated life of the underlying technologies licensed.  Please clarify to us that this is the same as
the estimated life of the sublicenses as stated in your response to comment 6
and if not, why.”

Response to Comment 3

The Company confirms that the estimated lives of the
sublicenses and the underlying technologies licensed are the same.

7.             Stockholders’
Equity Transactions, page 11

Comment
4:

“We
have read your response to comment 7.  We
note that you value the services based on the value of the Black Scholes method
for the warrants issued and that value is $0.
Please tell us why you have not used the fair value of the services
provided and why the fair value of the services it not more reliably
determinable than the warrants issued.”

2

Response to Comment 4

In valuing certain
stockholders’ equity transactions, the Company has analyzed the transactions in
order to ensure that the financial statements reflect the transactions at
either the value of services provided, or the value of securities issued,
whichever is more readily determinable.
The Company concluded that the value of warrants issued as a portion of
the consideration for services provided were more readily determinable, and
valued the warrants using a Black Scholes model.

The level of services
provided were minimal, and the value of the services is not readily
determinable.  The warrants were granted
with strike prices well in excess of the underlying shares’ fair value as an
incentive to the recipients, and in addition to fair consideration being paid
for the services.

In response to your question regarding such services,
we have conducted further investigation and held discussions with a number of
the warrant holders.  We have summarized
below the results of these additional discussions, which we believe provide
additional information indicating that the value of services are not readily
determinable, and if they were determinable, would be immaterial to the
financial results reported by the Company.

December 30,
2004 Warrants

Warrants to purchase
1,833,260 shares of common stock at $0.85 and warrants to purchase 1,291,615
shares of common stock at $2.00 were issued to three of our larger investors in
recognition of support in arranging the Merger.
No direct incremental services were provided by the entities and no
separate value can be placed on services provided.  Any outside estimate of the “value” of such
services would be difficult or impossible to obtain.

December 13,
2004 Warrants

1.                  Warrants
to purchase 1,488,000 shares of common stock were issued to an entity owned by
a principal of one of the Company’s significant investors.  The warrants were issued in recognition of
support in arranging the Company’s Series A Preferred financing.  No direct incremental services were provided
by the entity and no separate value can be placed on services provided.  Any outside estimate of the “value” of such
services would likely be less than $10,000.
In the event that costs were recorded by the Company, they would relate
directly to closing of the Series A Preferred financing, and such costs
would be offset against equity proceeds in the Company’s financial statements.

2.                  Warrants
to purchase 236,000 shares of common stock were issued to a consulting firm in
connection with services that were being provided during 2004.  William Caldwell, current Chief Executive
Officer of the Company, is a principal in the firm, and was paid fair value for
all consulting services

3

provided to the
Company, at the rate of $10,000 per month.
Accordingly, this warrant represented an additional incentive above and
beyond fair value received for services provided.

3.                  Warrants
to purchase 40,000 shares of common stock were issued to a consultant in
connection with services provided during 2004.
The consultant continues to be engaged by the Company, and was paid fair
value for all consulting services provided to the Company, at the rate of
$12,500 per month. Accordingly, this warrant represented an additional
incentive above and beyond fair value received for services provided.

4.                  Warrants
to purchase 105,000 shares of common stock were issued to legal firms in
connection with services provided to investors in the Series A Preferred
financing. Actual bills for legal services were paid directly by the investors,
with the warrants representing additional incentive above and beyond fair value
of services provided to the investors.
Investor legal fees related to these services were not paid by the
Company.  Any charges related to these
services would be offset against equity proceeds raised by the Company in the
equity financing.

5.                  Warrants
to purchase 75,000 shares of common stock were issued to a legal firm in
connection with services provided to the Company in the merger
transaction.  In addition to the warrant,
legal fees were billed and expensed by the Company and the warrant was issued
as an additional incentive.

6.                  Warrants
to purchase 10,000 shares of common stock were issued to one of the Series A
investors who assisted the Company in identifying additional potential
investors.  This investor received
warrants and equity in connection with his investment, and this warrant
represented an additional incentive for support provided in raising
capital.  Any charges related to these
services were directly related to the Series A Preferred financing, and
would be offset against equity proceeds raised by the Company in the equity
financing.

November 30,
2004 Warrants

Warrants to purchase
100,000 shares of common stock at $0.25 were issued to a former officer of the
Company as a portion of his severance compensation arrangement.

Conclusion

The Company has
calculated that the value of the warrants based on Black Scholes models is
$0.  For comparative purposes, the
Company has also run theoretical Black Scholes pricing models where the strike
price was reduced to be equal to the fair value of the underlying shares.  Even utilizing this more aggressive approach,
the value of the warrants is $20,371, of

4

which $6,303 would be offset against equity proceeds raised by the
Company in the equity financing, resulting in a profit and loss impact of
$14,069.  Therefore, the Company
concludes that even under this theoretical pricing model, the impact on the
financial statements would not be material.

In addition to the above
response, the Company proposes amending its disclosure with regard to the
warrants set forth in Footnote 7 to the Notes to Consolidated Financial
Statements.  The proposed language is
included on page 12 of the attached Form 10-QSB/A for your
review.

We hope that the foregoing
responses adequately address your comments.
At such time as you indicate that you have no further comments on the
Company’s proposed revisions to the filings in question, the Company hereby
undertakes to file amendments thereto consistent with the proposed changes you
have reviewed.

Please do not hesitate to
contact us with any questions you may have.

  Sincerely,

  /s/ Christopher E. Howard

  Christopher E. Howard

Enclosure

  cc:

  Mr. William M.
  Caldwell, IV, Advanced Cell Technology, Inc. w/o encl.

  Jonathan F.
  Atzen, Esq. w/o encl.

5

UNITED
STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON D.C. 20549

FORM 10-QSB/A

Amendment No. 1 to

  ý

  QUARTERLY REPORT PURSUANT TO SECTION 13
  OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

  FOR THE
  PERIOD ENDED MARCH 31, 2005

  OR

  o

  TRANSITION REPORT PURSUANT TO SECTION 13
  OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

  FOR
  THE TRANSITION PERIOD FROM
             TO
            .

COMMISSION
FILE NUMBER: 0-50295

A.C.T. HOLDINGS, INC.

(EXACT NAME OF SMALL
BUSINESS ISSUER AS SPECIFIED IN ITS CHARTER)

  NEVADA

  87-0656515

  (STATE OR
  OTHER JURISDICTION OF

  INCORPORATION OR ORGANIZATION)

  (I.R.S.
  EMPLOYER IDENTIFICATION NO.)

381
PLANTATION STREET, WORCESTER, MA 01605

(ADDRESS, INCLUDING ZIP
CODE, OF PRINCIPAL EXECUTIVE OFFICES)

REGISTRANT’S TELEPHONE
NUMBER, INCLUDING AREA CODE: (508) 756-1212

SECURITIES REGISTERED
PURSUANT TO SECTION 12(b) OF THE ACT: NONE

SECURITIES REGISTERED PURSUANT
TO SECTION 12(g) OF THE ACT: NONE

Indicate by check mark
whether the small business issuer (1) has filed all reports required to be
filed by Section 13 or

15(d) of the Securities Exchange Act of 1934 during the preceding 12
months (or for such shorter period that the small business issuer was required
to file such reports), and (2) has been subject to such filing
requirements for the past 90 days.

Yes ý       No
o

Indicate the number of
shares outstanding of each of the issuer’s classes of common stock, as of the
latest practicable date.

  Class:

  Outstanding at May 20, 2005:

  Common
  Stock, $0.001 par value per share

  23,213,212
  shares

Transitional Small Business
Disclosure format (check one)

Yes o       No
ý

A.C.T. HOLDINGS, INC.

INDEX

  RECENT
  DEVELOPMENTS OF SMALL BUSINESS ISSUER

  PART I.
  FINANCIAL INFORMATION

  ITEM 1.
  CONSOLIDATED FINANCIAL STATEMENTS

  ITEM 2.
  MANAGEMENT’S DISCUSSION AND ANALYSIS OR PLAN OF OPERATION

  ITEM 3.
  CONTROLS AND PROCEDURES

  PART II.
  OTHER INFORMATION

  ITEM 1.
  LEGAL PROCEEDINGS

  ITEM 2.
  UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS

  ITEM 3.
  DEFAULTS UPON SENIOR SECURITIES

  ITEM 4.
  SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS

  ITEM 5.
  OTHER INFORMATION

  ITEM 6.
  EXHIBITS AND REPORTS ON FORM 8-K

  SIGNATURE

2

EXPLANATORY NOTE

This Amendment No. 1 to our
Quarterly Report on Form 10-QSB/A (“Form 10-QSB/A”) amends and
restates the Quarterly Report on Form 10-QSB for the period ended March 31,
2005, as filed with the Securities and Exchange Commission on May 23, 2005
(“Form 10-QSB”).  The purpose of
this Form 10-QSB/A is to expand upon some of the disclosures contained in
the original filing.  In particular, this
Form 10-QSB/A provides additional explanatory information with regard to
the following areas:

•                  We have expanded our
disclosure with regard to our research and development expenses discussed in
Item 2, “Management’s Discussion and Analysis and Results of Operations.”

•                  We have added clarifying
language to the description of our products under “Potential Commercial
Applications of our Technologies” in Item 5, under “Business.”

•                  While risks relating to our
technology were fully disclosed in the original filing in Item 2, under “Risk
Factors That May Affect Our Business,” we have incorporated a discussion
of these risk factors into a more complete description of the strengths of our
intellectual property portfolio in Item 5, under “Business.”

•                  We have expanded the
disclosure with regard to our patents by indicating the expiration date of each
patent in the patent table in Item 5, under “Our Intellectual Property.”

•                  We have further expanded the
disclosure with regard to our intellectual property by expanding the discussion
of the material terms of our research and license agreements in Item 5, under “Research
and License Agreements.”

RECENT DEVELOPMENTS OF SMALL BUSINESS ISSUER

On January 31, 2005, A.C.T. Holdings, Inc.,
a Nevada corporation (the “Company”) completed a merger transaction with
Advanced Cell Technology, Inc., a Delaware corporation (“ACT”), pursuant
to which a wholly-owned subsidiary of the Company merged with and into ACT (the
“Merger”), with ACT remaining as the surviving corporation and a wholly-owned
subsidiary of the Company.  Upon the
completion of the Merger, the Company ceased all of its pre-Merger operations
and adopted the business of ACT.  In this
report, A.C.T. Holdings, Inc. and its subsidiaries are collectively
referred to as the “Company,” “we,” or “us.”
Advanced Cell Technology, Inc. is referred to separately as “ACT.”

Investors
are cautioned that, prior to the Merger, the Company had minimal business,
operations, revenues and assets, and has been involved in an industry entirely
unrelated to the business of ACT.
Therefore, the acquisition of ACT by the Company represented a complete
change in the nature of the Company’s business and operations, and changed the
nature of any prior investment in the Company.
Prior to the Merger, ACT, as a privately held Company, had not been
subject to the reporting requirements of the Securities Exchange Act of 1934,
(the “Exchange Act”) and, therefore, there was little public information about
ACT available.  In light of this fact, we
have elected to set forth additional disclosure regarding the business of the
Company under Part II, Item 5 of this Quarterly Report on Form 10-QSB.  Although such disclosure is not required in
this Quarterly Report on Form 10-QSB, we have provided this additional
disclosure as we believe that it is helpful to investors.

CAUTIONARY NOTE REGARDING
FORWARD-LOOKING STATEMENTS

Certain
statements contained in this Quarterly Report on Form 10-QSB and the
exhibits hereto containing the words “may,” “assumes,” “forecasts,” “positions,”
“predicts,” “strategy,” “will,” “expects,” “estimates,” “antici