SEC Company Response from TYLERSTONE VENTURES CORP (CIK 0001157443) — Jun 30, 2005
TYLERSTONE VENTURES CORP (CIK 0001157443)
Date: June 30, 2005 · CIK: 0001157443 · Accession: 0001157443-05-000023
AI Filing Summary & Sentiment
File numbers found in text: 333-121660
Referenced dates: April 18, 2005, June 24, 2005, June 24, 2005
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(Letterhead)
June 30, 2005
United States Securities and Exchange Commission
450 Fifth Street, N.W.
Washington, D.C.
20549
Mail Stop 4561
ATTENTION: MR. MARK P. SHUMAN
BRANCH CHIEF - LEGAL
-----------------------
Dear Mr. Shuman:
Re: Amendment No. 3 to Form SB-2
File No. 333-121660
Filed on May 31, 2005
In response to your comment in your letter dated June 24, 2005, I have prepared
the following replies.
As indicated in prior letter the page numbers referred to in this letter are
those of the "red-lined" copy.
To faciliate your review, I am enclosing the following documents:
Three copies of the "red-lined" Form SB-2A;
Three copies of the completed Form SB-2A without "red-lines";
Three copies of your letter dated June 24, 2005; and
Two copies of this letter.
My responses are made in the order set forth in your letter.
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REGISTRATION STATEMENT ON FORM SB-2
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Risk Factors, page 3
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General
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COMMENT 1
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In error the previous Risk Factor was deleted during the revision of the Risk
Factors. It has now been inserted as Risk Factor #2 as follows:
"BECAUSE THE COMPANY HAS NO REVENUE, THE COMPANY WILL NEED ADDITIONAL FUNDS TO
CONTINUE OPERATIONS
Because the Company has no revenue, the minimum period of operations the Company
could fund, relying on advances from its management, would be six months if no
funds were received under this offering. In the event management is unwilling
to fund operations, the Company could not operate at all. Since the Company
has no minimum offering under this prospectus, any money raised might have an
insignificant effect on financing operations. Therefore, the Company will have
to seek financing from other sources, which, at this time cannot be determined.
Therefore, there is a risk that investors in this offering may lose their entire
investment."
COMMENT 2
----------
In consideration of Comments 2 to 4, the previous Risk Factor #1 has been
amended to read as follows:
LOSS OF TOTAL INVESTMENT BY NEW INVESTORS IF THE COMPANY IS UNABLE TO RAISE
SUFFICIENT FUNDS TO CARRY ON OPERATIONS
To continue as a going concern, the Company is in urgent need of money. Over
the next twelve months the Company will require approximately $69,000, as shown
on page 41, to maintain operations but undertaking no exploration programs on
the Tylerstone except to maintain it in good standing for another year. If and
when the shares of the Company become publicly traded, the general and
administrative expenses will increase by $27,550 as outlined on page 36.
Investors should be warned there will be no money available from the sale of
gold, silver, lead or zinc from the Tylerstone in the foreseeable future or
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maybe never since there is no ore reserve existing on the Tylerstone and there
is the distinct possibility there will never be an ore reserve. Without
adequate funds being received under this offering, there is a distinct
possibility that any investors subscribing under this offering will lose their
entire investment.
COMMENT 3
----------
In former Risk Factor #1 it was indicated estimated expenses for the next twelve
months would be $8,800, accounts payable was $56,478, the cost to maintain the
Tylerstone in good standing in the event the offering was not subscribed for was
$3,411 and offering expenses were $26,100. This total was $94,789. This figure
was incorrect. An error on our part was made in that we should not have
included the offering expenses in the total funds required since they had been
accrued in the outstanding accounts payable as at February 28, 2005. Under
response #7 in our letter dated April 18, 2005, the offering costs were shown as
a deduction from accounts payable in order not to duplicate expenses under the
Use of Proceeds. To avoid any confusion on part of our future investors the
following schedule has been amended on page 41:
<TABLE>
<CAPTION>
Accounts
Add Payable
Estimated Total Less
Accounts Expenses Required Deduct Deduct Offering/
Payable for Funds for Offering Explor- Explor-
Feb. 28, 12 Next 12 Expenses ation ation
Description 2005 Months Months (iii) Expenses Expenses
----------- --------- -------- --------- --------- ------- ----------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
Accounting
and audit. . . . $ 12,325 $ 2,200 $ 14,525 $ (7,500) $ - $ 7,025
Exploration
- Tylerstone. - 3,411 3,411 - (3,411) -
Filing fees. . . - 400 400 (400) - -
Legal (i). . . . 14,670 3,000 17,670 (15,000) - 2,670
Office (ii). . . 765 1,000 1,765 (1,000) - 765
Printing . . . . - 1,000 1,000 (1,000) - -
Rent . . . . . . . 20,245 - 20,245 - - 20,245
Transfer
Agent (i). . . 8,473 1,200 9,673 (1,200) - 8,473
------- ------- ------- ------- -------- -------
Total . . . .$ 56,478 $ 12,211 $ 68,689 $(26,100) $(3,411) $ 39,178
======== ======== ======= ======= ======= =======
</TABLE>
In addition the previous sentences under (iii) have been changed to read as
follows:
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"The amount required for the next year including outstanding accounts payable to
third parties has been determined at $68,689 as noted above. In allocating the
Use of Proceeds on page 12 this amount has been reduced by the Offering Expenses
of $26,100 and exploration expenses of $3,411 to a net of $39,178 to avoid
double accounting of expenses."
The previous figures on pages 2 and 41 have been revised accordingly.
COMMENT 4
----------
In response to this comment, Risk Factor #3 has been included as follows:
"MANAGEMENT HAS NOT COMMITTED TO ADVANCING FURTHER FUNDS AND ARE NOT WILLING TO
SIGN PERSONAL GUARANTEES ALLOWING THE COMPANY TO BORROW FROM LENDING
INSTITUTIONS
If no money is received under this offering, the Company will have to rely upon
further advances from its management. Management has not committed to
advancing further money to the Company and is not willing to sign personal
guarantees allowing the Company to borrow from a lending institution. Without
further advances and if no money is received from this offering, the Company
will not have sufficient money to proceed with its planned objectives - refer to
Risk Factor #2. Investors should be aware, prior to making an investment under
this offering, there is the distinct possibility they will lose their entire
investment due to the Company having a lack of money to continue as a viable
entity."
COMMENT 5
----------
In response to this comment the previous Risk Factor has been revised as
follows:
"AUDITORS HAVE SUBSTANTIAL DOUBT AS TO WHETHER OR NOT THE COMPANY WILL CONTINUE
AS A GOING CONCERN
The Company's auditors have stated in their report to the directors dated
November 5, 2004 that the Company will need additional working capital for its
planned activities and to service its debt which raises substantial doubt about
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the Company's ability to continue as a going concern. The underlying
assumption, in any business entity, is that it exists as a viable concern able
to meet its current debt obligations and to continue with its planned
operations. Unless the Company is able to obtain additional working capital,
the auditors have substantial doubt that it will continue as a going concern.
New investors should seriously consider the doubts the auditors have expressed
regarding the future existence of the Company."
Thank you for the time you have taken to review my responses.
Yours very truly;
Tylerstone Ventures Corporation
Per: /s/ "Laurence Stephenson"
---------------------------------
Laurence Stephenson
Chief Executive Officer, President and
Director
Enclosures
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