SEC Company Response from HENLEY VENTURES INC (CIK 0001162200) — Jun 21, 2005
HENLEY VENTURES INC (CIK 0001162200)
Date: June 21, 2005 · CIK: 0001162200 · Accession: 0001162200-05-000009
AI Filing Summary & Sentiment
File numbers found in text: 333-122449
Referenced dates: March 2, 2005
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(Letterhead)
June 21, 2005
BY FEDERAL EXPRESS
United States Securities and Exchange Commission
Mail Stop 0407
450 Fifth Street, N.W.
Washington, D.C.
20549
Attention: Mr. Albert G. Pappas
Dear Mr. Pappas:
Re: Registration Statement on Form SB-2
Filed February 1, 2005
333-122449
I am in receipt of your letter dated March 2, 2005 relating to our previous
filing of the above mentioned Registration Statement.
The page reference in this letter, other than direct quotes from the prospectus,
are those of the page number of the "red-lined" copy.
In responding to your various comments, I have placed them in the order
mentioned in the above letter in order to facilitate your review.
General
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1. The audited financial statements have been updated to December 31, 2004
with comparisons as at March 31, 2005.
2. In response to this comment, I am enclosing three copies of the
registration statement. In addition, I am enclosing three copies of the
red-lined registration statement which shows all deletions and additions
made to the registration statement based on your comments.
Prospectus Cover Page
-----------------------
3. Throughout the registration statement the term "the Company" has been
replaced by "Henley". In addition, references to "selling security holders"
have been un-capitalized. I have not made any changes to the Notes to the
Financial Statements wherein the financial statements use the term
"Company".
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4. Both the reference to the par value of our shares and the previous last
paragraph in the prospectus covering page have been deleted.
5. The address and telephone number have been removed from the covering page.
6. The previous sentence has been replaced by "There is no public market for
Henley's common shares."
Item 3. Summary Information and Risk Factors, page 1
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Henley Ventures Inc. page 1
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7. The prospectus has been changed to refer to Henley as a "pre-exploration"
company in order to conform with other references in the prospectus.
Therefore, the first sentence of the second paragraph on page 1 (the
"red-line copy) has been amended follows:
"We are a pre-exploration stage company since we have not explored
sufficiently our mineral claim to determine the existence of any minerals
on it."
In response to the second bullet under this section, the following line has
been inserted on page 2 ("red-line" copy) in the second paragraph.
"On the Red Bird claim, Henley is focusing on precious metals; being gold
and silver."
In response to the third bullet in this section, the following sentence has
been added to the first sentence in the sixth paragraph on page 1 to
clarify the wording "claim group":
"(being a group of claims located in the same area, being roughly of the
size of 1,500 feet by 1,500 feet, with each touching one or more other
claims in the group)"
In response to the fourth bullet, the following sentences have been
inserted in the second paragraph on page 1 as follows:
"In addition, Henley does not own the land comprising the Red Bird but has
only the rights to the minerals thereon. The land is owned by the Province
of British Columbia; known as the Crown".
Regarding the exposure to us by having a Bill of Sale Absolute held in the
name of a third party the following sentences have been added to the second
paragraph on page 1 in this section:
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"We acquired the Red Bird by way of Bill of Sale Absolute from Richard J.
Billingsley on July 28, 2004. This Bill of Sale Absolute has not been filed
with the Ministry and therefore the claims are still in the name of Richard
Billingsley. The only way to ensure the Red Bird is not transferred to a
third party without the knowledge of Henley is to have the Red Bird
registered in the name of Henley. This has not been done - refer to page
Risk Factor #11 on page 6 and on page 27."
On page 43 under "Description of Property" the following paragraph has been
inserted in response to this comment:
"The Red Bird is recorded in the name of Richard Billingsley who has signed
a Bill of Sale Absolute in favor of Henley. Our reason for allowing the Red
Bird to remain in the name of Richard Billingsley is two-fold: first, we
will not have to extra-provincially incorporate a British Columbia company
at a cost of approximately $800 and, second, we would not have to obtain a
Free Miners License at a cost of $385. Under the mining laws of British
Columbia, only a company incorporated in the Province of British Columbia
can hold the rights to minerals on land owned by the Crown and can apply
and obtain a Free Miners License. When the Bill of Sale Absolute is filed
with the Ministry, the mineral rights will be transferred to the name of
Henley. Until this is done, we are exposed and might lose our interest in
the Red Bird to a third party if Mr. Billingsley were to transfer the
claims without our knowledge. The only way to protect ourselves from this
happening is to have the Red Bird registered in Henley's name (see Risk
Factor 11 on page 6)."
As you will notice in the above responses, the HV claim has been lost due
to Henley losing the rights to the minerals in January 2005.
Even though Henley spent sufficient money in January 2005 to maintain the
HV claim in good standing, it was not able to file its assessment work due
to a change in the method of filing with occurred twelve days before Henley
made its application to file its assessment work. Because of the new method
of filing, being over the Internet, Henley was delayed in its filing.
Nevertheless, it did attempt to computer stake the claim on the morning of
January 25, 2005 but Paul Saulnier, the individual holding the Bill of Sale
Absolute in favor of Henley, computer staked the HV claim for his own
purposes. Henley no longer has any interest in the HV claim.
Therefore, in the sixth paragraph on page 1 the following sentences have
been added:
"Effective January 12, 2005, the Ministry of Energy and Mines for the
Province of British Columbia changed its method of staking and maintaining
a mineral property in good standing - refer to page27. This resulted in
Henley losing its rights to the minerals on the HV claim."
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The reference noted above to page 27 ("red-line" page 28), has the
following paragraph on it indicating the changes made earlier this year
regarding maintenance of a mineral claim.
"During the month of January, we undertook an exploration program on the HV
claim sufficient to maintain it in good standing for another twelve months.
When submitting the assessment report to the Ministry, we were advised that
effective January 12, 2005 the system has been changed and all recording of
work on the claim had to be done on the Internet. To access the Internet,
an individual requires a British Columbia Electronic Identification Number
("BCeID"). Our geologist who performed our assessment work did not have a
BCeID number and therefore could not record our assessment work prior to
the expiry of the HV. We engaged the services of another individual who had
a BCeID number to "stake" on the Internet starting at 12:00 am on January
25, 2005. Unfortunately, Paul Saulnier, who previously held our Bill of
Sale Absolute on our behalf, was able to successfully record the previous
HV claim under his name and to his benefit. Therefore, we no longer have an
interest in the mineral rights on the HV claim.
Since we no longer have the rights to the minerals on the HV claim, the
prospectus has been changed to eliminate its history and assessment work
performed previously on the HV.
Under "Conditions to Retaining Title to the Red Bird" on page 28, the
following sentences have been added to the first paragraph in this section:
"The Bill of Sale Absolute has not been registered with the Ministry
thereby keeping the Red Bird in the name of Richard Billingsley. Refer to
Risk Factor 11.
As mentioned in the last sentence of bullet four under comment 7 Risk
Factor (#11) has been added:
"THE MINERAL RIGHTS TO THE RED BIRD ARE NOT HELD IN THE NAME OF HENLEY
WHICH COULD RESULT IN THE MINERAL RIGHTS BEING TRANSFERRED TO A THIRD PARTY
WITHOUT KNOWLEDGE OF HENLEY.
"The rights to the minerals on the Red Bird are recorded in the name of
Richard J. Billingsley, an unrelated party to Henley, and even though we
have a signed Bill of Sale Absolute we are exposed and might lose our
interest in the minerals on the Red Bird. Mr. Billingsley is on record with
the Ministry as the registered owner of the Red Bird and without our
consent and knowledge, he could transfer the rights to a third party which
would result in a lengthy legal case where, at the end, the case could be
decided against our interest. Unless we register with the Ministry our
rights to the minerals on the Red Bird there is no assurance we will retain
our interest to it."
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<PAGE>
In response to bullet five, the proven and probable reserves has been moved
to the business section on page 24.
8. The section referring to the absence of any revenue and very limited
operations has been moved to the forefront of this section and the
following has been inserted in response to this comment:
"Our auditors have expressed substantial doubt about our ability to
continue as a going concern - refer to page 46.
We currently have two officers that devote an immaterial amount of time to
our business. For example, one of our officers devotes approximately 10
hours per month to our business and our other officer devotes approximately
5 hours per month to our business.
We will have to raise money to meet our obligations during the next twelve
months in the amount of approximately $52,160 - refer to page 46 and Risk
Factor #1 on page 3.".
As mentioned above and in this prospectus, the rights to the minerals on
the HV claim have been lost. Unfortunately, we did the assessment work as
required but were unaware the filing system had change to one using the
Internet and any filer on the Internet required a BCeID number - a number
which required several weeks for an application to be approved.
The Offering, page 2
-----------------------
9. In the second sentence of the first paragraph on page 2 the following
sentence has been added:
"This represents 84 percent of the issued and outstanding shares."
Risk Factors, page 3
-----------------------
10. The response to the former Risk Factor #2 (now #4) -"Since inception we
have not made a profit ." the Risk Factor caption has been changed to read
as follows:
"SINCE JANUARY 3, 2001, OUR DATE OF INCEPTION, WE HAVE NOT MADE ANY REVENUE
AND HAVE ACCUMULATED LOSSES OF $99,947
Since our inception on January 3, 2001, we have made no revenue and as at
March 31, 2005 have accumulated losses of $99,947. Since we are a
pre-exploration stage company, all money spent by us on the exploration of
the Red Bird will increase our accumulated losses since it is extremely
unlikely we will be able to earn any revenue for a minimum of more than 5
years. First, we will have to explore the Red Bird by establishing a grid
allowing us to take rock and soil samples for assaying to determine if
-5-
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there exists any mineralization on the Red Bird. If there is
mineralization, we will have to extend the grid and also take additional
samples from within the original grid to determine the extent of
mineralization. As a minimum, the sampling of rocks and soils using the
grid could take two to three years. All expenses during this time will
increase our accumulated losses. If the results are still favorable, we
will consider a diamond drilling program. Drilling is expenses and the
number of holes to be drilled is unknown. Again, the accumulated losses
will continue to increase without any revenue being generated. There is the
possibility we might never generate any revenue and eventually have to
cease our operations".
Former Risk Factor #13 (now #14) which originally has the title caption of
"We will be affected by risk and hazards often associated with a company ."
has been revised to read as follows:
"DURING OUR EXPLORATION PROGRAMS WE WILL BE SUBJECT TO WORKERS' ACCIDENTS,
CLIMATIC CHANGES, OR DIFFICULT TERRAIN
Being a small pre-exploration company, we will be subject to many risk and
hazards associated with undertaking our exploration program. First,
individual workers on the Red Bird might be injured from twisting their
ankles or breaking their legs from falls or slipping on fallen trees and
shrubs. Second, during the summer months, we will be subject to forest
fires which would result in us abandoning the Red Bird quickly thereby
interrupting our exploration program. On the other hand, during the spring
and winter months, the Red Bird will be subject to snow and flood
conditions which will cause hardship on our exploration activities. Third,
the terrain of the Red Bird comprises hills, broken ground rocks, trenches,
fallen trees and maybe unknown adits. These hazards will delay our
exploration when we are confronted with them".
In addition to the above two amendments you mentioned, I have made the
following revisions to certain other Risk Factors as follows:
Risk Factor #15 title caption which previously read "We have not performed
a survey on either the HV or the Red Bird and therefore their boundaries
are uncertain" has been changed to read as follows:
"WITHOUT PERFORMING A SURVEY ON THE RED BIRD, WE ARE UNCERTAIN AS TO ITS
EXACT BOUNDARIES WHICH MIGHT EVENTUALLY LEAD TO LITIGATION TRYING TO DEFEND
OUR RIGHTS TO ITS MINERALS"
Risk Factor #18 title caption previously read "We might not be able to
acquire other mineral properties for exploration" has been amended to read
as follows:
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"WITHOUT MONEY, WE MAY NEVER BE ABLE TO ACQUIRE OTHER MINERAL PROPERTIES"
11. Former Risk Factors 17, 22 and 23 have been grouped and put at the
beginning o