SEC Company Response from TNT DESIGNS INC (CIK 0001286345) — Sep 27, 2005
TNT DESIGNS INC (CIK 0001286345)
Date: Sept. 27, 2005 · CIK: 0001286345 · Accession: 0001144204-05-030070
AI Filing Summary & Sentiment
File numbers found in text: 333-123941
Letter
September 27, 2005 Via EDGAR and Federal Express Securities and Exchange Commission 450 Fifth Street, N.W. Washington D.C. 20549 Attn: Jeff Shadey, Esq
Re: TNT Designs, Inc. Registration Statement of Form SB-2 filed April 6, 2005 (File No. 333-123941) Response to Comment Letter issued May 6, 2005
Dear Mr. Shady,
On behalf of TNT Designs, Inc. ("TNT" or the "Company"), we enclose responses that correspond directly to the numbered comments in the Commission's letter of May 6, 2005. Additional commentary is provided where appropriate to direct the Commission's attention to supplemental responses and/or revisions with respect to the Registration Statement. Please note that TNT has filed an amended registration statement on Form SB-2/A (No.1) which includes amendments in accord with the supplemental responses, updated financial statements and other disclosures to reflect financial results through May 31, 2005 as well as recent material subsequent events.
Additionally, we have manually marked a "hard copy" of the sections of the Registration Statement relevant to the supplemental responses which have been forwarded by Federal Express to your attention.
General
1. Please tell us how the resale of securities by the selling security holders does not constitute an indirect primary offering. In connection with your analysis, please discuss the following facts:
o how long the selling shareholders have held the securities;
o the circumstances under which the selling shareholders received the securities;
o the selling shareholders' relationship to the issuer;
o the amount of securities involved;
o whether the sellers are in the business of underwriting securities; and
o whether under all the circumstances it appears that the seller is acting as a conduit for the issuer.
<PAGE>
In addition, please discuss whether the purchasers in the private offering were given registration rights. Finally, please provide us with a copy of the private offering memorandum given to purchasers in the March 2005 private offering.
Response
Twenty three of the twenty five selling shareholders purchased their shares in arms length transactions in private placements. One of the selling shareholders acquired shares for services rendered to TNT and one of the selling shareholders acquired founder shares. The selling shareholders are not underwriters selling on behalf of TNT but rather solely for their own accounts. All selling shareholder have either purchased their shares or acquired their shares in exchange for services rendered to the Company and are at risk for their total investment as a market for their shares may never develop. The common stock has been issued to the selling shareholders and the shares have been held for periods ranging between six to nineteen months. Selling shareholders are anticipated to hold their shares at least until such time as a public market develops for TNT's common stock, if ever. While four of the selling shareholders are related to the TNT's sole officer and director, the remaining twenty selling shareholders are not affiliated with the Company. Further, we have been advised that none of the selling shareholders are in the business of underwriting securities, and are not acting as a conduit for TNT as the Company will receive no consideration from the sale of the shares by selling shareholders should a public market ever develop for the Common Stock.
TNT further advises by supplemental response that there were no private placement memoranda in connection with the March 2005 offering.
2. We note your use throughout the prospectus of the term "Company" to refer to TNT Design, Inc. The term "Company" is a vague, abstract term. Please revise to use your actual company name or a shortened version of it.
Response
The prospectus has been amended in accordance with the Plain English Rule to delete the term "Company" and replace with references "TNT Designs, Inc." or "TNT" where appropriate.
3. We note that Ms. Tandon is the sole officer, director and member of management. We also note that you use the terms "management" and "we" to refer to Ms.Tandon. Please revise your prospectus to clarify throughout your disclosure that TNT Design, Inc. has only one officer, director and member of management.
Response
The prospectus has been amended throughout to consistently reflect that TNT currently has only one officer (employee) and director.
4. Please supplementally provide us with copies of any graphics, maps, photographs, and related captions or other artwork including logos that you intend to use in the prospectus. Such graphics and pictorial representations should not be included in any preliminary prospectus distributed to prospective investors prior to our review.
<PAGE>
Response
TNT Designs does not intend to include graphics, maps, photographs, and related captions or other artwork including logos in its final prospectus.
5. We note the reference to your website at the bottom of page 12. Please confirm supplementally that all material information that is included in your website can be found in the prospectus.
Response
TNT's website has limited information posted at the current time as it is still being developed, however TNT supplementally confirms that material information currently on the website is included in the prospectus and TNT undertakes to update the prospectus when necessary to add any additional material information when posted on the website.
6. Please provide disclosure on the cover discussing the applicability of the penny stock rules to transactions in TNT Design's securities.
Response
Additional disclosure has been added to the cover of the prospectus discussing the applicability of the penny stock rules to TNT's common stock. In addition, the risk factor regarding penny stock rules is also cross referenced on the prospectus cover.
Prospectus Summary, page 1
7. Please include the following in your summary:
o you have incurred losses since inception; o that Ms. Tandon is the sole officer and director as well as your controlling stockholder and that you have no employees; o you have not generated revenues since inception; and o quantify your total accumulated deficit.
Response
The additional disclosure regarding losses incurred since inception, Ms. Tandon being the sole officer and director and controlling stockholder, no revenues having been generated and TNT's accumulated deficit have been added to the prospectus summary.
8. Please consider disclosing the address of your website in this section.
Response
In addition to listing TNT's website in the Description of Business section of the prospectus, the prospectus summary has been revised to include the website address.
Forward-Looking Action, page 3
9. Please delete references to the Private Securities Litigation Reform Act here and elsewhere in your document if it appears. The "safe harbor" provided for by the Private Securities Litigation Reform Act only applies to statements made by issuers who at the time the statement is made are subject to the reporting requirements of Exchange Act Section 13(a) or 15(d). It also does not apply to companies that issue penny stock. See Securities Act Section 27A and Exchange Act Section 21E.
<PAGE>
Response
Reference to the Private Securities Litigation Reform Act has been removed in accordance with the comment.
Risk Factors, page 3
10. You indicate in your introductory paragraph that these risk factors "among others" may cause actual results to differ materially from the statements made in this prospectus. It is not appropriate to indicate that additional risk factors not included in the prospectus exist or that existing risks that management deem to be immaterial may, at a later date, be material. All material risk factors should be described in the prospectus and risks that are deemed to be immaterial should not be referenced. Please revise.
Response
The wording "among others" has been removed from the introductory paragraph. The amended and new risk factors set forth in the prospectus section of the SB-2/A (No, 1) are deemed to be the material risk by TNT.
11. Currently, some of your risk factor headings are difficult to distinguish from your general text. Please consider revising this section to highlight each risk factor heading. For example, consider using boldface type, italics, or underlining each risk factor headings.
Response
The Company advises that the conversion to PDF format for EDGAR filing made the headings for the Risk Factors difficult to distinguish from the risk factors themselves. The Risk Factors format in Pre-Effective Amendment No. 1 has been revised so that all headings will be in capital letters.
12. Many of your risk factor subheadings state a fact, or describe some aspect of your business, rather than state a risk. These risk factors convey the cause of concern, but not the effect. This requires the reader to infer the risk. Revise your captions to accurately convey the risks that relate to the facts you present. For example, but not limited to:
o "We have no revenues;"
o "Our future operating results will be difficult to predict;"
o "Because we do not intend to pay any dividends on our common shares." and
o "We can not guarantee we will ever develop a customer base"
<PAGE>
Response
Risk factor captions that state a fact as opposed to stating a specific risk have been revised. Specifically:
o The caption of the fifth risk factor under the subheading "Risks Related to Our Financial Condition" on page 4 has been revised from "We Have No Revenues" to read "TNT IS A DEVELOPMENT STAGE COMPANY WITH NO REVENUES TO DATE AND THERE CAN BE NO ASSURANCES THAT TNT WILL EVER BE SUCCESSFUL IN GENERATING REVENUE THROUGH OUR BUSINESS AND MARKETING STRATEGY."
o The caption of the sixth risk factor under the subheading "Risks Related to Our Financial Condition" on page 4 has been revised from "Our Future Operating Results Will Be Difficult to Predict" to read "AS A DEVELOPMENT STAGE COMPANY WITH NO HISTORY OF OPERATIONS OUR ABILITY TO ACCURATELY PREDICT FUTURE OPERATING RESULTS IS LIMITED."
o The caption of the second risk factor under the subheading "Risks Related to the Market for Our Common Stock" on page 4 has been revised from "Because We Do Not Intend to Pay any Dividends On Our Common Shares, Investors Seeking Dividend Income or Liquidity Should Not Purchase Our Shares." to read "AS TNT HAS NO REVENUES AND NO ABILITY TO ACCURATELY ANTICIPATE OPERATING RESULTS THERE CAN BE NO ASSURANCES THAT TNT WILL EVER PAY DIVIDENDS ON ITS COMMON STOCK."
o The caption of the sixth risk factor under the subheading "Risks Related to Our Business" on page 7 has been revised from "We Cannot Guarantee We Will Ever Develop a Customer Base." to read "AS WE HAVE NO OPERATING HISTORY THERE CAN BE NO ASSURANCES THAT WE WILL EVER DEVELOP A CUSTOMER BASE THAT WILL ACCEPT OUR PRODUCTS."
o The caption of the eighth risk factor under the subheading "Risks Related to Our Business" on page 7 has been revised from "We Depend on Our Key Employees." to read "TNT CURRENTLY HAS ONLY ONE OFFICER AND EMPLOYEE AND MAY NOT BE ABLE TO RETAIN QUALIFIED ADDITIONAL EMPLOYEES IF AND WHEN REQUIRED."
o The caption of the n
Show Raw Text
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<TEXT>
BARATTA & GOLDSTEIN
ATTORNEYS AT LAW
597 FIFTH AVENUE
NEW YORK, N.Y. 10017
----------
(212) 750-9700
JOSEPH P. BARATTA FACSIMILE: (212) 750-8297
HOWARD J. GOLDSTEIN info@baragold.com
-----------
LOUIS R. AIDALA OF COUNSEL
JOAN PALERMO MARGARET M. STANTON
JOSEPH A. BARATTA* LINDA MARYANOV
SAMUEL M. GREENFIELD
September 27, 2005
Via EDGAR and Federal Express
Securities and Exchange Commission
450 Fifth Street, N.W.
Washington D.C. 20549
Attn: Jeff Shadey, Esq
Re: TNT Designs, Inc. Registration Statement of Form
SB-2 filed April 6, 2005 (File No. 333-123941) Response
to Comment Letter issued May 6, 2005
Dear Mr. Shady,
On behalf of TNT Designs, Inc. ("TNT" or the "Company"), we enclose
responses that correspond directly to the numbered comments in the
Commission's letter of May 6, 2005. Additional commentary is provided
where appropriate to direct the Commission's attention to supplemental
responses and/or revisions with respect to the Registration Statement.
Please note that TNT has filed an amended registration statement on Form
SB-2/A (No.1) which includes amendments in accord with the supplemental
responses, updated financial statements and other disclosures to reflect
financial results through May 31, 2005 as well as recent material
subsequent events.
Additionally, we have manually marked a "hard copy" of the sections of the
Registration Statement relevant to the supplemental responses which have
been forwarded by Federal Express to your attention.
General
1. Please tell us how the resale of securities by the selling
security holders does not constitute an indirect primary
offering. In connection with your analysis, please discuss the
following facts:
o how long the selling shareholders have held the
securities;
o the circumstances under which the selling
shareholders received the securities;
o the selling shareholders' relationship to the
issuer;
o the amount of securities involved;
o whether the sellers are in the business of
underwriting securities; and
o whether under all the circumstances it appears
that the seller is acting as a conduit for the
issuer.
1
<PAGE>
In addition, please discuss whether the purchasers in the private
offering were given registration rights. Finally, please provide us
with a copy of the private offering memorandum given to purchasers
in the March 2005 private offering.
Response
Twenty three of the twenty five selling shareholders purchased their
shares in arms length transactions in private placements. One of the
selling shareholders acquired shares for services rendered to TNT
and one of the selling shareholders acquired founder shares. The
selling shareholders are not underwriters selling on behalf of TNT
but rather solely for their own accounts. All selling shareholder
have either purchased their shares or acquired their shares in
exchange for services rendered to the Company and are at risk for
their total investment as a market for their shares may never
develop. The common stock has been issued to the selling
shareholders and the shares have been held for periods ranging
between six to nineteen months. Selling shareholders are anticipated
to hold their shares at least until such time as a public market
develops for TNT's common stock, if ever. While four of the selling
shareholders are related to the TNT's sole officer and director, the
remaining twenty selling shareholders are not affiliated with the
Company. Further, we have been advised that none of the selling
shareholders are in the business of underwriting securities, and are
not acting as a conduit for TNT as the Company will receive no
consideration from the sale of the shares by selling shareholders
should a public market ever develop for the Common Stock.
TNT further advises by supplemental response that there were no
private placement memoranda in connection with the March 2005
offering.
2. We note your use throughout the prospectus of the term "Company" to
refer to TNT Design, Inc. The term "Company" is a vague, abstract
term. Please revise to use your actual company name or a shortened
version of it.
Response
The prospectus has been amended in accordance with the Plain English
Rule to delete the term "Company" and replace with references "TNT
Designs, Inc." or "TNT" where appropriate.
3. We note that Ms. Tandon is the sole officer, director and member of
management. We also note that you use the terms "management" and
"we" to refer to Ms.Tandon. Please revise your prospectus to clarify
throughout your disclosure that TNT Design, Inc. has only one
officer, director and member of management.
Response
The prospectus has been amended throughout to consistently reflect
that TNT currently has only one officer (employee) and director.
4. Please supplementally provide us with copies of any graphics, maps,
photographs, and related captions or other artwork including logos
that you intend to use in the prospectus. Such graphics and
pictorial representations should not be included in any preliminary
prospectus distributed to prospective investors prior to our review.
2
<PAGE>
Response
TNT Designs does not intend to include graphics, maps, photographs,
and related captions or other artwork including logos in its final
prospectus.
5. We note the reference to your website at the bottom of page 12.
Please confirm supplementally that all material information that is
included in your website can be found in the prospectus.
Response
TNT's website has limited information posted at the current time as
it is still being developed, however TNT supplementally confirms
that material information currently on the website is included in
the prospectus and TNT undertakes to update the prospectus when
necessary to add any additional material information when posted on
the website.
6. Please provide disclosure on the cover discussing the applicability
of the penny stock rules to transactions in TNT Design's securities.
Response
Additional disclosure has been added to the cover of the prospectus
discussing the applicability of the penny stock rules to TNT's
common stock. In addition, the risk factor regarding penny stock
rules is also cross referenced on the prospectus cover.
Prospectus Summary, page 1
7. Please include the following in your summary:
o you have incurred losses since inception;
o that Ms. Tandon is the sole officer and director
as well as your controlling stockholder and that
you have no employees;
o you have not generated revenues since inception;
and
o quantify your total accumulated deficit.
Response
The additional disclosure regarding losses incurred since inception,
Ms. Tandon being the sole officer and director and controlling
stockholder, no revenues having been generated and TNT's accumulated
deficit have been added to the prospectus summary.
8. Please consider disclosing the address of your website in this
section.
Response
In addition to listing TNT's website in the Description of Business
section of the prospectus, the prospectus summary has been revised
to include the website address.
Forward-Looking Action, page 3
9. Please delete references to the Private Securities Litigation Reform
Act here and elsewhere in your document if it appears. The "safe
harbor" provided for by the Private Securities Litigation Reform Act
only applies to statements made by issuers who at the time the
statement is made are subject to the reporting requirements of
Exchange Act Section 13(a) or 15(d). It also does not apply to
companies that issue penny stock. See Securities Act Section 27A and
Exchange Act Section 21E.
3
<PAGE>
Response
Reference to the Private Securities Litigation Reform Act has been
removed in accordance with the comment.
Risk Factors, page 3
10. You indicate in your introductory paragraph that these risk factors
"among others" may cause actual results to differ materially from
the statements made in this prospectus. It is not appropriate to
indicate that additional risk factors not included in the prospectus
exist or that existing risks that management deem to be immaterial
may, at a later date, be material. All material risk factors should
be described in the prospectus and risks that are deemed to be
immaterial should not be referenced. Please revise.
Response
The wording "among others" has been removed from the introductory
paragraph. The amended and new risk factors set forth in the
prospectus section of the SB-2/A (No, 1) are deemed to be the
material risk by TNT.
11. Currently, some of your risk factor headings are difficult to
distinguish from your general text. Please consider revising this
section to highlight each risk factor heading. For example, consider
using boldface type, italics, or underlining each risk factor
headings.
Response
The Company advises that the conversion to PDF format for EDGAR
filing made the headings for the Risk Factors difficult to
distinguish from the risk factors themselves. The Risk Factors
format in Pre-Effective Amendment No. 1 has been revised so that all
headings will be in capital letters.
12. Many of your risk factor subheadings state a fact, or describe some
aspect of your business, rather than state a risk. These risk
factors convey the cause of concern, but not the effect. This
requires the reader to infer the risk. Revise your captions to
accurately convey the risks that relate to the facts you present.
For example, but not limited to:
o "We have no revenues;"
o "Our future operating results will be difficult to
predict;"
o "Because we do not intend to pay any dividends on
our common shares." and
o "We can not guarantee we will ever develop a
customer base"
4
<PAGE>
Response
Risk factor captions that state a fact as opposed to stating a
specific risk have been revised. Specifically:
o The caption of the fifth risk factor under the
subheading "Risks Related to Our Financial
Condition" on page 4 has been revised from "We
Have No Revenues" to read "TNT IS A DEVELOPMENT
STAGE COMPANY WITH NO REVENUES TO DATE AND THERE
CAN BE NO ASSURANCES THAT TNT WILL EVER BE
SUCCESSFUL IN GENERATING REVENUE THROUGH OUR
BUSINESS AND MARKETING STRATEGY."
o The caption of the sixth risk factor under the
subheading "Risks Related to Our Financial
Condition" on page 4 has been revised from "Our
Future Operating Results Will Be Difficult to
Predict" to read "AS A DEVELOPMENT STAGE COMPANY
WITH NO HISTORY OF OPERATIONS OUR ABILITY TO
ACCURATELY PREDICT FUTURE OPERATING RESULTS IS
LIMITED."
o The caption of the second risk factor under the
subheading "Risks Related to the Market for Our
Common Stock" on page 4 has been revised from
"Because We Do Not Intend to Pay any Dividends On
Our Common Shares, Investors Seeking Dividend
Income or Liquidity Should Not Purchase Our
Shares." to read "AS TNT HAS NO REVENUES AND NO
ABILITY TO ACCURATELY ANTICIPATE OPERATING RESULTS
THERE CAN BE NO ASSURANCES THAT TNT WILL EVER PAY
DIVIDENDS ON ITS COMMON STOCK."
o The caption of the sixth risk factor under the
subheading "Risks Related to Our Business" on page
7 has been revised from "We Cannot Guarantee We
Will Ever Develop a Customer Base." to read "AS WE
HAVE NO OPERATING HISTORY THERE CAN BE NO
ASSURANCES THAT WE WILL EVER DEVELOP A CUSTOMER
BASE THAT WILL ACCEPT OUR PRODUCTS."
o The caption of the eighth risk factor under the
subheading "Risks Related to Our Business" on page
7 has been revised from "We Depend on Our Key
Employees." to read "TNT CURRENTLY HAS ONLY ONE
OFFICER AND EMPLOYEE AND MAY NOT BE ABLE TO RETAIN
QUALIFIED ADDITIONAL EMPLOYEES IF AND WHEN
REQUIRED."
o The caption of the n