SEC Company Response from Bella Trading Company, Inc. (CIK 0001308710) — Feb 7, 2005
Bella Trading Company, Inc. (CIK 0001308710)
Date: Feb. 7, 2005 · CIK: 0001308710 · Accession: 0001004878-05-000036
AI Filing Summary & Sentiment
File numbers found in text: 333-121034
Referenced dates: January 11, 2005
Letter
HART & TRINEN Attorneys at Law 1624 Washington Street Denver, Colorado 80203 (303) 839-0061 (303) 839-5414 (fax) February 7, 2005 Duc Dang Securities and Exchange Commission 450 5th Street, N.W. Mail Stop 0304 Washington, D.C. 20549
Re: Bella Trading Company, Inc. Registration Statement on Form SB-2 File Number 333-121034
Dear Mr. Dang:
This office represents Bella Trading Company, Inc. (the "Company"). Amendment No. 1 to the Company's Registration Statement on Form SB-2 has been filed with the Commission. This letter sets forth the Company's responses to the comments received from the Staff by letter dated January 11, 2005. The paragraph numbers in this letter correspond with the numbered paragraphs in the Staff's comment letter. A numerical reference next to a response indicates the page where changes have been made in response to the comment.
Page Reference
1. The Company does not intend to use any artwork, photographs or maps with its prospectus. N/A
2. Comment noted. N/A
3. Comment complied with. Exhibit 23.2
4. Comment complied with. Cover Page
5. Comment complied with. 1
6. Comment complied with. 1
7. Comment complied with. 4
8. Comment complied with. 1, 6, 17
9. Comment complied with. 1, 4
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Page Reference
10. Comment complied with. 2
11. Comment complied with. 2
12. Comment complied with. 3
13. We have revised some of the Risk Factors in response to this comment. In our opinion each risk factor heading clearly states the particular risk and the consequences that may result if that risk should occur. In this regard, it should be noted that in some cases the risk factor heading contains the entire risk. In addition, a sentence at the beginning of the Risk Factor section of prospectus states that if any of the enumerated risks should materialize, the Company's common stock may decline in value or prove to be worthless. In the Microsoft Word version of the prospectus, the Risk Factors headings are in bold face. However, on the Edgar system words in bold face show as regular type since the Company's Edgar filings are made in the ASCII format, as opposed to the HTML format. In this amendment all risk factor headings have been underlined for ease of identification. 3, 4, 5
14. The date on which the offering will terminate has been changed. 1, 17
15. Comment complied with. 4
16. The risk factor which is the subject of this comment has been modified. 4
17. Comment complied with. 14
18. Comment complied with. 5
19. The risk factors which are the subject of this comment have been revised and relocated. 4, 5
20. The risk factors which are the subject of this comment have been revised and relocated. 4, 5
21. Comment complied with. 5
22. Comment complied with. 5
23. Comment complied with. 5
24. Comment complied with. 5
<PAGE>
Page Reference
25. Comment complied with. 5
26. Comment complied with. 6
27. Comment complied with. 6
28. Comment complied with. 7
29. Comment complied with. 7
30. Rule 502(d) of Regulation D provides that securities acquired in a transaction under Regulation D cannot be sold without registration under the Act or an exemption from registration. Since the shares sold in the private offering are being registered by means of the registration statement, the Company is in compliance with Rule 502(d). N/A
31. Comment complied with. 8
32. Comment complied with. 7
33. Comment complied with. 9
34. We have revised the Company's anticipated capital expenses for the twelve-month period following the offering. 10
35. The prospectus provides in part that the Company does not have any commitments or arrangements from any person to provide it with any additional capital. Since the Company does not have any external sources of liquidity we are not able to provide any more detail regarding this subject. N/A
36. Comment complied with. 9
37. Public corporations routinely sell their securities in private offerings. As long as there is no general solicitation of investors and the shares are restricted for resale in accordance with Rule 144 private sales will be exempt pursuant to Section 4(2) of the 1933 Act. N/A
38. We have revised the prospectus to cover sales for the three months ending December 31, 2004. 12
39. The Company does not have any material revenue from consignment sales. N/A
<PAGE>
Page Reference
40. Comment complied with. 9
41. Comment complied with. 10
42. Comment complied with. 9
43. Comment complied with. 10
44. Comment complied with. 10, 11
45. Comment complied with. 10
46. We have deleted the term "925 Stamped Sterling Silver" from the prospectus. 11
47. Comment complied with. 12
48. Comment complied with. 10
49. Comment complied with. 11
50. As disclosed in the prospectus, there are a substantial number of vendors in Nepal and Thailand who provide traditional ethnic products which are similar or virtually identical to the products sold by the Company. Most of these vendors work with American importers and are also able to provide most types of contemporary jewelry, based either on their own designs or designs supplied by American importers. Since the present vendors could be quickly and easily replaced, the Company does not believe that its reliance on only two vendors is a risk. N/A
51. Comment complied with. 11
52. Comment complied with. 13
53. Comment complied with. 13
54. Comment complied with. 12
55. The Company does not believe that conducting business with its vendors in Nepal and Thailand is any different then conducting business with vendors in the United States. Both of the Company's vendors have their own websites and are accessible via email or telephone. The
<PAGE>
Page Reference
Company pays for its products in U.S. dollars and products are shipped to the Company via DHL or UPS. There are no import restrictions on the products which the Company purchases from its vendors in Nepal and Thailand. Accordingly, the Company does not believe that there is any risk in conducting business with its vendors in Nepal and Thailand. N/A
56. Comment complied with. 14
57. Comment complied with. 15
58. Comment complied with. 15
59. Comment complied with. 15
60. Comment complied with. 15
61. Comment complied with. 15
62. Comment complied with. 15
63. Comment complied with. 16
64. Comment complied with. 16
65. Comment complied with. 4
66. Section 3(a)(4) of the Securities Exchange Act of 1934 defines a broker as "any person engaged in the business of effecting transactions in securities for the account of others".
As explained in the treatise "Securities Regulation" (Loss/Seligman) on page 2980, "the phrase engaged in the business connotes a certain regularity of participation in purchasing and selling activities rather than a few isolated transactions."
In the case of the officers who will be selling the securities on behalf of the Company:
o The officers' primary duties for the Company are other than sale of its securities; o The officers will not receive special compensation for their selling efforts; and
<PAGE>
Page Reference
o The officers' employment will continue beyond the conclusion of the securities offering.
As provided in Rule 3a4-1(b), no presumption arises that a person is a broker if the persons do not meet the conditions specified in Rule 3a4-1. N/A
67. Comment complied with. 17
68. The sentence which is the subject of this comment has been deleted from the prospectus. 17
69. None of the selling shareholders are affiliates of broker/dealers. 18
70. None of the selling shareholders have any material relationship with the Company or any affiliate of the Company. 18
71. Item 507 of Regulation B requires the disclosure of the ownership of selling shareholders if they own more than 1% of the issuer's outstanding common stock after the offering. No disclosure is required by Item 507 as to the ownership of the selling shareholders prior to the offering. N/A
72. Comment complied with. 17
73. Comment complied with. 19
74. Comment complied with. 19
75. Comment complied with. 20
76. Comment complied with. F-5
77. Comment complied with. F-8
78. Comment complied with. Back Cover Page
79. Comment complied with. Back Cover Page, F-9
80. At the time the Company sold common stock relying on the 504 exemption the Company was not:
o Subject to reporting requirements of the Exchange Act o An investment company, or
<PAGE>
Page Reference
o A development stage company that had no specific business plan or purpose or had a business plan to engage in a merger or acquisition with an unidentified company or companies.
The amount of securities sold by the Company was less than $1,000,000. Accordingly the Company was entitled to rely on the 504 exemption. N/A
81. Generally accepted accounting principles required the Company to value the 4,000,000 shares issued to Sara Preston at a price of $0.05 per share, since this was the price of the Company's securities sold in an arms length transaction shortly after the shares were issued to Ms. Preston. This resulted in a value of $200,000 for the services provided by Ms. Preston, which of course is not realistic. Although, GAAP often result in valuations which are not realistic, the Company is nevertheless required to present its financial statements in accordance with GAAP. N/A
82. Comment complied with. Signature Page
If you should have any questions concerning the above please do not hesitate to contact the undersigned.
Very truly yours,
HART & TRINEN, L.L.P.
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7
HART & TRINEN
Attorneys at Law
1624 Washington Street
Denver, Colorado 80203
(303) 839-0061 (303) 839-5414 (fax)
February 7, 2005
Duc Dang
Securities and Exchange Commission
450 5th Street, N.W.
Mail Stop 0304
Washington, D.C. 20549
Re: Bella Trading Company, Inc.
Registration Statement on Form SB-2
File Number 333-121034
Dear Mr. Dang:
This office represents Bella Trading Company, Inc. (the "Company").
Amendment No. 1 to the Company's Registration Statement on Form SB-2 has been
filed with the Commission. This letter sets forth the Company's responses to the
comments received from the Staff by letter dated January 11, 2005. The paragraph
numbers in this letter correspond with the numbered paragraphs in the Staff's
comment letter. A numerical reference next to a response indicates the page
where changes have been made in response to the comment.
Page Reference
1. The Company does not intend to use any artwork,
photographs or maps with its prospectus. N/A
2. Comment noted. N/A
3. Comment complied with. Exhibit 23.2
4. Comment complied with. Cover Page
5. Comment complied with. 1
6. Comment complied with. 1
7. Comment complied with. 4
8. Comment complied with. 1, 6, 17
9. Comment complied with. 1, 4
<PAGE>
Page Reference
10. Comment complied with. 2
11. Comment complied with. 2
12. Comment complied with. 3
13. We have revised some of the Risk Factors in response
to this comment. In our opinion each risk factor heading
clearly states the particular risk and the consequences
that may result if that risk should occur. In this
regard, it should be noted that in some cases the risk factor
heading contains the entire risk. In addition, a
sentence at the beginning of the Risk Factor section of
prospectus states that if any of the enumerated risks should
materialize, the Company's common stock may decline in value
or prove to be worthless. In the Microsoft Word version
of the prospectus, the Risk Factors headings are in bold
face. However, on the Edgar system words in bold face show
as regular type since the Company's Edgar filings are
made in the ASCII format, as opposed to the HTML format.
In this amendment all risk factor headings have been
underlined for ease of identification. 3, 4, 5
14. The date on which the offering will terminate has
been changed. 1, 17
15. Comment complied with. 4
16. The risk factor which is the subject of this comment
has been modified. 4
17. Comment complied with. 14
18. Comment complied with. 5
19. The risk factors which are the subject of this comment
have been revised and relocated. 4, 5
20. The risk factors which are the subject of this comment have
been revised and relocated. 4, 5
21. Comment complied with. 5
22. Comment complied with. 5
23. Comment complied with. 5
24. Comment complied with. 5
<PAGE>
Page Reference
25. Comment complied with. 5
26. Comment complied with. 6
27. Comment complied with. 6
28. Comment complied with. 7
29. Comment complied with. 7
30. Rule 502(d) of Regulation D provides that securities
acquired in a transaction under Regulation D cannot be
sold without registration under the Act or an exemption
from registration. Since the shares sold in the private
offering are being registered by means of the registration
statement, the Company is in compliance with Rule 502(d). N/A
31. Comment complied with. 8
32. Comment complied with. 7
33. Comment complied with. 9
34. We have revised the Company's anticipated capital expenses
for the twelve-month period following the offering. 10
35. The prospectus provides in part that the Company does
not have any commitments or arrangements from any person
to provide it with any additional capital. Since the
Company does not have any external sources of liquidity
we are not able to provide any more detail regarding this
subject. N/A
36. Comment complied with. 9
37. Public corporations routinely sell their securities in
private offerings. As long as there is no general
solicitation of investors and the shares are restricted
for resale in accordance with Rule 144 private sales will
be exempt pursuant to Section 4(2) of the 1933 Act. N/A
38. We have revised the prospectus to cover sales for the
three months ending December 31, 2004. 12
39. The Company does not have any material revenue from
consignment sales. N/A
<PAGE>
Page Reference
40. Comment complied with. 9
41. Comment complied with. 10
42. Comment complied with. 9
43. Comment complied with. 10
44. Comment complied with. 10, 11
45. Comment complied with. 10
46. We have deleted the term "925 Stamped Sterling Silver"
from the prospectus. 11
47. Comment complied with. 12
48. Comment complied with. 10
49. Comment complied with. 11
50. As disclosed in the prospectus, there are a
substantial number of vendors in Nepal and Thailand
who provide traditional ethnic products which are
similar or virtually identical to the products sold by the
Company. Most of these vendors work with American
importers and are also able to provide most types of
contemporary jewelry, based either on their own
designs or designs supplied by American importers.
Since the present vendors could be quickly and easily
replaced, the Company does not believe that its reliance
on only two vendors is a risk. N/A
51. Comment complied with. 11
52. Comment complied with. 13
53. Comment complied with. 13
54. Comment complied with. 12
55. The Company does not believe that conducting business with
its vendors in Nepal and Thailand is any different then
conducting business with vendors in the United States. Both
of the Company's vendors have their own websites and are
accessible via email or telephone. The
<PAGE>
Page Reference
Company pays for its products in U.S. dollars and
products are shipped to the Company via DHL or UPS.
There are no import restrictions on the products
which the Company purchases from its vendors in Nepal
and Thailand. Accordingly, the Company does not
believe that there is any risk in conducting business
with its vendors in Nepal and Thailand. N/A
56. Comment complied with. 14
57. Comment complied with. 15
58. Comment complied with. 15
59. Comment complied with. 15
60. Comment complied with. 15
61. Comment complied with. 15
62. Comment complied with. 15
63. Comment complied with. 16
64. Comment complied with. 16
65. Comment complied with. 4
66. Section 3(a)(4) of the Securities Exchange Act of 1934
defines a broker as "any person engaged in the business
of effecting transactions in securities for the account
of others".
As explained in the treatise "Securities Regulation"
(Loss/Seligman) on page 2980, "the phrase engaged in the
business connotes a certain regularity of participation in
purchasing and selling activities rather than a few
isolated transactions."
In the case of the officers who will be selling the securities
on behalf of the Company:
o The officers' primary duties for the Company are
other than sale of its securities;
o The officers will not receive special compensation
for their selling efforts; and
<PAGE>
Page Reference
o The officers' employment will continue beyond
the conclusion of the securities offering.
As provided in Rule 3a4-1(b), no presumption arises that
a person is a broker if the persons do not meet the
conditions specified in Rule 3a4-1. N/A
67. Comment complied with. 17
68. The sentence which is the subject of this comment has been
deleted from the prospectus. 17
69. None of the selling shareholders are affiliates of
broker/dealers. 18
70. None of the selling shareholders have any material
relationship with the Company or any affiliate of
the Company. 18
71. Item 507 of Regulation B requires the disclosure of the
ownership of selling shareholders if they own more than 1%
of the issuer's outstanding common stock after the offering.
No disclosure is required by Item 507 as to the ownership of
the selling shareholders prior to the offering. N/A
72. Comment complied with. 17
73. Comment complied with. 19
74. Comment complied with. 19
75. Comment complied with. 20
76. Comment complied with. F-5
77. Comment complied with. F-8
78. Comment complied with. Back Cover Page
79. Comment complied with. Back Cover Page, F-9
80. At the time the Company sold common stock relying on
the 504 exemption the Company was not:
o Subject to reporting requirements of the Exchange Act
o An investment company, or
<PAGE>
Page Reference
o A development stage company that had no specific
business plan or purpose or had a business plan to
engage in a merger or acquisition with an
unidentified company or companies.
The amount of securities sold by the Company was less
than $1,000,000. Accordingly the Company was entitled to
rely on the 504 exemption. N/A
81. Generally accepted accounting principles required the
Company to value the 4,000,000 shares issued to Sara
Preston at a price of $0.05 per share, since this was
the price of the Company's securities sold in an arms
length transaction shortly after the shares were issued
to Ms. Preston. This resulted in a value of $200,000 for
the services provided by Ms. Preston, which of course is
not realistic. Although, GAAP often result in valuations
which are not realistic, the Company is nevertheless
required to present its financial statements in accordance
with GAAP. N/A
82. Comment complied with. Signature Page
If you should have any questions concerning the above please do not
hesitate to contact the undersigned.
Very truly yours,
HART & TRINEN, L.L.P.
William T. Hart
WTH:ap
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