SEC Comment Letter for China Teletech Holding Inc (CNCT) (CIK 0001346287) (CLUS) — Dec 18, 2007
China Teletech Holding Inc (CNCT) (CIK 0001346287)
Date: Dec. 18, 2007 · CIK: 0001346287 · Accession: 0000000000-07-061252
AI Filing Summary & Sentiment
File numbers found in text: 333-145858
Letter
UNITED STATES SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549
DIVISION OF CORPORATION FINANCE
Mail Stop 3720 December 18, 2007 Yankuan Li Chief Executive Officer and Chairman of the Board Guangzhou Global Telecom, Inc. Room 1802, North Tower, Suntec Plaza No. 197, Guangzhou Avenue North Guangzhou, PRC 510075 Re: Guangzhou Global Telecom, Inc. Amendment No. 2 to Registration Statement on Form SB-2 Filed December 7, 2007 File No. 333-145858 Dear Mr. Li:
We have limited our review of your filing to the matters set forth in the comments below. Where indicated, we think you should revise your documents in response to these comments. If you disagree, we will consider your explanation as to why our comment is inapplicable or a revision is unnecessary. Pl ease be as detailed as necessary in your explanation. In some of our comments, we may ask you to provide us with information so we may better understand your disclosure. After reviewing this information, we may or may not raise additional comments. Please understand that the purpose of our re view process is to assist you in your compliance with the applicable disclosure requirements and to enhance the overall disclosure in your filing. We look forward to working with you in these respects. We welcome any questions you may have about our comments or any other aspect of our review. Feel free to call us at the telephone numbers listed at the end of this letter.
Yankuan Li Guangzhou Global Telecom, Inc. December 18, 2007 Page 2
General
1. Currently, you identify Mr. Li as the agen t for service and provide his address in China. Please disclose the name and address of the company’s agent in the United States who is authorized to recei ve notice. Refer to Schedule A to the Securities Act of 1933.
Disclosure Regarding Our Recent Financing and Conversion of Notes and Exercise of Warrants, page 2
Warrants, page 3 Note, page 3 2. In your disclosure of the anti-dilution provisions of both th e warrants and the convertible notes, you state that the exerci se/conversion price will be adjusted if you issue stock below the market price . We note that the exercise/conversion prices are adjustable if you issue stock below thos e exercise/conversion prices . Please clarify these statements. Note, page 3
3. Disclose how the number of shares of stock to be issued for interest payments will be determined under the term s of the convertible notes. 4. Explain the meaning of “Monthly Redemption Amount.” Fees and Payments Associated with Transaction, page 5
5. Please clarify how you calculated the ma ximum possible interest payments included in column three and the correspond ing footnote. Explain what portion of the maximum possible interest payments re presents original issue discount and what portion represents in terest payments, providing th e interest rate, principal amount and time period during which inte rest accrued for purposes of the calculation. Additional, identify and expl ain the terms of the securities that prevent interest from accruing while your stock price is greater than $.01 as referenced in the last se ntence of footnote three. Total Possible Profit Selling Stoc kholders Could Realize, page 6
Notes, page 6
6. Please clearly explain how you determined the total conversion price reflected in column (5). It is unclear how the amount shown, $4,428,570, reflects the total conversion price of the 4,181,184 shares re flected in column (3) based on a
Yankuan Li Guangzhou Global Telecom, Inc. December 18, 2007 Page 3
conversion price of $0.82. Alternately, revise column (5) and, correspondingly, column (6). Total Possible Profit Selling Shareholders Could Realize as a Result of the Redemption Conversion Discount, page 7
7. If correct, please revise the heading to co lumn (5) to reflect that the monetary amount shown is the total redemption conve rsion price, rather than the total possible shares selling shareholders may receive.
Total Possible Profit Selling Shareholders Could Realize as a Result of the Interest Conversion Discount, page 7 8. Please clearly explain how you determined the amount of shares included in column (3). It is unclear based on your existing disclosure why 258,460 shares would be issued in payment of $253,291 in interest based on an interest payment conversion price of $0.82. Alternatively, revise column (3) and, correspondingly, columns (4), (5) and (6). 9. If correct, please revise the heading to co lumn (5) to reflect that the monetary amount shown is the total inte rest payment conversion pric e, rather than the total possible shares selling shareholders may receive. Net Proceeds Payable to the Company and Combined Total Possible Profit Selling Stockholders Could Realize, page 8 10. The numbers used in the calculations descri bed in footnotes (2), (3) and (5) do not appear consistent with the numbers in the table or numbers shown in other tables in your prospectus. Please revise your footnotes and, if applicable, your table. For example, column (2) refers to an am ount already disclosed in the table “Fees and Payments Associated with Transac tion” on page five, yet you disclose your calculation in the footnote using new in terest payment and liquidated damages payment amounts. Additionally, the figure in column (5) should be determined by reference to columns (2), (3) and (4 ), yet your footnote disclosure of the calculation refers to different amounts.
* * * *
As appropriate, please amend your regist ration statement in response to these comments. You may wish to provide us with marked copies of the amendment to expedite our review. Please furnish a cove r letter with your amendment that keys your responses to our comments and provides any requested supplemental information. Detailed cover letters greatly facilitate our review. Please understa nd that we may have additional comments after reviewing your amendment and responses to our comments.
Yankuan Li Guangzhou Global Telecom, Inc. December 18, 2007 Page 4
You may contact John Harrington, Attorn ey-Adviser, at 202-551-3576 or me, at 202-551-3833, with any questions.
S i n c e r e l y , / s / M i c h e l e M . A n d e r s o n L e g a l B r a n c h C h i e f cc: Richard I. Anslow, Esq. Anslow & Jaclin, LLP Via facsimile: (732) 577-1188
Show Raw Text
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
DIVISION OF
CORPORATION FINANCE
Mail Stop 3720
December 18, 2007
Yankuan Li Chief Executive Officer and Chairman of the Board Guangzhou Global Telecom, Inc. Room 1802, North Tower, Suntec Plaza No. 197, Guangzhou Avenue North Guangzhou, PRC 510075
Re: Guangzhou Global Telecom, Inc.
Amendment No. 2 to Registration Statement on Form SB-2 Filed December 7, 2007
File No. 333-145858 Dear Mr. Li:
We have limited our review of your filing to the matters set forth in the comments
below. Where indicated, we think you should revise your documents in response to these
comments. If you disagree, we will consider your explanation as to why our comment is
inapplicable or a revision is unnecessary. Pl ease be as detailed as necessary in your
explanation. In some of our comments, we may ask you to provide us with information so we may better understand your disclosure. After reviewing this information, we may
or may not raise additional comments.
Please understand that the purpose of our re view process is to assist you in your
compliance with the applicable disclosure requirements and to enhance the overall
disclosure in your filing. We look forward to working with you in these respects. We
welcome any questions you may have about our comments or any other aspect of our review. Feel free to call us at the telephone numbers listed at the end of this letter.
Yankuan Li
Guangzhou Global Telecom, Inc.
December 18, 2007 Page 2
General
1. Currently, you identify Mr. Li as the agen t for service and provide his address in
China. Please disclose the name and address of the company’s agent in the
United States who is authorized to recei ve notice. Refer to Schedule A to the
Securities Act of 1933.
Disclosure Regarding Our Recent Financing and Conversion of Notes and Exercise of
Warrants, page 2
Warrants, page 3
Note, page 3
2. In your disclosure of the anti-dilution provisions of both th e warrants and the
convertible notes, you state that the exerci se/conversion price will be adjusted if
you issue stock below the market price
. We note that the exercise/conversion
prices are adjustable if you issue stock below thos e exercise/conversion prices .
Please clarify these statements.
Note, page 3
3. Disclose how the number of shares of stock to be issued for interest payments will be determined under the term s of the convertible notes.
4. Explain the meaning of “Monthly Redemption Amount.”
Fees and Payments Associated with Transaction, page 5
5. Please clarify how you calculated the ma ximum possible interest payments
included in column three and the correspond ing footnote. Explain what portion of
the maximum possible interest payments re presents original issue discount and
what portion represents in terest payments, providing th e interest rate, principal
amount and time period during which inte rest accrued for purposes of the
calculation. Additional, identify and expl ain the terms of the securities that
prevent interest from accruing while your stock price is greater than $.01 as
referenced in the last se ntence of footnote three.
Total Possible Profit Selling Stoc kholders Could Realize, page 6
Notes, page 6
6. Please clearly explain how you determined the total conversion price reflected in
column (5). It is unclear how the amount shown, $4,428,570, reflects the total
conversion price of the 4,181,184 shares re flected in column (3) based on a
Yankuan Li
Guangzhou Global Telecom, Inc.
December 18, 2007 Page 3
conversion price of $0.82. Alternately, revise column (5) and, correspondingly,
column (6).
Total Possible Profit Selling Shareholders Could Realize as a Result of the Redemption
Conversion Discount, page 7
7. If correct, please revise the heading to co lumn (5) to reflect that the monetary
amount shown is the total redemption conve rsion price, rather than the total
possible shares selling shareholders may receive.
Total Possible Profit Selling Shareholders Could Realize as a Result of the Interest
Conversion Discount, page 7
8. Please clearly explain how you determined the amount of shares included in
column (3). It is unclear based on your existing disclosure why 258,460 shares
would be issued in payment of $253,291 in interest based on an interest payment
conversion price of $0.82. Alternatively, revise column (3) and, correspondingly,
columns (4), (5) and (6).
9. If correct, please revise the heading to co lumn (5) to reflect that the monetary
amount shown is the total inte rest payment conversion pric e, rather than the total
possible shares selling shareholders may receive.
Net Proceeds Payable to the Company and Combined Total Possible Profit Selling
Stockholders Could Realize, page 8
10. The numbers used in the calculations descri bed in footnotes (2), (3) and (5) do not
appear consistent with the numbers in the table or numbers shown in other tables in your prospectus. Please revise your footnotes and, if applicable, your table.
For example, column (2) refers to an am ount already disclosed in the table “Fees
and Payments Associated with Transac tion” on page five, yet you disclose your
calculation in the footnote using new in terest payment and liquidated damages
payment amounts. Additionally, the figure in column (5) should be determined
by reference to columns (2), (3) and (4 ), yet your footnote disclosure of the
calculation refers to different amounts.
* * * *
As appropriate, please amend your regist ration statement in response to these
comments. You may wish to provide us with marked copies of the amendment to expedite our review. Please furnish a cove r letter with your amendment that keys your
responses to our comments and provides any requested supplemental information.
Detailed cover letters greatly facilitate our review. Please understa nd that we may have
additional comments after reviewing your amendment and responses to our comments.
Yankuan Li
Guangzhou Global Telecom, Inc.
December 18, 2007
Page 4
You may contact John Harrington, Attorn ey-Adviser, at 202-551-3576 or me, at
202-551-3833, with any questions.
S i n c e r e l y , / s / M i c h e l e M . A n d e r s o n L e g a l B r a n c h C h i e f
cc: Richard I. Anslow, Esq. Anslow & Jaclin, LLP Via facsimile: (732) 577-1188