Comment Number | Page[s] | Explanation |
1 . | 1 | Included |
2 . | 2 | Eliminated. No preliminary prospectus being circulated. |
3 . | 10 | Revised |
4 . | 12 | Eliminated |
5 . | 13 | Indicated |
6 . | 13-14 | Revised |
7 . | Subscription agreement revised | |
8 . | 18 | Sifry matters disclosed |
9 . | 21 | Updated |
10 . | 23 | Description revised to conform to Item 101(a) |
11 . | 23 | Developer information disclosed |
12 . | 25 | On-going services described |
13 . | 24 | Suppliers disclosed |
14 . | 24 | Marketing described |
15 . | 24 | Direct sales and no installation disclosed |
16 . | 25 | Support fees disclosed |
17 . | 25 | Fees disclosed |
18 . | 26 | Existing software disclosed. Development not started on other software. |
19 . | 24 | Government regulation disclosed |
20 . | 35 | These issuances are described in Certain Transactions. The difference between the shares listed and the 7,564,566 shares involves the sale of 810,000 shares and the issuance of 500,000 shares to GPT. See Recent Sales of Unregistered Securities. |
21 . | 28 | Profit margins disclosed |
22 . | 32-35 | Section revised. All contracts disclosed. All affiliations disclosed. |
23 . | 36 | Promoters named |
24 . | 36 | Updated |
25 . | 38 | Address corrected |
26 . | 38 | Compensation disclosed |
27 . | 14-15 | Determination disclosed |
28 . | See below | |
29 . | See below | |
30 . | See below | |
31 . | See below | |
32 . | See below | |
33 . | See below | |
34 . | See below | |
35 . | See below | |
36 . | See below | |
37 . | See below | |
38 | See below | |
39 . | See below | |
40 . | See below | |
41 . | See below | |
42 . | See below | |
43 . | See below | |
44 . | Exhibit provided |
ACCOUNTING COMMENTS:
December 31, 2004 Financial Statements
Statement of Stockholders' Deficit
28. Corrected as requested
Statements of Cash Flows
29. Corrected as requested
Notes to Financial Statements
Note 1 - - Summary of Significant Accounting Policies
30. The accounting method has been added to Note 1.
Revenue Recognition
31. Corrected as requested
32. Corrected as requested
Note 4 - - Income Taxes
33. The net operating loss carry forward and deferred tax asset have been updated. Please see revision.
Note 5 - - Commitments
34. Corrected as requested
35. Corrected as requested
36. Sputnik's understanding of the original agreement was, if the contingencies from the original agreement were met, the warrants would have to be issued. The contingencies were never met, and the warrants were never issued. This settlement enforced the fact that DLA Piper Rudnick Gray Cary has no rights to be issued any warrants. As of September 30, 2005, Sputnik owes DLA Piper Rudnick Gray Cary $13,972. That amount is included in Accounts Payable on the face of the Balance Sheet.
Note 8 - - Restatement
37. Corrected as requested
June 30, 2005 Unaudited Interim Financial Statements
General
38. The September 30, 2005 statements have been presented to conform with changes made to the December 31, 2004 financial statements.
39. A statement of equity has been added
Statement of Operations
40. Sputnik has received 20,000 shares of the Technorati stock as part a legal settlement. Technorati is not publicly traded, nor is it part of a publicly traded company. No financial statements of Technorati could be obtained, and no market for the shares could be determined. There was no basis to value the shares received, and therefore, no value was assigned, and no additional gain was recognized for the shares.
41. The three month periods have been removed.
Note 2 - Equity
42. 6,894,000 shares valued at $682,441 were payable as of December 31, 2004. This is comprised of the 6,394,000 plus the additional 500,000 shares valued at $50,000 for GPT (reference comment No. 35). An additional 810,000 shares were sold, but not issued, for $81,000 in cash during the first quarter of 2005. Therefore, there was an obligation to issue 7,704,061 shares valued at $736,441 as of March 31, 2005. During the second quarter, all of the shares were issued to settle the obligation.
Other regulatory
43. A current consent has been provided.
