Cane Clark llp | 3273 E. Warm Springs Las Vegas, NV 89120 | ||||
| Kyleen E. Cane* | Bryan R. Clark^ | Telephone: 702-312-6255 | |||
| Joe Laxague | Scott P. Doney | Facsimile: 702-944-7100 | |||
| Christopher T. Clark | Email: bclark@caneclark.com | ||||
| 1. | Generally, liquidity should be discussed on both a long-term and short-term basis. See Item 303 of Regulation S-K. In light of the continuing working capital deficit and going concern uncertainty, discuss the sufficiency of the Company’s resources to satisfy its ongoing cash requirements for the next twelve months and on a long-term basis considering potential acquisitions and joint venture agreements as described in your notes to the financial statements. Also, please describe the adverse consequences to your business in the event you are unable to raise additional capital. |
| 2. | We note the diverse assumptions for volatility, risk-free rates, and expected lives used in the Black Scholes option pricing model for purposes of valuing the Company’s stock based compensation grants. Supplementally advise us and expand your disclosure to explain in further detail how you determined the volatility, risk free interest rates and expected lives used in valuing your various stock based compensation grants. Also, please tell us and explain in the notes to your financial statements the specific grant to which the various assumptions used relate. We may have further comment upon reviewing your response. |
| 3. | Based on the information provided in Form 8-K filed February 5, 2010, on February 3, 2010, you entered into an Asset Purchase Agreement with SPEC to acquire the assets of SPEC for $2,065,000 cash and common stock equivalents of $750,000. The transaction was scheduled to close on or before April 15, 2010. Based on the information included in Form 10-Q for the period ended March 31, 2010, it appears that this may be an acquisition of a business, and there is no discussion regarding the status of closing of the transaction. In light of the materiality of the consideration, supplementally advise us and expand your disclosure in future filings to provide further details regarding the terms of the transaction and your accounting for it as an acquisition of a business versus an acquisition of assets. As part of your response and future disclosures, please provide an update regarding the status of the transaction. We may have further comment upon reviewing your response. |
