Mail Stop 0308
April 20, 2005
VIA U.S. MAIL AND FACSIMILE
Tom Lynch, President
Siouxland Ethanol, LLC
110 East Elk Street
Jackson, Nebraska 68743
Re: Siouxland Ethanol, LLC
Registration Statement on Form SB-2
File No. 333-123473
Filed on March 21, 2005
Dear Mr. Lynch:
We have reviewed your filing and have the following
comments.
Where indicated, we think you should revise your document 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. Please be as detailed as necessary in your
explanation.
In some of our comments, we may ask you to provide us with
supplemental 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 review 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 on any other
aspect
of our review. Feel free to call us at the telephone numbers
listed
at the end of this letter.
General
1. We note that the securities you are offering for sale at
$10,000
per unit include a deferred payment option. Specifically,
investors
may pay a minimum initial 10% of the purchase price in cash, and
provide up to the remaining 90% of the purchase price by means of
a
promissory note due after the offering closes. It is unclear
whether
this structure is consistent with Rule 10b-9 under the Securities
Exchange Act of 1934. Rule 10b-9(a)(2), in relevant effect,
prohibits the release from escrow of consideration paid in a
minimum-
maximum offering unless "the total amount due to the [issuer] is
received by [the issuer] by a specified date." It is unclear
whether
receipt of a promissory note constitutes the total amount due.
Please revise or advise. In this regard, and as part of your
response, please tell us with a view toward clarifying disclosure
whether your escrow agent will release the funds to you upon
confirmation that the offering has terminated and you have
received
the minimum proceeds in cash, or whether a mixture of cash and
promissory notes by the offering termination date is sufficient to
trigger release from escrow.
2. Please review your disclosure and ensure that you identify the
source for the industry and scientific data that you provide.
Currently, you include many factual statements, but you do not
always
indicate whether the source of this information is based upon
management`s belief, industry data, scientific reports, general
articles, or any other source. For example, we note the
following:
* "We expect the ethanol plant will annually process approximately
18.5 million bushels of corn into 50 million gallons of ethanol,
160,000 tons of distillers grains for animal feed and 110,200 tons
of
carbon dioxide."
* "We believe that ethanol production is expanding rapidly at this
time."
* "The price of grain has fluctuated significantly in the past and
may fluctuate significantly in the future."
* "[R]ail is considerably more cost effective than truck
transportation to the more distant markets."
These are only examples. The Business section in particular
contains
a number of other examples. If the statements are based upon
management`s belief, please indicate that this is the case and
include an explanation for the basis of such belief.
Alternatively,
if the information is based upon reports or articles, please
supplementally provide these documents to us appropriately marked
and
dated. We may have further comments.
3. Please provide us with copies of any additional artwork or
diagrams you intend to use as soon as possible for our review and
comment. Please keep in mind that we may have comments on these
materials and you should consider waiting for these comments
before
printing and circulating any artwork.
Registration Statement Facing Page
4. On the facing page, please add a sentence indicating that
securities are being offered on a delayed or continuous basis
pursuant to Rule 415. See interpretation D.36 of the Manual of
Publicly Available Telephone Interpretations (July 1997) and Form
S-1
to review the disclosure that you should include.
Prospectus Cover Page, page i
5. Please remove from the cover page and elsewhere in the forepart
of
your document all defined terms. Readers will understand, without
resorting to a definition, the meaning of "we," "us," or
"Siouxland
Ethanol."
6. Please consider deleting the table on this page. Since this
offering has no underwriters, this table is repetitive of the
preceding information about the minimum offering, the maximum
offering, and the offering prices.
7. Also, the first full paragraph after your table contains too
much
detail for a cover page. See Item 501(a) of Regulation S-B.
Please
revise. Rely on your Summary to provide information about your
business and financing needs.
8. The cross-reference to your Risk Factors section must be
highlighted by prominent type or another manner. See Item
501(a)(5)
of Regulation S-B. Therefore, please make your cross-reference
more
prominent by separating it from the Commission Legend.
9. On this page, and throughout your document, please more clearly
state when your offering will end. See Item 501(a)(9)(iii) of
Regulation S-B. Currently, you state that your offering will
terminate at the earliest of either your receipt of the minimum
amount of funds and a written debt financing commitment, one year
from the effective date of this registration statement, or the
offering`s termination.
10. Also, please clarify on what conditions you may terminate the
offering. You state that you will not close your offering until
you
receive the minimum amount of subscriptions and secure a written
debt
financing commitment. However, in other sections of this
document,
you condition the closing of your offering on receiving the
minimum
amount of subscriptions and the passing of one year from the time
this registration statement becomes effective. In these other
sections, regarding debt financing, you state only that you will
need
to obtain debt financing to fully capitalize this project, you do
not
state that it is a condition upon which closing the offering
depends.
Therefore, please clarify the conditions of your offering and make
them consistent throughout your document.
Prospectus Summary, page 1
11. The Summary section is intended to provide a brief overview of
the most material aspects of the offering. Your summary is too
long.
The summary should not contain, and is not required to contain,
all
of the detailed information in the prospectus. See Item 503(a) of
Regulation S-B. The Summary is only intended to provide a brief
snapshot of the offering. Therefore, please consider making the
following changes:
* reducing the excess detail of many of your subsections, such as
your "Membership in Siouxland Ethanol and Our Operating Agreement"
subsection;
* removing entire subsections from your Summary section and
placing
them in your document`s subsequent sections, such as your
"Management
of Siouxland Ethanol," "Distributions to Unit Holders," and
"Important Notices to Investors" subsections, as some subsections
have information that is not material enough to merit Summary
disclosure; and
* deleting repetitive information contained elsewhere in your
Summary, in this section, or in other parts of your document, such
as
some of the information in your "Financing Plan," "Financial
Information," and "Suitability of Investors" subsections.
These are only examples. Please thoroughly revise your Summary
section accordingly. We may have further comments based upon your
revisions.
12. In this section, please clarify that you have three
alternatives
if you receive at least the minimum amount of equity funds but you
are unable to receive a debt financing commitment before the
offering
closes. On page 21 of this document you state that you will
either
begin plant construction with the equity funds while seeking
another
debt financing source, you will hold the funds indefinitely while
seeking another funds source, or you will return the equity funds
to
your investors.
The Offering, page 1
13. Please disclose when this offering will commence.
14. Please disclose which officers and directors will be offering
securities on your behalf. If the officers and directors listed
on
the top of page six are the individuals who will be offering your
securities, please revise to clarify.
The Project, page 1
15. We note you disclose risks related to the construction of the
ethanol plant and that you have no definitive binding agreement
with
any contractor outside the signed letter of intent to design and
build a plant. Please revise in this section and throughout your
document to clarify that the $76.7 million is not a firm estimate,
but just a preliminary estimate of costs of an ethanol plant
similar
to the one that maybe designed and built. Also, please revise in
the
body of the document, such as in your Management`s Discussion and
Analysis section, to clarify the basis for this estimate and the
major assumptions used to calculate this amount.
Escrow Procedures, page 4
16. You state that you will return promptly your prospective
buyers`
investment plus nominal interest, less a deduction for escrow
agent
fees if you are unable to meet the requirements of the offering or
you terminate the offering prior to its closing. Please disclose
briefly whether the escrow fee deduction could result in your
investors receiving less than their full investment if you return
their money. If the escrow fee exceeds the interest and will not
be
paid with your investors` funds, please disclose with what funds
you
will pay the fee.
17. Please discuss prominently that once a prospective investor
executes the subscription agreement, the investor may not withdraw
the funds from escrow, sell their interests, or otherwise cancel
the
agreement.
Risk Factors, page 6
18. Your Risk Factors section should be a discussion of the most
significant factors that make your offering speculative or risky,
and
you should place these factors in context so your readers can
understand a specific risk as it applies to you. See SEC Release
No.
33-7497. Also, you should not present risks that are generic or
contain boilerplate language that could apply to any issuer or any
offering. We believe a discussion of risk in generic terms does
not
tell your readers how the risk may affect their investment in you.
Please revise your Risk Factors section generally to write each
risk
factor in plain English and avoid using boilerplate or generic
risk
factors. See Item 503(c) of Regulation S-B. As examples, please
consider the following risk factors:
* "Any agreements with lenders may require us to abide by
restrictive
loan covenants that may hinder our ability to operate."
* "Agreements that have not been finalized may never be finalized
or
may significantly change in ways that reduce the value of your
investment."
* "A change in environmental regulations or violations thereof
could
result in the devaluation of our units and a reduction in the
value
of your investment."
Further, some of your risk factor discussions do not clearly and
concisely convey the actual risk, such as the last risk factor on
page 10 and the third risk factor on page 14. Consider whether
other
subsections or elements of a discussion within a subsection are
necessary for this section, and whether certain risk factors can
be
combined so they are not repetitive. Accordingly, please revise
to
more precisely articulate the risks to your offering from each
risk
factor, and to ensure that each factor is written in plain
English.
We may have additional comments based upon your revisions.
Siouxland Ethanol has no operating history, which could result in
errors..., page 8
19. In this subsection, you state that your proposed operations
are
"subject to all the risks inherent in the establishment of a new
business enterprise." Please disclose if there are additional
risks
you have failed to mention in your Risk Factors section.
Otherwise,
please consider deleting the above quoted phrase.
Agreements that have not yet been finalized may never be
finalized..., page 8
20. You state that your prospectus makes reference to documents
and
agreements that are not yet final or executed, and in some
instances
these documents and agreements are not even in draft form.
Throughout your prospectus, please disclose which of your
documents
or agreements have not been finalized and at what developmental
stage
are each of your documents and agreements.
The IRS May Classify Your Investment as Passive Activity Income,
Resulting..., page 15
21. Please discuss briefly what the Internal Revenue Service
classifies as a "passive activity."
Use of Proceeds, page 17
22. Please integrate this section with your section entitled
Estimated Use of Proceeds.
23. Also, please identify the persons from whom any assets will be
purchased, and if any of these assets will be acquired from your
affiliates or their associates, please set forth the principal you
used in determining their costs to you. See Instruction 2 to Item
504 of Regulation S-B.
Determination of Offering Price, page 17
24. You state that you determined the unit offering price based on
your estimate of capital and expense requirements. However, even
if
you receive the maximum funds, you will still require at least
$30,640,000 in loans or government grants after your offering.
Therefore, please provide the factors you considered in
determining
the offering price of $10,000. See Item 504(a) of Regulation S-B.
For example, why did you not set the offering price at a higher
figure so that you would not have to borrow funds if you sold the
maximum number of units? Finally, please consider whether your
recent private placements at $5,000 per unit contributed to the
calculation of the offering price.
Capitalization, page 19
25. We note that you do not have a commitment for financing.
Please
advise or revise to clarify the basis for your pro forma
presentation
of long-term debt.
Management`s Discussion and Analysis and Plan of Operation, page
20
26. Please expand this section to discuss known material risks,
trends, and uncertainties that will have or are reasonably likely
to
have a material impact on your revenues, operations, liquidity, or
income over the short and long terms, and the actions you are
taking
to address them. In doing so, please discuss the industry-wide
factors relevant to your business and the risks and uncertainties
related to the development of your products to the extent
necessary
to commence operations and for the foreseeable future.
Additionally,
please discuss your ability to secure sources of supply and
customers, generate revenues, raise additional financing, and
manage
other significant risks and uncertainties that are material to
your
plan of operations and business. See SEC Release No. 33-8350 and
Item 303 of Regulation S-B.
27. In this section, please disclose the number of employees you
have
currently and your plans for any significant changes in this
number
in the future. See Item 303(a)(1)(iv) of Regulation S-B.
28. You disclose a proposed offering price of $10,000 for each
membership unit and we note you sold 195 membership units during
November 2004 for $5,000 per unit. Please expand your
Management`s
Discussion and Analysis section to include the following
information:
* a list of the units sold to date and a discussion of the factors
and methods used in determining fair value at the time of each
issuance; and
* a discussion of the factors contributing to the difference
between
the fair value as of the date of grant and the estimated offering
price.
Please include a summary of key events that have occurred since
November 2004 which represent activities that have contributed to
the
substantial increase in the valuation of your business.
Project Capitalization, page 21
29. You state that you have three alternatives if you receive at
least the minimum equity funds but do not satisfy the loan
commitment
conditions before closing the offering. In one alternative, you
state you will begin plant construction with the equity funds
while
seeking another debt financing source. Please disclose how long
you
can satisfy your cash requirements while you are beginning
construction and you are searching for a debt financing source if
you
receive the minimum amount of proceeds and if you receive the
maximum
amount of proceeds. Also, please disclose what you will do if
your
equity funds run out and you still have not found a debt financing
source. See Item 303(a) of Regulation S-B. Further, please
include
this as a risk factor.
30. Also, in another alternative, you state you will hold the
raised
funds "indefinitely" while you seek another debt financing source.
Again, please disclose how long you can satisfy your cash
requirements while you are searching for a debt financing source,
without beginning the plant construction, if you receive the
minimum
amount of proceeds and if you receive the maximum amount of
proceeds.
Further, please be more specific about how long you will hold
these
funds before deciding you will not be able to find a debt
financing
source, and please discuss what you will do with the funds and
interest if you fail to find financing after this time. Finally,
please include this as a risk factor.
Liquidity and Capital Resources, page 22
31. In a separately captioned section, please revise your
disclosure
to include any off-balance sheet arrangements that have or are
reasonably likely to have a current or future effect on your
financial condition. If there are none, please state this in your
revised disclosure. See Item 303(c) of Regulation S-B.
32. Please revise your disclosure to provide the current status of
your negotiations to obtain the additional financing for the plant
in
excess of the funds being raised by this offering.
Critical Accounting Policies, page 22
33. Your current disclosure does not discuss the types of assets
or
liabilities that you estimate. Please revise to include the types
of
assets, liabilities, and expenses that you currently estimate and
how
you determine the amounts estimated. If there are no significant
estimates, please state this in your disclosure.
Grants, Government Programs and Tax Increment Financing, page 22
34. You state that the Commodity Credit Corporation Bioenergy
Program
is scheduled to expire on September 30, 2006 and your plant will
not
be completed until spring 2007. Please disclose whether you have
developed your plant proposal assuming that the program will be
extended. If so, please tell us why you believe the program will
be
extended and the impact on you if it is not extended. If your
plant
proposal does not assume the extension of the program, please tell
us
why you have included a discussion about the program in your
document. Further, we note you provided the elimination of this
program as a risk factor, therefore please revise your disclosure
in
that section as well.
35. Please disclose the reasons you were rejected previously for
the
project development grant from the U.S. Department of Agriculture
in
the amount of $400,000. Also, please assess the likelihood you
will
receive the grant this year based upon the reasons for your
previous
year`s rejection.
Estimated Sources of Funds, page 24
36. Since the Northeastern Nebraska Railroad Grant, the Community
Development Block Grant, and the Tax Increment Financing from
Jackson
are only possible sources of funds, please disclose how you will
replace the $3,500,000 if these sources fail to provide you with
any
funds, or if they provide you will fewer funds than you
anticipate.
Description of Business, page 26
37. Please disclose your year of organization. See Item 101(a)(1)
of
Regulation S-B.
Primary Product - Ethanol, page 27
38. You state that you intend to market your ethanol through an
experienced ethanol marketer. In this section, please disclose
any
discussions you had with any ethanol marketer. If you have not
had
any of these discussions, please state this in your document.
By-Products, page 29
39. Please state whether you have engaged any company to market
your
distillers grains nationally. If you have, please disclose the
company and file the agreement with us as an exhibit. If you do
not
have a marketing company, please state this in your document.
Grain origination and risk management, page 31
40. In this section, you define hedging. Additionally, please
explain forward contracts, futures, and option contracts.
Regional ethanol markets, page 32
41. You provide examples of regional markets as Chicago, St.
Louis,
Denver, and Minneapolis. However, it appears that none of these
cities will be your regional market, because your plant will not
be
near any of these cities. It appears that your regional market
will
be around Sioux City, IA. Sioux City is much smaller than the
cities
you mentioned. Therefore, please revise this section by
discussing
your regional market`s size and characteristics.
Federal Ethanol Supports, page 36
42. Since the 109th Congress has commenced, any legislation that
was
introduced in the previous Congress must be reintroduced in this
Congress. Therefore, please consider updating your reference to
S.
791 of the 108th Congress or disclose the legislation`s prior
relevance to your offering.
Project Location and Proximity to Markets, page 37
43. Please disclose what you mean by the "hazardous conditions"
that
you may encounter on the plant sites.
Natural gas, page 39
44. You state that your plant could consume approximately
1,600,000
Million British Thermal Units per year. Also, you state that
natural
gas prices have risen from approximately $3.00/mcf to nearly
$5.00/mcf. So your readers will be able to understand better your
disclosure, please provide an approximate cost estimate for the
amount of consumption per year your plant will require.
Water, page 40
45. You state that you anticipate drilling two 700 gallon per
minute
wells "at the site" to handle your water needs. Please disclose
why
you believe you will be able to drill two wells that discharge
such
quantities of water. Please discuss this for both of the
properties
upon which you have options and may locate your plant.
Methane Gas, page 40
46. You reference your prospective plant site, but you have two
possible sites on which you are holding options. Although you do
not
anticipate using the site four miles west of Jackson, Nebraska,
please disclose the methane resources surrounding that site as
well
as the site one mile west of Jackson, Nebraska.
47. Please disclose in greater detail your plan to utilize the
methane gas of your site`s neighboring land fill to operate your
plant.
Our Primary Competition, page 40
48. Please estimate your competitive position relative to the
competitors you mention in your table, and please discuss your
principal methods of competition. See Item 101(b)(4) of
Regulation
S-B.
Employees, page 44
49. You state that your only current employee is your office
manager,
Jean Beach. However, in your Executive Compensation section, you
list Tom Lynch as your president, Pam Miller as your vice
president,
John Kingsbury as your treasurer, and Doug Garwood as your
secretary.
Further, you state that Bill Riechers and Darrell Downs are
serving
as project coordinators. Please include these individuals, and
any
others with similar responsibilities, as employees in this
section.
See Item 101(b)(12) of Regulation S-B.
ICM, Inc., page 45
50. Please disclose how ICM`s "very successful new design for
distiller`s dried grains dryers" differs from the old design.
Also,
please disclose on what basis you state that ICM`s new design is
"very successful."
51. Please revise this section to discuss ICM`s business using
clear
and concise language. For example, we note that you have not
defined
certain terms and phrases, such as "dried grains dryers,"
"methanator" and "near zero process water discharge."
Regulatory Permits, page 46
52. To the extent reasonably known, please estimate the costs and
effects of complying with the environmental laws you are must
follow.
See Item 101(b)(11) of Regulation S-B.
53. You state that you may be subject to regulations on emissions
from the Environmental Protection Agency. Yet, you say also that
the
agency`s statutes and rules do not require you to obtain separate
approval regarding your plant`s construction and operations.
Please
clarify whether there are any Environmental Protection Agency
rules
or regulations with which you must comply. If there are, please
revise your document to be consistent.
Directors, Executive Officers, Promoters and Control Persons, page
48
54. You state that your initial board of directors will serve
until
the first members` meeting following the "substantial completion"
of
the ethanol plant. By contrast, on page 63 of this document, you
state that initial terms of service of your current directors may
not
expire until the 2007 members meeting. However, previously in
your
document, you stated that you may hold your members` funds
indefinitely while searching for debt financing before you
construct
your plant. Alternatively, you stated that you could commence
construction of the plant using the equity funds while seeking
debt
financing. Therefore, if you hold the money indefinitely or
construct less than a substantial portion of the plant, it appears
that your initial board of directors could serve longer than until
2007. If true, please disclose what recourse your unit holders
would
have in this situation, if any. Also, please consider discussing
as
a separate risk factor the extended but uncertain term of your
board
of directors.
Business Experience of Directors and Officers, page 49
55. You must describe briefly the business experiences of your
officers and directors for the last five years without any gaps or
ambiguities. See Item 401(a)(4) of Regulation S-B. Currently,
you
describe only these individuals` present employment position and
their ownership situations. Therefore, please revise this section
to
discuss each person`s business experiences from 2000 to the
present.
56. Please describe the business of Meisner Management Services,
LLC
that your director, Donald Meisner, operates. Also, please
disclose
the agricultural businesses for which your director, Bill
Riechers,
is a project coordinator and consultant. Further, please
elaborate
on Mr. Riechers`s involvement in agricultural products sales and
marketing, and please disclose for whom Mr. Riechers`s performed
these functions.
Executive Compensation, page 53
57. Please describe any standard arrangements, stating the
amounts,
for which your directors are compensated, including any additional
amounts payable for committee participation or special
assignments.
See Item 402(f) of Regulation S-B. If you have none of these
arrangements, please state this in your document.
Transactions with Fagen, Inc., page 54
58. Since Matt Sederstrom is your director and member, and he is
employed by Fagen, Inc. as a project developer for fuel ethanol
facilities, please disclose whether the terms of your letter of
intent with Fagen, Inc. are comparable to those you could have
obtained from an unaffiliated third party. See Item 404 of
Regulation S-B.
59. Also, please disclose whether the terms of your consulting
agreements with your directors, Darrell Downs and Bill Riechers,
to
serve as your project coordinators for your plant development,
financing, and construction are comparable to those you could have
obtained from an unaffiliated third party. See Item 404 of
Regulation S-B.
Plan of Distribution, page 54
60. Please disclose whether the persons offering the securities on
your behalf will rely on the safe harbor from broker-dealer
registration set out in Rule 3a4-1 under the Securities Exchange
Act
of 1934. If applicable, please provide an analysis of your basis
for
your reliance on this safe harbor rule.
Summary of Promotional and Sales Material, page 57
61. You state that in addition to and apart from your prospectus
you
may use certain promotional and sales material in connection with
your offering. For example, we note you will mail information to
area residents, generate news articles, and advertise in local
media.
Please tell us in greater detail the type of promotional and sales
material you will use, how and when you will distribute it, and
whether any written communications that may not be preceded or
accompanied by this prospectus will comply with Rule 134 under the
Securities Act of 1933.
Federal Income Tax Consequences of Owning Our Units, page 64
62. We note you have filed a tax opinion with this amendment. As
this section represents the opinion of counsel, please delete any
reference here that suggests the disclosure is a "summary" of the
tax
consequences.
Legal Matters, page 73
63. In this section, please state that the validity of the tax
disclosure will be passed upon for you by Brown, Winick, Graves,
Gross, Baskerville & Schoenebaum, P.L.C.
Statement of Operations, page F-4
64. You disclose in the Executive Compensation section on page 54
that your officers have not received any compensation for services
rendered since your inception. We believe that your financial
statements should reflect all of the costs of doing business.
Therefore, please advise us or revise your financial statements to
reflect the fair value of the services provided by the officers at
no
cost as a capital contribution with a charge to the appropriate
expense accounts. See SAB Topics 1:B and 5:T.
Notes to Financial Statements, page F-7
65. Please disclose in a footnote the types and amounts of the
transactions you have with related parties such as officers. See
SFAS 57.
Accounting Estimates, page F-7
66. Supplementally, please explain to us the types of amounts that
you include in deferred costs which require estimating and why.
Also, please revise here, and under deferred costs, to identify
those
costs that are estimated.
Note 2, Development Stage Enterprise, page F-8
67. Please clarify the current status of your plans to enter into
a
binding agreement to construct an ethanol plant, the anticipated
costs of this facility, how you plan to finance its construction,
the
date you expect to commence construction, and the anticipated
completion date.
Note 3, Members` Equity, page F-8
68. Please disclose a description of your issued units, your
capital
structure, and any unusual rights or privileges of your membership
units. See paragraphs 17-18 of SFAS 129.
Note 5, Commitments and Contingencies, page F-8
69. You disclose several contracts or agreements that you have
recently entered into with third parties. Supplementally, please
clarify if in any of these arrangements the consideration given up
as
payment for these services has been membership units similar to
those
being offered in this registration statement. If so, please tell
us
the amount of units issued and how you determined their fair
value,
including the assumptions used. Further, please address the
source
of funds for these various contracts in your Liquidity and Capital
Resources section.
Design Build Contract, page F-8
70. We note in your disclosure that you have signed a letter of
intent to contract with an unrelated party to build the ethanol
plant. However, your heading suggests that you have a "contract"
with someone to build a facility. Supplementally, please tell us
and
revise your disclosures to clarify the nature of the document you
signed, the expiration date of the letter of agreement, and what
penalties, if any, you might incur if you subsequently make the
decision not proceed with a binding agreement.
Utility and construction contracts, page F-9
71. Please revise your disclosure to clarify and specify, where
applicable, the start date of the contract or agreement for
services
and if there are monthly payments or just a flat, one-time fee
arrangement.
Note 6, Subsequent Events, page F-9
72. You disclose the option to purchase several parcels of land in
Dakota County, Nebraska. Please revise your disclosures to
clarify
if all of these parcels of land are a part of your comprehensive
plans to acquire a large parcel of land in connection with and in
the
area where you contemplate building the ethanol plant you discuss
throughout the filing.
Item 28, Undertakings, page II-4
73. Please revise the first sentence of your paragraph (1)(ii) to
reflect the language in Item 512(a)(1)(ii) of Regulation S-B.
Signatures, page II-5
74. In your fist set of signatures, John Kingsbury signed your
document in his capacity as Principal Accounting Officer. Also,
please have your Principal Accounting Officer sign in that
capacity
in your second set of signatures. See Instruction 1 to the
Instructions for signatures.
Exhibits 5.1 and 8.1
75. In your counsel`s legality and tax opinions, counsel disclaims
any obligation to revise or supplement its opinions as to future
changes of law or fact. Also, counsel states that the opinions
expressed shall be effective only as of the date of the opinion
letter, which is March 21, 2005. These are unacceptable
qualifications of the opinions. Legality and tax opinions must be
valid as of the registration statement`s effectiveness date.
Therefore, please have counsel revise its opinions to eliminate
those
qualifications. Alternatively, counsel may file its opinion on
the
date of effectiveness.
* * * * * *
As appropriate, please amend your registration 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
cover 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
understand that we may have additional comments after reviewing
your
amendment and responses to our comments.
We urge all persons who are responsible for the accuracy and
adequacy of the disclosure in the filings reviewed by the staff to
be
certain that they have provided all information investors require
for
an informed decision. Since the company and its management are in
possession of all facts relating to a company`s disclosure, they
are
responsible for the accuracy and adequacy of the disclosures they
have made.
Notwithstanding our comments, in the event the company
requests
acceleration of the effective date of the pending registration
statement, it should furnish a letter, at the time of such
request,
acknowledging that:
* should the Commission or the staff, acting pursuant to delegated
authority, declare the filing effective, it does not foreclose the
Commission from taking any action with respect to the filing;
* the action of the Commission or the staff, acting pursuant to
delegated authority, in declaring the filing effective, does not
relieve the company from its full responsibility for the adequacy
and
accuracy of the disclosure in the filing; and
* the company may not assert staff comments and the declaration of
effectiveness as a defense in any proceeding initiated by the
Commission or any person under the federal securities laws of the
United States.
In addition, please be advised that the Division of
Enforcement
has access to all information you provide to the staff of the
Division of Corporation Finance in connection with our review of
your
filing or in response to our comments on your filing.
We will consider a written request for acceleration of the
effective date of the registration statement as a confirmation of
the
fact that those requesting acceleration are aware of their
respective
responsibilities under the Securities Act of 1933 and the
Securities
Exchange Act of 1934 as they relate to the proposed public
offering
of the securities specified in the above registration statement.
We
will act on the request and, pursuant to delegated authority,
grant
acceleration of the effective date.
We direct your attention to Rules 460 and 461 regarding
requesting acceleration of a registration statement. Please allow
adequate time after the filing of any amendment for further review
before submitting a request for acceleration. Please provide this
request at least two business days in advance of the requested
effective date.
You may contact Milwood Hobbs, Staff Accountant, at (202)
942-
2846, or Donna DiSilvio, Senior Accountant, at (202) 942-1852, if
you
have questions regarding comments on the financial statements and
related matters. Please contact John Fieldsend, Staff Attorney,
at
(202) 824-5505, David Mittelman, Legal Branch Chief, at (202) 942-
1921, or me at (202) 942-1900 with any other questions.
Sincerely,
H. Christopher Owings
Assistant Director
cc: Valerie D. Bandstra, Esq.
Brown, Winick, Graves, Gross, Baskerville & Schoenebaum,
P.L.C.
Via Fax: (515) 283-0231
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Siouxland Ethanol, LLC
April 20, 2005
Page 1