April 26, 2005
Mail Stop 0409
Edward J. O`Connor
Optionable, Inc.
555 Pleasantville Road
South Building, Suite 110
Briarcliff Manor, New York 10510
Re: Optionable, Inc.
Amendment No. 2 to
Registration Statement on Form SB-2 Filed April 7, 2005
Registration No. 333-121543
Dear Mr. O`Connor:
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 any other aspect
of
our review. Feel free to call us at the telephone numbers listed
at
the end of this letter.
Risk Factors
Our history of operating losses in our current business and our
plan
to enter a new line of business may make it difficult for you to
evaluate our business and your investment, page 4.
1. Please disclose your losses for 2004 and 2003.
Notes to the Financial Statements - December 31, 2004 and 2003
Note 7 - Stockholders` Deficit, pages F-14 - F-16
Stock Compensation Plan, page F-14
2. Revise to include the following disclosures for options granted
during the 12 months prior to the date of the most recent balance
sheet included in your registration statement:
* For each grant date, disclose the fair value of the common
stock,
and the intrinsic value, if any, per option (the number of options
may be aggregated by month or quarter and the information
presented
as weighted-average per share amounts)
* Disclose whether the valuation used to determine the fair value
of
the equity instruments was contemporaneous or retrospective
* Revise your MD&A to disclose the intrinsic value of outstanding
vested and unvested options based on the estimated offering price
and
the options outstanding as of the most recent balance sheet date
presented in your registration statement
3. In addition to our previous comment, if the valuation of your
common stock`s fair value was not performed contemporaneously by
an
unrelated valuation specialist, expand your MD&A disclosures to
also
incorporate the following:
? Discussion of the significant factors, assumptions and
methodologies used in determining the fair values assigned;
? A discussion of each significant factor contributing to the
difference between the fair value as of the date of each grant and
the estimated offering price;
* The valuation alternative selected and the reason management
chose
not to obtain a contemporaneous valuation by an unrelated
valuation
specialist.
Part II
Item 26. Recent Sales of Unregistered Securities.
4. We note your earlier disclosure that you raised $1.3 million in
your private placement of common stock. Please update this
section
accordingly.
* * * *
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.
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 Matthew Maulbeck at (202) 942-1905 or Donna
DiSilvio, Senior Staff Accountant, at (202) 942-1852 if you have
questions regarding comments on the financial statements and
related
matters. Please contact Michael McTiernan, Attorney-Advisor, at
(202) 824-5445 or the undersigned at (202) 942-1766 with any other
questions.
Sincerely,
Elaine Wolff
Branch Chief
cc: Kenneth S. Goodwin, Esq. (via facsimile)
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Optionable, Inc.
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