Mail Stop 4561
July 25, 2005
Lawrence D. McGovern
Executive Vice President and CFO
150 Almaden Boulevard
San Jose, California 95113
Re: Heritage Commerce Corp
Item 4.01 Form 8-K
Filed June 2, 2005
File No. 000-23877
Dear Mr. McGovern:
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 more
information so we may better understand your disclosure. After
reviewing this information, we may 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.
Item 4.01 Changes in Registrant`s Certifying Accountant
1. Revise the second paragraph of the disclosure to refer to the
consolidated financial statements for the years ended December 31,
2004 and 2003.
2. Revise to provide the information required by Item 304(a)(1)(v)
of
Regulation S-K, regarding the reportable event that the former
accountant advised the company of during the two most recent
fiscal
years and subsequent interim period through the date of
termination.
In detail, supplementally describe the nature of each reportable
event and the amount involved, if any. Also, tell us in what
period
the reportable event occurred and whether or not you restated (or
intend to restate) any prior period for any adjustment resulting
from
the reportable event; and if
not, why not. Tell us in detail the steps you have taken (or plan
to
take) and procedures you implemented (or plan to implement) to
correct each reportable event.
3. Revise to disclose the nature of the accounting errors and
misapplication of accounting principles. If various in type,
clearly
disclose the nature of each type of error or misapplication.
Clarify
the effect of the errors or misapplications on previously issued
financial statements. If no effect on the financial statements,
explain why not in the amendment. Refer to Regulation S-K Items
304(a)(1) (iv) and (v).
4. In detail, supplementally describe the nature of each material
weakness and the amounts involved, as applicable. Also, tell us:
* in what period each material weakness and accounting error or
misapplication of GAAP occurred,
* the amount of each accounting error and misapplication of GAAP,
* the reason(s) for each error or misapplication of accounting,
* whether or not you intend to restate any prior period for any
adjustments. If not, tell us why not, and
* in detail, all the steps you have taken (or plan to take) and
procedures you have implemented (or pan to implement) to correct
each
concern.
5. Please provide us with a schedule of your fiscal year end
fourth
quarter adjustments to close the books, or adjustments recorded in
connection with or as a result of the audit. Clearly explain the
reason for each adjustment. For each adjustment, show us the
impact
on pre-tax net loss. Quantify the net effect of all adjustments
on
pre-tax net income (loss). Also, tell us why none of the
adjustments
relate to prior periods. Explain in detail why you believe the
timing of each adjustment is appropriate.
6. Provide us with any letter of written communication to and from
the former accountants regarding any disagreements or reportable
events to management or the Audit Committee.
7. To the extent that you make changes to the Form 8-K to comply
with
our comments, please obtain and file an updated letter from the
former accountants stating whether the accountant agrees with the
statements made in your revised Form 8-K.
As appropriate, please amend your filing and respond to
these
comments within five business days or tell us when you will
respond.
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 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 filing to be certain that the
filing includes all information required under
the Securities Exchange Act of 1934 and that they have provided
all
information investors require for an informed investment 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.
In connection with responding to our comments, please
provide,
in writing, a statement from the company acknowledging that:
* the company is responsible for the adequacy and accuracy of the
disclosure in the filing;
* staff comments or changes to disclosure in response to staff
comments do not foreclose the Commission from taking any action
with
respect to the filing; and
* the company may not assert staff comments 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 our review of your filing or in
response to our comments on your filing.
If you have any questions, please call me at (202) 551-3695.
Sincerely,
Chris Harley
Staff Accountant
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Mr. Lawrence McGovern
Executive Vice President And CFO
Heritage Commerce Corp
July 25, 2005
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