September 22, 2005
Mail Stop 3561
Via US Mail and Facsimile
Mr. Edwin Kwong
Chief Financial Officer
62 W. 8th Avenue, 4th Floor
Vancouver, British Columbia,
Canada V5Y 1M7
Re: Jupiter Global Holdings, Corp.
Form 10-KSB for the year ended December 31, 2004
Commission file #: 000-27233
Dear Mr. Kwong:
We have reviewed the above referenced 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.
* * * * * * * * * * * * * * * * * * * * * * *
Form 10-KSB for the year ended December 31, 2004
Management`s Discussion & Analysis
- - General
1. In future filings, please include a section in MD&A that
discusses
your critical accounting policies, and addresses the following
areas:
* Types of assumptions underlying the most significant and
subjective
estimates;
* Sensitivity of those estimates to deviations of actual results
from
management`s assumptions; and
* Circumstances that have resulted in revised assumptions in the
past.
Refer to Financial Reporting Policy 60 and Proposed Rule 33-
8098
for guidance.
- - Liquidity and Financial Condition
2. Please revise your MD&A section in future filings to discuss
acquisitions and letters of intent entered into subsequent to year
end. For example, in the MD&A for 2004, disclosure of the April
2005
closing of the Promostaffing acquisition and the June 2005 stock
purchase agreement with Global Bancorp would enhance the
discussion on
liquidity.
Financial Statements
Statements of Stockholders` Equity
3. We note that in 2003 and 2004 you had several issuances of
common
and preferred stock for conversion of debt. Please tell us how you
valued the shares issued and/or the related consideration received
in
each of these transactions including any transactions that
occurred
subsequent to December 31, 2004. If the transactions were recorded
based on the fair value of the shares issued, please explain how
"fair
value" was determined. Additionally, for each conversion, please
tell
us the original terms of conversion for the debt that was
converted
and how you have considered the guidance in SFAS No. 84 in
accounting
for the conversion.
Notes to the Financial Statements
- - General
4. We note from Item 3 that there are several lawsuits that were
filed
against the Company in 2004 and 2005. In future filings, please
include a note to the financial statements disclosing the nature
of
all contingencies, an estimate of the possible loss or range of
loss,
and the amounts of accruals established or a statement that such
an
estimate cannot be made. See paragraphs 9-11 of SFAS No. 5.
Note 2. Significant Accounting Policies
- - Net Loss Per Share
5. In future filings, please revise this note to disclose the
number
of shares issuable upon exercise or conversion of stock options,
warrants and Series B convertible preferred shares that could
potentially dilute basic earnings per share in the future but that
were not included in the computation of diluted earnings per share
for
the periods presented because their impact was antidilutive. Refer
to
the requirements of paragraph 40c of SFAS No.128.
Note 4. Advances Receivable
6. We note that in 2003 you issued 1,000,000 Series A convertible
preferred shares for non cash consideration of $200,000. Please
tell
us how you valued the shares issued and/or the related
consideration
received in each of these transactions. If the transactions were
recorded based on the fair value of the shares issued, please
explain
how "fair value" was determined. Additionally, please explain to
us
why you believe this amount was properly recorded as an asset as
of
December 31, 2003. As part of your response, tell us the events
that
took place subsequent to December 31, 2003 that caused you to
determine the amount should be expensed. Also, tell us the
initial
terms for conversion or redemption of the Series A preferred
shares
and if your redemption of 125,000 shares for $50,000 cash was in
accordance with the initial redemption terms. Also tell us
whether
the Series A convertible preferred stock provided for a beneficial
conversion feature at issuance. If so, explain how it was
accounted
for in your financial statements. Additionally, if the initial
redemption terms included the option of redemption for cash,
please
tell us why you believe presentation of these preferred shares as
a
component of stockholders` equity was appropriate.
Note 8. Stock Options and Warrants Outstanding
- - Stock Purchase Warrants
7. We note that you have 22 stock purchase warrants outstanding as
of
December 31, 2004. Please tell us the terms of these warrants
including how they were accounted for when they were issued, the
consideration that was received at issuance, and the number of
shares
that will be issued if they are exercised.
Annual Report on Form 10-KSB - Note 15. Subsequent Events
Quarterly Report on Form 10-QSB for the Quarter ended March
31,2005 -
Note 5. Investments
8. Please tell us how you determined the value to be assigned to
the
64,615,352 shares of common stock to be issued to the sole
shareholder
of Promo Staffing, of $588,000. As part of your response, please
explain how the valuation of these shares complied with the
guidance
outlined in paragraph 22 of SFAS No.141. If the shares were valued
in
accordance with the guidance outlined in section 1.3 of the
purchase
agreement which provided for a 35% discount from the average three
day
closing price, please explain in detail why you believe the use of
this discount is appropriate.
Also, please revise the notes to your financial statements in
future
filings to include all of the disclosures required by paragraph 58
of
SFAS No.141 with respect to the acquisition transaction.
9. Please tell us why the Company acquired 800 shares of VOXBOX
from
Global for $40,000 along with the right to acquire an additional
8,400
shares for $420,000 of cash over a 12-month period, then
subsequently
sold these interests back to Global on June 16, 2005 in exchange
for
5,000,000 shares of Global valued at $50,000, and rights to
purchase
up to 50% of the issued and outstanding common shares of Global up
to
June 16, 2008. As part of your response, please address the
following
matters:
* Please explain the business purpose for the purchase of the
interest
in VOXBOX and for its subsequent sale to Global in exchange for
shares
of Global.
* Please explain how you determined the $50,000 value assigned to
the
Global shares received in connection with the sale of VOXBOX,
indicate
whether any gain or loss was recognized in the Company`s financial
statements, and indicate how any gain or loss recognized was
calculated or determined.
We may have further comment upon receipt of your response.
Form 10-QSB for the quarter ended March 31, 2005
Note 3. Stock Based Compensation
10. We note from your disclosure that you estimated the fair value
of
the options using the Black-Scholes option pricing model with the
assumption of an expected volatility of 94%. Please tell us the
nature of the changes in your business that resulted in the
assumption
of expected volatility decreasing from 311% as of December 31,
2005 to
94% as of March 31, 2005.
Note 5. Investments
11. We note that you issued a note payable to acquire 8,400 shares
of
VOXBOX in February 2005. Please tell us if VOXBOX had any
revenues or
expenses as of March 31, 2005 and if so how you have accounted for
your share of gains or losses in your financial statements as of
March
31, 2005. If you have not used the equity method of accounting
for
your investment, please tell us your accounting basis for your
treatment of the investment.
12. Comply with the comments on the Form 10-KSB for the year ended
December 31, 2004 as they apply to filings on Form 10-QSB.
Form 8-K filed April 22, 2005
13. We note that on April 18, 2005 you closed the acquisition of
Promostaffing.com and filed a Form 8-K reporting this transaction.
Please file an amended Form 8-K with the financial statements and
pro
forma information as soon as possible. Also, please file an
amended
Form 8-K with the financial statements and pro forma information
related to the June 16, 2005 stock purchase agreement with Global
Bancorp. If you do not believe financial statements or pro forma
information are required for these acquisitions please explain
your
basis for this conclusion. See Items 310(c) and (d) of Regulation
S-
B.
* * * * * * * * * * * * * * * * * * * * * * *
As appropriate, please respond to these comments within 10
business
days or tell us when you will provide us with a response. Please
furnish a cover letter that keys your responses to our comments
and
provides any requested supplemental information. Please
understand
that we may have additional comments after reviewing your
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.
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 filings;
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.
You may contact Claire Erlanger at 202-551-3301 or me at 202-551-
3813
if you have questions.
Sincerely,
Linda Cvrkel
Branch Chief
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Mr. Edwin Kwong
Jupiter Global Holdings, Corp.
September 22, 2005
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