October 7, 2005
Mail Stop 6010
Christopher Miles
Wimax EU, LTD
356 Pine Avenue, Apt. 1
Pacific Grove, California 93950
Re: Wimax EU, LTD
Amendment No. 2 to Registration Statement on Form SB-2
Filed September 23, 2005
File No. 333-123351
Dear Mr. Miles:
We have the following comments to your filing. 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.
Summary, page 1
1. Please provide independent and objective support for your
statements on page 2 that "testing of the technology has ended and
final ratification is expected in the next few months" and that
the
technology will become available for purchase within the next
couple
of months. Clarify who is conducting the testing and ratification.
Also, in another appropriate location of your document, clarify
the
material results of this test including the coverage of antennae
and
any material limitations.
2. In your new disclosure in response to our comment 5, you
describe
providing content in addition to providing internet access to
customers. Please disclose the nature of the content you intend
to
provide to customers in the business section.
3. The second phrase quoted in comment 7 remains in your document.
Therefore, we reissue the comment.
4. Please tell us how you know that competitors do not offer 24-
hour
service.
Risk Factors, page 3
5. We note your response to comment 9; however, it is unclear
where
you have included a risk factor to briefly explain the automatic
suspension and alert investors to the risks.
Exhibits
6. We note your response to our prior comment 17, yet you have not
filed the lock-up agreements with the four shareholders described
in
the second paragraph on page 21. Please file such lock-up
agreements.
7. We note your response to our prior comment 18. Please
reconcile
your response with Exhibit 10.8 in Amendment No. 2 filed on August
26, 2005 that indicates there is such a waiver.
June 30, 2005 Condensed Financial Statements
Condensed Statements of Operations, page 2
8. Please refer to our prior comment 20. The weighted average
number
of shares outstanding calculation that you provided for the six
months ended June 30, 2005 does not appear mathematically
accurate.
Please advise or revise.
Note D - Shareholders` Equity, page 10
9. Please refer to our prior comment 22. We note from your
response
that "basically a minimum value calculator was applied which
excludes
the expected volatility of the underlying stock." As previously
noted in our August 5, 2005 letter, the minimum value method is
not
appropriate for options issued after you filed your SB-2. If you
continue to believe that your volatility is 0%, please provide us
with your supporting calculations.
10. Please refer to our prior comment 23. We note from your
response
dated September 23, 2005,"the guidance of SFAS 150 was used to
record
this transaction" and from your response dated August 25, 2005
"the
company accounts for the fair value of the call option in
accordance
with SFAS 150, which requires the company to adjust the call
option
to fair value." Please tell us the fair value of the option, how
you
determined the fair value of the option, where this is recorded in
your financial statements, and how you specifically applied SFAS
150.
December 31, 2004 Financial Statements, page F-1
Balance Sheet, page 3
11. Please refer to our prior comment 21. We note from your
response
that the approving resolution only affected issued and outstanding
shares. Given that your outstanding shares exceeded your
authorized
shares at December 31, 2004, please tell us why you have not
reflected the shares issued in excess of authorized shares as a
liability in your December 31, 2004 balance sheet.
Note E - Commitments and Contingencies, page F-12
12. Please refer to our prior comment 24. It remains unclear to
us,
how you have addressed our prior comments regarding your royalty
agreement. Please address the following:
* Reconcile the disclosures with the terms of the agreements
included
in exhibits 10.2 and 10.6, including the 30-year term of the
agreement under section 1(d) of the royalty agreement with your
disclosure of a ten year term.
* Tell us where the agreement discusses the issuance of 1,000,000
shares of stock.
* Tell us why you are valuing the shares at $0.01 per share.
* Tell us and disclose how you are accounting for the share
consideration and tell us why.
* Please revise your interim financial statements to discuss the
significant terms and accounting for this agreement and the
addendum
signed on January 3, 2005.
* Cite the accounting literature upon which you relied.
Closing Comments
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 Eric Atallah at (202) 551-3663 or in his
absence, Kaitlan Tillan at (202) 551-3604, if you have questions
regarding comments on the financial statements and related
matters.
Please contact Jay Mumford at (202) 551-3637 or me at (202) 551-
3617
with any other questions.
Sincerely,
Russell Mancuso
Branch Chief
cc: Greg E. Jaclin, Esq.