MAIL STOP 3561
March 7, 2006
Mr. Bruce Lederman
HD Partners Acquisition Corporation
2601 Ocean Park Blvd. Suite 320
Santa Monica, CA 90405
Re: HD Partners Acquisition Corporation
Amendment No. 2 to Registration Statement on Form S-1
File No. 333-130531
Amendment Filed February 22, 2006
Dear Mr. Lederman:
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 Comments
1. Your disclosure indicates that $1,200,000 attributable to
underwriting-related fees and $96,000 attributable to deferred
administration services will be deposited into the trust account.
With respect to this, please clarify the following: (1) how will
the
80% net asset requirement be calculated in light of these
obligations; (2) under what circumstances will each of these items
be
paid; and, (3) in the event that these items are paid as part of a
business combination in which some stockholders elect to convert
their shares disclose the financial impact to the remaining
investors. Without limiting the generality of the foregoing, we
note
that the dilution to remaining investors will be higher in the
event
that there are converting shareholders. Accordingly, please
advise
us why the company elected to exclude the deferred underwriting
discounts and commissions from its dilution calculation on pages
30-
31.
Prospectus Summary
2. We note the disclosure on page 5 regarding the potential larger
gains holders of founding director warrants may realize over
regular
warrant holders. Please add a risk factor.
3. Please clarify whether any of the converting shareholders will
have any rights to the $1,200,000 proceeds placed in trust from
the
sale of the founding director warrants or the deferred
underwriting
discounts and commissions and deferred administrative fees in the
event that they convert their shares and a business combination in
consummated.
Risk Factors, page 11
4. Please revise risk factor five to state the number of companies
that have filed registration statements but are still in the
registration process.
5. We reissue prior comment three from our letter dated January
24,
2006. We continue to note the disclosure that your officers and
directors are currently affiliated with entities engaged in
business
activities similar to those intended to be conducted by HD
Partners.
Name these companies. Also, disclose those circumstances that may
result in the company seeking a business combination with an
affiliated entity. Clarify, given management`s detailed knowledge
of
its affiliated companies, how you reached the determination that
"our
existing stockholders are not currently aware of any specific
opportunities to consummate a business combination with any
entities
with which they are affiliated."
Use of Proceeds, page 27
6. Please reconcile your disclosure on page 27 that you will pay
$7,500/month in administrative fees with your disclosure on page 7
that you will pay $3,500/month in administrative fees.
Management`s Discussion and Analysis, page 33
7. On page 34 you disclose that you estimate that you will incur
$84,000 for administrative expenses "of which $4,000 per month is
being deferred until the completion of a business combination".
However, our review indicates that your total administrative fees
will be $7,500/month ($180,000 for 24 months) of which $84,000
will
be payable from the company`s general funds outside the trust
account. Please revise your disclosure to clarify. In addition,
please indicate whether the $96,000 held in trust will be
forfeited
in the event the company is liquidated.
Proposed Business, page 35
8. We note that in response to our prior comment 4 you have added
disclosure on page 37 indicating that management has reviewed
publicly available information concerning its target industry.
Please advise us of the nature and specificity of the information
reviewed. In this respect we are particularly interested in
whether
this review process has focused management`s attention on a
particular category of companies - either by industry, size,
geography, etc.
Recent Sales of Unregistered Securities
9. Please add the private placement of the warrants that will
occur
concurrently with the public offering in this section. State the
exemption and the facts supporting your reliance upon the
exemption.
Exhibits
Exhibit 10.9
10. Please file a copy of the amended Office Services Agreement
between the Registrant and Value Investments, LLC.
Exhibit 10.15
11. Section 8 of the Form of Founding Director Purchase Agreement
provides that the warrant purchase agreement may automatically be
terminated "upon the mutual written consent of the Company and the
Purchasers." However, in the current instance the purchasers have
the ability to control the company and therefore would see to be
able
to unilaterally terminate the warrant purchase agreement. Please
advise us of whether the company believes the disclosures made in
the
registration statement to be binding commitments of the company to
require the warrant purchases, and undertake to meet any
conditions
precedent to the warrant purchases.
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 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.
Any questions regarding the accounting comments may be
directed
to Babette Cooper at (202) 551-3396. Questions on other
disclosure
issues may be directed to Jay Williamson at (202) 551-3393.
Sincerely,
John Reynolds
Assistant Director
cc: Jody Samuels
Fax: (212) 370-7889
Mr. Bruce Lederman
HD Partners Acquisition Corp.
March 7, 2006
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