SPARTA The Source for Powersports Financing
COMMERCIAL SERVICES www.spartacommercial.com
Facsimile
To: Margaret Fitzgerald, Div. of Corp. Fin. From: A.L. Havens
- -------------------------------------------------------------------------------
Fax: 202-772-9208 Pages: 3, including cover
- -------------------------------------------------------------------------------
Phone: 202-551-3556 Date: 14 December, 2005
- -------------------------------------------------------------------------------
Re: Comment Letter for Sparta Commercial CC:
Services, Inc. Form 10-KSB filed 07/25/05
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
[ ]Urgent [ ]For Review [ ]Please Comment [ ]Please Reply [ ]Please Recycle
- -------------------------------------------------------------------------------
MESSAGE:
Dear Ms. Fitzgerald,
Pursuant to our conversation, please find attached the response we discussed.
With kinds regards,
If this facsimile is not properly received, please call (212) 239-2666 and
request a re-transmission.
- -------------------------------------------------------------------------------
CONFIDENTIALITY NOTICE
The information contained in this fax is confidential information only for the
use of the individual or the entity named above. If the reader of this message
is not the intended recipient, you are hereby notified that any dissemination,
distribution or copying of this communication is strictly prohibited. If you
have received this communication in error, please immediately notify us by
telephone
- -------------------------------------------------------------------------------
SPARTA The Source for Powersports Financing
COMMERCIAL SERVICES www.spartacommercial.com
December 14, 2005
VIA FAX AND EDGAR
Ms. Margaret Fitzgerald Division of Corporate Finance U.S. Securities & Exchange
Commission Washington, D.C. 20549
Re: Sparta Commercial Services, Inc.
File No. 000-09483
Form 10-KSB for Year Ended April 30, 2005
Dear Ms. Fitzgerald :
This will acknowledge receipt of your letter of comment dated November 30, 2005
with regard to the above referenced filing. Our response, which reference your
comment number, follow.
Comment 1- Response:
We propose to revise page 18 the 10 KSB to read as follows:
Results of Operations
Comparison of the Year Ended April 30, 2005 to the Year ended April 30, 2004 New
Loss
Our net loss for the year ended April 30, 2005 was $4,418,727 in contrast to a
loss of $1,772,257 for the year ended April 30, 2004, respectively. The increase
in net loss was due primarily to the fact that the Company incurred expenses
related to the private placement transaction, consisting of non cash expense of
a beneficial conversion discount of $1,810,000, and a non cash expense of
$383,284 for warrants issued to the placement agent in 2005 and to the fact that
the Company has increased its resources and spending in 2005 as it transitioned
from a development stage to an operating entity. The payment of $250,000 for a
purchase option for equipment leases from American Motorcycle Leasing Corp. also
contributed to the loss. While AML is not a shareholder of the Company, the
-------------------------------------------------------
Company's President and Chief Executive Officer is an officer and a minority
- --------------------------------------------------------------------------------
shareholder of American Motorcycle Leasing Corp.
- ------------------------------------------------
As a result of significant restrictions on transfers of the equipment leases
- --------------------------------------------------------------------------------
owned by American Motorcycle Leasing Corp., including but not limited to
- --------------------------------------------------------------------------------
obtaining approval's from American
- -----------------------------------
- --------------------------------------------------------------------------------
P.O. Box 60 New York, NY 10156 Tel: (800) 882-0778 Fax: (212) 239-2799
Motorcycle Leasing Corp.'s secured lender, and the Agreements' non-exclusivity,
- --------------------------------------------------------------------------------
the Company has accounted for the fee as an expense and charged the $250,000 to
- --------------------------------------------------------------------------------
operations in the current year.
- -------------------------------
While the Company has charged the fee to operations during the current year, the
- --------------------------------------------------------------------------------
Company believes the purchase option, subject to the terms and conditions
- --------------------------------------------------------------------------------
described, may provide the opportunity to expand its equipment leasing portfolio
- --------------------------------------------------------------------------------
and which would benefit the Company. However, there is no guaranty that we will
- --------------------------------------------------------------------------------
acquire any of the assets held by American Motorcycle Leasing Corp. at terms and
- --------------------------------------------------------------------------------
conditions acceptable to us.
- ----------------------------
Our net loss per common share (basic and diluted) was $0.05 for the year ended
April 30, 2005 and $0.25 for the year ended April 30, 2004.
We shall contact your offices within the week to determine if the above response
is acceptable, and we shall immediately prepare and file an amended Form 10KSB
incorporating the suggested changes.
The Company acknowledges 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 proceedings
initiated by the commission or any person under the federal securities laws of
the United States.
We thank you in advance for your assistance in this matter. If you have
any questions or additional comments, please do not hesitate to contact me at
212.239.2666.
Yours truly,
SPARTA COMMERCIAL SERVICES,
INC.
/s/ Anthony L. Havens
---------------------
Anthony L. Havens
President
The Source for Powersports Financing
www.spartacommercial.com