THORIUM
POWER, LTD.
8300
Greensboro Drive, Suite 800
McLean,
VA 22102
(800)
685-8082
July
13,
2007
Donna
Levy
Division
of Corporation Finance
U.S.
Securities and Exchange Commission
100
F
Street, NE
Washington,
DC 20549
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Post-Effective Amendment to Registration
Statement on Form SB-2 |
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Commission
File No. 333-135437
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Form
10-KSB for the Fiscal Year Ended December 31,
2006
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Commission
File No. 000-28543
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Form
10-QSB for the Fiscal Quarter Ended March 31,
2007
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Commission
File No. 000-28543
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Dear
Ms.
Levy:
On
behalf
of Thorium Power, Ltd. (“Thorium
Power”
or
the
“Company”),
we
hereby submit Thorium Power’s responses to the comments of the staff (the
“Staff”)
of the
Securities and Exchange Commission (the “Commission”)
set
forth in the Staff’s letter, dated June 15, 2007, providing the Staff’s comments
with respect to the above referenced Post-Effective Amendment to a Registration
Statement on Form SB-2 (the “Registration
Statement”),
Annual Report on Form 10-KSB (the “10-KSB”)
and
the Quarterly Report on Form 10-QSB (the “10-QSB”).
For
the
convenience of the Staff, each of the Staff’s comments is included and is
followed by the corresponding response of the Company. Unless the context
indicates otherwise, references in this letter to “we”, “us” and “our” refer to
the Company on a consolidated basis.
Post-Effective
Amendment on Form SB-2
General
| 1. |
Please
note that if a revision or additional disclosure in connection with
our
current review of your Form 10-KSB and Form 10-QSB is required, we
would
also expect a concurrent change be made in Post-Effective Amendment
on
Form SB-2, to the extent applicable. In addition, please be advised
that
you must clear all comments to the Forms 10-KSB and 10-QSB prior
to
acceleration of effectiveness on the Post-Effective
Amendment.
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COMPANY
RESPONSE:
To
the extent that revisions or additional disclosure were required in connection
with the Staff’s review of our Exchange Act reports, we have made concurrent
changes to the Registration Statement. We acknowledge that we must clear all
comments on the reviewed Exchange Act reports prior to requesting acceleration
for the Registration Statement.
Undertakings,
page l
| 2. |
Please
provide the undertaking required by Item 512(g)(2) of Regulation
S-B.
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COMPANY
RESPONSE:
We
have provided the information required by Item 512(g)(2) of Regulation S-B
in
Post-Effective Amendment No. 2 to the SB-2.
Signature
Page
| 3. |
Form
SB-2 must be signed by your Controller or Principal Accounting Officer.
Please provide the proper signatures in your next
amendment.
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COMPANY
RESPONSE:
Our
Acting Chief Financial Officer has signed Post-Effective Amendment No. 2 to
the
SB-2.
Form
10-KSB for the Fiscal Year Ended December 31, 2006
Description
of Business, page 3
| 4. |
We
note your disclosures of several statements, including the
following:
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•
page
5,
sixth paragraph: “. . .these companies will be our competitors... however they
will also be potential licensees of our fuel designs and may fabricate nuclear
fuels using our fuel design technology”
•
page
6,
second paragraph: “We expect that our thorium/reactor grade plutonium disposing
fuel will be less expensive compared to MOX or conventional uranium fuel,
assuming that the separated reactor-grade plutonium is available to us at no
cost”
•
page
F-10 third paragraph: “Our nuclear fuel process is dependent on the ability of
suppliers of the mineral thorium, to provide it to our future customers on
a
timely basis and also on favorable terms”
Please
expand your disclosures to discuss your basis for making these and similar
statements appearing elsewhere in the filing, specifically as they pertain
to
your expectations about who will be your customers and competitors, and
assumptions about contractual terms and the costs of obtaining
materials.
The
extent of your progress in negotiating these arrangements and elevating your
competitive stature to the level suggested in the disclosure should be
clear.
COMPANY
RESPONSE:
We
have expanded our disclosure in accordance with the Staff’s comments. We have
indicated throughout the new disclosure that the assertions are based upon
our
belief and understanding of the industry in which we operate. More
specifically:
| (1) |
We
have revised the section located on page 5 of the 10-KSB to clarify
that
we do not intend to directly compete with the entities identified,
which
are the four primary entities that account for the fabrication of a
majority of the world’s nuclear fuel, in terms of fabrication of nuclear
fuels. We plan to partner with one or more of these entities and license
our nuclear fuel designs so that the entities may fabricate and sell
our
thorium-based nuclear fuel designs. At the same time, however, these
same
entities may be competitors if that they design and fabricate their
own
uranium-based nuclear fuel designs for use in the same reactors for
which
our thorium-based fuel designs would be
used.
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| (2) |
We
have revised the section located on page 6 of the 10-KSB to explain
our
basis for believing that the fabrication of thorium/reactor grade
plutonium disposing fuel will be less expensive than MOX conventional
uranium fuel.
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| (3) |
We
have removed the third paragraph on page F-10 of the financial statements
contained in the 10-KSB. It is unnecessary for this statement to be
included in the financial statements. Instead we have moved this
discussion to the section “Sources and Availability of Raw Materials” on
page 8 of the 10-KSB, and revised it to clearly explain the contracting
process for obtaining materials for the fabrication of nuclear
fuels.
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Financial
Statements
Report
of Independent Registered Public Accounting Firm, page F-2
| 5. |
We
note that language in the report issued by your current auditors,
Child,
Van Wagoner & Bradshaw, PLLC indicates that they audited your
financial statements for the period from January 1, 2002 to December
31,
2006. However, you have not presented financial statements for this
period
alone. We see that your auditors also state that they did not audit
your
financial statements covering the period from January 8, 1992 (date
of
inception) to December 31, 2001 as those statements were audited
by other
auditors.
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If your current auditors are
to make
reference to the report of the other auditors, to indicate a division
of
responsibility, they would opine on your financial statements for
the
entire period, from January 8, 1992 (date of inception) to December
31,
2006, with an expression of reliance on the work of the other auditors
in
the introductory, scope and opinion, paragraphs, while also indicating
the
magnitude of the portion of the financial statements audited by the
other
auditor, following the guidance in AU Sections 543.06 through
543.09.
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COMPANY
RESPONSE:
The
current auditors will revise their audit report to only include the periods
ending December 31, 2006 and 2005. All columns in the financial statements,
showing cumulative amounts from January 8, 1992 (Inception) from December 31,
2006, including the periods January 8, 1992 (Inception) from December 31, 2004
shown in the restated statement of stockholders deficiency will be marked
unaudited.
| 6. |
Please
include the audit report from your prior auditors in the body of
your
financial statements, immediately following the audit report from
your
current auditors, instead of as an exhibit to your
filing.
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If
you
include the audit report of your prior auditors in your filing, confirm for
us
that you have obtained permission and a reissuance of the report from your
prior
auditors. If you are unable to obtain permission and reissuance, other
arrangements will need to be made; please advise us of any difficulties you
have
in this regard. Your prior auditors can refer to AU Sections 508.70 through
508.73 for further guidance on report reissuance.
COMPANY
RESPONSE:
As
discussed with the Staff, due to the fact that the prior periods audited by
the
prior auditor, were for periods dating back to 2001, it is now difficult to
obtain this consent. It has been mentioned to us by the Staff that instead
of
obtaining this consent from the prior auditor, the company is granted permission
and will now designate all cumulative amounts shown from January 8, 1992
(Inception) from December 31, 2006 as unaudited in the restated financial
statements.
Consolidated
Statements of Cash Flows page F-S
| 7. |
Ordinarily
share issue costs are recorded as an adjustment to offset offering
proceeds, in equity, except when associated with shares issued in
a
reverse merger recapitalization, in which case the costs recorded
against
equity should be limited to the amount of cash received. Tell us
why you
report the item labeled “capitalization of share issue costs” as an
adjustment to your fiscal year 2006 net loss, suggesting this item
impacted your results of operations for the period, and why your
$441,553
adjustment was added to, instead of subtracted from your net loss.
Please
include details about the share issuance and nature of costs incurred
(e.g. transaction dates, number of shares, proceeds, and the amounts
and
form of consideration representing share issuance
costs).
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COMPANY
RESPONSE:
We
have reviewed the Staff’s comment and have found that, in error, we had
classified the costs incurred to issue stock in the reverse merger as an
operating activity in the statement of cash flows, instead as reporting the
$441,553 as a separate line item, “disbursements - share issue costs” reported
as a financing activity in accordance with FAS#95, Paragraph 19(a). We have
reclassified that $441,553 use of funds from operating activities section of
the
cash flows and reported that amount in the financing activities section of
the
cash flows. This changed the total cash that was reported as cash used in
operating activities for the year ended December 31, 2006 from $3,746,188 to
$3,304,635 and effected a corresponding decrease in the cash reported as
provided by financing activities from $14,691,305 to 14,249,752. Changes were
made to the cumulative column in the statement of Cash Flows as well for these
sections of the cash flows as well.
The
cash received in the reverse merger was $12,742,408, which is in excess of
the
cash paid for the stock issue costs in the reverse merger recapitalization
of
$441,553. The $441,553 stock issue costs represented legal fees from two law
firms that were engaged to prepare the S-4 registration statements and the
SB-2
registration statements, both registration statements filed in connection with
the reverse merger of Thorium Power Ltd. and Thorium Power Inc. that occurred
on
October 6, 2006. The transaction dates, number of shares and proceeds were
reported to the SEC in those respective Registration Statements relating to
the
merger.
Consolidated
Statements of Chan in Stockholders’ Deficiency pa F-6
| 8. |
Please
revise your statements to show the effects of exchanging shares in
your
reverse merger on a retroactive basis. Share activity of the accounting
acquirer in a reverse merger should be recast using the ratio of shares
issued by the legal acquirer in the reverse merger over shares of the
accounting acquirer that were outstanding immediately prior to the
exchange, similar to a stock split
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This
should render the duplicative common share columns that you include unnecessary.
After recasting, all share activity immediately before the transaction should
sum to equal the number of shares issued by the accounting target. This should
be followed by an entry showing the number of shares of the accounting target
that were outstanding immediately before the event, along with the net assets
or
liabilities of that entity received by the accounting acquirer. Revise your
disclosures on page F-11 as necessary to clarify how the share counts, ownership
percentage and exchange ratio are represented in your presentation.
You
may
refer to the guidance in Section 1.F of Division of Corporation
Finance:
Frequently
Requested Accounting and Financial Reporting Interpretations and Guidance,
located on our website at the following address.
http://www.sec.
tzov/divisi.ons/corDfin/szuidance/cfactfap.htm#P1 62 22074
Please
note the reference on our website to guidance issued by the Emerging Issues
Committee of the Canadian Institute of Chartered Accountants, which we believe
is compatible with U.S. GAAP in this area, and is available in EIC
10.
COMPANY
RESPONSE:
We
have complied with the Staff’s comment by restating the shares outstanding from
inception, January 8, 1992, to reflect the equivalent number of Thorium Power
Ltd. common shares. At the merger date, October 6, 2006, there were 4,325,447
shares outstanding by the accounting acquirer (Thorium Power Inc.) and there
were 135,637,854 total common shares issued by the legal acquirer (Thorium
Power
Ltd.) on the merger date. Therefore, the mathematical ratio used to restate
all
stock issuances from the inception date is 31.36 or in other words, each share
of Thorium Power Inc. stock transaction in the Statement of Stockholders
Deficiency is restated to 31.36 shares of Thorium Power Ltd. since January
8,
1992 (inception) to the merger date. This ratio brings the outstanding share
amount of Thorium Power Inc. at the merger date to 135,637,854, and the shares
of the accounting target (Thorium Power Ltd.) outstanding at the merger date
are
now shown by adjusting the additional share amount or shares outstanding in
Thorium Power Ltd. at the merger date, which now reflect the total shares
outstanding after the merger and to record the net assets being received from
Thorium Power Ltd. (Refer to SEC Comment Number 10 for expanded disclosure
on
the net assets received from Thorium Power Ltd. reported in the statement of
Stockholders Equity.)
| 9. |
We
note your $5.2 million entry showing an “allocation of expenses” covering
the period from January 1, 2006 through June 30 2006 of Thorium Power,
Ltd., as a credit to additional paid-in capital. We see that you
also
mention an allocation of expenses in your pro forma presentation
on page
F-12. Tell us the extent to which these items represent the same
transactions, and explain the reasons they differ. Describe the specific
service or product for which the expenses are being incurred, the
amount
and form of consideration conveyed in exchange, dates incurred, and
the
reasons they were incurred by the accounting target on behalf of
the
accounting acquirer, if that is your view. Also, since you have
characterized the transaction as a reverse merger recapitalization,
tell
us why you present pro forma information, as if you had completed
a
business acquisition.
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COMPANY
RESPONSE:
The
allocation of expenses of $5.2 million covered the period January 1, 2006 to
June 30, 2006 of Thorium Power Ltd. and was reported as additional
paid-in-capital in the statement of stockholders equity for that period. The
total expenses that were allocated to Thorium Power Inc. from Thorium Power
Ltd.
was for the period January 1, 2006 to October 6, 2006 and that total was
approximately $7.5 million, as disclosed in the footnote to the pro-forma
information presented. The difference of approximately $2.3 million was for
expenses incurred by Thorium Power Ltd. on behalf of Thorium Power Inc. for
the
period July 1, 2006 to October 6, 2006 and these expenses were charged to the
inter-company receivable and payable accounts and eliminated in consolidation.
We realized that after the year end of Thorium Power Ltd. (Novastar Resources,
Ltd.) which was June 30, 2006, that expenses incurred on behalf of Thorium
Power
Inc. for this period (January 1, 2006 to June 30, 2006 should be allocated
to
Thorium Power Inc., therefore we charged the additional paid in capital account
instead of the inter-company accounts.
The
total expenses incurred and allocated consisted of allocated general and
administrative expenses of approximately $900 thousand (rent, salaries, office
expenses, etc.) and $6.6 million of direct expenses incurred as stock based
compensation (restricted stock and stock options issued) to Thorium Power Inc.
executives and consultants and recorded as expenses on Thorium Power Ltd’s books
prior to the merger date. These expenses allocated were incurred by the
accounting target because once the planning for the merger activities took
place
in January 2006 and announced to the public in February 2006, these above
mentioned expenses were being incurred by the Thorium Power Ltd on behalf of
Thorium Power Inc., to further the business plan of Thorium Power Inc. All
stock
based compensation issued by Thorium Power Ltd. was recorded in the footnotes
to
Thorium Power Ltd.’s financial statements filed with the SEC. The stock based
compensation was primarily given to the Company’s CEO, VP International
Operations, Board members and all Advisory Board members, all working to further
the business development of Thorium Power Inc. business.
To
eliminate the disparity in the disclosure of the allocated expenses from Thorium
Power Ltd. to Thorium Power Inc., we concur with the Staff’s comments to
eliminate the pro-forma footnote and the information below the pro-forma
footnote that discloses these total costs allocated. We have kept the reference
to SAB.T.1B1 allocation of total expenses in the merger footnote and have kept
the disclosure of the total expenses allocated in that footnote.
Note
I
— Nature of Operations and Merger with Thorium Power, Inc., page
F-10
Merger
Agreement
| 10. |
We
note your summary of assets and liabilities of Thorium Power, Ltd.
deemed
to have been acquired by you. Please revise your disclosure to reconcile
the book value to net assets acquired, as shown in this summary,
to the
$1,025,959 value of net assets acquired, shown on page F-9 of your
Statements of Changes in Stockholders’ Deficiency. Please be sure to
identify your elimination of inter-company accounts not reflected
in your
entry on page F-9. Expand your disclosure to explain your reason
for any
remaining difference.
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COMPANY
RESPONSE:
In
response the SEC comment number 8, we have changed the presentation of the
statement of stockholders deficiency of the shares issued to the equivalent
shares calculated for accounting purposes in the recapitalization of Thorium
Power, Inc. We have also changed the footnote disclosure on Page F-11 to show
the total amount of the Net Book Value of Thorium Power Ltd. that transferred
over to the statement of stockholders deficiency. The majority of the difference
of $11.5 million is due to the Temporary Equity Account (approximately $12
million) that was part of the Book Value of Thorium Power Ltd. that was acquired
in the reverse merger, but was not part of the statement of stockholders
deficiency statement as it was not reported in stockholders deficiency section
on the Balance Sheet. There is also a disclosure of the inter-company account
that was eliminated in consolidation, that became part of the assets acquired
from Thorium Power Ltd. in the reverse merger accounting
transaction.
| 11. |
Revise
your disclosures under this heading as necessary to show clearly
the dates
of the various actions. For example, in the first sentence, you presently
suggest that an event on February 14, 2006 occurred after the merger
on
October 6, 2006. The sequence of each undertaking described should,
be
logical and evident.
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COMPANY
RESPONSE:
We
have reviewed the Staff’s comment and have changed the wording in the first
sentence in the merger agreement footnote on Page F-10 to clearly reflect the
sequence of events. We have moved the section of the first sentence of this
footnote that deals with the name change that occurred on October 6, 2006 to
a
separate sentence that follows the discussion of the merger that took place
on
February 14, 2006.
Note
2— Summary of Significant Accounting Policies, page F-12
j)
Impairment Charges page F-15
| 12. |
We
note your disclosure of examples of events that would trigger impairment
testing of your property, plant, and equipment. However, you did
not
mention the condition of paragraph 8e of SFAS 144 also requiring
impairment testing when you report a current-period operating or
cash flow
loss, combined with a history of operating or cash flow losses. Please
expand your disclosure to describe the results of your impairment
testing,
triggered by this condition.
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COMPANY
RESPONSE:
We
have reviewed the Staff’s comment regarding the impairment testing. We have
revised the disclosure on Page F-15 Impairment Charges footnote to disclose
that
the Company had tested the Patent cost for impairment at December 31, 2006.
This
impairment test was done during the course of the Company’s strategic review of
its nuclear fuel operations as well as the conditions specified in paragraph
8(e) of SFAS 144. We have disclosed that the Company reviewed its intangible
assets held for use and it determined that future undiscounted cash flows
associated with the Patent rights to its nuclear fuel were sufficient to recover
their carrying values. The valuation of the company is primarily based on the
company’s patents for its nuclear fuel technology.
Note
7—Stockholders’ Equity page F-18
f)
Common Stock and Warrants Reserved for Future Issuance pa F-24
| 13. |
We
note you disclose on page F-25 that you. redeemed 1.62 million shares
from
a restricted stock grant to two executives at $0.20 per share, reflecting
a discount, due to lack of marketability, off your closing market
stock
price on the issuance date, in order to pay for the payroll taxes
owed on
the stock based compensation. Please tell us how you recorded your
stock
redemption and payroll tax transactions, and how your redemption
payment
to your executives achieved your payroll tax payment requirement.
Also
explain whether the discount applied to your valuation of the compensation
charge or only to the redemption price. Since you identify a valuation
expert, you will need to identify that individual or firm in the
filing,
assuming you are able to obtain their permission. If your discount
applied
to the compensation element, adjustment may be necessary, as discounts
for
stock restrictions or lack of marketability are generally not permitted
under U.S. GAAP. For examples, you may refer to the following
guidance:
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•
Question 58 of the FASB Staff Implementation Guide to Statement 115, Accounting
for Certain Investments in Debt and Equity Securities, which states that
adjusting the quoted market price is not permitted when determining fair value;
and
•
Footnote 3 of E 98- Accounting for Convertible Securities with Beneficial
Conversion Features or Contingently Adjustable Conversion Ratios, which states
that quoted market prices should not be adjusted to reflect transferability
restrictions.
COMPANY
RESPONSE:
We
have reviewed the Staff’s comment regarding the redemption of 1.62 million
shares of stock to the officers and we have revised this disclosure and deleted
the statement that the 50% discount factor was determined by an independent
third party valuation company, who was Kroll Associates. We have not been able
to obtain permission to use their name in the filing as this company has
subsequently merged into KPMG and now it will be very difficult to get the
consent of KPMG to use their name in this filing. We have also added disclosure
to make it clear that the 50% discount factor was not applied to the
compensation element or to the 4 million shares issued as stock-based
compensation.
We
did not take a 50% discount in the valuation of the compensation element. The
stock redemption was a separate subsequent capital transaction that was done
in
order to to generate the cash proceeds necessary in order for the Company to
comply with its payroll tax withholding and payment obligations. The Company
had
an obligation, as it does for its other recurring payroll transactions, to
withhold payroll taxes on all compensation to employees. In the case of stock
based compensation, there is no cash to withhold from the officers’
compensation, so stock is redeemed instead and thecash to be issued to the
officers in the stock redemption is used to satisfy the payroll tax withholding
obligation of the employee and the company and for the company to pay the
payroll taxes The redemption price was a subsequent capital transaction whereby
for tax reporting purposes a discount factor is allowed for lack of
marketability. This cash used for this redemption is paid directly to the
Federal and State taxing authorities, just as regular payroll tax withholding
is
handled and not given to the employee.
The
recording of these payroll tax transactions are to record or debit a current
asset (other receivables) and a credit to payroll tax payable for the payroll
tax liability amount. The other receivable account is then credited when the
shares are acquired from the officers and then these common shares that are
redeemed are returned to Treasury and cancelled. The payroll tax payable account
is reduced or debited when the payroll taxes are paid to the IRS and the State
taxing authorities.
Note
10— Commitments and Contingencies page F-25
| 14. |
We
note you disclose that you entered into an agreement imposing a $1.25
million minimum financial commitment toward a test and research reactor
project in Texas. However, you further disclose that after paying
$550,000, you have decided to no longer contribute additional finding
and
believe that you have no further obligations to fund this project.
Please
expand your disclosure to clarify how you recorded the $550,000 payment
and how the terms of this agreement enabled you to not fulfill your
minimum commitment. Please identify the counterparty to this arrangement
and describe any relationships between your officers or owners, and
those
of the counterparty or its
affiliates.
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COMPANY
RESPONSE:
We
have reviewed the Staff’s comment regarding disclosure of the commitment to
further fund the Texas Reactor Project. The counterparty to this agreement
is
the University of Texas of the Permian Basin (“UTPB”) and we recorded the
$550,000 expense as donations, under the caption general and administrative
expenses and we have expanded the footnote disclosure to specify where these
amounts were recorded on the statement of operations for the year ended December
31, 2006.
Pursuant
to Section 2.3 of this agreement, upon written notice of termination by any
party to the agreement, all rights and obligations of such party are terminated.
There was a general understanding between the parties that no further mandatory
donations were to be made under the agreement. According to the Company’s
accounting policy, management made an assessment that a potential material
loss
contingency was not probable, but was remote and just disclosed the remaining
commitment amount without recording the obligation. We have revised Note 10
to
clarify that all future contributions, according to management’s assessment at
December 31, 2006, were deemed to be “conditional contributions” to this reactor
project or the remaining $675,000 will be contributed only if the Company can
direct the ultimate use of these proceeds. No additional contributions have
been
made to UTPB as of the date of this letter and UTPB has not made any claims
against the company for these additional contributions.
The
disclosure of the remaining commitment amount was made because the Company
may
decide in the future to make a contribution to UTPB that would be directly
related to the Company’s Thorium based research and development technology
efforts or for nuclear reactors existing today that can use Thorium based fuels.
Given that the company has the flexibility in deciding whether to make this
contribution and direct the use of the contribution is the reason why we have
used the terminology “conditional contribution” in the footnote disclosure. It’s
a contribution that is remote, but that the Company can decide to make in the
future if certain conditions are met (uses of the funds are for Thorium based
nuclear fuel research.).
Exhibit
99.1 — Thorium Power Ltd Financial Statements As Of and For The Nine Months
Ended September 30 2006
| 15. |
We
note that you have labeled what appears to be the financial statements
of
Thorium Power Inc. covering the interim periods through September
30,
2006, before the merger, as those of Thorium Power Ltd. Please modify
this
exhibit to correct the labeling and to include a preliminary cover
page
explaining the reasons these are being presented, since you had previously
filed financial statements for the accounting acquirer through June
30,
2006 in your Form SB-2, but had not subsequently reported the following
quarter. Also add notes to these interim financial statements, as
you had
done in the registration statement.
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COMPANY
RESPONSE:
We
have reviewed the Staff’s comment and have included an explanatory paragraph
that the financial statements are being presented in order to bring the
financial reporting of Thorium Power Inc. up to date. The prior period financial
statements of Thorium Power Inc. were presented in the Form SB-2, but those
financial statements were prepared and filed up to and through the date June
30,
2006. We have also now added the appropriate footnotes and title to these
financial statements (Thorium Power Inc.) and have filed them.
Form
10-QSB for the Fiscal quarter Ended March 31, 2007
General
| 16. |
Please
add the information required about your disclosure controls and procedures
under Items 307 and 308T of Regulation S-B, to comply with Item 3
of Form
10-QSB.
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COMPANY
RESPONSE:
We
have added the required information about the disclosure controls and procedures
under Items 307 and 308T of Regulation S-B, to comply with Item 3 of Form
10-QSB.
Financial
Statements
Note
—
Research and Development Costs, page 6
| 17. |
Please
expand your disclosure to fill in the missing research and development
cost amounts for the three months ended March 31, 2007 and 2006 and
discuss your accounting for such
costs.
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COMPANY
RESPONSE:
There
were no Research and Development expenses for the three month periods March
31,
2007 and 2006. The “-“, that was put in the filing represented that there no
expenses in these periods.
If
you
would like to discuss any of the responses to the Staff’s comments or if you
would like to discuss any other matters, please contact the undersigned at
703.918.4918 or Louis A. Bevilacqua, Esq. of Thelen Reid Brown Raysman &
Steiner LLP, our outside special securities counsel at (202)
508-4281.
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Sincerely, |
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Thorium Power, Ltd. |
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By: |
/s/ Seth
Grae |
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Seth
Grae |
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Chief
Executive Officer |