September 28, 2005
Mail Stop 7010
By U.S. Mail and facsimile to (405) 270-3609
Gregory F. Pilcher, Esq.
Senior Vice President, General Counsel and Secretary
Tronox, Inc.
Kerr-McGee Corporation
123 Robert S. Kerr Avenue
Oklahoma City, Oklahoma 73102
Re: Tronox, Inc.
Amendment No. 2 to Registration Statement on Form S-1
Filed September 16, 2005
File No. 333-125574
Dear Mr. Pilcher:
We have reviewed your filing and have the following
comments.
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.
General
1. We note disclosure throughout your document of financing
transactions you intend to complete concurrently with this public
offering. Please be advised that we will review your disclosure
of
the material terms of these arrangements, in addition to other
non-
430A information, once they are provided in a future amendment to
your registration statement. In addition, please note that any
preliminary prospectus that is circulated must include all non-
430A
information.
Prospectus Summary, page 1
Upon consummation of this offering, we will have a substantial
amount
of debt. . ., page 15
2. After you reach definitive documentation, please indicate how
much
your interest expense will increase for each 1% increase in
interest
rates and the amount of your cash flow that you will use for debt
service.
Summary Financial Data, page 9
3. We have reviewed your response to comment three. Your revised
disclosure continues to present your operating statistics combined
with those of the Tiwest joint venture. Please revise the
titanium
dioxide operating statistics on pages 11 and 12 to present your
production volumes and capacity separately from those of the
Tiwest
joint venture.
Capitalization, page 30
4. Your discussion of the differences between the actual and as
adjusted columns is insufficient. Please revise to quantify and
discuss each adjustment between the actual and as adjusted
columns.
Please also ensure that your assumed pension liability is included
in
the as adjusted information.
Selected Financial Data, page 32
5. It is unclear why you do not present your environmental
remediation and/or restoration and other long-term liabilities in
selected financial data. Please refer to instruction two to Item
301
of Regulation S-K. Please revise or advise.
Management`s Discussion and Analysis, page 33
Contractual Obligations and Commitments, page 47
6. We note your response to comment 29 of our letter dated July 1,
2005. Please update your discussion to disclose the results of
your
consent solicitations.
Legal Proceedings, page 76
7. Please revise your disclosure to state the monetary penalties
being sought by the Environmental Protection Division of the
Georgia
Department of Natural Resources. See Instruction 5(c) to Item 103
of
Regulation S-K. Alternatively, please explain to us why you
deleted
this disclosure previously included in amendment number 1.
Combined Financial Statements, page F-1
Revenue Recognition, page F-12
8. We have reviewed your response to comment 15. We continue to
believe that to allow for comparability of income statement
classifications with other entities, your disclosure should enable
investors to understand which costs are in which captions. For
additional information please also refer to the speech given by
Scott
Taub at the December 4, 2000 AICPA National Conference. Please
disclose the types of amounts included in the cost of goods sold
line
item and the selling, general and administrative expense line
item.
In doing so, please also disclose whether you currently exclude
inbound freight charges, purchasing and receiving costs,
inspection
costs, warehousing costs, internal transfer costs, or other costs
of
your distribution network in the cost of goods sold line item.
With
the exception of warehousing costs, if you currently exclude a
portion of these costs from cost of goods sold, please disclose:
* in a footnote the line items that these excluded costs are
included
in and the amounts included in each line item for each period
presented; and
* in MD&A that your gross margins may not be comparable to those
of
other entities, since some entities include all of the costs
related
to their distribution network in cost of goods sold while others
like
you exclude a portion of them from gross margin, including them in
the selling, general and administrative expense line item.
Condensed Combined Financial Statements, page F-53
Note 5 - Accounts Receivable Sales, page F-60
9. Please disclose the amount of repurchased accounts receivable
for
which you received payments during April, May, and June. Please
also
disclose the classification of such receipts in your statement of
cash flows. If you have classified the receipts as an operating
cash
flow, please tell us the basis for that classification and
disclose
to readers that this is the second time that cash inflows related
to
the same receivables are being included in operating cash flows.
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 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 filing to be certain that the
filing includes all information required under the Securities Act
of
1933 and that they have provided all information investors require
for an informed investment 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 Scott Watkinson, Staff Accountant, at (202)
551-3741 or Rufus Decker, Accounting Branch Chief, at (202) 551-
3769
if you have questions regarding comments on the financial
statements
and related matters. Please contact Matt Franker, Staff Attorney,
at
(202) 551-3749 or Lesli Sheppard, Senior Staff Attorney, at (202)
551-3708 with any other questions. Alternatively, you may contact
me
at (202) 551-3760.
Sincerely,
Pamela A. Long
Assistant Director
cc: David B.H. Martin, Esq. (via facsimile 202/778-5128)
Covington & Burling
1201 Pennsylvania Avenue, N.W.
Washington, DC 20004-2401
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Gregory F. Pilcher, Esq.
Tronox, Inc.
September 28, 2005
Page 1
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549-7010
DIVISION OF
CORPORATION FINANCE