March 2, 2006
Securities and Exchange Commission 100 F Street, N.E.
Washington, D.C. 20549
Attn: Max Webb
Division of Corporation Finance
RE: TAM S.A.
AMENDMENT NO. 3 TO REGISTRATION STATEMENT ON FORM F-1
CONFIDENTIALLY SUBMITTED ON FEBRUARY 15, 2006
RESPONSE TO STAFF COMMENT LETTER DATED FEBRUARY 24, 2006
Dear Mr. Webb:
Thank you for your letter dated February 24, 2006 setting forth the
comments of the staff (the "Staff") of the Securities and Exchange Commission
(the "Commission") to the registration statement (the "Registration Statement")
of TAM S.A. (the "Registrant") on Form F-1 confidentially submitted on February
15, 2006.
Concurrent with the delivery of this letter, the Registrant has today
publicly filed a revised version of the Registration Statement on EDGAR. For
your convenience, we have sent three versions of the current version of
Registration Statement marked against Amendment No. 3 to the Staff by courier
today.
The Registrant's responses to the Staff's comments are set forth below. For
your convenience, we have re-typed in italics the Staff's comment preceding each
response. References to page numbers in our responses below are references to
pages in the marked version of the Registration Statement.
General
1. We remind you of outstanding comments from our prior comment letters:
o As indicated in prior comment 3 of our letter dated November 25, 2005,
please provide us with any artwork that you intend to use.
The Registrant hereby confirms that the artwork is as transmitted to
the Staff in paper form on February 13, 2006. The artwork is also
contained in the Registrant's filings of the Registration Statement on
EDGAR.
o As indicated in prior comments 4 and 73 of our letter dated November
25, 2005, please provide your exhibits, including your opinion of
counsel. We may have additional comments after reviewing this
additional information.
Securities and Exchange Commission
March 2, 2006
Page 2
The Registrant confirms that its exhibits have been included with its
filings of the Registration Statement on EDGAR. For the Staff's
convenience, we set out below the list of exhibits and dates on which they
were filed:
EXHIBIT NUMBER DESCRIPTION OF EXHIBIT
1.1 Form of International Underwriting Agreement
Filed on EDGAR on March 2, 2006
3.1 By-laws of the Registrant (English translation)
Filed on EDGAR on February 17, 2006
4.1 Form of Deposit Agreement
Filed on EDGAR on March 2, 2006
4.2 Amended and Consolidated Stockholders Agreement
Filed on EDGAR on February 17, 2006
5.1 Form of Opinion of Machado, Meyer, Sendacz e Opice as to legality of the
preferred shares
Filed on EDGAR on March 2, 2006
8.1 Form of Opinion of Machado, Meyer, Sendacz e Opice as to tax matters
Filed on EDGAR on March 2, 2006
10.1 through 10.8 Material contracts (confidential treatment application cleared with the Staff
inclusive on March 2, 2006)
Filed on EDGAR on March 2, 2006
12.1 Computation of ratios
Filed on EDGAR on February 17, 2006
21.1 List of subsidiaries
Filed on EDGAR on February 17, 2006
23.1 Consent of PricewaterhouseCoopers Auditores Independentes
Filed on EDGAR on March 2, 2006
23.2 Consent of Machado, Meyer, Sendacz e Opice (included in Exhibits 5.1 and 8.1)
Filed on EDGAR on March 2, 2006
23.3 Consent of Clifford Chance US LLP
Filed on EDGAR February 22, 2006
24.1 Powers of Attorney (included on signature page)
Filed on EDGAR on March 2, 2006
Securities and Exchange Commission
March 2, 2006
Page 3
o As indicated in prior comment 7 of our letter dated November 25, 2005,
separately state on the cover page the amount of ADSs to be offered by
selling shareholders. Please provide the same information for the
over-allotment portion of the offering.
The Registrant hereby confirms that, as disclosed on page 10 of the
Registration Statement, the over-allotment option will be exercised by
the Registrant only. Accordingly, no ADSs will be offered by the
selling shareholders pursuant to the over-allotment option.
With respect to the Staff's request that the cover page set out the
amount of ADSs to be offered by the selling shareholders, the
Registrant respectfully refers the Staff to its response to prior
comment 7 (as set out in our response letter of December 13, 2005).
The number of ADSs (as compared to preferred shares) to be offered by
the selling shareholders has not yet been determined but the
Registrant expects this information to be confirmed on or about March
9, 2006, the expected date for pricing of the offering. The Registrant
confirms that the Registration Statement and final version of the
prospectus will be updated to include the number of ADSs to be offered
by the selling shareholders when such information is confirmed.
o As indicated in your response to prior comment 15 of our letter dated
November 25, 2005, please file the consent of IATA.
The Registrant has elected to adopt the relevant statements as its own
(as suggested by the Staff in comment 15 of the letter dated November
25, 2005 as an alternative to obtaining consent). The revised
disclosure is set out on pages 1 and 61.
o As indicated in prior comment 53 of our letter dated November 25,
2005, if known, provide the date, such as the record date or date
dividends are declared, that the Depositary will determine the
exchange rate to be used in connection with converting cash dividends
or other cash distributions.
The Depositary has informed the Registrant that once dividends (in
Brazilian reais) are received by the Depositary and it has received
any required regulatory approvals for the conversion of such amounts
into U.S. dollars, the Depositary will effect such conversion on the
Brazilian reais/U.S. dollar spot market. Following such conversion,
the Depositary will set the per ADS dividend rate and announce it to
the New York Stock Exchange, thereby setting the record date and
payment date in relation thereto.
Principal and Selling Shareholders, page 102
2. Please revise the footnotes to identify the holding company (or companies)
that own TAM, Aerosystem S.A. Empreendimentos e, and Agropecuaria Nova
Fronteira Ltda.
The Registrant confirms that neither TAM - Empreendimentos e Participacoes,
Aerosystem S.A. - Empreendimentos e Participacoes or Agropecuaria Nova
Fronteira Ltda. are owned by holding companies and, in response to the
Staff's comment, the Registrant has corrected the disclosure in footnotes
1, 2 and 3 on page 104 to reflect this.
Securities and Exchange Commission
March 2, 2006
Page 4
3. In addition, with respect to Aerosystem S.A. Empreendimentos we re-issue
prior comments #4 and #5.
In response to the Staff's comment, the Registrant has revised the
disclosure in footnote 2 on page 104 in relation to Aerosystem S.A. -
Empreendimentos e Participacoes.
Note 27: TAM Fidelidade Program, page F-33
4. Refer to prior comment 4. Please revise to disclose that you accrue a
liability for the expected incremental cost of travel and other awards
earned by participants in your loyalty program when the requisite award
levels are achieved. Second, disclose the amount of loyalty costs accrued
for the periods presented.
In response to the Staff's comment, the Registrant has revised its
disclosure in footnote 27 to clarify that no liability is currently
recorded for incremental cost and the amounts of incremental cost incurred
in each period presented under Brazilian GAAP.
Signatures
5. As required by Instruction 1 relating to signatures of Form F-1, please
provide the signature of the registrant's controller or principal
accounting officer.
The Registrant confirms that the current filing of the Registration
Statement on EDGAR contains the signature of its principal accounting
officer, Mr. Eduardo Matzenbacher. The Registrant has revised the signature
page to reflect this.
* * *
Please direct any comments or questions to the undersigned at 212.878.3250.
Sincerely yours,
/s/ Jonathan Zonis
Jonathan Zonis