[BUTZEL LONG LETTERHEAD]
VIA FACSIMILE AT (202) 772-9203 AND EDGAR
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United States Securities and Exchange Commission
Office of Mergers and Acquisitions,
Division of Corporation Finance
100 F Street, N.W.
Washington D.C. 20549
Attn: Celeste M. Murphy, Esq.
Mail Stop 3628
RE: SPORTS RESORTS INTERNATIONAL, INC.
SCHEDULE TO-I/A FILED FEBRUARY 16, 2006
SCHEDULE 13E-3/A FILED FEBRUARY 16, 2006
SEC FILE NO. 005-40279
Ladies and Gentlemen:
The following are the responses of Sports Resorts International, Inc.
(the "Company") to the comments of the Staff dated February 22, 2006. For the
convenience of the Staff we have reproduced the Staff's comments. The Company's
response immediately follows the reproduced comment.
Schedule 13E-3
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1. We note your response to prior comment 5 that you
have added disclosure that clarifies that the
company, the board and the bidders believe that $1.00
per share whether received as a result of the
tendering in the offer or as part of a "squeeze out"
merger is fair to unaffiliated shareholders. Please
advise us of the location of this added disclosure as
we are unable to locate it.
RESPONSE
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THE COMPANY HAS ADDED APPROPRIATE DISCLOSURE TO "ITEM 8. FAIRNESS OF THE
TRANSACTION" ON PAGE 17 TO STATE THAT THE BOARD AND MR. WILLIAMSON BELIEVES THAT
A PURCHASE PRICE OF $1.00 PER SHARE WHETHER RECEIVED AS A RESULT OF TENDERING IN
THE OFFER OR AS PART OF A SECOND STEP MERGER TRANSACTION IS FAIR TO UNAFFILIATED
SHAREHOLDERS.
Offer to Purchase - General
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2. We note your response to prior comment 11, but
believe that you should revise the disclosure to
separately address fairness to those shareholders
being cashed out and the fairness to those who will
remain as shareholders in a private company. As we
previously noted, where a transaction will impact
different subsets of shareholders differently, the
fairness determination required by Item 1014(a) must
be made as to each group separately. See Q&A No. 19
in Exchange Act Release No. 17719 (April 13,1981),
RESPONSE
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DISCLOSURE HAS BEEN ADDED TO PAGE 7 UNDER THE SECTION "CERTAIN EFFECTS OF THE
OFFER" TO CLARIFY THAT SHAREHOLDERS THAT REMAIN AS SHAREHOLDERS AFTER THE
TERMINATION OF THE OFFER WILL OWN SHARES IN A PRIVATE COMPANY WITHOUT A LIQUID
TRADING MARKET. IN ADDITION, DISCLOSURE HAS BEEN ADDED THAT THE COMPANY WILL NO
LONGER HAVE TO COMPLY WITH THE DISCLOSURE REQUIREMENTS OF THE SECURITIES AND
EXCHANGE COMMISSION.
Summary Term Sheet. page 1
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3. We note your amendment and response to prior comment
12, but believe that you should revise your statement
that 'the only difference" between tendering shares
now and waiting for the transaction, if it should
happen, as receiving the compensation now or later
under the Introduction on page 4. You should add here
that shareholders who exercise dissenters' rights
under Michigan law will receive a judicially
determined fair-value for their shares, which value
could be more or less than the price per share to be
paid in the merger and also refer to the more
detailed section on dissenters rights.
RESPONSE
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DISCLOSURE HAS BEEN CLARIFIED ON PAGE 4 TO PROVIDE THE FOLLOWING:
"IN THE EVENT THAT THE SECOND-STEP TRANSACTION OCCURS, NON-TENDERING
SHAREHOLDERS, WHO PROPERLY EXERCISE DISSENTERS' RIGHTS, WOULD BE ENTITLED TO
RECEIVE A JUDICIALLY DETERMINED VALUE THAT MAY BE MORE OR LESS THAN THE $1.00
PURCHASE PRICE CONTEMPLATED IN THE OFFER. SEE "RIGHTS OF SHAREHOLDERS IN THE
EVENT OF THE SECOND-STEP TRANSACTION".
Special Factors, page 6
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4. Prior Comment 18. Please add the supplemental
response to your disclosure document, under the
fairness of the offer heading, as it is responsive to
Instruction 2(ii) to Item 1014 of Regulation S-K and
required disclosure in the negative instance where
the board and filing persons did not consider the
factor of historical market prices in making the
fairness determination.
RESPONSE
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THE FOLLOWING DISCLOSURE HAS BEEN ADDED TO PAGE 6:
"THE BOARD AND MR. WILLIAMSON DID NOT CONSIDER THE HISTORICAL TRADING PRICE OF
THE COMPANY'S COMMON STOCK IN DETERMINING THAT THE OFFER WAS FAIR. IT WAS
DETERMINED THAT THE DELISTING FROM THE NASDAQ SMALL CAP MARKET AND THE FUTURE
LIKELIHOOD OF AN INEFFICIENT TRADING MARKET MADE HISTORICAL TRADING PRICES
LARGELY IRRELEVANT. FURTHER, CONDITIONS IN THE BEDLINER BUSINESS, THE INABILITY
TO SELL THE COMPANY'S RACEWAY OPERATIONS AND THE COMPANY'S INABILITY TO ACCESS
THE CAPITAL MARKETS ALL INDICATED THAT THE STOCK PRICE WAS UNLIKELY TO REBOUND."
Position of the Board of Directors: Fairness of the Offer, page 9
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5- We note your response to prior comment 27. Please
expand your disclosure to state that the neither the
board nor the filing persons considered historical
market prices, going concern value, and liquidation
value, if true. See Interpretive Release Relating to
Going Private Transactions Under Rule 13e-3, April
13,1981, Question and Answer 2
RESPONSE
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DISCLOSURE HAS BEEN ADDED TO PAGE 6 THAT NEITHER THE BOARD OR MR. WILLIAMSON
CONSIDERED HISTORICAL MARKET PRICES, GOING CONCERN VALUE OR LIQUIDATION VALUE IN
MAKING THE FAIRNESS DETERMINATION.
Interests of Certain Person in the Offer, page 10
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6. We note your response to prior comment 29, but cannot
locate the added disclosure. In our prior comment we
noted that the board "is aware of... actual and
potential conflicts of interest and has considered
them along with the other matters described [under
Other sections]." Please identify the conflicts of
interest that exist as between the Continuing
Shareholders and actions related to the company. We
note the identification of "control [of] all matters
requiring approval of the Company's shareholders,
including the election of directors and approval of
any Second-Step Transaction." Disclose the steps the
board took to address such conflicts. Please identify
any other area where the board considered there to be
a conflict of interest and measures of precautions or
steps implemented to address such conflicts.
RESPONSE
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SECTION 4 ON PAGE 10 OF THE OFFER TO PURCHASE CONTAINS A DETAILED LISTING OF THE
RELATED PARTY TRANSACTIONS BETWEEN THE COMPANY AND MR. WILLIAMSON. DISCLOSURE
HAS BEEN ADDED THAT THE BOARD DID NOT TAKE ANY STEPS TO REDUCE OR OTHERWISE
MODIFY THE RELATED PARTY TRANSACTIONS WHILE CONSIDERING THE OFFER. IN ADDITION,
THE DISCLOSURE HAS BEEN MODIFIED TO CLARIFY THAT MR. WILLIAMSON HAS AN INTEREST
IN THE OFFER THAT IS DIFFERENT THAN THE INTERESTS OF THE UNAFFILIATED
SHAREHOLDERS. FURTHER, DISCLOSURE HAS BEEN ADDED THAT NO OTHER OFFICER OR
DIRECTOR HAS ANY INTEREST IN THE OFFER THAT IS DIFFERENT THAN THE INTERESTS OF
THE UNAFFILIATED SHAREHOLDERS.
Closing Comment
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Each filing person acknowledges that;
- that filing persons are 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
- that filing persons may not assert staff
comments as a defense in any proceeding
initiated by the Commission or any person
under the federal securities laws of the
United States.
Questions about the responses noted above or the disclosure contain the
referenced filings can be addressed to the undersigned at (313) 983-7454.
Very truly yours,
Dave Braun