December 27, 2004
VIA FEDERAL EXPRESS AND EDGAR
Ms. Tamara Brightwell
Division of Corporation Finance
Mail Stop 05-10
Securities and Exchange Commission
450 Fifth Street, N.W.
Washington, D.C. 20549-0510
Re: Crompton Corporation Registration Statement on Form S-4,
File No. 333-119641
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Dear Ms. Brightwell:
On behalf of Crompton Corporation (the "Company"), enclosed please find
three copies of Amendment No. 2 ("Amendment No. 2") to the Registration
Statement on Form S-4 (Registration No. 333-119641) (as amended, the
"Registration Statement") which was filed today via EDGAR with the Securities
and Exchange Commission (the "Commission"). Additionally, enclosed are three
copies of Amendment No. 2 which have been marked to show changes from Amendment
No. 1 to the Registration Statement on Form S-4 (filed with the Commission on
December 3, 2004). The changes in Amendment No. 2 include those made in response
to the comments of the staff of the Commission (the "Staff") set forth in your
letter dated December 16, 2004 (the "Comment Letter").
Set forth below are the Company's responses to the comments raised in
the Comment Letter. For the convenience of the Staff, each response has been
numbered to correspond with the comments in the Comment Letter. Page numbers in
the responses refer to pages of Amendment No. 2. Capitalized terms used but not
defined herein shall have the meanings ascribed to them in Amendment No. 2.
Ms. Tamara Brightwell
Division of Corporation Finance
December 27, 2004
Page 2
FORM S-4
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1. WE NOTE YOUR RESPONSE TO PRIOR COMMENT 11. PLEASE REVISE TO STATE THE AMOUNT
OF NET PROCEEDS USED FOR EACH PURPOSE.
The Use of Proceeds section has been revised in accordance with the
Staff's comment to state the amount of net proceeds used for each purpose.
SUMMARY OF THE TERMS OF THE EXCHANGE OFFERS
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THE EXCHANGE OFFER - PROCEDURES FOR TENDERING OLD NOTES, PAGE 33
2. REFER TO PRIOR COMMENT 12. IN RESPONSE TO THAT COMMENT, YOU STATE THAT YOU
REVISED THE PROSPECTUS TO REMOVE THE IMPLICATION THAT AN OFFER CONDITION COULD
BE WAIVED AS TO ONLY ONE OR CERTAIN TENDERING SECURITY HOLDERS. HOWEVER,
LANGUAGE STATING THAT YOU "RESERVE THE RIGHT TO WAIVE...CONDITIONS AS TO ANY
INDIVIDUAL TENDER" CONTINUES TO APPEAR ON PAGE 34. DESPITE THE NEW DISCLOSURE ON
PAGE 36 SAYING THE OPPOSITE, WE BELIEVE THIS LANGUAGE SHOULD BE DELETED.
The disclosure on page 34 has been revised to delete the language
concerning waivers with regard to individual holders, in accordance with the
Staff's comment.
3. CLARIFY WHAT YOU MEAN WHEN YOU SAY THAT YOU RESERVE THE RIGHT TO WAIVE
"INELIGIBILITY OF ANY HOLDER." WE ASSUME THAT YOU DO NOT INTEND TO WAIVE ANY
REQUIREMENTS OF THE EXXON CAPITAL LINE OF LETTERS. PLEASE MAKE THIS CLEAR IN
YOUR FILING.
The Company does not intend to waive any requirements of the Exxon
Capital line of letters. The disclosure on page 34 concerning waivers with
regard to individual holders has been deleted.
CONDITIONS TO THE EXCHANGE OFFER, PAGE 36
4. AS PREVIOUSLY REQUESTED IN PRIOR COMMENT 13, PLEASE REVISE THE LANGUAGE
REFERENCING "ACCEPTANCE" AT THE BEGINNING OF THIS SECTION. YOU SHOULD INSTEAD
REFER TO THE EXPIRATION OF THE OFFER, SINCE THAT IS THE TIME BY WHICH THE
CONDITIONS MUST BE SATISFIED OR WAIVED. IN ADDITION, THE "AT ANY TIME" LANGUAGE
IN THE PENULTIMATE PARAGRAPH OF THIS SECTION APPEARS INCONSISTENT WITH THE
CHANGES MADE STATING THAT CONDITIONS MUST BE SATISFIED OR WAIVED PRIOR TO THE
EXPIRATION OF THE OFFER. PLEASE REVISE.
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Ms. Tamara Brightwell
Division of Corporation Finance
December 27, 2004
Page 3
The disclosure on page 36 has been revised in accordance with the
Staff's comment to refer to the expiration of the offer. Additionally, the
penultimate paragraph of this section has been revised to clarify that the
Company's right to waive conditions may be asserted at any time and from time to
time, prior to the expiration of the exchange offer.
DESCRIPTION OF OTHER INDEBTEDNESS AND ARRANGEMENTS, PAGE 39
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5. PLEASE PROVIDE THE INTEREST RATE FOR THE REVOLVING CREDIT FACILITY AS OF THE
MOST RECENT DATE PRACTICABLE.
The interest rate for the Revolving Credit Facility as of November 30,
2004, the most recent date practicable, has been added to the disclosure on page
39 in accordance with the Staff's comment.
6. STATE WHETHER THE COMPANY IS CURRENTLY IN COMPLIANCE WITH THE FINANCIAL
COVENANTS OF THE REVOLVING CREDIT FACILITY.
The disclosure on page 39 has been revised in accordance with the
Staff's comment to state that the Company is in compliance with the financial
covenants of the Revolving Credit Facility as of the date of the prospectus.
EXHIBIT 5.1
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7. PLEASE DELETE THE FIRST PARAGRAPH ON PAGE TWO OF THE OPINION. PLEASE NOTE
THAT THE LEGALITY OPINION IS FILED (NOT FURNISHED) AS AN EXHIBIT PURSUANT TO
ITEM 601(B)(5) OF REGULATION S-K.
The first paragraph on page two of the opinion has been revised to
remove the reference to "furnishing" the opinion, in accordance with the Staff's
comment.
8. WE NOTE THE ASSUMPTIONS IN THE SECOND FULL PARAGRAPH ON PAGE THREE RELATING
TO THE ORGANIZATION, ETC. OF THE NON-DELAWARE/TEXAS GUARANTORS. THESE
ASSUMPTIONS ARE IMPROPER AND SHOULD BE REMOVED. TO THE EXTENT THAT THESE MATTERS
SUPPORT LEGAL CONCLUSIONS THAT ARE NECESSARY TO SKADDEN, ARPS' OPINION, WE WILL
NOT OBJECT IF YOU OBTAIN LOCAL COUNSEL OPINIONS, FILE THEM AS EXHIBITS AND
REVISE THE SKADDEN OPINION TO STATE THAT IT IS RELYING ON THE OPINIONS OF NAMED
LOCAL COUNSELS IN GIVING ITS OWN OPINION.
Please note that subsequent to the filing of Amendment No. 1 with the
Commission, GT Seed International Company, a Subsidiary Guarantor incorporated
in the State of Texas, merged into Uniroyal Chemical Company, Inc., a Subsidiary
Guarantor incorporated in the State of New Jersey. As a result, references to
"Non-Delaware/Texas Guarantors" have been changed to "Non-Delaware Guarantors".
Skadden, Arps, Slate, Meagher & Flom LLP ("Skadden Arps") does not
maintain offices in the jurisdictions where the Non-Delaware Guarantors are
incorporated, and does not have the requisite expertise to provide an opinion
under the laws of these jurisdictions. Accordingly, the Company has filed as an
exhibit to Amendment No. 2, the opinion of Lynn A. Schefsky, Senior Vice
President and General Counsel of the Company, concerning the validity and
enforceability of the subsidiary guarantees to be offered by the Non-Delaware
Guarantors.
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Ms. Tamara Brightwell
Division of Corporation Finance
December 27, 2004
Page 4
9. PLEASE EXPLAIN SUPPLEMENTALLY HOW UNIROYAL CHEMICAL COMPANY CAN BE
INCORPORATED BOTH IN DELAWARE AND IN THE BAHAMAS. WE NOTE THAT YOUR
ENFORCEABILITY OPINION AS TO ITS GUARANTEE IS SPECIFICALLY LIMITED TO ITS
"STATUS" UNDER DELAWARE LAW. IF UNIROYAL IS A BAHAMIAN CORPORATION, THE OPINION
SHOULD NOT EXCLUDE THE IMPACT OF ITS STATUS OF BAHAMIAN LAW. WE MAY HAVE
ADDITIONAL COMMENTS UPON REVIEW OF YOUR RESPONSE.
Pursuant to Section 388 of the Delaware General Corporation Law (the
"DGCL"), a non-United States corporation may become domesticated in the State of
Delaware by complying with the procedures of that Section. Upon the filing of
the requisite documents with the Secretary of State of the State of Delaware
(i.e., a certificate of domestication and a certificate of incorporation), a
corporation becomes subject to the provisions of the DGCL as if incorporated in
the State of Delaware on the date of filing. From the date of its domestication,
the corporation is subject to Delaware law as if it were incorporated in the
State of Delaware. Uniroyal Chemical Company Limited (Delaware) is subject to
Delaware law and has no operations or significant assets in the Bahamas.
Further, the Company is in the process of causing Uniroyal Chemical Company
Limited (Delaware) to become solely incorporated in the State of Delaware and to
terminate its incorporation in the Bahamas. For these reasons, we believe that a
separate opinion concerning Bahamian law is not required, and that the opinion
given by Skadden Arps as to the enforceability of the guarantee is sufficient to
satisfy the requirements of Item 601 of Regulation S-K concerning opinions of
counsel.
10. IN THE FIRST PARAGRAPH ON PAGE FOUR, PLEASE DELETE THE STATEMENT THAT THE
OPINION IS LIMITED TO THE LAWS THAT "ARE NORMALLY APPLICABLE TO TRANSACTIONS OF
THE TYPE CONTEMPLATED BY THE EXCHANGE OFFER" AND THE RELATED STATEMENTS
REGARDING "OPINED ON LAW" AND "NON-OPINED ON LAW."
We respectfully advise the Staff that Section 6.6 of the Report of the
TriBar Opinion Committee on Third-Party Closing Opinions (the "Tri-Bar Report")
states that "the no violation of law opinion does not cover all law. As with
other opinions, the no violation of law opinion addresses only the law
(including published rules and regulations of government agencies) of
jurisdictions that are specified for coverage in the opinion letter. In
addition, the opinion is understood to exclude local law, such as city
ordinances and county zoning regulations, that are adopted by political
subdivisions below the state level." Section 6.6 further states that "no lawyer
or firm, no matter how diligent, can reasonably be expected to be familiar with
every law, rule and regulation (even within the jurisdiction whose law is
covered by the opinion letter) that might possibly apply to the Company and the
transaction." While the Tri-Bar Report is not incorporated into the federal
securities laws, it provides guidance as to customary practice in providing
legal opinions. We believe that the vast majority of opinions follow customary
practice and the Tri-Bar Report is followed by a large segment of practitioners.
Accordingly, Skadden Arps has specified that its opinion is limited to those
laws that are normally applicable to transactions of the type contemplated by
the exchange offer.
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Ms. Tamara Brightwell
Division of Corporation Finance
December 27, 2004
Page 5
We also advise the Staff that several members of Skadden Arps had
discussions with Messrs. Martin Dunn, Steven Duvall, Mark Webb and Timothy
Levenberg of the Staff in connection with the Registration Statement on Form S-4
filed by Hexcel Corporation, file no. 333-71601. As a result of such
discussions, the Staff concluded that a substantially similar assumption was
acceptable for the opinion of Skadden Arps filed as an exhibit to Hexcel
Corporation's Form S-4.
11. REMOVE THE ASSUMPTION IN THE FIRST PARAGRAPH ON PAGE 4 AS TO CONFLICTS WITH
OTHER AGREEMENTS. IT IS NOT CLEAR TO US THAT CONFLICTS WITH OTHER AGREEMENTS
WOULD RENDER THE COMPANY'S OBLIGATIONS TO INVESTORS UNDER THE NOTES AND
INDENTURE UNENFORCEABLE. FURTHER, COUNSEL SHOULD CONDUCT ALL DILIGENCE IT DEEMS
NECESSARY IN ORDER TO PROVIDE A CLEAN LEGALITY OPINION.
We respectfully advise the Staff that under New York law, if the
execution and delivery of the Indentures or the Notes and the related guarantees
causes the breach of another existing contract between the Company and a third
party, the result may be that, under certain circumstances, the Indentures
and/or the Notes and the related guarantees may be deemed unenforceable. For
example, New York case law supports the proposition that if the Company and the
parties seeking to enforce the Indentures or the Notes and the related
guarantees have actual knowledge that the Indentures, the Notes or the related
guarantees violate another earlier contract entered into by the Company, a court
may refuse to enforce the later "interfering" contract (in this case the
Indentures and/or the Notes and related guarantees). The Company is neither
small nor newly formed and Skadden Arps does not have personal knowledge of
every contract to which the Company is a party. Similarly, Skadden Arps does not
have personal knowledge of what parties who may seek to enforce the Indentures,
the Notes and the related guarantees may know in relation to earlier contracts
entered into by the Company. Further, Section 6.5.5 of the Tri-Bar Report states
that "Unless the Company is very small or newly formed, the opinion preparers
are unlikely to have personal knowledge of every contract and court order to
which the opinion might conceivably apply." The Company is required to file, as
exhibits to its periodic reports under the Securities Exchange Act of 1934,
agreements considered material to it pursuant to Item 601(b)(10) of Regulation
S-K. Additionally, the Company has filed with or incorporated by reference into
the Registration Statement those instruments required pursuant to Item 601(b)(4)
of Regulation S-K, and has identified these instruments, along with the Item
601(b)(10) agreements, as material to it and has listed these in Part II of the
Registration Statement. Accordingly, Skadden Arps has limited its opinion to
these documents which have been identified to it as material, and has assumed
that the Indentures, the Notes and the related guarantees do not violate any
agreement other than these agreements and instruments of which Skadden Arps has
personal knowledge.
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Ms. Tamara Brightwell
Division of Corporation Finance
December 27, 2004
Page 6
In addition, several members of Skadden Arps' opinion committee had
discussions with Messrs. Martin Dunn, Steven Duvall, Mark Webb and Timothy
Levenberg of the Staff in connection with the Registration Statement on Form S-4
filed by Hexcel Corporation. As a result of such discussions, the Staff
concluded that a substantially similar assumption was acceptable for the opinion
of Skadden Arps filed as an exhibit to Hexcel Corporation's Form S-4.
If you have any questions regarding the responses to these comments or
require additional information, please contact Michael J. Zeidel at (212)
735-3259 or Stephen D. Evans at (212) 735-3546.
Very truly yours,
/s/ Michael J. Zeidel
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Michael J. Zeidel
Enclosures
cc: Pamela Long
Assistant Director
Division of Corporation Finance
Securities and Exchange Commission
450 Fifth Street, N.W.
Washington, D.C. 20549-0510
Lynn A. Schefsky, Esq.
Crompton Corporation
Joanne F. Davis, Esq.
Crompton Corporation
Phyllis G. Korff, Esq.
Skadden, Arps, Slate, Meagher & Flom LLP
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