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[LETTERHEAD
OF COMSTOCK RESOURCES, INC.]
CORRESP
October
5, 2007
BY
FACSIMILE (202-772-9369) AND EDGAR
Securities
and Exchange Commission
100
F
Street N.E.
Washington,
D.C. 20549
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Re:
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Comstock
Resources, Inc.
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Form
10-K, for the Fiscal Year Ended December 31,
2006
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Filed
March 1, 2007
Response
Letter dated September 19, 2007
File
No.: 1-3262
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Ladies
and Gentlemen:
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The
following is the response of Comstock Resources, Inc. ("Comstock" or the
"Company") to the comment contained in the Staff's comment letter dated
September 27, 2007 (the "Comment Letter") concerning the above-referenced
10-K
(the "10-K"). The response is numbered to correspond to the number of
the Comment Letter.
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Form
10-K for the Fiscal Year Ended December 31, 2006
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Notes
to Consolidated Financial Statements
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Note
1 Summary of Significant Accounting Policies
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Formation
of and Investment in Bois d'Arc Energy, Page
F-7
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1.
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We
note your response to our prior comment number seven. Please
clarify if there is any form of legal agreement that binds your
CEO or CFO
to vote their shares in concert with the shares held by the
company.
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The
Company does not have
any formal written agreement with the CEO or CFO as to the voting of their
shares of Bois d'Arc Energy, Inc. ("Bois d'Arc"). Nevertheless, in
September 2006, Comstock concluded that the shares of Bois d'Arc Energy,
Inc. it
had recently acquired were sufficient to give it voting control of Bois d'Arc
because of the additional shares held by Comstock's CEO and CFO. This
conclusion was based on:
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The
presumption that management is always part of a potential control
group of
shareholders of a company, as discussed in EITF 88-16 and FIN 44
paragraph
87;
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Securities
and Exchange Commission
October
5, 2007
Page
2
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The
shares of Bois d'Arc held by the CEO and the CFO were issued at
the
formation of Bois d'Arc; these awards were approved by the Comstock
board
with the understanding that the shares would be voted consistent
with the
Comstock shares;
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The
Comstock board of directors has historically provided the CEO and
CFO of
Comstock the authority to vote the shares of Bois d'Arc owned by
Comstock
and they have always voted their personal holdings consistently
with the
voting of the shares owned by
Comstock;
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Comstock's
CEO and CFO serve as the Chairman of the Board of Directors and
the CFO of
Bois d'Arc, respectively;
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Comstock's
financial statements included in its filings, beginning with the
quarter
ended September 30, 2006, have included the assertion that Comstock
has
voting control over Bois d'Arc. Such filings have been signed
by the CEO and CFO and the Company's Form 10-K has been signed
by
Comstock's directors. Five of Comstock's six directors are
included in the nine directors of Bois d'Arc and the compensation
committee of Bois d'Arc consists of two members that also serve
on
Comstock's compensation committee. At all times since the
origination of Bois d'Arc, directors who serve on the Comstock
board of
directors, which include the Comstock CEO and CFO, have controlled
and
intend to continue to control both the composition of the Bois
d'Arc board
and the executive management of Bois
d'Arc;
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At
Bois d'Arc's Annual Meeting of Stockholders held in each of 2006
and 2007,
the voting shares held by Comstock represented 50.2% and 51.2%,
respectively, of the total shares voted at the meeting (either
in person
or by proxy). By adding the shares owned by Comstock's CEO and
CFO, which were voted in the same manner as those owned by Comstock,
shares voted by Comstock represented 51.9% and 52.7% of the shares
voted
at these meetings. Comstock clearly represented the majority of
the shares voted at each of these annual meetings;
and
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Comstock
has in place monitoring procedures designed to routinely track
the number
of Bois d'Arc shares issued, outstanding and available to vote,
and the
Company has routinely acquired additional shares to ensure that
Comstock
will at all times maintain a majority of the voting stock of Bois
d'Arc.
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Comstock
believes these factors clearly give it the ability to control the activities
of
Bois d'Arc. As a result, Comstock did not initially believe that a formal
agreement binding the CEO and CFO to vote their shares in concert with the
shares owned by Comstock was required in the case of its particular facts
and
circumstances. The Comstock board is willing to implement such a
formal agreement and understands that doing so would further support the
Company's assessment of control over Bois d'Arc.
Securities
and Exchange Commission
October
5, 2007
Page
3
The
management of Comstock acknowledges that:
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the
Company is responsible for the adequacy and accuracy of the disclosures
in
its filings;
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staff
comments or changes to disclosures in response to staff comments
do not
foreclose the Commission from taking any action with respect to
the
filing; and
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the
Company 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.
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If
you
have any questions, please do not hesitate to contact the undersigned at
(972)
668-8811.
Very
truly yours,
/s/
Roland O.
Burns
Roland
O.
Burns
Senior
Vice President and Chief Financial Officer
RDS