<SEC-DOCUMENT>0001193125-12-271292.txt : 20121016
<SEC-HEADER>0001193125-12-271292.hdr.sgml : 20121016
<ACCEPTANCE-DATETIME>20120614213013
<PRIVATE-TO-PUBLIC>
ACCESSION NUMBER:		0001193125-12-271292
CONFORMED SUBMISSION TYPE:	CORRESP
PUBLIC DOCUMENT COUNT:		1
FILED AS OF DATE:		20120614

FILER:

	COMPANY DATA:	
		COMPANY CONFORMED NAME:			ADT Corp
		CENTRAL INDEX KEY:			0001546640
		STANDARD INDUSTRIAL CLASSIFICATION:	SERVICES-DETECTIVE, GUARD & ARMORED CAR SERVICES [7381]
		IRS NUMBER:				454517261
		STATE OF INCORPORATION:			DE
		FISCAL YEAR END:			0912

	FILING VALUES:
		FORM TYPE:		CORRESP

	BUSINESS ADDRESS:	
		STREET 1:		1501 YAMATO ROAD
		CITY:			BOCA RATON
		STATE:			FL
		ZIP:			33431
		BUSINESS PHONE:		561-988-3600

	MAIL ADDRESS:	
		STREET 1:		1501 YAMATO ROAD
		CITY:			BOCA RATON
		STATE:			FL
		ZIP:			33431
</SEC-HEADER>
<DOCUMENT>
<TYPE>CORRESP
<SEQUENCE>1
<FILENAME>filename1.htm
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<TITLE>SEC Response Letter</TITLE>
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 <P STYLE="margin-top:0px;margin-bottom:0px" ALIGN="center"><FONT STYLE="font-family:Times New Roman" SIZE="2">[Simpson Thacher Letterhead] </FONT></P>
<P STYLE="margin-top:12px;margin-bottom:0px" ALIGN="right"><FONT STYLE="font-family:Times New Roman" SIZE="2">June&nbsp;14, 2012 </FONT></P> <P STYLE="margin-top:12px;margin-bottom:0px"><FONT STYLE="font-family:Times New Roman" SIZE="2"><U>VIA EDGAR
TRANSMISSION </U></FONT></P> <P STYLE="margin-top:12px;margin-bottom:0px"><FONT STYLE="font-family:Times New Roman" SIZE="2">Ms.&nbsp;Celeste&nbsp;M. Murphy </FONT></P> <P STYLE="margin-top:0px;margin-bottom:0px"><FONT
STYLE="font-family:Times New Roman" SIZE="2">Mr.&nbsp;Larry Spirgel </FONT></P> <P STYLE="margin-top:0px;margin-bottom:0px"><FONT STYLE="font-family:Times New Roman" SIZE="2">Division of Corporation Finance </FONT></P>
<P STYLE="margin-top:0px;margin-bottom:0px"><FONT STYLE="font-family:Times New Roman" SIZE="2">Securities and Exchange Commission </FONT></P> <P STYLE="margin-top:0px;margin-bottom:0px"><FONT STYLE="font-family:Times New Roman" SIZE="2">100 F
Street, N.E. </FONT></P> <P STYLE="margin-top:0px;margin-bottom:0px"><FONT STYLE="font-family:Times New Roman" SIZE="2">Washington, D.C. 20549-7010 </FONT></P> <P STYLE="font-size:12px;margin-top:0px;margin-bottom:0px">&nbsp;</P>
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<TD WIDTH="5%" VALIGN="top" ALIGN="left"><FONT STYLE="font-family:Times New Roman" SIZE="2">Re:</FONT></TD>
<TD ALIGN="left" VALIGN="top"><FONT STYLE="font-family:Times New Roman" SIZE="2">The ADT Corporation </FONT></TD></TR></TABLE> <P STYLE="margin-top:0px;margin-bottom:0px; margin-left:13%"><FONT STYLE="font-family:Times New Roman" SIZE="2">Amendment
No.&nbsp;1 to Form 10-12B </FONT></P> <P STYLE="margin-top:0px;margin-bottom:0px; margin-left:13%"><FONT STYLE="font-family:Times New Roman" SIZE="2">Filed May&nbsp;25, 2012 </FONT></P> <P STYLE="margin-top:0px;margin-bottom:0px; margin-left:13%"><FONT
STYLE="font-family:Times New Roman" SIZE="2">File No.&nbsp;001-35502 </FONT></P> <P STYLE="margin-top:12px;margin-bottom:0px"><FONT STYLE="font-family:Times New Roman" SIZE="2">Dear Ms.&nbsp;Murphy and Mr.&nbsp;Spirgel: </FONT></P>
<P STYLE="margin-top:12px;margin-bottom:0px"><FONT STYLE="font-family:Times New Roman" SIZE="2">On behalf of The ADT Corporation (the &#147;Company&#148;), we are writing to respond to the comments set forth in the comment letter of the staff of the
Securities and Exchange Commission (the &#147;Staff&#148;) dated June&nbsp;4, 2012 (the &#147;Comment Letter&#148;), relating to the above-referenced Amendment No.&nbsp;1 to the Registration Statement on Form 10-12B filed by the Company on
May&nbsp;25, 2012 (the &#147;Registration Statement&#148;), including the Information Statement filed as Exhibit 99.1 (the &#147;Information Statement&#148;) thereto. </FONT></P> <P STYLE="margin-top:12px;margin-bottom:0px"><FONT
STYLE="font-family:Times New Roman" SIZE="2">Set forth below are our responses to the Staff&#146;s comments as set forth in the Comment Letter. For your convenience, the numbered paragraphs of this letter correspond to the numbered paragraphs of the
Comment Letter. To assist your review, we have retyped the text of the Staff&#146;s comments in italics below. The responses and information described below are based upon information provided to us by the Company. </FONT></P>

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 <P STYLE="margin-top:0px;margin-bottom:0px"><FONT STYLE="font-family:Times New Roman" SIZE="2"><I><U>General </U></I></FONT></P> <P STYLE="margin-top:6px;margin-bottom:0px"><FONT
STYLE="font-family:Times New Roman" SIZE="2"><I><U>Summary, page 1 </U></I></FONT></P> <P STYLE="margin-top:6px;margin-bottom:0px"><FONT STYLE="font-family:Times New Roman" SIZE="2"><I><U>Summary of the Spin-Off, page 6 </U></I></FONT></P>
<P STYLE="font-size:6px;margin-top:0px;margin-bottom:0px">&nbsp;</P>
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<TD WIDTH="4%" VALIGN="top" ALIGN="left"><FONT STYLE="font-family:Times New Roman" SIZE="2"><I>1.</I></FONT></TD>
<TD ALIGN="left" VALIGN="top"><FONT STYLE="font-family:Times New Roman" SIZE="2"><I>We note your response to comment 5 in our letter dated April&nbsp;10, 2012. However, please revise your summary disclosure on page 9 to briefly discuss the specific
transactions you expect to complete that would result in you incurring new indebtedness. This includes entering into a new unsecured senior revolving credit facility for a commitment of up to $750 million. In addition, discuss the other indebtedness
you expect to incur in an amount of $2.5 billion in connection with the spin-off. We note your disclosure on page 124. Further, please confirm your understanding that once you have provided the specific terms of your indebtedness in an amendment to
this information statement, we may have further comments. </I></FONT></TD></TR></TABLE> <P STYLE="margin-top:6px;margin-bottom:0px; margin-left:8%"><FONT STYLE="font-family:Times New Roman" SIZE="2">The Company advises the Staff that it is still in
the process of determining the specific financing transactions it expects to complete to incur the referenced indebtedness and will disclose the terms of such transactions when they are known in a pre-effective amendment to the Registration
Statement. The Company confirms its understanding that the Staff may have further comments once the Company has provided the specific terms of its new indebtedness. </FONT></P> <P STYLE="margin-top:18px;margin-bottom:0px"><FONT
STYLE="font-family:Times New Roman" SIZE="2"><I><U>Financial Statements </U></I></FONT></P> <P STYLE="margin-top:6px;margin-bottom:0px"><FONT STYLE="font-family:Times New Roman" SIZE="2"><I><U>Note 1. Basis of Presentation and Summary of Significant
Accounting Policies, page F-7 </U></I></FONT></P> <P STYLE="margin-top:6px;margin-bottom:0px"><FONT STYLE="font-family:Times New Roman" SIZE="2"><I><U>Revenue Recognition, page F-8 </U></I></FONT></P>
<P STYLE="font-size:6px;margin-top:0px;margin-bottom:0px">&nbsp;</P>
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<TD WIDTH="4%" VALIGN="top" ALIGN="left"><FONT STYLE="font-family:Times New Roman" SIZE="2"><I>2.</I></FONT></TD>
<TD ALIGN="left" VALIGN="top"><FONT STYLE="font-family:Times New Roman" SIZE="2"><I>In your revenue recognition policy here, and elsewhere as appropriate, please provide a description and nature of performance, cancellation, termination, or refund
type provisions in your contracts, in particular the multiple-element type arrangements. </I></FONT></TD></TR></TABLE> <P STYLE="margin-top:6px;margin-bottom:0px; margin-left:8%"><FONT STYLE="font-family:Times New Roman" SIZE="2">The Company
acknowledges the Staff&#146;s comment and advises the Staff that its customer contracts, including multiple-element type arrangements, contain provisions for contract termination charges related to terminations and cancellations of monitoring and
maintenance services prior to the end of the contract term. Amounts recorded for customer contract termination charges for each of the last three fiscal years have been immaterial. The Company may refund up-front consideration and monitoring fees
paid during the six months following installation of a system in limited circumstances after all attempts to resolve customer concerns have been exhausted. Amounts that the Company has refunded have also been immaterial for each of the past three
fiscal years.</FONT></P>
 <p STYLE="margin-top:0px;margin-bottom:0px"><FONT SIZE="1">&nbsp;</FONT></P> <P STYLE="margin-top:0px;margin-bottom:0px" ALIGN="center"><FONT STYLE="font-family:Times New Roman" SIZE="2">2 </FONT></P>


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 <P STYLE="margin-top:0px;margin-bottom:0px; margin-left:8%"><FONT STYLE="font-family:Times New Roman" SIZE="2">In response to the Staff&#146;s comment, the Company will include in future filings the
following revised disclosure in the &#147;Revenue Recognition&#148; discussion in the Critical Accounting Policies&nbsp;&amp; Estimates section of both &#147;Management&#146;s Discussion and Analysis of Financial Conditions and Results of
Operations&#148; and Note 1 to the Financial Statements: </FONT></P> <P STYLE="margin-top:6px;margin-bottom:0px; margin-left:13%"><FONT STYLE="font-family:Times New Roman" SIZE="2">&#147;Sales of security monitoring systems may have multiple
elements, including equipment, installation, monitoring services and maintenance agreements. The Company assesses its revenue arrangements to determine the appropriate units of accounting. In certain circumstances, ownership of the system is
contractually transferred to the customer, in which case each deliverable provided under the arrangement is considered a separate unit of accounting. Revenue associated with sale of equipment and related installations is recognized once delivery,
installation and customer acceptance is completed<U></U>, while the revenue <U></U>for monitoring and maintenance services is recognized on a straight-line basis over the contract term as services are rendered. <U>Early termination of the contract
by the customer results in a termination charge in accordance with the customer contract, which is due immediately following the termination date. The amounts of contract termination charges recognized in revenue during the years ended
September&nbsp;30, 2011, September&nbsp;24, 2010 and September&nbsp;25, 2009 were not material. </U><U>The Company may refund up-front consideration and monitoring fees paid during the six months following installation of a system in limited
circumstances after all attempts to resolve customer concerns have&nbsp;been exhausted. Amounts that the Company has refunded during the years ended September&nbsp;30,&nbsp;2011, September&nbsp;24,&nbsp;2010 and September&nbsp;25, 2009 were not
material.</U> Amounts assigned to each unit of accounting are based on an allocation of total arrangement consideration using a hierarchy of estimated selling price for the deliverables. The selling price used for each deliverable is based on Vendor
Specific Objective Evidence (&#147;VSOE&#148;) if available, Third Party Evidence (&#147;TPE&#148;) if VSOE is not available, or estimated selling price if neither VSOE nor TPE is available. Revenue recognized for equipment and installation is
limited to the lesser of their allocated amounts under the estimated selling price hierarchy or the non-contingent up-front consideration received at the time of installation, since collection of future amounts under the arrangement with the
customer is contingent upon the delivery of monitoring and maintenance services.&#148; </FONT></P> <P STYLE="margin-top:18px;margin-bottom:0px"><FONT STYLE="font-family:Times New Roman" SIZE="2"><I><U>Subscriber System Assets and Related Deferred
Cost and Deferred Revenue, page F-9 </U></I></FONT></P> <P STYLE="font-size:6px;margin-top:0px;margin-bottom:0px">&nbsp;</P>
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<TD WIDTH="4%" VALIGN="top" ALIGN="left"><FONT STYLE="font-family:Times New Roman" SIZE="2"><I>3.</I></FONT></TD>
<TD ALIGN="left" VALIGN="top"><FONT STYLE="font-family:Times New Roman" SIZE="2"><I>We note your response to comment 28 in our letter dated May&nbsp;3, 2012. In order to clarify the pattern in which the economic benefits of the subscriber system
assets and related deferred costs and deferred revenues are consumed, please disclose the average accelerated declining depreciation rate as a percentage of the total of this asset class within years 1 through 5, 6 through 10, and 11 through 15.
</I></FONT></TD></TR></TABLE>
 <p STYLE="margin-top:0px;margin-bottom:0px"><FONT SIZE="1">&nbsp;</FONT></P> <P STYLE="margin-top:0px;margin-bottom:0px" ALIGN="center"><FONT STYLE="font-family:Times New Roman" SIZE="2">3 </FONT></P>


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 <P STYLE="margin-top:0px;margin-bottom:0px; margin-left:8%"><FONT STYLE="font-family:Times New Roman" SIZE="2">In response to the Staff&#146;s comment, the Company will include in future filings the
following revised disclosure in the &#147;Subscriber System Assets and Related Deferred Costs and Deferred Revenue&#148; discussion in Note 1 to the Financial Statements: </FONT></P> <P STYLE="margin-top:6px;margin-bottom:0px; margin-left:13%"><FONT
STYLE="font-family:Times New Roman" SIZE="2">&#147;Subscriber system assets and any deferred costs and revenue resulting from the customer acquisition are accounted for over the expected life of the customer relationship. The Company accounts for
subscriber system assets and related deferred costs and deferred revenue using pools, with separate pools for the components of subscriber system assets and any related deferred costs and deferred revenue based on the same month and year of
acquisition. The Company depreciates its pooled subscriber system assets and related deferred costs and deferred revenue using an accelerated method over 15 years. <STRIKE>The accelerated method utilizes declining balance rates</STRIKE><U> In order
to align the depreciation of these assets to the pattern in which their economic benefits are consumed, the accelerated method utilizes an average declining balance rate of 240%</U> and converts to a straight-line methodology when the resulting
depreciation charge is greater than that from the accelerated method<U>, resulting in an average depreciation of 58% of the pool within the first five years, 25% within the second five years and 17% within the final five years</U>.&#148; </FONT></P>
<P STYLE="margin-top:18px;margin-bottom:0px"><FONT STYLE="font-family:Times New Roman" SIZE="2"><I><U>Note 5. Goodwill and Intangible Assets, page F-21 </U></I></FONT></P> <P STYLE="font-size:6px;margin-top:0px;margin-bottom:0px">&nbsp;</P>
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<TD WIDTH="4%" VALIGN="top" ALIGN="left"><FONT STYLE="font-family:Times New Roman" SIZE="2"><I>4.</I></FONT></TD>
<TD ALIGN="left" VALIGN="top"><FONT STYLE="font-family:Times New Roman" SIZE="2"><I>Furthermore, in order to clarify the pattern in which the economic benefits of the contracts and related customer relationship intangible asset disclosed on page
F-21 are consumed, please disclose the average accelerated declining amortization rate as a percentage of the total of this asset class within years 1 through 5, 6 through 10, and 11 through 15. </I></FONT></TD></TR></TABLE>
<P STYLE="margin-top:6px;margin-bottom:0px; margin-left:8%"><FONT STYLE="font-family:Times New Roman" SIZE="2">In response to the Staff&#146;s comment, the Company will include in future filings the following revised disclosure in the &#147;Dealer
and Other Amortizable Intangible Assets, Net&#148; discussion in Note 1 to the Financial Statements: </FONT></P> <P STYLE="margin-top:6px;margin-bottom:0px; margin-left:13%"><FONT STYLE="font-family:Times New Roman" SIZE="2">&#147;Intangible assets
arising from the ADT dealer program described above are amortized in pools determined by the same month and year of contract commencement on an accelerated basis over the period and pattern of economic benefit that is expected to be obtained from
the customer relationship. The estimated useful life of dealer intangibles is 15 years. <U>The accelerated method for amortizing these intangible assets utilizes an average declining balance rate of 300% and converts to a straight-line methodology
when the resulting amortization charge is greater than that from the accelerated method, resulting in an average amortization of 67% of the pool within the first five years, 22% within the second five years and 11% within the final five
years.</U>&#148; </FONT></P>
 <p STYLE="margin-top:0px;margin-bottom:0px"><FONT SIZE="1">&nbsp;</FONT></P> <P STYLE="margin-top:0px;margin-bottom:0px" ALIGN="center"><FONT STYLE="font-family:Times New Roman" SIZE="2">4 </FONT></P>


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 <P STYLE="margin-top:0px;margin-bottom:0px"><FONT STYLE="font-family:Times New Roman" SIZE="2">We advise the Staff that the Company acknowledges the following: </FONT></P>
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<TD WIDTH="2%" VALIGN="top" ALIGN="left"><FONT STYLE="font-family:Times New Roman" SIZE="2">&#149;</FONT></TD>
<TD WIDTH="1%" VALIGN="top"><FONT SIZE="1">&nbsp;</FONT></TD>
<TD ALIGN="left" VALIGN="top"> <P ALIGN="left"><FONT STYLE="font-family:Times New Roman" SIZE="2">the Company is responsible for the adequacy and accuracy of the disclosure in the filing; </FONT></P></TD></TR></TABLE>
<P STYLE="font-size:6px;margin-top:0px;margin-bottom:0px">&nbsp;</P>
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<TD WIDTH="2%" VALIGN="top" ALIGN="left"><FONT STYLE="font-family:Times New Roman" SIZE="2">&#149;</FONT></TD>
<TD WIDTH="1%" VALIGN="top"><FONT SIZE="1">&nbsp;</FONT></TD>
<TD ALIGN="left" VALIGN="top"> <P ALIGN="left"><FONT STYLE="font-family:Times New Roman" SIZE="2">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 </FONT></P></TD></TR></TABLE> <P STYLE="font-size:6px;margin-top:0px;margin-bottom:0px">&nbsp;</P>
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<TD WIDTH="2%" VALIGN="top" ALIGN="left"><FONT STYLE="font-family:Times New Roman" SIZE="2">&#149;</FONT></TD>
<TD WIDTH="1%" VALIGN="top"><FONT SIZE="1">&nbsp;</FONT></TD>
<TD ALIGN="left" VALIGN="top"> <P ALIGN="left"><FONT STYLE="font-family:Times New Roman" SIZE="2">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. </FONT></P></TD></TR></TABLE> <P STYLE="margin-top:12px;margin-bottom:0px"><FONT STYLE="font-family:Times New Roman" SIZE="2">We thank you for your assistance in this matter. Please do not hesitate to call me at
(212)&nbsp;455-3188 with any questions or further comments you may have regarding this letter or if you wish to discuss our responses to the Comment Letter. </FONT></P> <P STYLE="font-size:12px;margin-top:0px;margin-bottom:0px">&nbsp;</P>
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<TD VALIGN="top"><FONT STYLE="font-family:Times New Roman" SIZE="2">Very truly yours,</FONT></TD></TR>
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<TD VALIGN="top"> <P STYLE="margin-top:0px;margin-bottom:1px;border-bottom:1px solid #000000"><FONT STYLE="font-family:Times New Roman" SIZE="2">/s/ Alan Klein, Esq.</FONT></P></TD></TR>
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<TD VALIGN="top"><FONT STYLE="font-family:Times New Roman" SIZE="2">Alan Klein, Esq.</FONT></TD></TR>
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 <p STYLE="margin-top:0px;margin-bottom:0px"><FONT SIZE="1">&nbsp;</FONT></P> <P STYLE="margin-top:0px;margin-bottom:0px" ALIGN="center"><FONT STYLE="font-family:Times New Roman" SIZE="2">5 </FONT></P>

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